## Facts

- A commercial landlord leased two shopping-center units to a tenant for use as a laundry from May 5, 1978, to April 30, 1981, with separate monthly rents for each unit.
- The tenant fell behind on rent.
- On May 2, 1979, the landlord served a written “Demand For Payment Of Rent Or Possession,” requiring the tenant within three days to either pay the rent due or surrender possession.
- Within the three-day period, the tenant removed equipment and vacated the premises.
- The landlord took possession, posted the space for rent, and re-let the premises to a new tenant starting August 1, 1979.
- The landlord sued to recover rent for May, June, and July 1979, and the trial court awarded the full amount claimed.
- The lease contained (1) a clause permitting the landlord to terminate the lease after three days’ written notice upon rent default, and (2) a clause permitting the landlord to retake and re-let without terminating the lease, while holding the tenant liable for the balance of rent through the lease term.

## Issues

1. Whether the landlord’s “pay rent or surrender possession” notice and subsequent repossession constituted an election to terminate the lease under the termination clause.
2. If the lease was terminated, whether the landlord could nonetheless recover amounts measured as rent for periods after termination, rather than only rent accrued before termination.

## Decision

- The Colorado Supreme Court affirmed in part and reversed in part.
- The court held that the landlord’s notice and conduct amounted to an election of the termination remedy, rather than a non-terminating retaking.
- The landlord could recover unpaid rent that had accrued up to the effective termination of the lease.
- The landlord could not recover damages measured as rent for the portion of the lease term after termination based on treating the lease as continuing.

## Legal Principles

- A commercial lease may provide alternative remedies for default, including (1) termination and repossession, or (2) repossession and re-letting without termination while preserving tenant liability for the balance of rent.
- A landlord’s notice and conduct can constitute an election of remedies; a “pay or quit” notice followed by repossession and re-letting may be treated as termination.
- Upon termination elected by the landlord, the tenant’s liability for rent as such does not continue for the post-termination portion of the lease term; recovery is limited to obligations that accrued before termination (subject to the lease’s terms and consistent conduct).

## Conclusion

The court ruled that the landlord’s pay-or-surrender notice and subsequent repossession reflected a choice to terminate the lease, allowing recovery of accrued unpaid rent but barring recovery of post-termination rent measured by the remaining lease term.


Aigner v. Cowell Sales Co., 660 P.2d 907 (Colo. 1983)