Neal v. Craig Brown, Inc.

356 S.E.2d 912, 86 N.C. App. 157, 1987 N.C. App. LEXIS 2687
CourtCourt of Appeals of North Carolina
DecidedJune 16, 1987
Docket8626SC1073
StatusPublished
Cited by19 cases

This text of 356 S.E.2d 912 (Neal v. Craig Brown, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Neal v. Craig Brown, Inc., 356 S.E.2d 912, 86 N.C. App. 157, 1987 N.C. App. LEXIS 2687 (N.C. Ct. App. 1987).

Opinion

MARTIN, Judge.

Plaintiff assigns error to the entry of summary judgment dismissing his claims against defendants. He contends that genuine issues of material fact exist with respect to the nature of his tenancy in defendants’ property. We affirm the judgment of the trial court.

Summary judgment is appropriate only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Kessing v. National Mortgage Corp., 278 N.C. 523, 180 S.E. 2d 823 (1971). The burden of establishing the lack of any triable issue of material fact is on the party moving for summary judgment. Texaco, Inc. v. Creel, 310 N.C. 695, 314 S.E. 2d 506 (1984). A defending party may satisfy this burden by showing that claimant cannot prove the existence of an essential element of the claim. Bernick v. Jurden, 306 N.C. 435, 293 S.E. 2d 405 (1982). In ruling on the motion, the trial court must carefully scrutinize the moving party’s papers and resolve all inferences against him. Kidd v. Early, 289 N.C. 343, 222 S.E. 2d 392 (1976). The existence of questions of fact which are immaterial to the legal issues involved, however, is insufficient to defeat a motion for summary judgment. Kessing v. National Mortgage Corp., supra.

*159 The record filed in this Court reflects that the evidentiary materials presented to the trial court at the summary judgment hearing consisted of the pleadings and attachments thereto as well as affidavits. These materials establish that, in 1967, Craig T. Brown, Sr. and his wife Gaynell H. Brown owned real property located at 6315 South Boulevard in Charlotte. On 25 October 1967, they entered into a written lease agreement leasing the property to 60 Minute Systems, Inc. (60 Minutes), a Florida corporation engaged in a national dry-cleaning franchise business. The term of the lease was for fifteen years, beginning upon completion of a building which the lessors were obligated to erect as a part of the lease. According to the lease, the building was to be completed no later than 15 April 1968. The lease provided for monthly rental payments of $585.00 and contained options to extend for two successive five-year periods upon written notice of intent to exercise the option given at least 90 days prior to the expiration of the preceding term.

On 30 November 1967, 60 Minutes entered into a sublease agreement with William J. Hutchison. The sublease was to commence 1 March 1968 and run through 28 February 1983 at a monthly rental of $592.00. The sublease provided for options to renew at increased rentals for two additional five-year periods commencing 1 March 1983 and 1 March 1988. Hutchison opened a retail dry-cleaning and laundry business on the premises in the spring of 1968.

Sometime during 1970, 60 Minutes filed a petition for bankruptcy with the United States Bankruptcy Court, Middle Division of Florida. 60 Minutes was subsequently adjudicated bankrupt and a trustee in bankruptcy was appointed. The record properly before us contains no further information concerning the bankruptcy proceeding.

On 7 December 1970, Hutchison assigned “all of his right, title and interest” in the sublease to plaintiff, who began operating a laundry and dry-cleaning business on the premises. Plaintiff was thereafter directed by the bankruptcy trustee for 60 Minutes to pay rent “directly to the owners of the premises.” In his affidavit, plaintiff stated that he paid monthly rent of $592.00 directly to Craig Brown, Sr. and that he and Craig Brown, Sr. considered the sublease from 60 Minutes to Hutchison to be the contract governing his use of the premises.

*160 Upon the death of Craig T. Brown, Sr. in 1974, plaintiff paid the monthly rental payments to Gaynell H. Brown. In 1975, Gaynell Brown conveyed the subject property to defendant Craig Brown, Jr., who conveyed it to defendant Craig Brown, Inc. Since 1975, plaintiff has made all monthly rental payments to defendants.

Plaintiff offered evidence tending to show that on 20 December 1982 he gave written notice to defendants that he intended to exercise the option to extend the lease for five years and that, since that time, he has paid an increased monthly rental. He also made improvements to the property, including installation of a new boiler in 1983 at a cost of approximately $6,100.00. Defendants were aware of these improvements and never intimated to plaintiff that he was anything “other than a long-term tenant” under the terms and provisions of the Hutchison lease agreement.

By affidavit, Craig Brown, Jr. stated that he has never received a notice of renewal from plaintiff, has never discussed an extension of any term with plaintiff, and has always considered plaintiff to be a tenant at will. According to the affidavit, the increase in rent from $592.00 to $630.00 per month came about as a result of negotiations with plaintiff, during which the existence of a lease was not mentioned.

On 19 August 1985, defendants notified plaintiff to vacate the premises by 1 October 1985. Plaintiff remains in possession of the premises.

Plaintiff first contends that genuine issues of fact exist with respect to the intentions of the parties and that those factual issues are material to a determination of whether the parties are obligated to each other as direct lessor and lessee pursuant to the terms and conditions of the sublease between 60 Minutes and Hutchison. In support of his contention, plaintiff asserts that 60 Minutes’ adjudication in bankruptcy constituted a surrender of its lease to Brown, Sr. by operation of law and that, by his attornment to Brown, Sr. under the terms of the Hutchison sublease, he became Brown, Sr.’s direct tenant. Plaintiff further argues that the parties’ “acts, acknowledgments and receipts” over the fifteen-year period of his tenancy —evidenced by his regular monthly rent payments made pursuant to the terms of the lease, *161 his addition of capital inprovements to the premises and his delivery of written notice of his intent to renew the lease —clearly indicate that the parties considered themselves direct lessor and lessee pursuant to the terms of the sublease.

In addressing plaintiff s contentions with respect to his status as a long-term tenant under the Hutchison sublease, it is important to note that plaintiff has presented no evidence from which one could conclude that the original lease agreement entered between 60 Minutes and Brown, Sr. was terminated by reason of 60 Minutes’ bankruptcy. From the evidence properly before us, we are able to ascertain only that 60 Minutes filed a petition in bankruptcy in 1970, was adjudicated bankrupt, and that a trustee was appointed. By letter dated 9 December 1970, the trustee notified the landlords of 60 Minutes’ franchisees that the franchisees were to pay rent directly to the landlords. The letter further advised the landlords that in the event of default, the trustee for 60 Minutes intended to proceed against the defaulting franchisee. The letter indicates neither a surrender nor a termination of 60 Minutes’ lease by its trustee.

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Bluebook (online)
356 S.E.2d 912, 86 N.C. App. 157, 1987 N.C. App. LEXIS 2687, Counsel Stack Legal Research, https://law.counselstack.com/opinion/neal-v-craig-brown-inc-ncctapp-1987.