Contracts Keyed to Knapp
Baehr v. Penn-O-Tex Oil Corp
Facts
Plaintiff leased gasoline filling stations to Kemp. Kemp was purchasing a business and related property Defendant and as a result became heavily indebted to Defendant. Because Kemp became unable to make payments due to Defendant, Kemp assigned Defendant accounts receivable and to become receivable. During this period of time, Defendant received rent paid by filling station operators and other payments made to the business sold to Kemp. At the direction of Kemp, Defendant paid some of the debts of the business. Defendant also placed an agent in the office to run the business. While in Florida, Plaintiff received a letter from Kemp indicating that Defendant tied up all of Kemp’s assets. Plaintiff called Defendant about payment of rent owed by Kemp. Defendant told Plaintiff that Kemp’s affairs would be straightened out and the rent checks would be sent. After Plaintiff did not hear from Defendant, Plaintiff wrote Defendant a letter to ask what needed to be done to receive the rent checks. Plaintiff also indicated that legal action would be pursued if the rent payments were not received. Defendant sent Plaintiff a letter in response denying responsibility for the rent and stating that Defendant was merely helping Kemp keep the business going. Plaintiff again called Defendant to request payment of the rent. Defendant indicated that it would be taken care of. The rent still not paid, Plaintiff brought suit after returning from Florida.
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