Golden State Mutual Life Insurance v. Frankfurt

HERNDON, J.—

This appeal is taken from judgments rendered in two cases consolidated for trial. Appellant, as lessee, and respondent Victor Frankfurt, as lessor, entered into a 10-year lease which by its terms was to commence on July 1, 1957, and provided for a monthly rental of $250. Upon execution of the lease, $500 was paid to respondent lessor to cover the first and last months’ rent and it was further provided that the lessee would not be liable for the rent until such time as the lessor could deliver possession. Lessor’s delivery of possession became possible on September 1,1957.

The leased premises consisted of the lower floor of a two-story building. The upper floor owned by respondent Frankfurt was used as a hotel. The findings of fact of the trial court declare that on various dates in 1958, defective plumbing in the upper portion of the building caused discolored water and plaster to fall into appellant’s portion of the building; that respondent Frankfurt repaired such defects; that minor damage was caused to appellant’s personal property, but because appellant never repaired its property, the amount of such damage was unknown.

On October 14, 1958, appellant served on respondent Frankfurt a notice purporting to rescind the lease on grounds of fraud, deceit, and mutual and unilateral mistake. Thereafter, this notice also was served on respondents Lane who had purchased the property and had taken an assignment of the lease on October 16, 1958. Appellant also gave notice to respondent Frankfurt by a letter dated October 15, 1958, that appellant elected to terminate the lease due to the lessor’s alleged failure to make repairs; however, appellant also indicated therein that it was willing to continue in possession on a month to month basis. On December 11, 1958, appellant served on respondents Lane a notice of termination based on the same general grounds as stated in the earlier notices and in which it was also indicated that appellant would vacate the premises on December 31, 1958.

On November 12, 1958, appellant having failed to pay the specified rental, respondents Lane served upon it a “Three Day Notice to Pay Rent or Quit,” which expressly stated that 11 [y] our landlord hereby elects not to declare a forfeiture of your lease under which you have held said premises, and

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specifically intends to hold you liable thereunder. ’ ’ Appellant failed either to pay the rent or to vacate, and on December 19, 1958, respondents Lane filed an action in unlawful detainer seeking possession of the premises, but not a forfeiture of the lease. This cause came on for hearing on January 9, 1959. At this time appellant had vacated the premises and therefore stipulated that judgment might be entered for respondents on the issue of possession. Judgment was entered in accordance with this stipulation. Respondents Lane were also awarded $250 as rental due to January 1, 1959. The court apparently determined that, due to the delay in the initial taking of possession, there had been a double payment of rent for September of 1957. Therefore, although appellant had not paid the rental for either November or December of 1958, and the court expressly refused to credit appellant with the advance payment of the final month’s rental, credit for one month’s rent was nevertheless allowed to appellant by the terms of the “stipulated” judgment.