Indus. MacHinery, Inc. v. Creative Displays

344 So. 2d 743
CourtSupreme Court of Alabama
DecidedFebruary 4, 1977
StatusPublished
Cited by27 cases

This text of 344 So. 2d 743 (Indus. MacHinery, Inc. v. Creative Displays) is published on Counsel Stack Legal Research, covering Supreme Court of Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Indus. MacHinery, Inc. v. Creative Displays, 344 So. 2d 743 (Ala. 1977).

Opinion

344 So.2d 743 (1977)

INDUSTRIAL MACHINERY, INC., a corp., and Alabama Outdoor Advertising Co., Inc.
v.
CREATIVE DISPLAYS, INC.

SC 1822.

Supreme Court of Alabama.

February 4, 1977.
Rehearing Denied April 8, 1977.

*744 William M. Acker, Birmingham, for Alabama Outdoor Advertising Co.

William J. Sullivan, Jr., Birmingham, for Industrial Machinery, Inc.

W. Frank Greenleaf and James A. Harris, Jr., of Sirote, Permutt, Friend, Friedman, Held & Apolinsky, Birmingham, for appellee.

*745 FAULKNER, Justice.

This is a contest between two lessees—each claiming the other's lease to be void. The trial court declared the first lease void, and the second valid. We affirm.

On December 5, 1972, Alabama Outdoor Advertising Co., Inc. leased part of a lot from All State Linen Service Co. to erect a commercial advertising sign. The term of the lease was for ". . . Indefinite years, beginning . . . 1 day of January, 1973, and ending . . . year to year thereafter." The consideration was $1.00 plus Alabama Outdoor's painting an on-premises sign to advertise All State's business. The sign was painted, but no billboard was ever erected by Alabama Outdoor. The lease was not recorded. On March 24, 1975, the lot was purchased by Industrial Machinery, Inc., and in April, for $600 a year, payable in equal monthly installments, it leased part of the lot to Creative Displays, Inc. The term of the lease was to begin on the date a billboard was erected, and to run for a period of 5 years thereafter. The lease contained a condition that "Creative Displays will not be bound by this contract unless authority can be obtained to build 5 similar structures (unipoles) in the city of Birmingham on the Interstate." Creative applied to the State Highway Department in July for a building permit, but the Department refused to grant it. In August, Creative began paying the monthly rental payments. Upon its learning of the All State lease to Alabama Outdoor, Industrial Machinery filed a declaratory action to have the lease to Creative declared void, and the Alabama Outdoor lease declared valid. The court found the lease to Alabama Outdoor void, and the lease to Creative valid and binding on Industrial Machinery.

1.

All State—Alabama Outdoor Advertising Lease

A lease for a term of years must have a term certain. There must be a certain beginning and a certain ending. See National Bellas Hess, Inc. v. Kalis, 191 F.2d 739 (8th Cir. 1951), cert. denied, 342 U.S. 933, 72 S.Ct. 377, 96 L.Ed. 695; Ehrlich v. Barbatsis Holding Co., 63 So.2d 911 (Fla.1953). The lease to Alabama Outdoor began on January 1, 1973, for a term of "indefinite years," ending "year to year thereafter." Thus, there was no certain ending, thereby rendering the lease void for a term of years. However, a tenancy at will was created. Where the end of the term is indefinite and uncertain there is no valid lease for a term of years, but an estate at will is thereby created. 3 Thompson on Real Property § 1088 (1959); National Bellas Hess, Inc. The question, therefore, is for what period of time was the tenancy at will in existence. We are of the opinion that the resulting tenancy at will began on January 1, 1973, and ended when the property was conveyed to Industrial Machinery, Inc. on March 24, 1975. "[T]he rule generally followed in this country is that a tenancy at will is terminated by a conveyance of the premises by the landlord . . .." 49 Am.Jur.2d Landlord and Tenant § 79; accord, Annot., 120 A.L.R. 1006 (1939). We opine also that notice to Alabama Outdoor to terminate was not required. Ten days notice is required under Title 31, § 3 of the Code of Alabama 1940 only when the tenancy at will is expressly created. Martin v. Carroll, 259 Ala. 197, 66 So.2d 69 (1953).

Because the lease terminated when the property was conveyed, we do not decide the issue of priority of the lease.

II.

Industrial Machinery—Creative Displays Lease

The first question raised as to the validity of the Industrial Machinery—Creative lease is whether a lease which is not binding on one party until the happening of an event controlled in part by that party is mutually binding. Alabama Outdoor and Industrial Machinery contend that the contract provisions stating that Creative will not be bound unless authority can be obtained to build a billboard on Industrial Machinery's lot and to erect 5 unipoles on the Birmingham *746 Interstate give Creative a unilateral right to terminate the lease and that, hence, the lease is void for want of mutuality. Alabama Outdoor and Industrial Machinery further argue that, assuming that the lease is not found void for want of mutuality, the lease was terminated when Creative was unable to obtain authority to construct the billboards as expressly provided in the lease.

Real estate purchase and lease contracts commonly contain a clause stating that the conveyance is subject to securing a zoning change. Such a clause is a protective provision for the buyer or lessee which does not per se make a contract void for want of mutuality. To hold otherwise would place too much risk on the buyer or lessee so as to prevent the development of property. This lease is not void for want of mutuality because of the protective provisions.

The lease was not terminated because Creative was unable to obtain the authority to erect the unipoles. Creative made a good faith effort to obtain that authority. After being denied that authority but still within four months of the signing of the lease, Creative began making the monthly rental payments, thus waiving the protective provisions, and binding itself to the lease.

The case of LaGrave v. Jones, Ala., 336 So.2d 1330 (1976), is controlling as to the waiver question. In that case this court held that a purchaser of land has the right to waive a condition for his exclusive benefit in a contract for the sale of that land to him. Accord, Hodge v. Joy, 207 Ala. 198, 92 So. 171 (1921) (lease contract); Commercial Union Fire Ins. Co. v. Parvin, 279 Ala. 645, 189 So.2d 330 (1966); cf. Young v. U.S., 327 F.2d 933 (5th Cir. 1964).

The facts of LaGrave and the instant case are similar. In LaGrave the parties were concerned with a purchase option with the following conditions: (1) that it would expire on a certain date unless exercised prior to that date, (2) that it was subject to the buyers' being able to secure certain zoning changes, and (3) that the purchase price was to be a certain figure. The buyers, after their request for a variance was denied, notified the sellers that they exercised the option despite the denial, but the sellers refused to convey the property. This court found a valid waiver and required the conveyance.

In the case at bar, it was undisputed that the protective provisions were solely for the benefit of Creative. Although no specific date was mentioned, there was an implied condition of reasonable time within which Creative was to erect the billboard. Both contracts were subject to the obtaining of certain zoning changes, and both specified a certain conveyance price. That we are not here concerned with an option is insignificant because the waiver rule applies to all contracts, not just option contracts. See Ala. Tailoring Co. v. Judkins, 205 Ala. 601, 88 So. 865 (1921).

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