Percoff v. Solomon
| Citation | 67 So.2d 31,38 A.L.R.2d 1100,259 Ala. 482 |
| Decision Date | 11 August 1953 |
| Docket Number | 1 Div. 479 |
| Parties | , 38 A.L.R.2d 1100 PERCOFF et al. v. SOLOMON. |
| Court | Supreme Court of Alabama |
Caffey, Gallalee & Caffey and Leo M. Brown, all of Mobile, for appellant.
Robt. E. Hodnette, Jr., Mobile, for appellee.
Godbold & Hobbs, Montgomery, Amici Curiae.
The bill in this case was filed in the circuit court of Mobile County, in equity, by Madeline Solomon against Sam Percoff, Goldie G. Percoff and Manuel's Inc.
Respondents Sam Percoff and Goldie G. Percoff demurred to the bill. They have appealed to this court from a decree overruling their demurrer.
The controversy arises out of a lease executed on or about September 30, 1946, wherein appellee leased to appellants a store building known and described as number 25 South Conception Street, Mobile, Alabama.
The lease is made an exhibit to the bill. The parts of the lease which we understand to be pertinent to the instant controversy are as follows:
'State of Alabama Mobile County}
'This Lease, made this 30th day of September, 1946 between Madeline Solomon, party of the first part, hereinafter called lessor, by Julius E. Marx, as agent of lessor and Sam Percoff and Goldie G. Percoff, parties of the second part, hereinafter called the lessee.
'Witnesseth: That the lessor does hereby lease and rent unto the lessee, the following premises in the City of Mobile, Alabama, viz: No. 25 South Conception Street for occupation by the lessee as retail store for the sale of ladies ready-to-wear, not including the right to sell jewelry, costume or genuine, of any kind whatsoever, and for no other different object or purpose, for and during the term of 60 months 15 days, to-wit: from the 15th day of October, 1946, to the 31st day of October, 1951, and the lessor shall not be liable for the failure to deliver possession of said premises, provided the lessor shall exercise due diligence.
'The lessee agrees to pay to the lessor or said agents, at the office of said agents, the sum of $10,587.50 by one installment of $262.50, due October 15, 1946, and by 59 installments of $175.00 each due and payable, respectively on the 1st day of December, 1946, and on the first day of each month thereafter, together with such additional rent as provided for under and pursuant to the terms of Additional Rent Clause Rider attached hereto and by reference made a part hereof. * * *
* * *
* * *
'Additional Rent Clause Rider. It is agreed between the parties hereto that the Lessee further covenants to pay to the Lessor as additional rent annually during the term of this lease a sum of money equal to 6% of all Gross Sales resulting from the Lessee's business conducted in, upon, or from the leased premises in excess of $35,000.00 for each annual period. The first annual period shall extend until December 31, 1950. The final period under this additional rent clause shall be from January 1, 1950, to October 31, 1951, and during said final period the Lessee agrees to pay to the Lessor as additional rent 6% of all said Gross Sales for said period in excess of $29,166.66. Additional rent payments due hereunder shall be payable for each of the above described periods on or before the 30th day of the month next succeeding the date when such period shall end; and each said payment shall be accompanied by such statements and accounts as hereinafter provided for.
'The term 'Gross Sales' as used herein shall include (1) the selling price of all merchandise sold by this Lessee or sub-tenants of this Lessee, whether for cash or on credit, and in case of sales on credit, whether payment is actually made or not; provided, however, that the selling price of all merchandise returned by customers to the Lessee and accepted by Lessee shall be excluded; and (2) the charges made by the Lessee, or by anyone on Lessee's behalf, for the rendition to Lessee's customers of service of any kind whatsoever, it being understood that such services may be rendered without charge. Any sales taxes which the Lessee may be required to collect and account for to any governmental authority shall not be included in determining said 'Gross Sales.'
'The Lessee further covenants that for the purpose of ascertaining the amounts payable as additional rent for any period as hereinabove provided, Lessee will keep at its executive offices, books which shall show daily sales made by the Lessee in, on or from the demised premises, and further agrees to deliver to the Lessor duplicate statements of the total gross sales made in, on or from said premises, signed and sworn to by Lessee, and to furnish Lessor with duplicate copies of an annual audit of a certified public accountant of all such sales, and, at the election of the Lessor, to give the Lessor access to such books, accounts, records and reports of gross sales kept for the premises herein demised as show the daily gross sales of such business by Lessee and to permit Lessor to have an audit made thereof by accountant appointed by the Lessor. If any such audit reveals an error in sales, in excess of $1000.00 in any period, as result of which the Lessor has been paid less than the amount to which the Lessor is entitled, then the expenses of such audit shall be borne by the Lessee, otherwise it will be borne by the Lessor. The result of such audit shall be final and binding upon both parties. The Lessee agrees to exhibit to the Lessor, or Lessor's agent, all tax returns, or copies thereof, made by the Lessee for State and/or Federal Income Tax or Sales or Use Tax.
