Gap Canada was ordered to pay a Kingston landlord over $ 208,000 in rent arrears after failing to pay rent in 2020. Gap has announced it will close its Kingston location in September 2020.
The decision, released on September 20, was issued following hearings held in Kingston on August 25, 2021. The hearing was heard by the Ontario Superior Court.
Kingston’s Gap had been leasing the location at 230-234 Princess Street since 1994. The store was forced to close on March 24 after the Ontario government declared a provincial state of emergency and demanded the closure of non-businesses. essential. The Ontario government has said it has made the decision to prevent the spread of COVID-19.
Gap was unable to reopen until the restrictions were listed in May 2020.
According to the Braebury Development Corporation, which owned the Princess Street property, the company did not pay rent for April or May 2020. It then made partial rent payments from June 2020 to September 2020.
Gap Canada argued that the emergency order constituted a “force majeure“, allowing Gap Canada to terminate its contract with the owner.
Although the judge agreed that Gap Canada’s lease with Braebury was a “force majeure“, the contract clause did not excuse the company from late rent payments.
The judge also found that there was no frustration with the contract. “[After the emergency order], Gap could have operated its store subject to remaining public health measures. While this is not a negligible disruption to Gap’s retail operations, it does not appear that these disruptions have occurred as the lease has been frustrated, ”the judge wrote in his comment. decision.
Following the decision, the parties agreed to exchange summaries of costs after the hearing.