Kite v. Gus Kaplan, Inc.

708 So. 2d 473, 1998 WL 63783
CourtLouisiana Court of Appeal
DecidedFebruary 18, 1998
DocketNos. 97-57, 97-58
StatusPublished
Cited by3 cases

This text of 708 So. 2d 473 (Kite v. Gus Kaplan, Inc.) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kite v. Gus Kaplan, Inc., 708 So. 2d 473, 1998 WL 63783 (La. Ct. App. 1998).

Opinions

WOODARD, Judge.

This is a consolidated appeal arising out of a unilateral termination of a commercial contract of lease and alleged unlawful eviction of plaintiff-appellant’s, Timothy W. Kite d/b/a Timothy Kite Enterprises, jewelry store from defendants-appellees’, Gus Kaplan, Inc. and Gustave Kaplan, department store, Number 97-57, and an action on a promissory note held by plaintiff-appellee, Gus Kap-lan, Inc., against Timothy Kite Enterprises, defendant-appellant, Number 97-58. From a judgment by the trial court in favor of Gus Kaplan and Gustave Kaplan in Number 97-57, that the Timothy Kite was not unlawfully evicted, Kite now appeals. In Number 97-58, Timothy Kite Enterprises does not appeal judgment for Gus Kaplan, Inc. on the promissory note.

FACTS

Timothy Kite (Kite) first contacted Gus-tave Kaplan (Kaplan) in 1988, expressing his interest in Gus Kaplan, Inc.’s (GKI). new jewelry department. GKI had been located in MaeArthur Village in Alexandria, Louisiana since 1967 but had plans to move to a new location at Gus Kaplan Drive, which was the site of a former D.H. Holmes department store. Kaplan was the President of GKI.

Kite was a certified jeweler and gemologist, who was knowledgeable and experienced in the fine jewelry business. Over the next three years, he continued to maintain contact with Kaplan and informally discussed, either with Kaplan or with his son, Sidney Kaplan, the possibility of Kite’s relocating to Alexandria to work in the new Gus Kaplan store to operate its fine jewelry department.

In May 1992, Kite and his fiance, Ann M. Watkins, flew from Las Vagas, Nevada to Alexandria to talk with Kaplan. Kaplan was very interested in having him operate the jewelry department. Since, Kite did not wish to become an employee of GKI at the proposed salary, they discussed the possibility of Kite’s operating the jewelry department as a lessee. He was initially reluctant to relocate to Alexandria and doubted his ability to acquire the necessary capital and inventory of jewelry necessary to start the jewelry department. Kaplan persuaded him to consider a Small Business Administration (SBA) loan. Kite obtained an SBA loan application on May 18, 1992. Within days, he and his fiance were married and immediately returned to Alexandria to work on the SBA application.

laKite had initial problems with the SBA application and told Kaplan about them. Kaplan provided assistance by granting him a $25,000.00 loan of which $15,000.00 was immediately used to pay Kite’s preexisting debts. Kite used the remaining $10,000.00 as collateral for his SBA loan. On September 10, 1992, he obtained a loan for $185,000 to finance the jewelry départment.

On August 3,1992, Kite and GKI executed a written lease contract whereby GKI leased certain designated space in the new Gus Kaplan store to Kite for the purpose of operating a fine jewelry department. • The lease contract provided for a primary lease term of five years, beginning October 1, 1992, and the monthly rental was to be fourteen percent of the jewelry department’s gross retail sales. The contract contained the following pertinent clauses:

That LESSOR does by these presents, lease, let and deliver unto LESSEE, acknowledging due delivery and possession thereof, certain store space and reserved stock space situated and located in the store of LESSOR, known as “GUS KAP-LAN” in the TownCenter [sic] Shopping Center in Alexandria, Rapides Parish, Louisiana, said space illustrated in Appendix A, hereby made a part hereof.
[476]*476All of the mentioned store space, and reserved stock space is located in the store of LESSOR, and may be changed from time to time by LESSOR at its option and expense.
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2. PURPOSE OF LEASE: The premises are herein leased for the purpose of conducting a retail sales department of jewelry. It is mutually agreed and understood by and between LESSOR and LESSEE, that LESSEE shall by these presents have the exclusive right and privilege to merchandise and sell all items usually sold by a fine jewelry department.
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9. OPERATIONS: LESSEE’S department shall be arranged as part of, and in conformity to, LESSOR’S store, and shall be conducted under the trade name of the LESSOR and in such manner that said department shall appear to be conducted as a department of and an integral part of the LESSOR’S store, and so that it shall appear to the customers in the Store that all sales from LESSEE’S department are made as sales from the Store. LESSEE’S department shall be run and operated at all times in a manner consistent with the general type and character of the business conducted in the Store and the service connected therewith. ^LESSOR acknowledges that it is familiar with the type of operation run by LESSEE and is satisfied that said operation is suitable. All communications to customers shall be in the name of the LESSOR only. LESSEE’S department shall be conducted at all times upon the same standard of business policy, ethics and integrity, in relation to the methods of sales of merchandise as are maintained through LESSOR’S Store, and in conformity with all reasonable rules, regulations and policies established or promulgated from time to time by the Store for the government and control of the Store. General janitorial service will be provided by LESSOR; however it is the LESSEE’S responsibility to maintain its department to accepted standards of neatness and cleanliness.
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Í7. OWNERSHIP OF IMPROVEMENTS: Any improvements made by LESSEE, including, but not limited to showcases, display cases, counters, work tables and other improvements necessary to perform the purposes of this Lease, shall remain the property of LESSEE, and upon termination of this Lease, LESSOR may purchase said improvements at the appraisal value.

The map, which appears as Appendix A to the lease contract, shows the location of Kite’s leased premises to be the same location which had been specifically designated for the fine jewelry department in the earlier D.H. Holmes store. Kite testified that its location and appurtenances made it very effective for the display and sale of fine jewelry. It was situated in a central, prominent, highly trafficked area, directly in front of the main entrance of the store. It contained adequate space for his jewelry-inventory and was properly equipped to meet the specialized needs of a fine jewelry department. Its high quality jewelry display eases had been custom made for that location. In order to protect the expensive jewelry merchandise from theft, the cases could be individually locked, and the tops of the cases were secured by a metal bead which held the glass in place. Inside the cases were custom made pads on which the jewelry could be properly displayed. The cases were illuminated from above by special high intensity lighting. The department was also furnished with individually locking storage drawers for the merchandise. Featured in the department were eight Duratrans displays, which are photographic transparencies, backed by high intensity light for the purpose of advertising the type and quality of merchandise being sold. Also Kite had a motion detector installed in the ceiling, which were required by |5practical necessity as well as by the provisions of the jeweler’s insurance policy under which the department was insured.

The Gus Kaplan department store opened for business on October 29, 1992.

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708 So. 2d 473, 1998 WL 63783, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kite-v-gus-kaplan-inc-lactapp-1998.