Evaluating Commercial Leases Post-'Rohrmoos'

In 2019, contravening well-settled Texas law, the Texas Supreme Court held that a commercial tenant may terminate a lease based on a landlord's prior material breach of the lease. Rohrmoos Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469 (Tex. 2019). Specifically, Rohrmoos held that a commercial landlord's material breach — at least one that might also qualify as a breach of the implied warranty of suitability — justifies a tenant's recission of the lease. (The record is not wholly clear, but it appears the material breach was moisture penetration at the tenant's dialysis clinic resulting in state health inspectors' "critici[sm]" of the facility. 578 S.W.3d at 475-76. The tenant in this case had built the stand alone clinic.) 578 S.W.3d at 482-83. The Rohrmoos decision effected a seismic shift in Texas landlord-tenant law that this article briefly explores. This article focuses on Rohrmoos' — apparent — collapsing of the distinction between the implied warranty of suitability in a commercial lease and a material breach of lease and offers insight into what both transactional and litigation lawyers should consider in evaluating commercial leases post-Rohrmoos.