Epstein v. Zahloute

WILSON, J.

Plaintiffs’ predecessor in interest executed a lease to defendant of an apartment for the terms of two years “with option for renewal each succeeding year thereafter, ...” Subsequently to the expiration of the two-year term plaintiffs brought this action to quiet title to the property and to cancel the lease. They have appealed from the judgment rendered in favor of defendant.

[739]

The effect of the quoted provision of the lease amounts to the creation of a perpetuity. “A covenant for a lease to be renewed indefinitely at the option of the lessee, is, in effect, the creation of a perpetuity; it puts it in the power of one party to renew forever, and is therefore against the policy of the law.”

(Morrison

v.

Rossignol,

5 Cal. 64, 66.) In

Becker

v.

Submarine Oil Co.,

55 Cal.App. 698, 700 [204 P. 245], it is said that a clause in a lease providing for perpetual renewals at the option of the lessee is enforceable when it is clear that the parties intended the lessee to have that right. However, the lease in question in the Becker ease was an oil and gas lease and what the court there said must be considered in the light of the fact that such a lease creates a profit

a prendre

and vests in the lessee an estate in real property.

(Gavina

v.

Smith,

25 Cal.2d 501, 505 [154 P.2d 681];

Callahan

v.

Martin,

3 Cal.2d 110, 122 ff. [43 P.2d 788, 101 A.L.R. 871].) An assignment by the landowner of an interest in his oil rights without limitation as to time does not violate the rule against perpetuities.