Opinion
No. 29566
Decided December 8, 1943.
Landlord and tenant — Perpetual teases not favored — Intention to create perpetuity to be clearly shown — Lease not construed to create right to perpetual renewal, when — Such intention not clearly shown by general renewal option, when — Length of period and right to one renewal fixed, when.
1. Perpetual leases are not favored by the law and an intention to create such a perpetuity must be clearly shown.
2. A lease will not be construed to create a right to perpetual renewal unless the language employed clearly indicates that it. was the intention of the parties so to do.
3. Such an intention is not clearly shown by a lease for the term of one year at a total rental of $420 with a general option for renewal from year to year.
4. Such a lease fixes the length of the renewal period and gives. the lessee the right to one such renewal.
APPEAL from the Court of Appeals of Cuyahoga county.
The plaintiff instituted this action in the Municipal Court of the city of Cleveland to recover possession of a storeroom claimed to be forcibly detained by the defendant.
That court rendered judgment for the defendant.
On an appeal on questions of law the Court of Appeals reversed the judgment of the trial court and rendered final judgment for the plaintiff.
The case is in this court for review by reason of the allowance of the defendant's motion to certify the record.
Mr. Thomas C. Terrett, for appellee.
Mr. Louis Wm. Gering, Jr., and Mr. Harrison M. Crellin, for appellant.
The storeroom is located in a building owned by the plaintiff and was leased to the defendant by the plaintiff under a written agreement which reads in part as follows:
"To have and to hold unto the lessee for the term of one year commencing on the 25th day of March, in the year nineteen hundred and thirty three and ending on the 24th day of March, in the year nineteen hundred and thirty four upon the covenants and agreements herein set forth:
"The lessee hereby covenants and agrees to pay to the lessor as rental for said premises during said term the sum of four hundred twenty ($420) dollars payable in monthly installments of thirty five ($35) dollars each in advance upon the 25th day of every calendar month during said term.
"It is mutually agreed by and between the parties that this lease may be renewed from year to year at the same rental at the option of the lessee, provided, however, that said lessee shall give thirty (30) days written notice to the lessor of his intention so to renew."
Each year the defendant lessee gave the plaintiff lessor the required thirty-day notice of the former's intention to renew the lease; but on February 19, 1942, the plaintiff notified the defendant that another renewal of the lease would be refused. Nevertheless, the defendant thereafter restated his intention to renew and also tendered the plaintiff the rent for the first month of the new term. The plaintiff refused the tender.
The crux of this controversy is the meaning of the provision in the lease that it "may be renewed from year to year * * * at the option of the lessee" by means of a thirty-day notice. The defendant lessee contends that he has 'a perpetual lease renewable at his option during his lifetime. The plaintiff insists that the lease creates simply a year-to-year tenancy, fixing the length of the renewal period and giving the defendant the right to one such renewal.
In attempting to construe this provision of the lease it is necessary to keep in mind the fundamental rule that perpetual leases are not favored and that general covenants as to right of renewal are therefore usually limited to a single renewal unless an intention to create a perpetuity is clearly shown. This principle is summarized as follows in 32 American Jurisprudence, 813, Section 968:
"The law does not favor perpetual leases; the intention to create one must appear in clear and unequivocal language, and accordingly, a lease will not be construed to create a right to perpetual renewal unless the language employed clearly and unambiguously indicates that it was the intention and purpose of the parties to do so. It is the rule that a provision in a lease in general terms for a renewal or continuance of the lease will be construed as providing for only one renewal. This rule is based on the principle that the courts do not favor perpetuities, and unless the lease expressly or by clear implication provides that the second lease shall contain a covenant for future or perpetual renewals, it will be construed as providing for only a single renewal."
Annotated cases on the subject appear in 3 A. L. R., 495, 14 A. L. R., 944, and 39 A. L. R., 275.
In 24 Ohio Jurisprudence, 1239, Section 483, it is observed that "as a general rule the courts will not construe a lease as conferring a right to perpetual renewals unless the lease clearly so provides."
In the instant case the lease for the storeroom in the plaintiff's building is "for the term of one year" at a total rental of $420 with a general option for renewal "from year to year." This limited language hardly can be said to indicate clearly and unambiguously an intention and purpose to create a right to perpetual renewal of the lease for the room.
The judgment of the Court of Appeals in favor of the plaintiff lessor is affirmed.
Judgment affirmed.
MATTHIAS, HART, ZIMMERMAN, BELL and WILLIAMS, JJ., concur.
TURNER, J., concurs in paragraphs one and two of the syllabus, but dissents from paragraphs three and four of the syllabus, and from the judgment.