Connecticut - My Family Moving & Storage business (My Father owns it, I am his daughter and bookkeeper) signed a seven year commercial lease agreement in May, 2000. Rent : $13,005.98/month - Exp: 4/30/07.

After the Sept 11 attacks, business took a downward turn, so we asked to amend the lease:

First Amendment was signed on Nov 28, 2001:
11/1/01 - 7/30/02 $9,005.98
8/1/02 - 1/31/04 $15,069.91
2/1/04 - 4/30/07 $13,005.98

Financials were provided as well as outlines of decreased revenues/increased expenses and the Landlord agreed to amend the lease again:

Second Amendment was signed on May 25, 2004:
1/1/04 - 12/31/04 $7500.00
1/1/05 - 4/30/07 $13,005.98

Our Controller got lung cancer and passed away in Feb 05, he was the usual negotiator with landlords, etc. We could not afford to go back up to the $13,005.98 on 1/1/05, but continued to pay the $7500.00 and he did not demand the balance....that went on for an entire year before he issued a notice of default in Feb 06 that he accompanied with an A/R aging showing the amount due as the payment shortfall for plus late charges for each month of 2005 and Jan & Feb of 06.

I did some prelim research online....but thought I'd ask here....has anyone been successful in using the defense of estoppel by silence/equitable estoppel claiming that his acceptance of the reduced amount went without demand for the full amount for that period of time and can prevent him from collecting the shortfalls for that year??? I am sure this won't hold water, but I see it as our only possible out. My father has personally guaranteed the lease, so the landlord has no incentive to work with us any further to amend the lease.

Sorry so long and complex :(

You need to consult a local attorney and not try to rely on this site as your case is very specific. As for your argument, you can make it, but if the landlord has a lease showing that you owe something different, then they can enforce that and say they were giving you time to catch up out of deference to the longterm nature of the lease and business relationship, but they cannot afford to do that anymore. You can try but I don't think the argument is going to work. Also, it does not sound like you all reached out to seek modification to allow for partial payments, so I do not think you really have much of an argument though the situation is emotionally pulling.