## Facts

- A. Brown, Inc. operated a retail appliance and electronics store under a long-term commercial lease.
- The lease placed responsibility for “exterior and structural repairs” on the landlord and “interior repairs” on the tenant.
- Soon after occupancy began in 1978, the tenant repeatedly notified the landlord that the roof leaked and requested repairs; minor repair attempts did not stop the leak.
- In 1980, ceiling panels and insulation collapsed into the showroom, damaging displayed inventory and causing water-related damage.
- The leak also damaged the heating system, requiring replacement of a furnace and later a second furnace.
- The store closed for roughly two to three weeks for cleanup and repairs, causing lost sales and alleged lost profits, and the tenant incurred cleanup and interior repair costs.
- Leaks continued through 1983; the roof was repaired after a later change in ownership.
- The tenant sued for breach of the lease repair covenant; the landlord counterclaimed for past-due property taxes on a different leased property.
- The trial court awarded the tenant \$24,500 in damages, offset by an agreed \$1,238.48 on the landlord’s counterclaim; the landlord appealed.

## Issues

1. Whether the evidence supported findings that the landlord’s failure to repair the roof was the probable cause of the ceiling collapse and resulting damages.
2. Whether consequential damages (inventory markdown losses, lost profits, cleanup and repair costs, and furnace replacements) were recoverable as within the reasonable contemplation of the parties at contracting.
3. Whether the tenant proved damages with reasonable certainty where proof largely consisted of testimony rather than invoices, receipts, or detailed business records.

## Decision

- The Vermont Supreme Court affirmed the judgment for the tenant.
- The court held the evidence, viewed favorably to the prevailing party, supported causation and breach based on repeated notice, inadequate repairs, continued leaking, and the collapse.
- The court upheld the award of consequential damages as reasonably foreseeable from failure to maintain a roof over a retail store’s inventory and operations.
- The court held credible owner testimony and surrounding circumstances could establish damages with reasonable certainty; lack of documentation went to weight, not legal sufficiency.

## Legal Principles

- Appellate review of factual findings is deferential; evidence is viewed in the light most favorable to the prevailing party with reasonable inferences drawn in that party’s favor.
- A party who breaches a contractual repair covenant is liable for damages that are the natural and probable consequences of the breach and objectively within the reasonable contemplation of the parties, not limited to harms specifically negotiated or subjectively anticipated.
- Consequential damages in commercial lease disputes may include business interruption losses and property damage proximately caused by failure to perform repair obligations when such harms are reasonably foreseeable.
- Damages must be proven with reasonable certainty, but documentary proof is not categorically required; credible testimony by business owners may suffice if not speculative.

## Conclusion

The court affirmed a tenant’s recovery of consequential damages for a landlord’s breach of a lease duty to make exterior and structural roof repairs, holding that foreseeability is assessed objectively and that credible testimonial estimates can satisfy the reasonable-certainty requirement for contract damages.


A. Brown, Inc. v. Vermont Justin Corp., 148 Vt. 192, 531 A.2d 899 (Vt. 1987)