Maas v. Standard Oil Co.

STONE, J.

Appellants-lessors leased a service station bordering Highway 99 to respondent-lessee several years

[915]

prior to the June 26, 1956, filing of a condemnation action by the State of California. The condemnation plan provided for a fence along the highway right-of-way line. On November 5, 1957, lessee exercised an option to extend the lease for a five-year term beginning January 1, 1958. At that time access to Highway 99 had been completely obstructed and a judgment in condemnation had been entered.

Lessee continued to operate the station, and in February 1958 the Division of Highways made a temporary opening in the fence, giving the property access to Highway 99. However, two years and three months later, on May 16, 1960, the opening in the fence was permanently closed. On October 17, 1960, lessee gave notice of termination of the lease pursuant to a provision that gave lessee the right to terminate if in lessee’s opinion condemnation proceedings made it impracticable to use the leased premises as a service station.

Interestingly enough, two years later permanent access was provided by an access road connecting with Highway 99 approximately eight-tenths of a mile north of the property; whereupon lessee resumed operation of the service station. This action is for rent during the period of nonoperation.

We find it difficult to follow lessors’ first argument, that lessee, by exercising its option to extend the term for five years, forfeited or waived its right to terminate the lease if operation of the service station became impracticable. It was not condemnation or diversion of traffic, as such, that gave lessee its right to terminate. It had that right under paragraph (8) of the lease “if any part of the leased premises or the approaches thereto are condemned or changed by public authority, or if any highway or street change is made diverting or rerouting traffic away from the leased premises, so that in any such case enumerated above it becomes impossible or impracticable in Lessee’s opinion to use the leased premises for any purpose for which such premises are being used at the time. ...” The option to extend and the right to terminate are contained in unrelated paragraphs bestowing completely independent rights upon lessee. Lessors neither pleaded nor proved consideration for lessee’s loss of a contract right, nor did they plead or prove the elements of an estoppel. They argue that lessee made an election of its rights, urging, in support of their theory, reasoning that parallels the theory of election of remedies in the trial of an action. The cases cited by lessors in support of their contention discuss an election of remedies in a judicial proceeding under eircum