## Facts

- May Centers, Inc. (May) leased shopping-center space to Paris Croissant of Enfield Square, Inc. (Paris) under a 10-year commercial lease beginning April 15, 1986.
- The lease stated that monthly rent was due on the first day of each month.
- The lease required May to provide notice of a default and allowed Paris 10 days to cure before May could pursue remedies.
- Individual defendants (including Anthony Scussel) signed a written personal guaranty of Paris’s lease obligations.
- The guaranty limited the guarantors’ liability to the first two years of the lease, but provided that the guaranty would continue for the entire lease term if Paris was in default “as of the expiration of the second (2nd) year.”
- During the first two years, Paris regularly paid rent around the middle of the month rather than on the first.
- May consistently accepted these mid-month payments without claiming a default or taking steps to enforce the “rent due on the first” term during that period.
- Near the end of the second year, Paris paid the April 1988 rent on April 20, 1988; May accepted the payment.
- The lease contained provisions stating that a party’s failure to act on a default was not a waiver “if such default persists or is repeated,” and that acceptance of rent after a breach did not constitute a waiver.
- In 1989, Paris stopped paying rent, and May sued Paris for breach of the lease and also sued the individual guarantors, claiming the guaranty extended beyond two years because Paris was supposedly in default as of April 14, 1988.

## Issues

1. Whether May proved that Paris was “in default” as of the expiration of the second year of the lease, triggering extension of the guaranty for the remainder of the 10-year term.
2. Whether May’s consistent acceptance of mid-month rent payments, together with the lease’s notice-and-cure requirements, prevented May from establishing a qualifying default at the two-year cutoff date, despite non-waiver language in the lease.

## Decision

- The court ruled for the guarantors on the extension question.
- May failed to carry its burden to show that Paris was in default as of the end of the second lease year for purposes of extending the guaranty beyond its stated two-year limit.
- May could pursue Paris for the lease breach, but could not impose post–year-two liability on the guarantors based on the guaranty’s extension condition.

## Legal Principles

- A party seeking to extend a guarantor’s liability under a conditional guaranty must prove that the stated condition (here, a default at a specified time) occurred.
- The parties’ course of performance may inform the meaning and enforcement of payment-timing terms; repeated acceptance of later payments can show that the timing term was not treated as a default-triggering obligation during the relevant period.
- Where a lease requires notice and an opportunity to cure before remedies may be pursued, the existence of a “default” for a contractual trigger may depend on whether the landlord treated the conduct as a default and invoked the contract’s default process.
- Non-waiver clauses can preserve a landlord’s remedial rights against a tenant, but they do not automatically establish that a tenant was in default at a particular historical moment for purposes of expanding a guarantor’s obligation beyond the guaranty’s stated term.
- Guaranties are construed narrowly; courts do not extend a guarantor’s liability beyond the guaranty’s clear limits unless the contractual trigger for extension is proved.

## Conclusion

Because May accepted Paris’s mid-month rent payments throughout the first two years—including the April 20, 1988 payment at the end of year two—and did not show that Paris was in default as of the second-year expiration under the lease’s default structure, the condition for extending the guaranty was not met, and the guarantors were not liable for obligations arising after the initial two-year period.


May Centers, Inc. v. Paris Croissant of Enfield Square, Inc., Et Al., 599 A.2d 407 (1991)