Wachovia Bank & Trust Co., N.A. v. Rubish

293 S.E.2d 749, 306 N.C. 417, 1982 N.C. LEXIS 1486
CourtSupreme Court of North Carolina
DecidedAugust 3, 1982
Docket54A81
StatusPublished
Cited by25 cases

This text of 293 S.E.2d 749 (Wachovia Bank & Trust Co., N.A. v. Rubish) is published on Counsel Stack Legal Research, covering Supreme Court of North Carolina primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wachovia Bank & Trust Co., N.A. v. Rubish, 293 S.E.2d 749, 306 N.C. 417, 1982 N.C. LEXIS 1486 (N.C. 1982).

Opinion

EXUM, Justice.

Plaintiff, holder of legal title as trustee, seeks by this summary ejectment action to regain possession of premises currently possessed by defendant as lessee. Plaintiff asserts that defendant failed to give timely written notice of his intent to exercise his option to extend the lease; thus his refusal to surrender possession after the expiration of the last extension is an impermissible holding over. Defendant answers that the requirement of written notice had been waived by plaintiff’s predecessor in interest, that plaintiff had actual oral notice of his intent to renew, and that plaintiff failed to notify him that written notice was required to *419 be directed to Wachovia. Thus, he alleges, plaintiff is estopped from asserting the requirement of written notice.

The most significant question raised by this appeal is whether there was sufficient evidence of estoppel to justify submission of the case to the jury. Additional questions are whether the jury was properly instructed and whether the trial court erred in several evidentiary rulings.

Defendant, a former football player at the University of North Carolina at Chapel Hill and a professional golfer, entered into a lease with Mr. and Mrs. William E. Baker on 12 February 1960 of some 19.03 acres of undeveloped land on the Durham-Chapel Hill Boulevard in Durham County, adjacent to what is now South Square Mall. Mr. Baker was an avid sportsman and agreed to lease the property to defendant for development as a recreational complex. Defendant’s attorney drew the lease according to defendant’s and Mr. Baker’s wishes. The lease limited defendant’s use of the property as follows:

[A]s a part of the consideration moving to [Baker] to execute this lease [defendant] will erect on said premises a modern clubhouse, containing a golf shop, for the sale of golfing equipment and apparel, a lounge, a grille or luncheonette, and a one-unit dwelling apartment, and, in addition thereto, will erect an eighteen-hole miniature golf course, a golf driving range, a nine-hole par three golf course, and a play area for children, provided however that it is not contemplated that all of the above-referred to improvements shall be constructed or erected within a maximum prescribed period of time, but only as the necessities of the business . . . shall require.

The period of the lease was ten years, until 30 April 1969, but it granted defendant an option to extend the period for six additional five-year periods. Rent was $4,000 for the first year, $5,000 for the second, and $6,000 for the third and all subsequent years through the first four additional periods. For the fifth and sixth additional periods, the parties agreed to renegotiate the rent.

The lease provided that defendant could extend for the additional periods by giving Mr. and Mrs. Baker “written notice of his *420 intention to do so not later than ninety (90) days prior to the expiration of the then current term of this lease.” Plaintiff and defendant stipulated that the lease was extended for two additional periods upon notice 2 by defendant to the Bakers. The first extension ran from 1 May 1969 to 30 April 1974; and the second, from 1 May 1974 to 30 April 1979.

Mr. Baker died on 9 June 1976, and Wachovia Bank and Trust Company qualified under his will as executor and trustee of his estate. Ms. Jean Holleman was assigned responsibility for the estate. Under Mr. Baker’s will, a trust was established to provide income for Mrs. Baker. The trust’s only remaining asset is the property leased to defendant. From Ms. Holleman’s examination of the lease after Mr. Baker’s death, she determined that the lease was in the middle of its second additional term. She found no writing from defendant to Mr. Baker purporting to extend the lease, although she was able to find among Mr. Baker’s personal files various correspondence about the property between the two men, tax returns and ledger books recording rental payments.

In August 1976 Ms. Holleman met with defendant to discuss directing his future rental payments to Wachovia’s trust department. She testified that at “my initial meeting with Mr. Rubish, he advised me that it looked like he was going to continue his business and that was his plan at that time.” In an internal memorandum about an August 1977 meeting with defendant, Ms. Holleman wrote: “I was very pleased with the way our meeting with Rubish progressed. In my opinion, he went from one extreme to the other. He first stated that he would never give up his business for any reason and would fight to keep it with every means available to him. When we concluded our meeting I felt that he was quite anxious to join with us on a sale of the property at a price of $1,100,000.00 or above.” In this and other discussions about a possible sale of the property 3 and appropriate division of the proceeds, she concluded that defendant considered his lease to run for forty years. She stated in her deposition that every *421 time defendant “referred to the lease, I think he always stated that it ran until 1999.” She explained to defendant that the lease would effectively terminate in 1989 because the upward rental adjustment to be required at that time would make it financially unrealistic for him to continue his operations. In May 1979, after infrequent contact with defendant since August 1977, Ms. Holleman wrote defendant that his lease had terminated. The basis for this action, she testified, was defendant’s failure to give notice of his intention to extend the lease as required by its terms. She claimed defendant never gave oral or written notice of his intent to extend the lease. Plaintiff accepted no rental payments after the purported termination of the lease on 30 April 1979 without first asserting that such payments would not affect its right to terminate.

Plaintiff offered expert testimony that the fair market value of the property on 1 May 1979 at its highest and best use was $1,150,000 4 and its fair market annual rental value was $50,000. Its most profitable use would be as a free standing commercial establishment such as a discount store, and not in its present use as a golfing complex.

Defendant testified that he has constructed on the property a nine-hole, par three golf course, a golf driving range, two eighteen-hole miniature golf courses, and a clubhouse with golf shop and grill. Almost all of these improvements were made before Mr. Baker’s death and were intended to have a forty-year life. A corporation in which defendant apparently is the sole stockholder owns “Mike Rubish’s Golf City,” and defendant personally manages the property.

Defendant admitted that he had not given written notice 5 of renewal of the lease to Wachovia before 1 May 1979. When he *422 received the letter of termination he was “dumbfounded” and “panicky.” Defendant admitted that he wrote a letter purporting to extend his lease, predated it, and sent it to Mrs. Baker.

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Bluebook (online)
293 S.E.2d 749, 306 N.C. 417, 1982 N.C. LEXIS 1486, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wachovia-bank-trust-co-na-v-rubish-nc-1982.