Businessman David Hood to Challenge Jury’s Decision on Lease Breach, Seeks Supreme Court Review

Garapan, Northern Mariana Islands — Businessman David Hood is preparing to contest a recent court decision holding him accountable for $160,250 in damages over disputed lease agreements. The verdict arose from a lawsuit concerning a failed plan to develop a boutique hotel, which has become a focal point of legal debates about contract interpretation and landlord-tenant disputes.

In January, after a complex trial, a jury found Hood liable for the said amount in back rent but dismissed a significantly higher claim. The more substantial $3.6 million claim, related to allegations of bad faith dealings, did not result in any damages awarded to the plaintiff. Hood’s attorney, Bob O’Connor, indicated satisfaction with the dismissal of the major claim but confirmed plans to appeal the ruling on the smaller rent-related claim.

The lawsuit was initiated by Hideaki Sawada, owner of the May Ten Building in Garapan, through his company, Magic International Corporation. Sawada leased the building’s second floor to Hood’s enterprise, Bright Star LLC, for the development of an 18-room hotel in 2016. The conflict centers around whether conditions noted in a handwritten clause in the lease were met, allowing lease cancellation by Hood’s company.

This handwritten clause has been pivotal in the proceedings, suggesting that Bright Star could annul the lease unless certain conditions relating to permit acquisition and construction bids were met. According to court filings, Hood’s team argued that these conditions were never fulfilled, thus nullifying the lease obligations, including rent payments.

However, Sawada’s legal representation contended successfully that Hood breached the lease by not meeting payment obligations, resulting in the award of $142,500 for back rent plus additional charges and interest, which totals approximately $160,250. The jury also addressed claims regarding breaches of good faith, though they assigned no financial penalties for these.

The legal battle reveals much about the complexities of handwritten lease amendments and their interpretation under law. Superior Court Presiding Judge Roberto C. Naraja, who presided over the trial, had the challenging task of guiding jurors through the intricacies of contract law shaped by these unique circumstances.

Adding another layer to the case, Hood and Bright Star filed a counterclaim demanding the return of a $40,000 security deposit, along with compensation for attorney’s fees and litigation costs. This dispute underscores continuing tensions and unresolved issues between the parties involved.

As Hood prepares for the appeal, legal experts note that the Supreme Court’s review will likely scrutinize the lease’s ambiguous phrasing and its implications on the contract’s enforceability. The decision could have broader implications for how similar lease conditions are crafted and interpreted in future commercial property agreements.

The outcome of this appeal will not only affect Hood and Sawada but also set a precedent for future disputes in the realm of real estate development and leasing in the region.

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