'The Lessee covenants that for the purpose hereof the Lessee will install and maintain a system by which will be recorded the receipts from all gross sales and other transactions had in and upon said premises in connection with the Lessee's business, and that Lessee will keep same on file at its executive offices for a period of not less than one year and will give to the Lessor and Lessor's agents the privilege at any time during business hours of the Lessee of inspecting and examining Lessee's papers, bills, vouchers, records, books of account and sales slips, and that Lessee will freely lend Lessee's own assistance in the making of such inspection, examination or audit.
'All references to Lessee's
The provisions of the first paragraph of the 'Additional Rent Clause Rider' are not clear as to when payments provided for thereunder are to be made and as to what constitutes as 'annual period.' It would seem that each year would constitute an 'annual period' and yet it is said: 'The first annual period shall extend until December 31, 1950,' thus embracing 50 1/2 months. And in providing that, 'The final period under this additional rent clause shall be from January 1, 1950 to October 31, 1951,' the calendar year 1950 is included in both so-called 'periods.' We call attention to this situation although we are not primarily concerned here with the proper construction to be placed on those specific provisions of the first paragraph of the said 'Rider.'
The bill of Madeline Solomon avers in substance as follows:
The appellants went into possession of the leased premises on or about October 31, 1946. From that date until the time of the filing of the bill in this case appellants conducted and operated in, upon, and from the leased premises a ladies' ready-to-wear store.
Appellants regularly paid the basic rental of $175 per month.
For the first year of the operation of said business, that is, from October 31, 1946, to December 31, 1947, appellants paid to lessee the additional sum of $2,544.95, based upon a gross sales figure of $77,415.75 which amount was paid to appellee in January of 1948. The correctness of the amount of this payment is not questioned by appellee, complainant below.
On or about January 5, 1948, a corporation was formed known as Manuel's Inc., with its principal office being listed as 25 South Conception Street, the location of the leased premises. The appellant, Sam Percoff, is a director and is the president of the corporation and the owner of seventy shares of stock. The total number of shares of stock subscribed is 150. Goldie G. Percoff is a director and the vice-president of the corporation and owns five shares of its stock. The remaining seventy-five shares of stock stand in the name of Manuel Percoff, the son of Sam and Goldie G. Percoff.
There are no averments in the bill in regard to payments made, if any, by appellants to appellee based on gross receipts of the business at 25 South Conception Street for the calendar year 1948.
In the latter part of 1948 appellee discovered that appellants were negotiating for the rental of a store building situate directly across the street from the leased premises, which appellants proposed to use and occupy as a retail store for the sale of ladies' ready-to-wear. Appellee objected to this proposed action on the part of appellants, advising them that the result would be to diminsh the 'gross business' done by appellants at 25 South Conception Street an that 'the amount of such gross business was one of the inducements and considerations flowing to complainant [appellee] for the execution of and performance of the said lease.'
But in spite of the objections voiced by appellee, the appellants on or about December 15, 1948, began to operate in a building across the street from 25 South Conception Street a...
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Smith v. Wilder
...in the bill and the complainants have an adequate remedy at law, directed to the amended bill as a whole. See Percoff v. Solomon, 259 Ala. 482, 67 So.2d 31, 38 A.L.R.2d 1100. It is argued that the grounds of the demurrers to the effect that the bill as last amended shows on its face that co......
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Bank of N.Y. Mellon v. Jefferson Cnty. (In re Jefferson Cnty.), 11–05736–TBB.
...directly applicable to the agreed one for purposes of knowing what the parties meant as Operating Expenses. See Percoff v. Solomon, 259 Ala. 482, 67 So.2d 31, 40–41 (1953) (“We have observed that the general rule in the law of contracts is that when the parties reduce their agreements and o......
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Bank of N.Y. Mellon v. Jefferson Cnty. (In re Jefferson Cnty.)
...not directly applicable to the agreed one for purposes of knowing what the parties meant as Operating Expenses. See Percoff v. Solomon, 67 So. 2d 31, 40-41 (Ala. 1953) ("We have observed that the general rule in the law of contracts is that when the parties reduce their agreements and oblig......
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Olympus Hills Shopping Center, Ltd. v. Smith's Food & Drug Centers, Inc.
...It must arise from the presumed intention of the parties as gathered from the instrument as a whole. Id. at 703 (quoting Percoff v. Solomon, 67 So.2d 31, 40 (Ala.1953)). The court further stated that "[w]hile we must enforce the lease in accordance with the intent of the parties, we must fi......