Landlord and tenant - Arbitration - Lease.

Byline: R.I. Lawyers Weekly Staff

Where the plaintiff university brought suit over a lease of land to the defendant, the litigation must be stayed, as the dispute is within the scope of the lease's arbitration clause.

A Superior Court order denying the defendant's motion for a stay is reversed.

Background

"We are called upon to decide whether the terms of a ground lease agreement between the plaintiffs, the University of Rhode Island and the Rhode Island Council on Postsecondary Education, and the defendant, Hellenic Society Paideia Rhode Island Chapter, require the parties to arbitrate all disputes arising from their lease agreement, or merely a subset of those disputes. The defendant appeals from orders of the Superior Court denying its Motion to Stay Litigation in Favor of Arbitration pursuant to G.L. 1956 10-3-3. For the reasons set forth in this opinion, we vacate the order of the Superior Court and remand the case to the Superior Court for entry of an order staying litigation pending arbitration proceedings.

"In 2005, the University of Rhode Island and the Rhode Island Board of Governors for Higher Education agreed to lease a parcel of land on the Kingston campus of the University of Rhode Island to the Hellenic Society Paideia Rhode Island Chapter (the Society or defendant) for the purpose of building and maintaining a Center for Hellenic Studies, which also was to house the Hellenic Studies Program at the University and the University of Rhode Island Center for Humanities. The initial term of the Lease was for ninety-nine years following completion of the building, and the Lease gave defendant the option to extend the initial Lease term for four additional ninety-nine year terms.

"Although excavation was completed and a foundation was laid, construction of the building was halted in 2012 and, for reasons outside the scope of this appeal, construction was never recommenced. In November 2012, plaintiffs sent a Notice of Default and Termination of Ground Lease to the Society, advising it of plaintiffs' intent to terminate the Lease because construction had not been completed within thirty months of the commencement of construction, as required by the Lease. In June 2013, plaintiffs sent another letter to the Society, demanding that defendant restore the property to its former condition.

"After years of back and forth between the parties, plaintiffs brought a petition in the Superior Court to appoint a special master to resolve the...

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