Opinion
NOT TO BE PUBLISHED
Sonoma County Super. Ct. Nos. SCV241756, SCV242418.
Margulies, J.
Narsi Samii and Dounia R. Samii (the Samiis) appeal from a judgment (1) restoring possession of a restaurant space they formerly leased at a shopping mall to the mall owner, and (2) dismissing the Samiis’ consolidated action for declaratory relief against the mall. Respondents Codding Enterprises, LP, and Coddingtown Mall, LLC (Coddingtown or the Mall), and Simon Property Group, LP (Simon) operate the mall.
The Samiis contend the trial court erred by not ruling (1) the conditions precedent to terminating their lease were never satisfied, (2) the mall owner was estopped by its own conduct from enforcing the provision of the lease under which their tenancy was purportedly terminated, and (3) the mall owner’s notice of termination was fatally defective. We find no error in the trial court’s determinations, and affirm the judgment.
I. BACKGROUND
A. Lease Terms
The Samiis entered into a commercial lease with Codding Enterprises on June 18, 1983 (hereafter the lease or the Samiis’ lease) to operate a restaurant called Narsi’s Hof Brau (Hof Brau) at the Coddingtown Mall in Santa Rosa. Initially, the lease covered approximately 2, 000 square feet. The lease was amended eight times between 1988 and 2005. The Samiis expanded their leased premises four times, adding 152 square feet in 1989, 1, 842 square feet in 1996, 831 square feet in 2001, and 977 square feet in 2003.
The Hof Brau’s annual gross sales grew from around $342,000 in 1983–1984, to a peak of over $1.45 million in 2002–2003, before receding by about $100,000 per year in the following four years. The Samiis’ monthly rent under the lease consisted of a minimum rent amount of $1,907.85 (adjusted annually based on a consumer price index), plus the amount, if any, by which 6 percent of their gross sales in the preceding calendar month exceeded the minimum rent.
The parties incorporated three riders as part of the original lease. Rider No. 3, the rider at issue in this case, gave owner and tenant the option to terminate the lease as follows if the Samiis failed to achieve a benchmark sales threshold: “Either Owner or Tenant shall have the right to terminate [the] Lease by written notice to the other party in the event Tenant’s annual gross sales do not achieve at least $150.00 per square foot of the leased premises during any full lease year, provided that said figure thereafter of $150.00 shall be adjusted upward each lease year [after the second lease year] in the same percentage proportion that the Consumer Price Index for all Urban Consumers (CPI-U) for the San Francisco-Oakland area, published by the U.S. Department of Labor, Bureau of Labor Statistics, shall be increased at the end of each lease year over the Consumer Price Index of the date of [the] Lease. [¶] In order to validly exercise the right to terminate, written notice of termination must be given no later than fifteen (15) days after Tenant submits to Owner Tenant’s written statement of gross receipts for the preceding lease year required by Section 3.2 of this Lease.”
Section 3.2 of the lease referenced in Rider No. 3 required the tenant to submit to the owner “on or before the 30th day following the end of each lease year... a written statement signed by Tenant, and certified to be true and correct showing in reasonably accurate detail satisfactory in scope to Owner the amount of gross receipts during the preceding lease year, and duly certified to Tenant by independent certified public accountants of recognized standing, which certification shall be one which is satisfactory to Owner in scope and substance. The statements referred to herein shall be in such form and style and contain such details and breakdown as the Owner may determine.”
B. Termination of the Lease
Near the end of 2005, Simon, an Indiana company, purchased an interest in Coddingtown and began work on a plan with the existing owners to redevelop it. Simon wanted to revitalize the shopping center and generate more income and sales out of the property. As part of that effort, Todd Eads, a Simon leasing representative located in Indianapolis, began prospecting potential national tenants who could be brought into the Mall. The redevelopment plan included combining the space occupied by the Samiis with adjacent shop spaces in order to bring a larger national retail or restaurant chain into that location in the Mall. Eads reviewed all of the Coddingtown tenants’ leases in early 2006 to determine whether Simon would have the relocation or termination rights it needed to implement its redevelopment plan.
