Utah Coal And Lumber Restaurant v. Outdoor Endeavors Unlimited

40 P.3d 581 (2001)

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Nature of the Case

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Facts

P is the owner of a historic commercial building. D the operator of a sporting goods store, entered into a lease on May 16, 1993, whereby P leased the property to White Pine for five years. In exchange, D was bound to pay an annual rent of $33,000. The lease also gave D options to renew the lease for three consecutive five-year terms. To exercise each option, White Pine was required to notify D of its intent in writing, not more than 120 days nor less than 60 days before the expiration of the current lease term. D accepted possession of the building 'as is' and took sole responsibility for the substantial remodeling necessary to make the premises suitable for retail use. D spent over $105,000 on permanent improvements. P knew that D had to renew the lease to get a return on the investment. The 'window' for giving notice of intent to renew under the lease ran from May 13, 1998, to July 11, 1998. During this time D was extremely busy. D failed to give written notice of its intent to renew the lease within the specified period. P's attorney sent D a letter stating the lease would expire by its terms on September 9, 1998. D received the letter on July 22, 1998, consulted its attorney, and immediately provided P with written notice of D's intent to exercise the option. D's notice was eleven days late. P sought to renegotiate the lease at terms and D declined. P filed this unlawful detainer action seeking actual and treble damages, as well as costs and attorney fees. D counterclaimed, seeking a declaratory judgment that it was equitably excused from strict compliance with the notice of renewal provision of the lease. P moved for summary judgment; D cross-moved for partial summary judgment, seeking an order excusing it from strict compliance with the lease's renewal provision. The court granted partial summary judgment to D. It found that P did not suffer harm or prejudice as a result of the delay, and D would suffer substantial harm if not equitably excused. It held that D 'met the requirements necessary to invoke the doctrine of equitable excuse.' P appealed.