Usually not, and stopping can be very costly. The Appeals Court upheld a judgment of $545,054.45 against a commercial tenant that stopped paying rent after its landlord demanded that a subtenant leave, because the tenant had breached the lease first and the lease barred any setoff. This is an unpublished Appeals Court decision under Rule 23.0, which courts may cite as persuasive but not as binding precedent.
What happened
The tenant signed a ten-year lease for a commercial building in downtown Boston in 2017. In 2019, it sublet part of the building to a hostel operator. The landlord told the tenant to stop residential use, then sent a notice of default and demanded that the hostel leave. The tenant asked the hostel to go. In May 2020, the tenant stopped paying rent. The landlord sent default notices and sued for breach of the lease.
After a trial without a jury, a Superior Court judge ordered the tenant to pay past-due rent, late fees and interest, and to leave the building.
What the court decided
The Appeals Court affirmed in Brom+Fled II LLC v. Colonial Trading Company, Inc., No. 25-P-9 (Mass. App. Ct. February 11, 2026) (Rule 23.0 decision). It rejected each of the tenant’s four arguments.
Material breach. A breach is material when it goes to an essential and inducing feature of the contract. EventMonitor, Inc. v. Leness, 473 Mass. 540, 546 (2016). A material breach by one side can excuse the other side from performing. Ward v. American Mut. Liability Ins. Co., 15 Mass. App. Ct. 98, 100 (1983). But the court found the landlord did not breach the lease by demanding the hostel leave. The tenant had not shown insurance for the hostel, the certificate of occupancy did not cover hostel use, and the tenant started work without submitting plans to the landlord. Those were lease violations, and they came first. Any later refusal by the landlord to consider new subtenants came after the tenant had already stopped paying rent.
Setoff and counterclaim. The lease required rent to be paid without any setoff or deduction. Clear contract language is enforced by its plain meaning. Balles v. Babcock Power Inc., 476 Mass. 565, 571-572 (2017). The tenant also wanted its defense treated as a claim for interference with its sublease. Mass. R. Civ. P. 8 (c) lets a court fix a pleading that was mislabeled by mistake. Here, the tenant told the judge twice that it had not filed a counterclaim, so there was no mistake to fix.
Improvement allowance. The lease offered up to $26,250 for improvements, but only if the tenant was not in default and made a written request. The only request in the record came after the default. The judge did not have to believe testimony about an earlier request.
Damages. The tenant argued the award wrongly used the lease’s acceleration clause. The court disagreed. The award covered only rent and charges that had already come due from May 2020 through December 2023, under a separate lease section. The lease also said a sublease did not reduce the tenant’s own duty to pay full rent.
What this means for you
If you rent commercial space, this case is a warning. In a commercial lease dispute, the court looked first and last at the words of the lease. Many commercial leases say rent is due without setoff or deduction. Courts enforce those words.
The order of events also matters. If you break the lease first, even on something that seems technical like insurance proof or permits, you may lose the ability to blame the landlord for what happens next. And if the landlord harms your business, you may need to bring your own claim. Calling it a defense may not be enough.
Finally, stopping rent does not end your liability. Rent, taxes, late fees and interest keep adding up month after month. In this case, the award covered unpaid rent and charges for more than three and a half years.
What to do now
- Read your lease for words like “without setoff or deduction,” default notice periods and conditions on any allowance.
- Before you sublet or change how the space is used, confirm insurance, the certificate of occupancy and any landlord approval, in writing.
- Do not stop paying rent as leverage without legal advice. Keep paying and preserve your claims instead.
- If the landlord’s conduct has cost you money, ask a lawyer whether to file a counterclaim, not only a defense.
- Keep copies of every request, notice and approval you send or receive.
If this is your situation, call Doubleday Law at (617) 575-2006 or tell us what happened. These cases move on short deadlines.
Prior results do not guarantee a similar outcome.
