American Contract Law for a Global Age, 2017a

Problems
Problem 18.1
Pantera’s is a chain of “café-style” restaurants. It enters into a contract with
Shopping Center to put a Pantera café in the center. As part of the negotiations,
Pantera’s insists that it wants to limit competition within the center. The Center has
other tenants, however, who also serve food. After negotiation, the parties agree to
the following language:
Center agrees not to enter into a lease, occupancy agreement or license
affecting space in the Shopping Center or consent to an amendment to an
existing lease permitting use . . . for a bakery or restaurant reasonably
expected to have annual sales of sandwiches greater than ten percent
(10%) of its total sales or primarily for the sale of high quality coffees or teas,
such as, but not limited to, Starbucks, Tea-Luxe, Pete's Coffee and Tea,
and Finagle a Bagle. The foregoing shall not apply to (i) a business serving
near-Eastern food and related products, (ii) restaurants primarily for
sit-down table service, (iii) a KFC restaurant, and (iv) a Papa Gino's
restaurant (provided the same continues to operate with substantially the
same categories of menu items as now apply to its stores and franchisees
generally).
The parties sign the contract, the Pantera café opens, and it becomes
successful. Subsequently, Shopping Center is approached by Adoba, a national chain
of “Mexican Grills” that serve various items in a café-style setting that does not
involve sit-down table service. On learning of these discussions, Panera’s protests,
claiming that burritos, tacos, and quesadillas are “sandwiches” and that they account
for more than 10 percent of Adoba’s sales. Pantera’s sues, asking for an injunction
against its claimed violation of the lease. What result and why?
Problem 18.2
Homeowner lives in a coastal community that is sometimes subject to
hurricanes. She has a “homeowner’s insurance” policy on her home, issued by
Arcturus Life & Casualty Co., an insurer licensed in Homeowner’s state. The
Arcturus policy, a standard form used by many different insurers, provides that it
will cover “direct physical loss to structures on the property” from any cause, except
for “excluded perils.” Among the list of “excluded perils” is:
Damage from . . . flood, surface water, waves, tidal water, overflow of a
body of water, or spray from any of these, whether or not driven by wind.
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UNIT 18: THE INTERPRETIVE TOOLBOX 379