Eads reviewed Rider No. 3 in the Samiis’ lease. He also examined recent sales records for the Hof Brau and learned its sales were insufficient to prevent Simon from terminating the Samiis’ lease. Eads estimated a national chain restaurant in the Hof Brau’s location could do $3 million to $5 million in annual sales compared to the Hof Brau’s revenues of approximately $1.1 million. He also noticed the Hof Brau’s revenues had been declining by about 5 to 15 percent per year in recent years.
By 2007, Simon was in discussions with six or seven high volume national restaurant chains about occupying this space or other space at the Mall. Having confirmed interest on the part of suitable potential tenants, Eads decided to go forward with terminating the Samiis’ lease. At some point in 2007, he instructed Simon’s mall manager for Coddingtown, Laura Kozup, to obtain a “written statement of gross receipts for the preceding lease year” from the Samiis as a preliminary step to terminating the lease in accordance with Rider No. 3. Kozup by this point had met with Narsi Samii and discussed with him that Simon wanted to relocate the Hof Brau to a different space in the Mall.
Kozup tried to get the annual sales report from the Samiis “for a few months, ” without success. On September 18, 2007, the assistant mall manager sent the Samiis a “notice of default” stating the tenant had “failed to submit [a] Certified Annual Sales Report as required by the Lease by the due date specified in the Percentage Rent section of the Lease.” The notice demanded the report be submitted within 10 days and threatened termination of the lease if it was not timely submitted. Mr. Samii testified no one at Coddingtown had ever previously asked him to prepare an annual report of sales since the inception of the lease. He had filled out and submitted monthly sales reports every month, but never a yearly report. Samii testified he called Coddingtown management and was told to use September 2006 through August 2007 as the time period, and could certify it himself as he had done with the monthly reports in lieu of having a CPA (certified public accountant) certify it. Samii filled out a report covering that period, certified it was correct, and submitted it to mall management on September 23, 2007. When Kozup received the report, she forwarded it to Simon’s corporate offices.
The provision of the lease headed “Percentage Rent” did not specify a due date of any kind. Section 3.2 of the lease, headed “Reports By Tenant, ” specified that the annual report was to be submitted by the 30th day following the end of the lease year. The Samiis’ lease year ended on June 30.
The report was submitted on a preprinted Coddingtown Mall form entitled “Tenant Report of Gross Sales, ” which could be used for monthly, quarterly, or annual reporting. Over a space for the tenant’s signature and date, the form contained the following preprinted legend: “I certify that the information contained hereon is documentation of gross sales earned for the reported period.”
Todd Eads relied on the Samiis’ report to terminate the lease under Rider No. 3. Rider No. 3 required the Samiis to achieve minimum annual gross sales during the 2006–2007 lease year of $1,905,957 ($328.50 per square foot of sales multiplied by 5, 802 square feet of leased space). The Samiis’ report reflected gross sales for September 2006 through August 2007 of $1,052,232. On September 27, 2007, four days after receiving the Samiis’ sales report, a Simon employee in Indianapolis sent the Samiis a notice of termination on behalf of Coddingtown Mall, LLC, as successor in interest to the original lessor. The notice was sent via certified mail, return receipt requested. It stated in relevant part: “Pursuant to the terms of Rider No. 3 of the Lease, Owner is exercising its right to terminate the above-referenced Lease effective thirty (30) days after Tenant’s receipt of this letter. The leased premises should be vacated on or prior to that date and should be in broom-clean condition.”
Although the Samiis later admitted receiving the notice of termination no later than October 6, 2007, the return receipt came back with a delivery date of November 15, 2007. Coddingtown accepted the latter date as the date of receipt, and considered the lease to be terminated effective December 15, 2007. After sending the termination notice, both Eads and Kozup contacted Mr. Samii to let him know the move-out date was negotiable and Simon wanted to keep him as a tenant if he was willing to relocate his restaurant to a different part of the Mall.
