Ilkhchooyi

In this case we decide that the doctrine of unconscionability applies to invalidate an express condition on transfer in a commercial lease, despite the Legislature’s broad authorization of transfer restrictions and reaffirmation of the principle of freedom of contract in a commercial setting. Citing an express clause in the lease, the lessor of a shopping center refused to allow an assignment to the prospective buyer of a drycleaning establishment unless the transferring tenant paid it a portion of the purchase price. The tenant did not comply and the sale was never consummated. The tenant filed this action against the lessor for declaratory relief, breach of lease and the implied covenant of good faith and fair dealing, and for intentional interference with contractual relations. Following a nonjury trial, the trial court entered judgment in favor of the tenant on all causes of action and awarded $40,000 in damages and $30,000 in punitive damages. The lessor appeals, insisting the lease clause was valid and claiming there was no evidence of bad faith. It also challenges the punitive damages award because there was no evidence of malice or its financial condition. We…