Copinol Restaurant v. 26 N. Market

Court of Appeals of Maryland·Decided July 11, 2025·No. 43o/24·Published

Opinion

Copinol Restaurant, Inc. v. 26 North Market LLC, No. 43, September Term, 2024, Opinion by Booth, J.

LANDLORD-TENANT LAW—TENANT HOLDING OVER, RP § 8-402

The tenant holding over statute, Real Property Article § 8-402, does not apply where a tenant is in possession of real property pursuant to a lease for a term that has not expired.

LANDLORD-TENANT LAW—LEASE TERMS THAT PURPORT TO GIVE LANDLORD THE AUTHORITY TO USE A STATUTORY REMEDY

A landlord may not contractually modify the phrase “expiration of a lease,” as that term is used in the tenant holding over statute, RP § 8-402, to avail himself or herself of the tenant holding over statute in order to recover possession of property where the parties are subject to a lease that has not expired, and the landlord elects to terminate the lease for the tenant’s nonpayment of rent. Circuit Court for Frederick County Case No.: C-10-CV-24-000038 Argued: May 6, 2025 IN THE SUPREME COURT

OF MARYLAND

No. 43

September Term, 2025

COPINOL RESTAURANT, INC.

v.

26 NORTH MARKET LLC

Fader, C.J., Watts, Booth, Biran, Gould, Eaves, Killough,

JJ.

Opinion by Booth, J. Watts, J., joins in judgment only.

Filed: July 11, 2025

Pursuant to the Maryland Uniform Electronic Legal Materials Act (§§ 10-1601 et seq. of the State Government Article) this document is authentic.

2025.07.11 '00'04- 13:13:41 Gregory Hilton, Clerk The Maryland General Assembly has created a judicial process, known as a “tenant

holding over action,” which allows a landlord to obtain a judgment for restitution of

possession of real property from the District Court of Maryland, upon the “expiration of a

lease,” after providing statutory notice to a tenant who remains in possession. Md. Code

Ann., (2023 Repl. Vol.) Real Prop. (“RP”) § 8-402. We issued a writ of certiorari in this

case to determine: (1) whether the tenant holding over action applies when a tenant is in

possession of property pursuant to a lease for a term of years that has not expired; and if

not, (2) whether a landlord may contractually modify the phrase “expiration of a lease,” as

that term is used in RP § 8-402, to avail itself of the tenant holding over statute in order to

recover possession of property where the parties are subject to a lease that has not expired,

and the landlord elects to terminate the lease for the tenant’s nonpayment of rent.

As we discuss more fully herein, 26 North Market LLC, Respondent (“North

Market” or “Landlord”), and Copinol Restaurant, Inc., Petitioner (“Copinol” or “Tenant”),

are parties to a commercial lease for a term that expires on March 31, 2032, unless

terminated sooner pursuant to the terms of the lease. After Copinol failed to pay rent by

the due date in the lease, North Market terminated the lease and provided written notice to

vacate. Copinol failed to vacate the premises, and North Market filed a tenant holding over

action in the District Court of Maryland sitting in Frederick County. Copinol asserted that

North Market could not bring a tenant holding over action because the statute has no

application when the tenant is in possession of property pursuant to a lease that has not

expired. North Market disagreed and argued that under the terms of the commercial lease,

it was entitled to bring such an action upon the tenant’s breach of a lease for non-payment, and the landlord’s election to terminate the lease. The District Court agreed with North

Market and granted it a judgment of possession of the property. Copinol appealed. The

Circuit Court for Frederick County initially ruled in Copinol’s favor; however, after North

Market filed a motion to alter or amend judgment, the circuit court affirmed the District

Court’s judgment awarding possession to North Market.

Copinol filed a petition for writ of certiorari, which this Court granted. We held

oral argument on May 6, 2025. On May 23, 2025, we issued a per curiam order reversing

the order issued by the circuit court and remanding the case to the circuit court for entry of

judgment in favor of Copinol.

In our order, we held that: (1) the lease had not expired; (2) the tenant holding over

statute establishes a statutory mechanism that enables a landlord to regain possession of

property by virtue of the landlord’s reversionary interest, which is available after “the

expiration of a lease”; and (3) that the parties do not have the authority to contractually

modify the statutory meaning of the phrase “expiration of a lease” in RP § 8-402, thereby

enabling a landlord to avail itself of remedies available under the tenant holding over statute

in a manner inconsistent with its plain language. We now explain the basis for that order.

