Thursday, March 06, 2008

Landlord for the Vatterot College Trade School sued the school in Douglas County district Court for Vatterot's failure to pay several years of property taxes on the property. The Douglas County District Court dismissed the action finding that the Landlord and the assigned tenant did not have privity of estate and further they had no contractual agreement for the college to pay the taxes. DeWester v. Watkins, S-06-230, 275 Neb. 173 An assignee or transferee of an interest in leased property is liable for a breach of a promise that runs with the land and which is broken while the assignee or transferee holds the leasehold estate, but is not liable for a promise that runs with the land if the promise is broken before the assignment or transfer. Napleton and Vatterott were not in privity of estate when the 2000 tax liability accrued. Nor were they in privity of estate between January and October 4 of the 2001 tax year, or for 9 months of the period in which the 2001 taxliability accrued. The lack of privity of estate between Napletonand Vatterott means that Vatterott is not liable for any breaches of the lease terms prior to the October 5, 2001, assignment unless the parties contracted otherwise. the Assignment Agreement is clear and unambiguous.The Assignment Agreement does not provide that Vatterott is liable for any obligations arising prior to the date of assignment. Absent aprovision obligating Vatterott for liabilities arising prior to the time Vatterott obtained its leasehold interest in the property,the lack of privity of estate in this case compels our conclusion that Vatterott is not liable for Omaha College’s failure to fulfillOmaha College’s obligations under the 1999 lease

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