C. The Present Litigation
On October 31, 2007, the Samiis sued Coddingtown for breaching the lease and sought declaratory relief that the notice of termination and the provisions of Rider No. 3 were unenforceable. Coddingtown ultimately filed an unlawful detainer action against the Samiis. The two actions were consolidated and then bifurcated for trial with the unlawful detainer case to be tried first. The trial court ordered that the Samiis’ declaratory relief case be set for trial only if they first prevailed in Coddingtown’s unlawful detainer proceeding.
Following a court trial, the trial court determined in a written statement of decision that Rider No. 3 was valid and enforceable, Coddingtown did not waive or rescind its notice of termination, and the notice of termination the Samiis received properly terminated their tenancy. Judgment was entered in favor of Coddingtown in the unlawful detainer case and in favor of Coddingtown and related defendants in the Samiis’ declaratory relief action. On Coddingtown’s ensuing motion for attorney fees, the court awarded fees to Coddingtown. A timely appeal from the judgment was filed on December 30, 2009.
II. DISCUSSION
The Samiis contend Coddingtown’s attempted termination of their lease was ineffective because (1) the conditions precedent to terminating the lease under Rider No. 3 were never satisfied, (2) Coddingtown is barred from terminating the lease under Rider No. 3 due to its failure to enforce the rider at any time before September 2007, and (3) the notice of termination was insufficient in that it failed to specify a clear termination date and was impermissibly ambiguous about Coddingtown’s demand for possession of the leased premises.
A. Standard of Review
We review de novo a trial court’s construction of a contract if it is based solely upon the terms of the written instrument without the aid of evidence, or where there is no conflict in the extrinsic evidence of the parties’ intent. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865–866 (Parsons).) On questions of fact, we defer to the trial court’s determination of disputed issues if it is supported by substantial evidence. (SFPP v. Burlington Northern & Santa Fe Ry. Co. (2004) 121 Cal.App.4th 452, 462.)
“Where findings of fact are challenged on a civil appeal, ... ‘... the power of an appellate court begins and ends with a determination as to whether there is any substantial evidence, contradicted or uncontradicted, ’ to support the findings below. [Citation.] We must therefore view the evidence in the light most favorable to the prevailing party, giving it the benefit of every reasonable inference and resolving all conflicts in its favor....” (Jessup Farms v. Baldwin (1983) 33 Cal.3d 639, 660.)
In conducting substantial evidence review, “if two or more different inferences can reasonably be drawn from the evidence this court is without power to substitute its own inferences or deductions for those of the trier of fact, which must resolve such conflicting inferences in the absence of a rule of law specifying the inference to be drawn. We must accept as true all evidence and all reasonable inferences from the evidence tending to establish the correctness of the trial court’s findings and decision, resolving every conflict in favor of the judgment.” (Howard v. Owens Corning (1999) 72 Cal.App.4th 621, 631.)
In construing a lease, we apply the general rules of contract interpretation. (Medico-Dental etc. Co. v. Horton & Converse (1942) 21 Cal.2d 411, 418–419; Edmond’s of Fresno v. MacDonald Group, Ltd. (1985) 171 Cal.App.3d 598, 603.) Forfeitures are not favored; hence a contract, and conditions in a contract, will if possible be construed to avoid forfeiture. (Civ. Code, § 1442; O’Morrow v. Borad (1946) 27 Cal.2d 794, 800.) However, “ ‘[a] clause terminating the lease in certain contingencies does not declare a forfeiture. It fixes events, having no relation to any act or default of the parties, upon which it is agreed that the lease shall end.’ ” (11382 Beach Partnership v. Libaw (1999) 70 Cal.App.4th 212, 218, quoting C. M. Staub Shoe Co. v. Byrne (1915) 169 Cal. 122, 129.)
Moreover, “ ‘[t]he rule that a forfeiture clause is to be strictly construed means simply that no wider scope is to be given to the language employed than is plainly required. It does not require the court to put a strained or overtechnical construction upon the language employed, ignoring the essence of the condition imposed.... No artificial distinctions are to be taken advantage of or quibbling indulged in to the end that a person plainly and palpably coming within the scope of the forfeiture clause may by “some hook or crook” escape the penalty of forfeiture.’ ” (Urban Properties Corp. v. Benson, Inc. (1940) 116 F.2d 321, 323, quoting In re Kitchen (1923) 192 Cal. 384, 389–390.)
