Seeing red over yellow
Runnymede wins colorful landlord vs. tenant case

By Phillip Newswanger, Inside Business – Hampton Roads, April 30, 2007

The building was painted bright yellow with red trim.

The colors so horrified a doctor that he called the Runnymede Corp. to complain. Runnymede owns the building at

3216 Western Branch Blvd.

in Chesapeake. At one time, it housed a Bank of America and Bank of Suffolk branch office, and its original exterior was natural stone with off-white pebble trim.

“We were appalled,” said Morris Fine of the law firm of Fine, Fine, Legum & McCracken LLP. Fine represented Runnymede before the Virginia Supreme Court against Select Management Resources, trading under the name of LoanMax, which provides loans on automobile titles. Fine’s family owns Runnymede.

Even the presiding Supreme Court judge who wrote the opinion was appalled after seeing before and after photographs of the building.

“What once had the appearance of a stately stone building has been given the mark of crass commercialism, which can only be erased with the expenditure of a significant sum of money,” wrote Senior Justice Harry Carrico in his opinion.

Runnymede told Select Management, the tenant, to restore the building to its former state. If Select Management did not comply, Runnymede threatened to terminate its lease within 30 days.

Select Management asked that the building remain painted until its lease expired, which will be in two years. Runnymede denied the request because Select Management never asked for permission to paint the building.

Instead of complying, Select Management filed suit in Chesapeake Circuit Court, arguing that all of its 200 loan offices in the country, including 24 in Virginia, are painted the same color.

Select Management also took the position that the color scheme resembled that of nearby buildings, including McDonald’s, Dairy Queen, Jiffy Lube and Rally’s.

The lower court ruled in favor of Runnymede. Select Management appealed on the argument that the painting of the exterior of the building was a cosmetic change and not an alteration, as indicated in the lease.

But the before and after photographs were worth more than a thousand words, at least to Carrico, who ruled in favor of Runnymede April 20.

L. Steven Emmert, an appellate lawyer with the law firm of Sykes, Bourdon, Ahern & Levy PC, said the Virginia Supreme Court’s ruling gives the landlord more control over the premises they rent.

Emmert focuses his practice on appeals and monitors the courts’ rulings. He runs a Web site tagged Virginia Appellate News & Analysis.

Although Emmert questioned whether the issue would have mushroomed if the building had been painted a muted gray with a blue trim, he maintained that the tenant has a responsibility to the landlord.

“Tenants will have to be more careful about making structural changes to the property,” Emmert said. “Get the landlord’s consent and never see the inside of a court room. The safest thing to do is involve the landlord.”

Fine said there were few cases that ever dealt with a painting, per se, to the exterior of the building.

“I think the court was surprised,” said Fine, who in 52 years of practicing law has rarely encountered such a case.

Carrico agreed with Select Management that, ordinarily, the painting of the exterior of the building is merely cosmetic in nature and not an alteration in the legal sense.

“But this is not an ordinary situation,” Carrico wrote. “Here, the trial judge would have needed to take only one look at the graphic before and after photographs of the building to find that the change caused by the painting was substantial, not trifling, resulting in a change in the nature and character of the building.”

Fine said the court considered the case on whether Runnymede withheld permission to paint the building rather than on whether the change was cosmetic or an alteration.

“You did it without permission, so how could you have permission?” Fine said.

Select Management could not be reached for comment. The company has a five-year lease with Runnymede that expires in two years. In fact, a LoanMax still operates at the address.

Select Management did remove the paint, but that hasn’t swayed Fine.

“We would like them out of there,” he said.