Property I
Spring 2001
Midterm
Professor Brower

Laurence was the owner of the Wild Animal Kingdom Zoo (slogan "Born Free, then Caged") in Springfield. He also owned Blackacre, the property immediately adjacent to Wild Animal Kingdom Zoo. Blackacre was configured for a food service establishment. In April 1999, Laurence leased Blackacre to Theresa for 18 months at a monthly rental of $1000. Theresa moved into Blackacre and began to operate her singing waiter-themed restaurant, "Singing SirLoin's House of Ballads and Salads." Although Theresa tried to draw customers to her restaurant, she eventually sold her business, including the leasehold, to Umberto in April 2000. Umberto reopened the restaurant on Blackacre as "Up, Up and Buffet," a smorgasbord with a 1960s theme.

In May 2000, Laurence began a new feature at Wild Animal Kingdom Zoo in which visitors could watch the animals eat. As part of that feature, Laurence had raw meat and carrion delivered to his facility and stored it unrefrigerated in the area immediately adjacent to Blackacre. Soon the stench from the rotten carcasses permeated Umberto's restaurant and, after only a few minutes, made for an unpleasant dining experience for his customers. Although Umberto complained to Laurence about the smell, Laurence did nothing to improve the situation. Accordingly, patronage at Up, Up and Buffet fell off dramatically, and in July 2000 Umberto sold his business and leasehold to Veronica. Veronica reopened the restaurant as a takeout dessert emporium, called The Texas Cheesecake Depository. Veronica also complained to Laurence about the smell, although she continued to operate for the remainder of her leasehold. Veronica left at the end of the lease.

It is now 2001; Theresa, Umberto and Veronica have come to your office because of your expertise in real property law. They have informed you that although they paid the rent in full during the time they each rented Blackacre, they now understand that they might have some recourse against Laurence for the rotten meat smell. They all estimate that a third of the value of their leasehold was lost during that period. They want you to give them an impartial legal opinion determining whether they have any legal claims against Laurence, and if so, in what amount. They would also like to know if anything in your answer would change had they come to you before their leasehold had run out.

Please write a complete, legible, yet concise response to their inquiries using modern majority law. You may use only one examination booklet for your answer, writing only on the right-hand side of the page and skipping every other line.