Moorosi Tsiane
A POPULAR downtown night club, Cuban Linx, has dragged its lessor, Lesotho National Development Corporation (LNDC), to court demanding a whooping M10 million compensation for premature termination of its lease agreement.
Cuban Linx is fighting to keep its business alive, claiming that the LNDC is seeking to unlawfully terminate their sublease agreement which they argue only expires in August 2027.
They therefore want the Commercial Division of the High Court to either block LNDC from evicting them from the Old LNDC Block or order the LNDC to pay them M10 million in compensation for the anticipated losses which they claim will occur if they were to stop operating at this moment.
LNDC subleased the downtown building, which was previously occupied by Times Café, to Cuban Linx in March 2017. In September the same year, the two parties entered into a five-year agreement which Cuban Linx claims was extended by another five years in 2022, to August 2027.
“The defendant (LNDC) made an unlawful demand to the plaintiff (Cuban Linx) on 31 July 2023 that it terminates the sublease agreement and that the plaintiff should vacate the premises because the building may collapse at any time,” Cuban Linx alleges in its application filed two weeks ago.
“The plaintiff employed an expert to determine if the building or property may collapse and established that the landlord’s claims were false. The plaintiff has (also) sought the permission of the defendant to renovate the premises and the defendant unreasonably refuses to grant permission to the plaintiff.”
“The parties entered into an agreement in March 2017 and rent was M25,748.05 subject to annual escalation which rent is currently above M360 000 per annum. The plaintiff also pays statutory services of electricity, water and municipal rates. The plaintiff pleads that it is entitled to continue with the occupation of the premises in terms of the parties’ sublease agreement which terminates in August 2027.”
The club’s management also argues that LNDC should keep its end of the bargain in terms of the renewed contract which expires in August 2027. They alternatively demand M10 million compensation, arguing they have invested much in the club and stand to suffer huge losses.
“The plaintiff has complied with its side of the bargain and thus no justifiable ground exists for the defendant to terminate the sublease agreement and evict the plaintiff,” Cuban Linx said in the application.
“The plaintiff has invested heavily in business strategy, forging alliances, furnishing, renovations and marketing among others, such that if the sublease agreement is terminated prior to the expiry date of 31 August 27, it would suffer serious financial losses in excess of M10 million.
“It is pleaded that the parties’ written agreement should in the circumstances be enforced and the plaintiff shall remain in occupation of the premises. In the alternative and in the event that the plaintiff not being in occupation of the premises until Aug 2027 …the plaintiff is entitled to payment of damages for future loss of opportunity and business in the amount of M10 million.”
Cuban Linx also claims that LNDC had ignored, failed or refused to pay the M10 million buyout hence they rushed to court for redress.
LNDC filed its intention to oppose the application last week. It has also requested for further particulars from Cuban Linx, being the sublease agreement(s) in question, before filing its detailed response.
