E. H. Webb and Ann Thomas Webb own a shopping center in Davidson ...

[Mr. Wonderful]

E. H. Webb and Ann Thomas Webb own a shopping center in Davidson County, Tennessee, and leased one of its spaces to Scooter Stores, Incorporated, in 1971. In 1975, Scooter assigned the lease to Borchert Enterprises. The Webbs approved the assignment, but various controversies arose between the parties, and Borchert filed suit. The Webbs counterclaimed for rent due under a clause in the lease, which required a payment of 2 percent of gross sales as additional rent. The clause provided as follows: Lessee, in addition, agrees to pay to Lessor as additional rental a sum equal to two (2) percent of the gross sales in excess of Two Hundred Thousand (200,000 ) Dollars per annum, excluding sales tax and money order sales, said payments to be made annually, within forty-five (45 ) days from each annual anniversary of this Lease. Lessee agrees to provide to Lessor annually a Certified Public Accountants' report of sales to substantiate the payments made hereunder. Borchert was engaged in the operation of a convenience market and installed several pinball machines. The Webbs contended that Borchert had failed to pay the 2 percent due on the pinball revenues, and Borchert contended that revenue from the pinball machines was not included in the term gross sales. The trial court held that the pinball income was part of gross sales, and Borchert appealed. How should the case be decided?

Question 2

An LLC is a separate legal entity and may own property in its own name.
  Indicate whether the statement is true or false

[Beatricemm]

Answer to Question 1

The court held pinball revenue does not meet the definition of sales. Borchert Enterprises, Inc. v. Webb, 584 S.W.2d 208 (Tenn. 1979)

Answer to Question 2

TRUE

[Mr. Wonderful]

Thanks for the timely response, appreciate it

[xthemafja]

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