Procedural Posture

In plaintiff second lessee’s action against defendants, lessor, first lessee, and his co-conspirator, for damages for breach of a written lease and for conspiracy to induce the lessor to breach the lease, the Superior Court of Los Angeles County (California) entered an order dismissing the action. The second lessee appealed.

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Overview

At the time of making a lease between the lessor and the second lessee, the premises were occupied by the first lessee. The lessor gave a notice to the first lessee to surrender the premises. Thereafter, the lessor cancelled the lease with the second lessee by written notice and withdrew his notice to the first lessee to surrender the premises. The appellate court concluded that the breach of the written lease claim alleged sufficient facts to state a cause of action against the lessor because: (1) the lessor violated the implied covenant of good faith and fair dealing and violated his duty to refrain from doing anything that would render performance of the contract impossible, without cause, when he withdrew his notice to the first lessee to surrender the premises and permitted him and his successors to remain in possession, and (2) the giving of the written notice by the lessor to the second lessee cancelling the lease agreement completed the lessor’s repudiation of the lease and such acts constituted an anticipatory breach of the lease agreement whereby the taking of possession of the premises by the second lessee was made impossible by the repudiation.

Outcome

As to the lessor, the order was reversed as to the causes of action that sought damages for breach of the written lease; the order was affirmed as to the conspiracy to induce claim. As to the first lessee, the order was affirmed as to the causes of action that sought damages for breach of the written lease; the order was reversed as to the conspiracy to induce claim.