The Need for Legislative Authorization of Noncompete Servitudes in Commercial Leases

Abstract

Winn-Dixie Stores, Inc. is a Florida-based supermarket chain that operates over 500 grocery stores across the southeastern United States. In the Greater New Orleans area alone, Winn-Dixie operates nearly twenty stores. Winn-Dixie stores generally "anchor" shopping centers, meaning that Winn- Dixie stores attract customers to shopping centers, and those customers in turn patronize other stores in those centers.3 As a general policy, when Winn-Dixie agrees to anchor a shopping center, its leases include a "Grocery Exclusive" clause. This Grocery Exclusive clause purports to prohibit other tenants in that shopping center from selling certain grocery items in competition with Winn-Dixie. In an attempt to establish its Grocery Exclusive clause as a real property right enforceable against third parties (i.e., a noncompete servitude), Winn-Dixie's leases declare that the Grocery Exclusive clause "shall be deemed both a covenant and a condition and shall run with the land."' Additionally, Winn-Dixie records its leases in the public registry to put others on notice as to the clause's existence.