B. Compliance with Section 3.2
The Samiis assert a statement of gross receipts fully compliant with Section 3.2 of the lease was a condition precedent to termination of their lease under Rider No. 3. According to the Samiis, since the gross receipts statement submitted by Mr. Samii was not submitted “on or before the 30th day following [the 2006–2007] lease year, ” did not show “the amount of gross receipts during the preceding lease year, ” and was not “duly certified to Tenant by independent certified public accountants of recognized standing, ” it was not compliant with Section 3.2 and could not support a valid termination of the lease.
As an initial matter, we note the Samiis’ interpretation of Rider No. 3 would leave the landlord’s right to terminate the lease within the exclusive control of the tenant. Each factor the Samiis cite—the date the gross receipts statement is submitted, the period it covers, and the type of certification, if any, it includes—is subject to the tenant’s sole control. If strict conformity with Section 3.2 was a mandatory condition precedent to the landlord’s termination of the lease under Rider No. 3, a tenant with substandard gross receipts could always thwart termination by deliberately submitting its yearly statement late, not reporting receipts for the 12 months coinciding with the lease year, or failing to get a proper certification. At the same time, a tenant wishing to assert its termination rights under Rider No. 3 would merely have to submit a statement conforming with Section 3.2. This would turn Rider No. 3 into an entirely one-sided exit clause for the tenant. We decline to so construe it.
An interpretation of contractual language that renders part of the contract ineffective is to be avoided. (1 Witkin, Summary of Cal. Law (10th ed. 2005) Contracts, §§ 745, 750, pp. 833, 840 [“ ‘an interpretation [of a contract] which gives a reasonable, lawful, and effective meaning to all the terms is preferred to an interpretation which leaves a part unreasonable, unlawful or of no effect’ ”]; City of Atascadero v. Merrill Lynch, Pierce, Fenner & Smith, Inc. (1998) 68 Cal.App.4th 445, 473 [interpretation rendering contract language nugatory or inoperative is disfavored].) Moreover, if a party to the contract prevents or makes impossible the performance of a condition precedent, the condition is excused. (Exchequer Acceptance Corp. v. Alexander (1969) 271 Cal.App.2d 1, 14 (Exchequer Acceptance Corp).) Further, a condition can be waived voluntarily by the party for whose benefit it has been inserted in the contract. (Collins v. Marvel Land Co. (1970) 13 Cal.App.3d 34, 40 (Collins).)
In our view, Rider No. 3 must be construed with reference to the fact the tenant has unique access to its own annual gross receipts data whereas the landlord must rely on the tenant’s self-report of its receipts. The rider’s reliance on the written statement of gross receipts “required by Section 3.2” is most reasonably interpreted as intended for the landlord’s benefit—at least with respect to the time period to be used and the requirement of independent verification. The evident purpose of these requirements is to enable the landlord to verify whether or not the one essential condition precedent to either party’s right to terminate has occurred—the tenant’s failure to achieve the benchmark annual gross receipts set by Rider No. 3. The text of Section 3.2 reinforces this interpretation. It specifies the written statement must show the receipts in “reasonably accurate detail satisfactory in scope to Owner” and the certification must be “satisfactory to Owner in scope and substance.” (Italics added.) Since these requirements of Section 3.2 were intended for Coddingtown’s benefit, Coddingtown was entitled to waive them, especially when it was evident a statement of gross receipts in strict compliance with Section 3.2 would not have changed the fact the Samiis’ 2006–2007 receipts fell far short of the benchmark set by Rider No. 3. (Collins, supra, 13 Cal.App.3d at p. 40; see also Sabo v. Fasano (1984) 154 Cal.App.3d 502, 505 [well-settled contracting party may waive conditions placed in a contract solely for that party’s benefit].)
