Business 8th Edition by Marianne Jennings

Exercise 27

MacDonald Group, Ltd., owned and operated the Fresno Fashion Fair Mall and leased space to Edmond's, a California retail jeweler. The lease contained a covenant that limited MacDonald to one additional jewelry-store as a tenant in the mall. The lease was entered into in 1969. In 1978, MacDonald was involved in the construction of an expansion to the mall and began negotiations to include a retail jeweler in the new space. Edmond's objected and brought suit. The covenant provides that only two jewelry stores would be tenants in the Fresno Fashion Fair Mall. The expansion would still be part of the Fresno Fashion Fair Mall and would not have a separate name. Would the covenant apply to the new addition to the mall? [ Edmond's of Fresno v MacDonald Group, Ltd., 217 Cal. Rptr. 375 (1985)]