Md7, LLC v. SEIDNER (California Court of Appeal, January 18, 2011).
The plaintiff, the tenant of rooftop space for a wireless installation on an office building, sought to rescind a lease amendment on the ground of unilateral mistake, claiming the lease amendment wrongly increased the monthly rent instead of decreasing it. The trial court found no mistake was made — the parties had negotiated to increase the rent in exchange for increasing the size of the leased area.
The appellate court held that substantial evidence supported the trial court's finding that the tenant knowingly agreed to pay a higher monthly rent in exchange for obtaining increased roof space to expand its antenna installation. While the lease allowed the tenant to "supplement... [or]... expand the equipment [and] increase the number of antennas," it confined any such additions to the area "within the Premises." The evidence sufficiently showed the new antenna installation expanded beyond the leased "Premises" and was not merely an increase in the "Permitted Use." The tenant argued that there was a custom in the wireless telephone industry that cables and hanging antennas do not occupy space.
However, the trial court’s award of attorney fees to the landlord was reversed. Although the lease contained an indemnity clause, the obligation to pay attorney fees arising from a "breach of any provision of this Agreement" did not expressly refer to fees incurred in enforcing the agreement between the parties. Instead the clause was construed to only include the duty to reimburse the other for attorney fees incurred in defending against third party claims that arise from conduct that breached the lease.
For a copy of this decision, contact Anthony Dorland at dorlanda@moss-barnett.com.