The third aspect of Section 3.2 the Samiis rely upon—that the written report be submitted within 30 days after the lease year ends—presents a somewhat different issue. The incorporation of that provision in Rider No. 3 by reference was arguably intended to protect both parties to the lease by limiting the time window during the lease year in which either party could exercise its right to terminate due to insufficient gross receipts. But, here, there was substantial evidence Kozup had tried without success to get the Samiis to submit their annual report “for a few months” before finally sending them a notice of default on September 18, 2007. Even if construed as a condition precedent to Coddingtown’s right to terminate under Rider No. 3, the 30-day requirement was excused by the Samiis’ voluntary delay in submitting the written report required by Section 3.2 after being timely requested to do so. (Exchequer Acceptance Corp., supra, 271 Cal.App.2d at p. 14; see also Parsons, supra, 62 Cal.2d at pp. 868–869.)
For these reasons, we reject the Samiis’ argument that the conditions precedent to terminating the lease under Rider No. 3 were never satisfied. We reach this conclusion assuming for purposes of analysis that Rider No. 3 does constitute a forfeiture clause which is to be strictly construed. As discussed in the next section, we believe the rider is more properly construed as an option to terminate the lease, not as a forfeiture clause. As such, it is not subject to the rule of strict construction. (See 7 Miller & Starr, Cal. Real Estate (3d ed. 2004) § 19:186, pp. 578–581.)
C. Waiver, Estoppel, and Laches
The Samiis contend Coddingtown cannot enforce Rider No. 3 because for over 24 years it did nothing to enforce that rider or the requirement for an annual report of gross receipts under Section 3.2. The Samiis assert waiver, estoppel, and laches as defenses based on this assertion.
“A waiver is an intentional relinquishment of a known right.” (Salton Community Services Dist. v. Southard (1967) 256 Cal.App.2d 526, 532 (Salton).) Waiver is a question of fact for the trial court. (Black v. Arnold Best Co. (1954) 124 Cal.App.2d 378, 384–385.) Conduct manifesting an intention to waive, such as acceptance of benefits under a lease, can support a finding of implied waiver. (Salton, at pp. 532–533.) The burden is on the party claiming a waiver of a right to prove it by clear and convincing evidence that does not leave the matter to speculation; doubtful cases will be decided against a waiver. (DRG/Beverly Hills, Ltd. v. Chopstix Dim Sum Cafe & Takeout III, Ltd. (1994) 30 Cal.App.4th 54, 60.) The presence of a nonwaiver provision in a lease militates against a finding of waiver under most circumstances. (Gould v. Corinthian Colleges, Inc. (2011) 192 Cal.App.4th 1176, 1180 (Gould).)
Estoppel arises from “[c]onduct of a lessor following execution of a lease leading the lessee to believe compliance with a particular covenant will not be enforced, and reliance upon this belief by the lessee with consequent performance by him of other covenants of the lease.” (Salton, supra, 256 Cal.App.2d at p. 533.) Such conduct “estops the lessor to declare a forfeiture of the lease on account of a breach of the particular covenant.” (Ibid.) Laches is “an unreasonable delay in asserting an equitable right, causing prejudice to an adverse party such as to render the granting of relief to the other party inequitable.” (In re Marriage of Plescia (1997) 59 Cal.App.4th 252, 256.)
Here, the trial court found as a fact there was no waiver on Coddingtown’s part. Our role is limited to determining whether there was any substantial evidence to support that finding. (Jessup Farms v. Baldwin, supra, 33 Cal.3d at p. 660.) There was.
