Walt v. Superior Court

8 Cal. App. 4th 1667, 11 Cal. Rptr. 2d 278, 92 Daily Journal DAR 11918, 92 Cal. Daily Op. Serv. 7343, 1992 Cal. App. LEXIS 1044
CourtCalifornia Court of Appeal
DecidedAugust 26, 1992
DocketA055319
StatusPublished
Cited by8 cases

This text of 8 Cal. App. 4th 1667 (Walt v. Superior Court) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Walt v. Superior Court, 8 Cal. App. 4th 1667, 11 Cal. Rptr. 2d 278, 92 Daily Journal DAR 11918, 92 Cal. Daily Op. Serv. 7343, 1992 Cal. App. LEXIS 1044 (Cal. Ct. App. 1992).

Opinion

Opinion

KLINE, P. J.

Petitioners Franklin C. Walt et al., are plaintiffs in an action filed against real party in interest John J. Clement concerning a commercial lease of real property. Summary adjudication of issues was granted in favor of Clement as to three of the four causes of action alleged in the complaint. Petitioners seek a writ of mandate commanding the superior court to set aside its order granting Clement’s motion for summary adjudication.

Factual Background

On April 4, 1984, petitioners as owners of commercial property in Sonoma County, entered into a written lease agreement with Clement for a term of five years extending through May 14, 1989. Commencing in May 1986 and continuing through November 1986, Clement failed to make his monthly rental payment. On November 24, 1986, petitioners served upon Clement a three-day notice to pay rent in full or quit which demanded $25,603.68 in past due rent or surrender of the premises. The notice stated, “You Are Further Notified That, the undersigned does hereby elect to declare the forfeiture of your Lease Agreement under which you hold possession of the above-described premsises [szc], and (Landlord) will institute legal proceedings to recover rent and possession of said premises with such other damages as may be allowed by law.”

Clement did not pay all past due rent within three days or surrender possession of the premises. He devised a plan to pay the rent past due and continued to occupy the premises until April 15, 1988. During the period November 24, 1986, until April 15, 1988, Clement and petitioners entered into discussions, negotiations and attempts to sublet a portion of the premises to a third party (Annette’s). These negotiations were unsuccessful. On April 15, 1988, Clement abandoned the premises some 13 months before expiration of the original lease term.

*1670 On December 18, 1989, petitioners filed a complaint for damages for breach of contract (the 1984 lease), waste, breach of contract (an alleged lease entered into on or about October 20, 1987), and bad faith denial of the existence of a contract (the 1984 lease and the alleged 1987 lease).

On June 5, 1991, Clement moved for summary adjudication of issues alleging that three of the four causes of action were without merit. As to the cause of action for breach of the 1984 lease, Clement contended that petitioners’ three-day notice to quit terminated the lease and the occupancy became a month-to-month tenancy which carried with it no postabandonment liability for future rent. As to the causes of action for breach of the alleged 1987 lease and bad faith denial of existence of a contract, Clement maintained that the signatures of Clement and petitioners on the proposed written sublease in 1987 which was never executed by the subtenants, neither reinstated the original lease nor created a new enforceable obligation.

On September 24, 1991, respondent court entered its order granting summary adjudication:

“(1) Plaintiffs’ First Cause of Action has no merit in that it cannot be established that, at the time Clement vacated Plaintiffs’ premises in April of 1988, he was under any legal obligation to pay rent to Plaintiffs beyond that date;
“(2) Plaintiffs’ Third Cause of Action has no merit in that it cannot be established that, in 1987 and in connection with his proposed sublease to Annette’s, Clement entered into an agreement with Plaintiffs to lease the premises from them for a term continuing until May 14, 1989 or for any other term;
“(3) Plaintiffs’ Fourth Cause of Action has no merit in that it cannot be established that (a) Clement denied without probable cause the existence of the 1984 lease, and (b) a valid contract arose in 1987 between Plaintiffs and Clement in connection with the proposed sublease;
“(4) Clement did not owe to Plaintiffs a duty to re-let the premises following his vacation thereof in April of 1988; and
“(5) Clement had no duty to mitigate Plaintiffs’ claimed losses as a result of his vacation of Plaintiffs’ premises.”

*1671 The trial court specifically held that the remedies provided by Civil Code section 1951.2 1 were not available to petitioners because Clement did not abandon the property within three days following his 1986 breach and petitioners did not terminate his right to possession by filing an unlawful detainer action. The court found that since Clement remained in possession after the three-day notice to quit was served, the parties by their conduct created a month-to-month tenancy and Clement was not therefore a lessee of real property within the meaning of section 1951.2.

This petition followed. We issued an order to show cause to consider the issue of whether the remedies of section 1951.2 are available to a landlord who terminates the lease but forgoes an unlawful detainer action and allows the tenant to remain on the premises.

Discussion

Petitioner contends the fact that the lessee continued in possession for some time after the lease was forfeited is not a bar to recovery under section 1951.2.

Section 1951.2 provides in pertinent part: “Except as otherwise provided in Section 1951.4, if a lessee of real property breaches the lease and abandons the property before the end of the term or if his right to possession is terminated by the lessor because of a breach of the lease, the lease terminates.” The lessor’s right of action arises “upon such termination.” (§ 1951.2, subd. (a).) Four measures of damages are then available to the lessor. 2

The enactment of section 1951.2 was “ ‘an admirable attempt to engraft the contract remedy of loss of bargain onto real property law. (Recommendation Relating to Real Property Leases (Nov. 1969) 9 Cal. Law Revision Com. Rep. (1969) appen. IV, pp. 157-163.) It abrogates the common law rule that the lessee’s obligation to pay rent depends on the continued *1672 existence of the term. It encourages the lessor to mitigate damages by no longer requiring the reletting of the property to be for the benefit of the lessee. Its formula for damages permits the lessee to prove what rental loss could have been avoided. It provides for discounting unpaid future rent to present value. (2 Assem. J. (1970 Reg. Sess.) pp. 3040-3044 ....)’ (Italics supplied.)” (Danner v. Jarrett (1983) 144 Cal.App.3d 164, 166-167 [192 Cal.Rptr. 535].)

In Danner, the parties executed a long-term lease for commercial property. Disputes over the payment of rent and late charges arose. The lessor filed an unlawful detainer action and the lease was declared forfeited. Subsequently, the lessor filed a suit pursuant to section 1951.2 seeking damages for the unpaid rent for the balance of the term of the lease less what was recovered by reletting the premises. The trial court ruled that the lessor was not entitled to relief under section 1951.2 since a forfeiture of the lease was declared in the prior unlawful detainer action.

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8 Cal. App. 4th 1667, 11 Cal. Rptr. 2d 278, 92 Daily Journal DAR 11918, 92 Cal. Daily Op. Serv. 7343, 1992 Cal. App. LEXIS 1044, Counsel Stack Legal Research, https://law.counselstack.com/opinion/walt-v-superior-court-calctapp-1992.