I

Factual Background

A. Commercial Lease North Market and Copinol entered into a commercial lease agreement dated

December 31, 2003, in which Copinol agreed to rent the premises, located at 26 North

Market Street, Frederick, Maryland, from North Market. Thereafter, the parties executed

2 an “Amended and Restated Lease Agreement” dated March 27, 2014, for a term of ten

years. On May 1, 2022, the parties executed a “First Amendment to Amended and Restated

Lease Agreement,” which increased the rent and extended the term for an additional 10

years, with an expiration date of March 31, 2032, “unless the Lease is sooner terminated

in accordance with the terms and provisions of the Lease.” We shall collectively refer to

these agreements as the “Lease.”

Copinol operated the Cacique Restaurant at the premises. We touch upon some of

the notable provisions of the Lease that are relevant to the instant dispute. The Lease

established an annual minimum rent, which was payable in monthly installments, defined

in the Lease as “Minimum Rent.” In addition to the minimum monthly rent, Copinol was

responsible for all taxes and insurance, which the Lease included as “Additional Rent.”

Each monthly installment of the Minimum Rent and the Additional Rent were due on the

first day of the month. Section 4.2 of the Lease provides that if the payment of the

Minimum Rent and Additional Rent “shall be in arrears, in whole or in part, for five (5) or

more days, then such failure shall be an Event of Default hereunder and Landlord may elect

to pursue such remedies as are set forth herein.” Although the Lease requires Landlord to

provide notice and an opportunity to cure for non-monetary defaults, no notice is required

where Tenant’s breach arises from the failure to pay rent. 1 Section 9.2 addresses the

Landlord’s remedies in the event of a default for failure to pay rent, stating in pertinent part:

1 Section 9.1 of the Lease Agreement states:

Tenant agrees that Tenant shall perform all covenants contained in this Lease and that it shall promptly, upon receipt of written notice specifying action 3 If the Rent shall be in arrears in whole or in part for five (5) or more days . . . the covenant to pay Rent herein shall be considered breached by Tenant.

Free access — add to your briefcase to read the full text and ask questions with AI

Copinol Restaurant v. 26 N. Market, (Md. 2025).

Copinol Restaurant v. 26 N. Market (Copinol Restaurant v. 26 N. Market) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Pernell v. Southall Realty
416 U.S. 363 (Supreme Court, 1974)
Hudson v. Housing Authority
935 A.2d 395 (Court of Appeals of Maryland, 2007)
Glorius v. Watkins
102 A.2d 274 (Court of Appeals of Maryland, 1954)
Evergreen Amusement Corp. v. Pacheo
145 A.2d 774 (Court of Appeals of Maryland, 1958)
Williams v. Housing Authority
760 A.2d 697 (Court of Appeals of Maryland, 2000)
University Plaza Shopping Center, Inc. v. Garcia
367 A.2d 957 (Court of Appeals of Maryland, 1977)
Dashiell v. Meeks
913 A.2d 10 (Court of Appeals of Maryland, 2006)
Italian Fisherman, Inc. v. Middlemas
545 A.2d 1 (Court of Appeals of Maryland, 1988)
Nova Research, Inc. v. Penske Truck Leasing Co.
952 A.2d 275 (Court of Appeals of Maryland, 2008)
Drew v. First Guaranty Mortgage Corp.
842 A.2d 1 (Court of Appeals of Maryland, 2003)
Streeter v. Middlemas
213 A.2d 471 (Court of Appeals of Maryland, 1965)
Fertitta v. Bay Shore Development Corp.
250 A.2d 69 (Court of Appeals of Maryland, 1969)
Progressive Friendship Savings & Loan Ass'n v. Rose
201 A.2d 8 (Court of Appeals of Maryland, 1964)
Cochran v. Norkunas
919 A.2d 700 (Court of Appeals of Maryland, 2007)
Martin v. Howard County
709 A.2d 125 (Court of Appeals of Maryland, 1998)
Reier v. State Department of Assessments & Taxation
915 A.2d 970 (Court of Appeals of Maryland, 2007)
Chesapeake Bank v. Monro Muffler/Brake, Inc.
891 A.2d 384 (Court of Special Appeals of Maryland, 2006)
Bringe v. Collins
335 A.2d 670 (Court of Appeals of Maryland, 1975)
Lockshin v. Semsker
987 A.2d 18 (Court of Appeals of Maryland, 2010)