We note at the outset that the Samiis’ waiver theory is built on a shaky foundation. They assume Rider No. 3 established a condition or covenant that Coddingtown waived by failing over the years to “enforce” it when the Samiis were in “breach.” In our view, Rider No. 3 neither establishes a covenant or condition, nor defines an event constituting a tenant breach or default. By its terms, it creates an option to terminate the lease upon the happening of a specified condition—that the tenant’s gross receipts fall below a benchmark number. This option is available to either party, and it is not a breach of any covenant or condition of the lease if the condition giving rise to it occurs. Edward Wilson, the Codding Enterprises employee who negotiated the lease with Mr. Samii, testified Rider No. 3 was a “two-way street” between the Mall and the tenant, and was usually included in Mall leases only if the tenant was “worried about the amount of business they’re going to do and want a provision like that.” Codding Enterprises’ leasing agent, Leroy Knibb, testified Rider No. 3 “gives both the landlord and the tenant flexibility to get out of a lease.” (Italics added.)
Viewed as an option, there are many obvious reasons why either party might make the business decision not to exercise its rights under Rider No. 3, even when the condition for its exercise has materialized. Depending on market conditions and the degree to which the tenant’s receipts have fallen short, holding on to a known, reliable source of rental income may make more sense for the landlord than taking a chance of finding a stronger tenant in the marketplace. Especially in a recessionary market, the landlord might not feel confident it could attract a replacement tenant who could generate higher rental income or bring more customers to the mall, may already have a surplus of vacant space, or may believe the existing tenant’s potential is superior to the likely alternatives. If other tenants at the mall are simultaneously suffering declining sales, terminating one struggling tenant may only aggravate the problem. The high initial cost of tenant improvements required to bring in a new tenant may also be a barrier. The tenant faces similar considerations. If business at the current location is slow or stagnant, the tenant has to weigh the costs and benefits of taking advantage of Rider No. 3. Although the rider enables the tenant to relocate the business or to close shop without incurring liability under the lease, the tenant might have good reason to want to stay on, at least for another year. Knowing the option to terminate will still exist the following year if revenues continue to lag, both the landlord and tenant might well make the business decision to wait and see if gross receipts bounce back. Such a deferral of action, if anything, shows an intent to preserve the option for future use, not an intent to permanently relinquish it.
In short, if Rider No. 3 is viewed as a continuing option rather than a covenant or condition, a landlord’s or tenant’s failure to exercise it in any given year proves nothing about that party’s intent to relinquish the right. Such inaction would have to continue for a very long time, without any credible business explanation, to constitute clear and convincing inferential evidence of an intent to permanently relinquish the option.
We note further that it seems unlikely either landlord or tenant would want to deprive itself of the option to terminate the lease for poor sales without confirming the other party’s reciprocal agreement to forgo that right.
There was substantial evidence to defeat any such inference in this case. The Samiis exceeded the target figure established by Rider No. 3 every year from the lease’s inception in 1983 through the 1995–1996 lease year. They fell short the first time during the 1996–1997 lease year, which followed a near doubling of their leased square footage. Knibb testified it would not have been fair to terminate the lease immediately after such an expansion. In 2001–2002, following a 20 percent expansion in their leased space, the Samiis fell short a second time, but only by approximately 1 percent of the target amount ($20,000 out of nearly $1.4 million in receipts). They immediately got back on track the next year.
Due to the increased square footage, the Samiis’ target gross receipts figure rose from $508,098.99 in 1995–1996, to $972,170.39 in 1996–1997, making it understandable why they would have difficulty reaching the target in the latter lease year.
For the next three lease years, from 2003 until 2006, the Samiis did fall well short of the target, by amounts increasing from $400,000 in 2003–2004, to over $600,000 in 2005–2006. But there were more credible explanations than intentional waiver for Coddingtown’s failure to exercise its option in these years. The 2003–2004 shortfall followed a further 20 percent expansion of the Samiis’ square footage in 2003. There was every reason to assume the Samiis’ receipts per square foot would recover as they had in the past. Coddingtown’s failure to terminate the lease following the 2004–2005 and 2005–2006 lease years is readily explained by the Mall’s change of ownership. Simon’s purchase of its interest in the Mall closed near the end of 2005. Coddingtown was having its tenants sign estoppel letters in early October 2005. With Simon negotiating to take a controlling interest in the Mall, Coddingtown would have had a compelling business reason not to terminate the Samiis’ tenancy after the 2004–2005 lease year closed. When the 2005–2006 lease year ended, Simon had been in charge of the Mall for just six months, and was still in the midst of formulating its redevelopment plans and prospecting for national tenants. It would have been premature to exercise the rider at that point. Todd Eads’s testimony shows Simon was nonetheless actively reviewing the Samiis’ lease in early 2006 to verify the feasibility of taking over his space as part of the company’s eventual redevelopment plan for the Mall. That testimony is completely inconsistent with any intent by Coddingtown to permanently relinquish the right to terminate under Rider No. 3. The testimony further established that once Simon came to believe it could find a national restaurant chain for the space it terminated the Samiis’ lease at its next opportunity.
