Atl. Prod. Co v. Dunn

• Decision Date: 30 October 1906
• Citation: 55 S.E. 299,142 N.C. 471
• Parties: ATLANTIC PRODUCT CO. v. DUNN.
• Court: North Carolina Supreme Court

55 S.E. 299

142 N.C. 471

ATLANTIC PRODUCT CO.

v.DUNN.

Supreme Court of North Carolina.

Oct. 30, 1906.

Landlord and Tenant—Lease—Option to Renew—Purciiase—Expiration.

Defendant leased certain premises to plaintiff for one year, beginning April 1, 1899, the lease providing that, on the expiration of the term, defendant should be entitled, at its option, to continue the lease for another term of five years, beginning April 1, 1900, at the same rent, with the right and option to have an extension at the same rent at the end of the first term of five years for another period of five years, and that, at any time during the continuance of the lease, plaintiff should have the option to purchase the property at a specified price. Held that, where plaintiff renewed the lease for the first term of five years, but gave no notice of the exercise of its option, either to renew for a second term, or to purchase the property, until after April 1, 1905, the lease and the options expired.

[Ed. Note.—For cases in point, see vol. 32, Cent. Dig. Landlord and Tenant, §§ 290-294.]

Appeal from Superior Court, Craven County; Long, Judge.

Controversy without action between the Atlantic Product Company and William Dunn. From a judgment in favor of the latter, the former appeals. Reversed.

Controversy without action submitted to Long, J. The following are substantially the facts agreed. On March 10, 1899, the defendant leased the premises for one year beginning April 1, 1899, to the plaintiff in consideration of $125 payable yearly in advance with this further agreement: "The party of the second part, upon the expiration of the said term of one year, shall have the right at its option to continue this agreement and lease for another full term of five years beginning April 1, 1900, at the same yearly rental i. e. $125 payable as aforesaid with the right and option to have an extension and continuance hereof at the same yearly rental at the end of said first term of five years for another full term of five years." There was also a further proviso that the plaintiff herein (party of the second part) "at any time during the continuance hereof shall have the right to purchase said leased property in fee simple at the price of $1,550." The plaintiff, exercising its option, renewed the lease April 1, 1900, for five years. On April 3, 1905, the defendant notified the plaintiff that its lease had "expired April 1, 1905, and, with said expiration, the right of renewal, " and inquired if the plaintiff wished to make a new lease, if not he wished it "to give up the property." On April 5th the president of plaintiff company replied that he did not have the lease at hand, but thought it was for 11 years, and had five more years to run. He made no reference to the demand for surrender of the premises, nor any offer to pay rent. On April 26th he offered to continue the lease, but the defendant, while willing to enter Into the new lease, declined to renew or extend the terms of the old lease or revive or renew the option to purchase contained in the old lease. On June 24th the agent of the plaintiff offered to pay the rent, but the defendant declined to receive it. The plaintiff continued in possession till August 2, 1905, when the defendant turned the plaintiff's watchman out, and took possession of the property, and still holds the same. On July 15, 1905, the plaintiff offered to pay defendant $1,550 and all accrued rent upon execution of a fee-simple deed, which offer the defendant refused to accept. The plaintiff did not give the defendant any notice either verbally or in writing that it would exercise the option to continue said lease and agreement before or on April 1, 1905,...