Newsletter
Miss the Notice, Extend the Lease: Court Enforces Automatic Renewal Terms
January 16, 2026
Authors
Joel E. Antwi
Associate, Washington, D.C.
jantwi@goulstonstorrs.com+1 617 574 0585
Sydney Cramer
Associate, Boston
scramer@goulstonstorrs.com+1 617 574 0504
Mariana Korsunsky
Director, Boston
mkorsunsky@goulstonstorrs.com+1 617 574 3584
Kevin P. O'Flaherty
Of Counsel, Boston
koflaherty@goulstonstorrs.com+1 617 574 6413
Gary M. Ronan
Director, Boston
gronan@goulstonstorrs.com+1 617 574 3593
Salome Salia
Associate, Boston
ssalia@goulstonstorrs.com+1 617 574 0598
John F. White III
Associate, Boston
jwhite@goulstonstorrs.com+1 617 574 0576Related Expertise
In Innovation Pharmaceuticals Inc. v. Cummings Properties, the question before the Appeals Court was whether the plaintiff, Innovation Pharmaceuticals Inc. (“IPI”), provided sufficient notice to its landlord, defendant Cummings Properties, LLC (“Cummings”), that IPI was not extending its commercial lease, so as to prevent the lease from automatically extending for another five years. The Appeals Court held that IPI did not provide sufficient notice and affirmed a judgment for Cummings.
IPI, a publicly traded biopharmaceutical company, and Cummings, a large commercial real estate management firm, executed a commercial lease for laboratory space in 2008 for an initial term of five years, which the parties extended for another five years in 2013 (the “Lease”). The Lease included an automatic extension provision for another five years. If IPI chose not to further extend the Lease, the Lease required that IPI give written notice to Cummings by certified or registered mail, by constable, or by courier no later than March 30, 2018. Electronic, fax, or oral communications were explicitly deemed ineffective under the Lease.
In early 2018, as the six-month notice period approached, IPI held informal discussions and email exchanges with Cummings staff about possibly relocating or downsizing. However, it never sent a written nonrenewal notice pursuant to the Lease. After IPI failed to send proper notice, Cummings treated the lease as automatically renewed for another five years.
IPI ultimately disputed the renewal, stopped paying rent after fifteen months, and filed suit against Cummings, seeking, among other things, a declaratory judgment that the renewal was unenforceable. Cummings counterclaimed for breach of contract and sought the remainder of the rent for the renewed five-year term under the liquidated damages provision of the Lease. The judge found that IPI’s communications were tentative, and that IPI never gave clear notice of nonrenewal. Accordingly, the Lease had extended. The judge awarded Cummings forty-five months rent in liquidated damages equal to $810,251.
IPI appealed the decision, arguing that despite its noncompliance with the procedure set by the Lease for exercising its option not to extend, IPI’s informal communications with Cummings were sufficient notice to prevent the automatic extension. Specifically, IPI relied on testimony from Cummings’s IPI account manager that he (and thus, Cummings) “understood,” at certain points prior to March 30, 2018, that IPI “intended” to vacate the premises and that IPI “no longer intended” to remain at the premises. Accordingly, IPI argued that Cummings had actual knowledge of its intent to vacate, which should suffice.
The Appeals Court affirmed the trial court’s judgment. Reviewing the lower court’s findings of fact for clear error, the Appeals Court rejected IPI’s argument that Cummings had actual knowledge of the nonrenewal (which was contrary to what the trial court had found). The Court also rejected IPI’s argument that a party seeking to exercise an option not to extend a lease need only convey its intention to its landlord with reasonable certainty (rather than unequivocal notice), notwithstanding that the lease specifies requirements for giving notice. The Court explained that this argument runs contrary to the elementary principle that an unambiguous contract must be enforced according to its terms.
The Court distinguished Sourcing Unlimited v. Cummings Properties, LLC, 102 Mass. App. Ct. 653 (2023), which involved identical lease language but different facts. In Sourcing Unlimited, the tenant’s written email notice was unequivocal and timely, though technically delivered by an unauthorized method, whereas in this case no such unequivocal notice was provided. IPI’s communications were ambiguous and inconsistent, referring to potential downsizing and relocation without confirming a definite decision to vacate.
Finally, IPI argued that the judge’s award of liquidated damages was disproportionate to a reasonable estimate of the actual damages likely to result. The Court disagreed, finding no error in the enforcement of the valid and bargained-for liquidated damages provision.
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