The text and business purpose of Rider No. 3, as well as the evidence explaining why it was not exercised until 2007, thus constitute substantial, persuasive evidence supporting the trial court’s rejection of the Samiis’ waiver and estoppel defenses.
The Samiis’ agreement to a nonwaiver clause as part of their lease independently supports that determination. The nonwaiver clause provided that no purported waiver of any term of the lease was valid unless it was in writing. Such clauses are enforceable. (Hersch v. Citizens Savings & Loan Assn. (1983) 146 Cal.App.3d 1002, 1009–1010.) While a nonwaiver clause can itself be waived by conduct, the existence of such a clause supports a reasonable inference the landlord does not intend to waive any provision of the lease unless such intention is put in writing. (See Bettelheim v. Hagstrom Food Stores (1952) 113 Cal.App.2d 873, 878.) In Salton, the Court of Appeal held a nonwaiver clause stating, “ ‘The [landlord’s] subsequent acceptance of rent hereunder... shall not be deemed to be a waiver of any prior occurring breach, ’ ” was sufficient to sustain a demurrer to a waiver defense based on the landlord’s acceptance of rent. (Salton, supra, 256 Cal.App.2d at p. 530.) As noted earlier, an antiwaiver provision in a lease militates against a finding of waiver “under most circumstances.” (Gould, supra, 192 Cal.App.4th at p. 1180.) Based on these authorities, and the applicable standard of review, the nonwaiver clause in the Samiis’ lease is sufficient in itself to support the judgment. (See Board of Education v. Jack M. (1977) 19 Cal.3d 691, 697.)
The clause states in relevant part: “The waiver by Owner of any breach of any term, covenant or condition herein contained shall not be deemed to be a waiver of such term, covenant or condition or any subsequent breach of the same or any other term, covenant or condition herein contained. The subsequent acceptance of rent hereunder by Owner shall not be deemed to be a waiver of any preceding breach by Tenant.... No covenant, term or condition of this Lease shall be deemed to have been waived by Owner, unless such waiver be in writing by Owner.”
The Samiis cite Coddingtown’s failure to enforce Section 3.2 of the lease (requiring certified annual reports of gross receipts for the lease year) at any time before 2007 as significant evidence of the landlord’s intent to waive Rider No. 3. But there was no dispute that Coddingtown did consistently require the Samiis to submit monthly gross receipts reports, and Coddingtown’s bookkeepers prepared annual and quarterly reports of tenants’ sales figures for the Mall’s board. As the trial court found, it would have been duplicative and burdensome to require tenants to prepare their own annual reports every year that would merely recapitulate the information provided in their monthly reports. In any event, even assuming an intent to waive Rider No. 3 reasonably could have been inferred from Coddingtown’s failure to enforce the annual report requirement, it was not error for the trial court to draw a different inference as long as it was supported by substantial evidence.
Citing the equitable doctrine of laches, the Samiis also claim the termination was unlawful because Coddingtown “slept on its right.” According to the Samiis, their investment in and expansion of the Hof Brau over the 24 years of the lease constitute detrimental reliance on Coddingtown’s unreasonable delay in enforcing Rider No. 3.
