Cafe Apollo Co. v. Anselm

California Court of Appeal Oct 3, 1941 No. Civ. 12555Published

Before: York

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Holding. The court held that an ambiguous option clause in a sublease, when interpreted in light of extrinsic evidence and the parties' conduct, granted the sublessee a right to renew for a term concurrent with the sublessor's new lease, rather than creating a month-to-month tenancy.

Issues

Whether an ambiguous option clause in a sublease may be interpreted using extrinsic evidence regarding the parties' intent.
Whether the sublessee's continued possession and payment of rent constituted an exercise of the option to renew the sublease.

Disposition. reversed

Quotations verified verbatim against the opinion

“A reading of the disputed paragraph of the sublease readily discloses that it has little, if any, meaning, unless it refers to the so-called “new” lease between respondent and the owners of the property.”

“Such payment of the rental and its acceptance by respondent constituted an exercise of such option by appellant.”

YORK, P. J.

On June 1, 1933, Leroy and Anna Plolt, as owners, leased to respondent Cafe Apollo Company those certain premises in the city of Los Angeles, known and operated as Italian Village Cafe, for the term beginning on said date

[152]

and ending September 30, 1937. After expiration of said lease, respondent held over as a tenant from month to month, under the terms of the lease, until April 26, 1938, when a new lease was executed between the same parties. Before the expiration of the original lease, to-wit, on April 1, 1,936, respondent sublet to appellant Agnes Marie Anselm for the period ending on September 30, 1937, certain floor space in said Italian Village Cafe at a rental of $275 per month, said sublease containing, among others, the following provisions:

“It is further agreed that Party of the Second Part (appellant) is hereby granted an option for the length of lease of First Party (Respondent), at the expiration of this contract under the same terms and conditions as hereinbefore set forth.

“If said option is accepted by the Second Party (appellant) at the expiration of this contract.

“It is hereby agreed that this contract shall expire on the same date as the present lease held by the First Party.

“This lease and concession shall begin on the First Day of April, 1936, and shall terminate on the 30th day of September, 1937.”

Appellant paid the stipulated rental of $275 per month from April 1, 1936, to and including July 1, 1939, and on or about the last named date received notice from respondent as follows:

“Referring to your month to month tenancy covering a portion of the premises known as Italian Village. . . .

“Please take notice that commencing August 1, 1939, the terms of your tenancy will be changed as follows, to-wit: The rental which you will be required to pay for said premises under said tenancy will be raised from the sum of $275.00 per month to the sum of $500.00 per month, payable in advance on the first day of each month commencing August 1, 1939.

Cafe Apollo Co. v. Anselm

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YORK, P. J.

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