Zeidman v. Davis, A-8080

• Citation: 161 Tex. 496,342 S.W.2d 555
• Decision Date: 01 February 1961
• Docket Number: No. A-8080,A-8080
• Parties: M. B. ZEIDMAN et ux., Petitioners, v. Chas. A. DAVIS et al., Respondents.
• Court: Supreme Court of Texas

Page 555

342 S.W.2d 555

161 Tex. 496

M. B. ZEIDMAN et ux., Petitioners, v. Chas. A. DAVIS et al., Respondents.

No. A-8080.

Supreme Court of Texas.

Feb. 1, 1961.

Duckett & Duckett, El Campo, Vinson, Elkins, Weems & Searls, M. C. Chiles, with above firm, Houston, for petitioners.

Charles Owens, Wharton, for respondents.

CALVERT, Chief Justice.

This suit for declaratory judgment was filed by M. B. Zeidman (Morris Zeidman) and others, petitioners, against Chas. A Davis, Jr. and others, respondents. Petitioners sought a construction of a farm lease executed by petitioners, as lessors, and the respondent, Pervis R. Landry, as lessee, and a termination of the lease. The crucial questions in the case were whether the lease was for a three or a four year term and whether an option to renew it for a five year period had been timely exercised.

The trial court found as facts that the parties intended the lease to be, and that it was, for a term of three years, but that the option to renew if for five years had been timely exercised. The court concluded that the lease had not terminated but by the exercise of the option was extended for a five year term ending December 31, 1964. Accordingly, judgment was entered awarding possession of the premises to Landry and those holding under him for a term ending December 31, 1964. The Court of Civil Appeals affirmed. 338 S.W.2d 530.

The controversy stems from the term clause of the lease agreement with Landry. It reads as follows: 'The term of this lease shall be for a period of three (3) years commencing on January 1, 1957 and terminating on December 31, 1960, unless terminated at an earlier date under the terms hereof.' Considered as standing alone, the clause is undoubtedly ambiguous. The term could be for three years or it could be for four years. As indicated above, the trial court found that it was for a term of three years ending on December 31, 1959. Considering the instrument as a whole, including many other provisions which it is unnecessary to mention, the court could hardly have found otherwise. However that may be, the finding has not been challenged and must be accepted as establishing the fact.

The exercise of the option to renew the lease was conditioned on the giving of written notice by the lessee 'of his intention to exercise such option not less than six (6) months prior to the termination of the three year primary term.' The lease contained an additional provision as follows: 'Lessee shall have the right to sublease any part of the leased premises, but shall not have the right to assign the lease in whole, without first obtaining the written consent of the Lessoors so to do.' The lease was dated August 27, 1956.

On October 1, 1956 Landry sublet a part of the premises to one Q. J. Doree, Jr. The provisions of that sub-lease have no bearing on the rights of the parties to this suit. The remainder of the premises was sublet by Landry to respondent, Chas. A. Davis, Jr., on January 15, 1958. Paragraph 2 of the sub-lease reads as follows:

'The term of this sublease shall commence on the signing of this instrument and shall terminate on December 31, 1960, unless the option to renew for an additional five (5) years is exercised, in which event this sub-lease shall terminate on December 31, 1965.

'Under the terms of the original lease, Pervis R. Landry has the option to extend the three (3) year term of the original lease for an additional period of five (5) years. Pervis R. Landry hereby agrees to exercise that option by the method stated in the original lease if the said Charles A. Davis, Jr. so desires to extend said lease and so directs the said Pervis R. Landry to exercise said option in the manner required by the original lease.'

The record discloses that the sub-lease was prepared by Davis or his attorney, and it may be assumed that the erroneous termination dates were placed in the sub-lease by them.

No written notice of the exercise of the option having been given by July 1, 1959, the lessors, on July 7, 1959, notified both Landry and Chas. A. Davis, Jr. that the lease would be terminated on December 31, 1959. In a letter to the lessors, dated July 20th, Davis enclosed an undated written statement from Landry giving notice that he was exercising his option to renew the lease for a term of five years. Davis did not by his letter purport to exercise an option. He did make known his intention to protect all of his 'rights and privileges as sub-lessee from Pervis R. Landry.'

As a basis for its judgment the trial court found that by virtue of the sub-lease Davis succeeded to all of the rights of Landry; that the termination date, December 31, 1960, stated in the original lease, was a mistake made by the lessors in the preparation of the instrument; that the mistake caused Davis to fail to exercise the option according to its terms; that the lessors had notice that Davis intended to exercise the option; that Davis had made substantial improvements on the premises and would suffer substantial damage if the lease were terminated on December 31, 1959; that lessors were not damaged by failure of Davis to exercise the...