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Penticton's Cherry Lane Mall and its tenant the Hudson's Bay Company have launched a pair of lawsuits against each other, as Cherry Lane seeks to evict The Bay for failing to pay rent.
In a suit filed Nov. 13 in Penticton, Cherry Lane Shopping Centre Holdings Ltd. alleges The Bay has not paid its $78,036.49 per month rent since April 2020, resulting in over $620,000 owed, plus more than $85,000 in taxes and lease costs reconciliation.
The suit outlines months of notices of default delivered to Hudson's Bay, a notice of termination of the lease served on Nov. 9 and a demand for possession of the premises on Nov. 10. Cherry Lane claims that since then, The Bay has been "in wrongful possession of the premises and refused to vacate."
Hudson's Bay Company, which operates The Bay retail locations, filed its own lawsuit the same day in Vancouver Supreme Court, blaming Cherry Lane for their loss of revenue during the pandemic that left them unable to pay their rent.
The suit alleges that Cherry Lane did not make upgrades to their HVAC system or air filters which would make the public safer, and refused to install touchless doors, upgrade washrooms, improve pedestrian controls and increase mall staff responsible for "ensuring customers are complying wth safety precaution, including wearing masks and physically distancing."
Hudson's Bay alleges this, along with lack of marketing "to address customers' concerns and encourage them to return," resulted in low customer traffic and lack of revenue.
Sales have dropped dramatically since the beginning of the pandemic, with the worst month being April. In April 2019, The Bay at Cherry Lane recorded $1,009,495 in sales, compared to just $4,634 in April 2020, a 99.5 per cent change.
Since the spring, year over year sales losses per month have ranged between 23.9 per cent and 32.3 per cent.
The lawsuit further notes that 66 people are employed at The Bay at Cherry Lane and that they are in the process of hiring 22 more for the holiday season.
"All of these people will lose their jobs if the store is terminated," reads the suit.
In its own suit, Cherry Lane disputes claims that they have not adopted appropriate health and safety measures, and says they have "undertaken significant marketing initiatives during the last several months directed at increasing footfall at the shopping centre."
Hudson's Bay Company is seeking an injunction restraining Cherry Lane from terminating the lease, which The Bay has held since 1996. Their lawsuit also mentions The Bay's location in Victoria, B.C. where the company is fighting a similar battle against their landlord and making similar arguments.
Hudson's Bay has recently had success elsewhere in Canada blocking eviction for unpaid rent.
Representatives from either party were not immediately available for comment.
