Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-89-03219/USCOURTS-ca10-89-03219-0/pdf.json

Nature of Suit Code: 290
Nature of Suit: Other Real Property Actions
Cause of Action: 

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PUBLISH 

UNITED STATES COURT OF APPEALS 

TENTH CIRCUIT 

No. 89-3219 

CAR-X SERVICE SYSTEMS, INC. and ) 

MUFFLERS OF KANSAS CITY I INC. I ) 

) 

Plaintiffs-Appellees, ) 

) 

v. ) 

) 

OLIVETTE G. KIDD-HELLER, ) 

) 

Defendant-Appellant. ) 

flL~D United SJtffi CouJt ef Appeals 

Tenth Circuit 

MAR 51111 

ROBERT L. HOECKER 

Clerk 

Appeal from the United States District Court 

For the District of Kansas 

(D.C. No. 87-2201-S) 

J. Nick Badgerow (Nancy M. Landis of Spencer Fane Britt & Browne, 

and Frank M. Lewis, with him on the brief), Overland Park, Kansas, 

for Plaintiffs-Appellees. 

Ronald L. Gold, Shawnee Mission, Kansas, for Defendant-Appellant. 

Before HOLLOWAY, Chief Judge, and McKAY and McWILLIAMS, Circuit 

Judges. 

McWILLIAMS, Circuit Judge. 

Appellate Case: 89-3219 Document: 01019301413 Date Filed: 03/05/1991 Page: 1 
The principal issue in this appeal is whether the district 

court erred in granting equitable relief to a lessee who failed to 

timely exercise its right to renew a five-year lease of commercial 

property for an additional five years. Our jurisdiction is based 

on 28 u.s.c. § 1291. The district court's jurisdiction was based 

on diversity of citizenship. 28 u.s.c. § 1332. Venue was based 

on 28 u.s.c. S 1391(a). Some background facts are necessary to an 

understanding of the matter. 

On September 27, 1967, Jacob G. Heller and Olivette G. KiddHeller, husband and wife and residents of Kansas, entered into a 

lease with a Mr. and Mrs. Tanquary by which the Hellers were 

entitled to use and possess a parcel of real estate located at 

7540 Metcalf Avenue, Overland Park, Kansas. The lease was for a 

ten-year period with three five-year options which, if exercised, 

would extend the lease to September 30, 1992. On March 31, 1977, 

Car-X Service Systems, Inc., a Delaware corporation, entered into 

a lease agreement with Kidd-Heller for the subject property, which 

by that time contained a structure erected by Kidd-Heller suitable 

for use as an automotive repair business, for a five-year term 

with two five-year options. The initial five-year term was from 

May 1, 1977 through April 30, 1982. The initial rent was 

$1,550.00 per month which increased to $1,800.00 per month on 

October 1, 1977, through the end of the initial five-year term. 

Rent for the first additional five-year term was increased to 

$1,900.00 per month, and to $2,000.00 per month for the final 

five-year term. On April 7, 1977, Car-X entered into a sublease 

of the subject property with its franchisee, Mufflers of Kansas 

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City, Inc., a Missouri corporation, whose business consists 

primarily in the installation of exhaust units, brakes, and shock 

absorbers. The sublease agreement between Mufflers and Car-X made 

Mufflers subject to the terms and conditions of the lease agreement between Car-X and Kidd-Heller. 

The Hellers' lease with the Tanquarys provided, inter alia, 

that the tenant had the right to make such alterations, changes, 

and improvements to the interior of the building located on the 

subject premises as it deemed necessary or desirable, and that no 

alterations, changes, or improvements costing more than $10,000.00 

would be made without the written approval of the landlord. This 

provision was incorporated by reference into the lease agreement 

between Kidd-Heller and Car-X. In addition, the lease agreement 

between Kidd-Heller and Car-X provided that the lessee could make 

such improvements to the premises as it deemed desirable but not 

to exceed $20,000.00 aggregate cost, and that additional improvements beyond $20,000.00 required the written approval of KiddHeller. 