The Samiis concede laches ordinarily presents a question of fact for the trial court, but claim the issue may be decided as a matter of law by this court because the relevant facts are undisputed. (See San Bernardino Valley Audubon Society v. City of Moreno Valley (1996) 44 Cal.App.4th 593, 605.) We do not agree the relevant facts are undisputed. For the reasons we have explained, it is not correct that Coddingtown waited 24 years to enforce Rider No. 3. During most of the years the lease was in force, Coddingtown had no right to terminate under Rider No. 3. When it did have that right, there were good reasons, including fairness to the Samiis, for its decision not to do so. It is true Coddingtown did not invoke Rider No. 3 between 2003 and 2006, when the Samiis’ gross receipts were substantially short of the target level, and falling. But there is no evidence the Samiis detrimentally relied on Coddingtown’s inaction during this period. They made no further expansion of the restaurant after March 2003, and there is no evidence they made substantial new investments during this period based on the assumption their tenancy could not be terminated based on poor gross receipts. As to the earlier expansions, Edward Wilson and Leroy Knibb testified these were not foisted unwillingly on the Samiis, but came about at their request based on their own business plan. Coddingtown was under no obligation to remind the Samiis of the fact that increasing their square footage would increase the threshold rent established by Rider No. 3. Following the 2003 expansion, the Samiis were unable to reach even the threshold amount of gross receipts established before that expansion.
The Samiis concede detrimental reliance affords them no defense unless their reliance was also reasonable. (See Mills v. Forestex Co. (2003) 108 Cal.App.4th 625, 655.) The lease at all times included both Rider No. 3 and a nonwaiver clause specifying no lease term could be deemed waived by the owner unless the waiver was in writing. The option to terminate under the rider carried no expiration date. There is no evidence the Samiis ever sought clarification of their rights under these provisions in connection with any planned expansion or investment. Any arguable reliance by the Samiis on Coddingtown’s non-exercise of its option was not reasonable in these circumstances.
In our view, the record fails to establish that any conduct or forbearance on Coddingtown’s part overrode the express terms of Rider No. 3 or gave the Samiis a valid defense to its enforcement.
D. Adequacy of the Termination Notice
The Samiis contend the termination notice was fatally ambiguous in that it did not specify a termination date and did not clearly state Coddingtown’s intent to terminate the Samiis’ possessory interest in the property.
“[A] provision requiring notice of the exercise of an option to terminate a lease is not construed strictly, but it is sufficient if the intention of the party to exercise the option is fairly communicated.” (Western Camps, Inc. v. Riverway Ranch Enterprises (1977) 70 Cal.App.3d 714, 723, fn. 4; Zumwalt v. Hargrave (1945) 71 Cal.App.2d 415, 420.) The termination notice in this case was not indefinite or ambiguous. The notice stated Coddingtown was exercising its “right to terminate the above-referenced Lease effective thirty (30) days after Tenant’s receipt of this letter.” The notice afforded the Samiis the information they needed to determine the exact date on which their lease would be terminated—the date that fell 30 days after the date they received the notice. The Samiis cite no appellate case or legal authority holding such notice inadequate. In fact, the unlawful detainer statute itself attaches important legal consequences to dates determinable by reference to the passage of a number of days from the receipt of notice. (See Code Civ. Proc., § 1161 [e.g., landlord entitled to repossession in cases of waste “upon service of three days’ notice to quit”; tenant may save premises from forfeiture by certain actions taken within “three days after the service” of specified notice].) Civil Code section 1946, providing for the termination of month-to-month tenancies, requires a minimum of “30 days’ written notice.” It would make no sense to fault Coddingtown for utilizing a termination notice consistent with what section 1946 would have required if it applied.
The notice also fairly communicated Coddingtown’s intention to recover possession of the leased premises. It stated Coddingtown was exercising its right to terminate the lease, and the leased premises “should be vacated on or prior to” the date the lease is terminated. It is undisputed the Samiis understood from the notice of termination their lease was being terminated and they were going to be required to vacate the premises. No further verbiage was required.
E. Attorney Fees
The Samiis ask this court to vacate the award of attorney fees and costs to Coddingtown incident to reversing the judgment. Since we affirm the judgment, we decline to do so.
III. DISPOSITION
The judgment is affirmed.
We concur: Marchiano, P.J., Dondero, J.