I bought a company that sold pizza. Before purchasing the business I gave an accountant the records of the business to see if it was a worthwhile investment. The accountant checked over the books and reported that indeed it was quite profitable. Based on this, I purchased the business and rented a store to make and sell the pizza. I told the storeowner that the reason I wanted to rent is because I had bought someone’s pizza business. However, shortly thereafter it became clear that the sellers had altered the records and the business was not a worthwhile investment. We therefore canceled the purchase on the grounds that it was a mekach to’us. However, when we tried to cancel our lease for the store, the owner did not want to release us from our contract. Can we cancel the agreement or are we bound by our original agreement?
We find in the Torah and Gemara that there are specific rules when one has the right to cancel an agreement. In the Torah we find that Moshe Rabbeinu made his grant of the east side of the Jordan River to the tribes of Reuven and Gad contingent upon their participation in the battle to conquer the west side of the Jordan River. From this the Gemara derives that one can insert conditions in an agreement and if one of the parties fails to adhere to the conditions, the agreement is invalid.
The Gemara (Kiddushin 49B) states that if one sold a parcel of land because he intended to emigrate to Eretz Yisroail the sale remains valid even if he is unable to emigrate due to unforeseen conditions. The reason is because the seller failed to stipulate the condition, namely that the sale is formally contingent upon his emigration. The fact that he failed to stipulate a condition renders his thoughts nothing more than devorim shebeleiv which have no validity. In order for a condition to be valid it must be stated explicitly as a condition.
However, the Gemara limits its ruling that the sale is final to a case where the seller did not even mention at the time of the sale that he intended to move to Eretz Yisroel. The implication is that if the seller did mention that he was selling because he intended to move then if he was forced to change his plans he could cancel the sale even though the sale was not stated explicitly as being contingent upon the seller’s moving to Eretz Yisroel. Thus, a mere mention of the seller’s intention suffices to make the sale contingent upon the seller’s ability to implement his plans and one does not have to make his plans a formal condition in the sales agreement. Your situation would seem to be similar, since you mentioned your purchase of the business at the time of the rental and therefore, according to this you are justified in canceling your agreement.
However, the Rosh (Kiddushin 2, 15) deduces an important principle from the fact that Rashi made a point of mentioning that this rule was stated in reference to an immovable object (real property). He explains that there was a very clear distinction in the time of the Gemara between one who sold his land and one who sold movable objects. People did not sell their land unless they intended to move, because their land was their source of livelihood. In contrast, people at times sold their movable objects even if they did not intend to move. Thus, the Rosh argues that stating one’s plans suffices only when it is supported by an umdeno (a logical argument) that the sale is contingent. The principle of the Rosh is ruled by the Tur and the Ramo (207, 3) and is authoritative. Therefore, we must examine your situation in light of the Rosh’s principle.
There are other situations that are discussed by the Tur and Shulchan Aruch which shed light on the Rosh’s principle. The Tur (230, 9) records a dispute between Rabbeinu Yonah and Rabbeinu Chananel concerning a person who bought a large amount of wine and mentioned, at the time of purchase, that his intention was to sell it in a place where wine was expensive. Rabbeinu Chananel, whose opinion is ruled by the Tur and is authoritative, says that the customer has the right to cancel his purchase in case the price fell in the place where he intended to sell the wine. This seems to contradict what the Tur himself wrote concerning the sale of movable objects. The Pischei Teshuvo (207, 6) cites a number of poskim, including the Chasam Sofer (CM 70), who differentiate that when it comes to buying movable objects (as opposed to selling them) people don’t buy them unless they have a reason and, therefore, it suffices if the customer mentioned his intention when he purchased the wine.
A third instance where this concept is discussed concerns rentals. The Ramo (312, 9) discusses the case of a person who rented out his house and mentioned at the time of the rental that he was renting it because the renter was his friend. The Ramo rules that if during the course of the rental period they became enemies the owner may cancel the rental. Thus we see another situation where a mere statement of fact suffices to insert a condition in an agreement.
The Ketsos (319) disagrees with the Ramo’s ruling. He notes that people try to rent out any property of theirs that is vacant and therefore this should be similar to what the Rosh wrote about the sale of movable objects where it is necessary to stipulate one’s conditions explicitly, according to the rules for conditional agreements.
The Nesivos (312, 7) addresses the objection of the Ketsos. He says the ruling of the Ramo applies only to a house which in the past was not rented out by its owner. In that case, the statement of the owner that he is renting to this customer because he is his friend suffices to allow the owner to cancel the rental when relations sour. It stands to reason that the Nesevos only applies if the renter is aware that the house was not rented out in the past since we want to use this fact to create a condition in an agreement between the owner and the renter.
We should note that the Nesivos is stating an important chiddush, which the Ketsos may disagree with. Until now in all our examples the rules were general and did not concern a particular situation. People in general do not sell immovable objects. People do not buy movable objects that aren’t necessary for their day-to-day living, and so on. Here the Nesivos says that even if a person made an exception to his personal practice – which was not the general practice – it is enough.
The Maharsham (Mishpat Sholom 207, 14) gives a very important principle which is in accordance with the Nesivos. His rule is that if there is an umdeno, if it stands to reason that the statement which was made at the time of the agreement was critical, then the statement is binding even though it was never stated as a formal condition. Many later poskim (see Pischei Choshen (Sechirus 5, footnote 15)) accepted the principle of the Maharsham.
According to this principle, in your situation if you don’t usually rent stores and the owner was aware of this then you can cancel the rental. However, if you have other stores or even if the owner is not aware that you only rented because of your purchase of the pizza business it would be difficult to allow you to cancel the rental. Furthermore, if you already paid a portion of the rent it will be difficult to recover the money since there may be poskim who do not agree with the Nesevos.
In conclusion: Your right to cancel the rental depends on what you do otherwise. In the future, it is always best to spell out all your conditions when you make a formal agreement. That way you will avoid sheilos and unnecessary dinei Torah.