In May, 1977, Mufflers, Car-X's sublessee, built an attached 

storage building next to Kidd-Heller's automotive structure at a 

cost of $7,140.00. At the same time, Mufflers removed certain 

improvements belonging to Kidd-Heller, namely guttering, outside 

lights, and a chain link fence worth $4,700.00. Mufflers did not 

get Kidd-Heller's permission to make this addition or the removals. In May, 1979, Kidd-Heller learned of the changes and asked 

the president of Mufflers to remove the new building and restore 

the fence, lights, and guttering since she had never given her 

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permission for the changes. The president of Mufflers advised 

Kidd-Heller that he could not restore the fence, lights, or guttering because they had been disposed of. A dispute ensued 

wherein Kidd-Heller threatened to file suit against Mufflers 

because the alterations and removals were made without her permission, as, she contended, was required by the two leases in question, i.e., the Hellers' lease with the Tanquarys and Car-X's 

lease with Kidd-Heller. 

Mufflers and Kidd-Heller resolved this dispute in May, 1979, 

when Kidd-Heller agreed not to bring suit and Mufflers agreed to 

pay Kidd-Heller an additional $100.00 for one month, and an additional $75.00 per month for the balance of the lease. The 

president of Mufflers stated that he agreed to pay these additional sums to avoid a lawsuit and that it was cheaper than hiring an attorney to resist a court challenge. Kidd-Heller's position was that the extra payments were to compensate her for her 

loss of the improvements, i.e., guttering, lights, and a chain 

link fence. 

The lease agreement between Kidd-Heller and Car-X required 

the lessee to exercise its option to renew at least six months 

prior to the termination of the then current term, and that such 

notice be in writing and delivered personally to Kidd-Heller or 

sent to her by certified mail at the place where rent payments 

were due. As indicated, the initial five-year term was to expire 

on April 30, 1982. Car-X did not exercise its option to renew the 

lease for the first additional term until February 26, 1982. It 

recognized that the exercise of its option was untimely, and 

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explained that it had "inadvertently failed" to extend the lease 

in timely fashion. Kidd-Heller initially refused to recognize the 

belated exercise by Car-X of its right to renew. Later, on April 

23, 1982, Kidd-Heller and Car-X signed a new lease agreement which 

stated that although Car-X had failed to timely exercise its option, the lease would nevertheless be extended for a second fiveyear period, with the rent being raised to $2,000.00 for the first 

additional five-year term and $2,100.00 for the second additional 

five-year term. 

The lease agreement required Car-X to keep in force public 

liability insurance and property damage insurance on the subject 

property. Also, Car-X was required to furnish Kidd-Heller with a 

certificate of insurance evidencing such insurance coverage. Apparently, during certain periods of 1985 and 1986, Car-X obtained 

the required insurance but did not furnish Kidd-Heller with a 

certificate evidencing such insurance. In any event, in April, 

1986, Kidd-Heller purchased insurance for property damage for the 

subject property for a premium of $486.00. 

In May, 1986, Kidd-Heller retained an attorney to represent 

her in the dispute with Car-X over insurance. On May 10, 1986, 

that attorney sent Car-X a registered letter advising Car-X that 

the lease was being terminated for failure to comply with the 

insurance provisions of the lease agreement. On June 3, 1986, 

Car-X's attorney responded to that letter, in the course of which 

he stated that Car-X wished "to continue [leasing the property] 

through the end of [the] last option term in 1992 and beyond." It 

is apparently agreed that Kidd-Heller was apprised by her attorney 

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of the contents of this letter. Later, on December 8, 1986, KiddHeller purchased a liability insurance policy for the subject 

property for a premium of $1,896.00. 

On February 19, 1987, Kidd-Heller gave Car-X notice by 

registered mail that she was terminating the lease as of April 30, 

1987. On March 16, 1987, Car-X's attorney wrote Kidd-Heller's 

attorney again concerning the insurance dispute. In that same 

letter counsel for Car-X also stated that it was Car-X's position 

that the lease it had with Kidd-Heller was "intended to run 

concurrent with the underlying Ground Lease" the Hellers had with 

the Tanquarys, to the end that the current leasehold term would 

expire on September 30, 1987, not April 30, 1987. On March 19, 

1987, Kidd-Heller was given notice, by registered mail, of Car-X's 

intent to exercise its option to renew the lease for the second 

additional five-year term. 

In this general setting, Car-X and Mufflers filed the present 

proceeding in United States District Court for the District of 

Kansas on April 30, 1987. In Count I, Car-X sought a temporary 

restraining order prohibiting Kidd-Heller from terminating its 

lease with Car-X. In Count II, Car-X sought a declaratory judgment that Car-X had exercised its option to renew the lease in 

timely fashion. As indicated, in this regard Car-X alleged that 

it was the intent of the parties that the initial five-year lease 

expire on September 30, 1982, not April 30, 1982, and that the 

ensuing five-year renewal period terminate on September 30, 1987, 

not April 30, 1987. In Count III, Car-X, on a theory of unjust 

enrichment, sought damages in excess of $20,000.00, an amount 

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which it alleged had been received by Kidd-Heller from Car-X. In 

Count IV, Car-X alleged that it had prepaid Kidd-Heller five 

months' rent for which it sought reimbursement. 

