Rent acceleration clause deemed not to be a penalty in Massachusetts commercial lease

The Supreme Judicial Court ruled that a landlord was entitled to five years of rent upon the tenant’s breach in accord with a rent acceleration clause in the lease, even though the landlord was able to quickly find a replacement tenant. Cummings Props., LLC v. Hines, 217 N.E>3d 604 (Mass. 2023). The court believed the amount of the liquidated damages was not an unreasonable estimate of the costs of breach, and that it did not matter how much the damages actually were, in other words, how quickly the landlord was able to relet the premises. The court found, unlike many other courts, that the remaining rent is per se a reasonable estimate of the damages from breaching the lease regardless of how easy it is to find a replacement tenant. Id. at 610.