Moore v. Vandermast, Inc.

California Supreme Court Nov 25, 1941 No. L. A. 17265Published

Before: Gibson

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Holding. The court held that the plaintiff failed to provide clear and convincing evidence of a mutual mistake necessary to justify the reformation of a written lease agreement.

Issues

Whether the trial court's finding that there was no mutual mistake in the execution of the lease is supported by the evidence.
Whether the plaintiff met the burden of proof required to reform a written instrument based on mutual mistake.

Disposition. affirmed

Quotations verified verbatim against the opinion

“The plaintiff has not met the burden of proving there was a mutual mistake in the execution of the lease.”

“In the absence of clear and convincing evidence to the contrary, a written instrument is presumed to express the true intent of the parties.”

GIBSON, C. J. —

This action was brought to reform a written lease and to recover damages for a breach of the reformed lease. The plaintiff appeals from that portion of the judgment which denied his right to have the lease reformed and denied the recovery requested under the reformed provisions of the lease. No appeal was taken from that portion of the judgment granting plaintiff recovery for the defendant’s breach of the lease as written.

The plaintiff, Walter L. Moore, is the owner of a four-story structure known as the “Moore Building” in the city of Santa Ana. The defendant corporation and its predecessors have been engaged in the merchandising business in that city for many years. Since 1929, the defendant has maintained a retail clothing store in the Moore Building which it leased from the plaintiff. During the year 1933, declining business conditions made it impossible for the defendant to make the rental payments specified in the fifteen-year lease entered into in 1929. A substantial arrearage in rentals consequently accrued which, according to the plaintiff, amounted to something over $20,000. It is admitted that the defendant was in desperate financial condition at that time and, as a result, negotiations were entered into for the purpose of drawing up a new lease which would permit the defendant to continue in business.

After considerable discussion between the parties in which each was aided by counsel, the lease which is the subject of the present action was executed on March 7, 1934. The lease was drafted by the plaintiff’s attorney and was a so-called percentage lease, providing for a specified percentage of defendant’s gross receipts as rental. The lease covered a five-year period and provided, among other things, that the rental to be paid by the defendant “shall be the sum of Six Percent (6%) of the gross receipts from all its merchandising busi

[96]

ness

done im, the above demised premises.

...” (Italics ours.) The lease also contained a provision for a guaranteed minimum rental of $350. For the purpose of computing the rental “gross receipts” were defined to include “the amount received by Lessee from the sale of goods, wares, and merchandise . . .

sold from the hereinbefore described property and premises

Moore v. Vandermast, Inc.

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