Stockton Dry Goods Co. v. Girsh

SHENK, J.

The plaintiff as lessor brought an action against the defendant lessee for declaratory relief pursuant to section 1060 of the Code of Civil Procedure. The existence of a controversy was alleged and placed in issue by the defendant’s answer. The trial court found that a controversy existed as to a proper construction of the terms of the lease, and basing its findings on stipulated facts and the language of the lease, rendered judgment for the plaintiff. The defendant appealed.

The plaintiff owns a department store in the city of Stockton. For about 20 years prior to March, 1944, one Ben Warshauer operated the shoe department of the store under a lease of a portion of the premises. Mr. Warshauer retired and in his place his brother-in-law, the defendant Stanley Girsh, was accepted as the lessee and now conducts the department. A written lease was entered into between the parties on March 7, 1944, providing for the renting of a 20 by 50-foot space on the mezzanine floor near the stairway, “to be conducted as a Shoe Department,” for a term of five years with option of

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renewal for a like term. The consideration was specified as 10 per cent of all net cash sales and 11 per cent of all net charge sales. Other provisions regarding payments for utilities, thrift stamps, matters of wrapping and delivery service, management and sales policies, and privilege of window display space were included.

The plaintiff alleges that the defendant claims the sole and exclusive right under the lease to operate a shoe department in the store. The plaintiff disputes the claim and in turn asserts the right to set up one or more shoe departments in the store in competition with the defendant. On the trial the court excluded from consideration the defendant’s offer of proof of conversations had between the parties prior to the execution of the lease. The evidence was offered as support for an asserted oral understanding that the defendant should have the sole right to conduct a shoe department in the store. The court concluded that the lease provisions did not amount to a grant to the defendant of the sole and exclusive right to operate a shoe department in the store.

The applicable principles are found in our codified law. The writing embodies the whole of the agreement between the parties and parol evidence to enlarge or explain it is excluded with certain specified exceptions (Code Civ. Proc., § 1856), none of which, as will be seen, is applicable here. The function of the court is to ascertain what in terms or in substance is contained in the instrument and not to insert what has been omitted, or to omit what has been inserted. (Code Civ. Proc., § 1858.) Sections 1856 and 1860 permit the judge to place himself in the position of the parties by receiving evidence of the circumstances under which the agreement was made, which in proper cases may explain an extrinsic ambiguity, establish illegality or fraud, or disclose a mistake or imperfection in the writing. There is here no contention that the language of the lease is ambiguous, that there was any illegality or fraud in the transaction, or any mistaken omission of an agreed provision. Deformation of the lease is not sought. It is not contended that there was a collateral agreement for the exclusive right based on a consideration. It is the defendant’s contention that there is implicit in the lease of a portion of the store for the conduct of a shoe department an agreement on the part of the plaintiff that there would not be another shoe department conducted in the store. This is his contention despite the fact that such restrictive language is not in the lease and that a declaration to that effect would be