Realty & Rebuilding Co. v. Rea

RICHARDS, J.

This is an appeal by the defendant Eugene J. Sullivan from that portion of the judgment in this action which runs in favor of the plaintiff and against said defendant and by which the plaintiff is awarded the sum of $11,215.81. The action was instituted by the plaintiff as the transferee from one Rudolph Spreekels of a lease of certain premises on Fillmore Street, in the city of San Francisco, to the defendants herein, L. A. Rea, E. Kehrlein, and Eugene J. Sullivan, and by them assigned to the defendant Fillmore Arcade Company, a corporation. Certain stockholders of said corporation are also made parties defendant.

The complaint is in two counts—one to recover rent overdue and unpaid under the terms of said lease and of a later extension thereof; the other to recover damages in a large sum for an alleged breach of certain covenants in said lease relating to the duty of the lessees and their assigns to keep the buildings upon the premises in repair.

Upon the trial of the' cause the court made its findings and rendered its judgment in favor of the plaintiff and against the defendants, said Rea, Kehrlein, Sullivan, .and Fillmore Arcade Company, upon the first count in said complaint, but as to those defendants who were alleged and shown to be stockholders in the Fillmore Arcade Company the court gave its judgment in their favor upon their plea of the statute of limitations, and also gave its judgment in favor of all of the defendants upon the cause of action embraced in the second count of the complaint. Two appeals were taken from this judgment, this one by the defendant Eugene J. Sullivan from that portion of the judgment running against him as one of the original lessees for unpaid rent; the other by the plaintiff from that portion of the judgment denying it relief against the stockholders of the Fillmore Arcade Company upon the first count, and against all of the defendants upon the second count of its complaint. This appeal is upon the judgment-roll alone, the only question presented being as to whether the findings support that portion of the judgment appealed from herein.

[675]

The facts out of which the case arose are briefly these: On June 1, 1906, Rudolph Spreckels entered into a written lease with the said defendants Rea, Kehrlein, and Sullivan, by which he leased and demised to them certain property on Fillmore Street, of which he was. then the owner, for the term of three years from said date and for the entire sum of one hundred and twenty-six thousand dollars for said term, payable in monthly installments of three thousand five hundred dollars per month, monthly in advance. According to one of the provisions of said lease the said lessees agreed that within six months from and after July 1, 1906, they would erect upon the demised premises a frame building or buildings at a cost of about one hundred and fifty thousand dollars; by another provision in said lease it was agreed by the lessor that at the end of the said term of three years he would purchase the said buildings so to be erected by the lessees at one-half of their then to be appraised value, in which event the term of the lease should cease; provided, however, that the said lessees by giving notice at least thirty days before the expiration of said three-year term might elect to take a three-year extension of the lease at a monthly rental of two thousand five hundred dollars, in which event the buildings erected upon the premises by the lessees should thereupon become and be the property of the lessor. The lease also contained clauses respecting the duty of the lessees to keep the buildings and structures upon the demised premises in good order and repair.