A recent appellate court decision has clarified the rights of commercial tenants and landlords when it comes to late rent payments and associated penalties, following a dispute over a warehouse lease agreement. The case was brought by Xerion Advanced Battery Corp. and Northwoods Blvd., LLC against Certa Vandalia LLC, with the complaint filed in Montgomery County Common Pleas Court under case number 2023 CV 05544.
The conflict arose from a purchase and sale agreement (PSA) signed on August 19, 2019, for the lease and eventual sale of a warehouse at 250 Northwoods Boulevard. Under this agreement, Northwoods was required to pay $45,000 in monthly rent due on the first day of each month. If rent was not received by the fifth day, an additional $2,000 cure payment plus 18% interest would be applied. The PSA allowed for late payments to be cured within thirty days of the first day of the month that payment was due.
According to court documents, Northwoods made several late payments during the term of the lease. In August 2020, rent was paid twenty-eight days late without a cure payment being made; however, Certa did not declare default or demand this payment at that time. In June 2021, after another late payment, Certa issued a notice of default demanding a cure payment by July 1. Northwoods claimed it made this payment on time but Certa received it after the deadline.
The situation escalated in September 2023 when Certa sent Northwoods a notice terminating the lease due to nonpayment of an August cure fee totaling $2,168.62. Although Northwoods sent this cure payment immediately upon receiving notice—on September 5—Certa returned their September rent and refused further payments.
Northwoods then sought declaratory judgment from the trial court stating it was not in default under the PSA and had not materially breached its terms. Alternatively, they requested damages for breach of contract and other claims such as promissory estoppel and unjust enrichment. Certa counterclaimed for breach of contract and other reliefs including quiet title.
Central to both parties’ arguments were differing interpretations of whether written notice was required before declaring default for failure to pay either rent or cure fees. Northwoods argued that while non-payment of rent could be considered material if ongoing and uncured, missing an administrative late fee did not rise to that level—especially given past conduct where Certa had not always enforced these provisions strictly or consistently provided written notice.
Certa maintained that because “time is of the essence” under their agreement, any delay constituted material breach warranting termination without need for further notice regarding cure payments.
The trial court found ambiguity in the PSA’s language about whether written notice was necessary before declaring default over missed cure payments. It examined both contract text and prior behavior between parties—including instances where late payments were accepted without penalty—to determine intent.
Ultimately, the trial court sided with Northwoods: “based upon the ambiguity of the plain language of the PSA and parties’ past course of conduct,” it held that written notice should have been provided before enforcing forfeiture based on unpaid cure fees. The judge concluded that failing to provide such notice meant there was no material breach by Northwoods: “Northwoods was entitled to a declaratory judgment that it is not in default…and [Certa] was estopped from asserting that [the agreement] was terminated due to [the] failure to timely remit.” Most counterclaims by Certa were denied except those requiring further factual determination regarding notification procedures under Section 18 of their agreement.
On appeal, Judge Christopher B. Epley authored an opinion affirming these findings: “the PSA is ambiguous with respect to requirement of notice for non-payment…and parties’ prior conduct demonstrates that Northwoods did not breach.” The majority noted that enforcing strict forfeiture over approximately $2,000 would be unequitable given years-long cooperation and significant investment by Northwoods—estimated at around $3 million in rents plus down payment toward purchase.
Presiding Judge Lewis concurred with this outcome while Judge Tucker dissented; Tucker argued that contract language unambiguously allowed immediate declaration of default without additional notice when rent or related fees were paid late.
Attorneys listed include Jeffrey M. Nye representing appellant Certa Vandalia LLC; Matthew M. Suellentrop, James H. Greer, David C. Greer, and Kaylin R. Jarecki representing appellees Xerion Advanced Battery Corp./Northwoods Blvd., LLC; Judge Christopher B. Epley authored the appellate opinion (CA No. 30553).
Source: 2026Ohio1307_Xerion_Advanced_Battery_Corp_v_Certa_Vandalia_LLC_Opinion_Ohio_Court_of_Appeals.pdf
