A landlord filed a request for payment of an administrative expense claim for the difference between the amount of post-petition rent it claimed it was due and the amount the debtor actually paid. In December 2018, shortly before the debtor filed bankruptcy in January 2019, it asked the landlord to make some rent concessions to allow the debtor to keep its store open and not reject the lease immediately upon filing its petition. The landlord agreed to, and accepted payment of, a reduced rental rate. The debtor then rejected the lease and closed the store in late April 2019. The landlord argued that the lease as modified was not valid because there was no consideration, so the debtor owed the higher amount of rent pursuant to the original lease.
The court denied the request, finding the debtor's promise to not close the store immediately constituted consideration for the landlord's promise to accept reduced rent. The debtor's subsequent closure of the store was not a failure of consideration, but was simply a breach of contract.
The request for payment of the administrative expense claim was denied except for the post-petition rent owed for January at the reduced rate, which the debtor conceded it owed.