Litigation Support: Lost Income – Commercial Tenant
In a recent Litigation Support engagement, Ryan Nguyen, Forensic Accounting Manager, provided expert testimony based on his forensic accounting analysis.
Our client, a local doctor, leased his facility. His partner suddenly passed away, creating a vacancy in the building with a need to fill the space. Our client brought on a new physician tenant, who moved from Northern California and agreed to pay his proportionate share of the office expenses including rent. However the tenant’s practice never became profitable and he quickly fell behind on payments, with his debt growing over the course of a year. Our client filed suit.
The dispute continued over how much was owed to our client. The tenant doctor claimed that he was supposed to be subsidized until his practice became profitable. He further asserted that he was promised to receive the patients of the deceased doctor and that our client lured him to move to Orange County under false pretenses. The tenant doctor then countersued for lost future income because he shut down his former practice in Northern California to move to Orange County.
Our client claimed that all annual unpaid expenses and rent were due. He showed the Court that the agreement was never written or intended to subsidize the new doctor for the entire time. Our client could not promise to deliver the former doctor’s patients because patients have the freedom to choose their physician.
The jury found 12-0 in our client’s favor, awarding all unpaid expenses including rent and denying the tenant any damages for lost future income.