Hadian v. Schwartz

884 P.2d 46 (1994)

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Nature of the Case

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Facts

P and D signed a lease for commercial property. D intended to lease it for use as a combined bar and cabaret. The term of the lease was three years at a monthly rental of $650, with an option to renew for an additional five years at a rental of $800 a month. The lease agreement was a preprinted 'fill-in-the-blank' document entitled 'Standard Industrial Lease--Net' published by the American Industrial Real Estate Association. They struck out provisions for a warranty by the lessor that the premises did not violate applicable building codes, regulations or ordinances in effect at the commencement of the term; and provisions that the lessor warranted the condition of the plumbing, lighting, heating and similar building systems. They also struck a provision requiring the lessee to pay the real property taxes but added that D would pay for any increase in property taxes occurring during the term of the lease. The lease required D to comply with any applicable statutes, ordinances, and other requirements regulating his use of the property. D was relieved of any obligation to repair or maintain the property. D exercised his option to renew the lease for an additional five years at the increased rent, the new term to commence on July 24, 1987. On March 4, 1987--five months after D exercised the renewal option and almost five months before the initial three-year term ended--P received a letter from City of Los Angeles advising her that the unreinforced masonry construction of the Sunset Boulevard building made it susceptible to substantial structural damage in the event of an earthquake. P claimed that D was responsible for these issues. D denied responsibility and P was required to pay for a survey and do upgrades which ultimately cost $34,450.26. P filed a breach of contract action against D to recover the cost of the alterations. P claims that D had agreed through a provision of the lease to bear the cost of complying with any alterations ordered by municipal authorities, that the seismic retrofit so qualified, and that D, having refused to pay the cost himself, was liable to her by way of indemnity. The superior court ruled in favor of P and D appealed. The Court of Appeal affirmed the judgment of the trial court. This appeal resulted.