On May 4, 1987, after a hearing, the district court entered a 

temporary restraining order prohibiting Kidd-Heller from terminating the lease between the parties. In the present proceeding, 

Kidd-Heller appeals that order. 

On May 6, 1987, Car-X and Mufflers filed an amended 

complaint. The principal change was in Count III where they 

reduced their claim for unjust enrichment to an amount in excess 

of $18,000.00. 

By an amended counterclaim Kidd-Heller sought damages in the 

total amount of $2,382.00 for premiums paid by her for insurance 

on the subject property. In addition, Kidd-Heller also alleged 

that Mufflers in 1977 had made certain changes and alterations to 

the premises and had destroyed, damaged, or removed certain 

personal property belonging to her without first obtaining her 

approval. In this connection, Kidd-Heller sought a declaratory 

judgment that she and Mufflers entered into a verbal agreement in 

1979 whereby in return for her forebearance of filing an action 

against Mufflers, the latter agreed to compensate her for the 

destruction of her property in the sum of $100.00 for the first 

month, and $75.00 per month thereafter through the term of Mufflers' occupancy of the property. It was further alleged that 

beginning in May, 1979 and continuing through April, 1987, Mufflers paid her $100.00 for one month, and then $75.00 per month 

thereafter, but that beginning in May, 1987, and continuing 

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thereafter, Mufflers had refused to pay the $75.00 per month. She 

asked that Mufflers be ordered to continue such monthly payments. 

Both parties moved for summary judgment on the issue of which 

party had the right to possession of the subject property. On 

July 27, 1987, the district court denied Kidd-Heller's motion and 

granted Car-X's motion, and judgment to that effect was entered on 

July 28, 1987. Kidd-Heller in the present proceeding appeals that 

order. 

On January 20, 1988, the district court entered an order 

denying Car-X's motion for summary judgment on Count III of its 

complaint, which count, after further amendment, sought the return 

of $7,300.00 paid by Mufflers to Kidd-Heller in exchange for KiddHeller's agreement not to sue Mufflers and Car-X for making 

unauthorized alterations to the leased premises and 

property. In support of their motion, Car-X 

contended that they had a right under the lease 

removing her 

and Mufflers 

to make the 

alterations in question, and that since said alterations resulted 

in an improvement to the premises which would ultimately inure to 

the benefit of Kidd-Heller, their payment of $100.00 plus $75.00 

per month to Kidd-Heller resulted in a "double benefit" to KiddHeller. On the other hand, Kidd-Heller contended that those payments were intended to compensate her for the destruction of her 

property. Based on these arguments, the court found that there 

was "a factual issue . . • relevant to the disposition of [Count 

III]." 

In an ensuing order, entered February 12, 1988, the district 

court, by way of a case summary, found summary judgment for Car-X 

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on Counts I and II, which had previously been entered, to be appropriate. By that same order the district court reaffirmed its 

earlier determination that summary judgment was inappropriate for 

Count III, and also held that Count IV was by that time moot. 

On May 19, 1989, Count III and Kidd-Heller's counterclaim 

relating to insurance coverage were tried to the court. In its 

Memorandum and Order entered on July 20, 1989, the district court 

found Kidd-Heller was unjustly enriched in the amount of $7,300.00 

and entered judgment in favor of Car-X in that amount. In the 

present proceeding Kidd-Heller appeals that order. 

In its order of July 20, 1989, the district court also 

entered judgment in favor of Kidd-Heller and against Car-X in the 

amount of $2,382.00, which amount reimbursed Kidd-Heller for the 

premiums paid by her for insurance coverage on the subject 

property when Car-X failed to provide her with evidence that it 

had already obtained such insurance. Car-X does not appeal that 

order. 

I. Equitable Relief 

As indicated by the original pleadings, Car-X initially 

contended that its written notice given Kidd-Heller on March 19, 

1987, constituted valid notice in accord with the terms of its 

lease with Kidd-Heller since it was the intent of the parties that 

the first additional term of the lease would not expire until 

September 30, 1987, and hence the notice was beyond the six-month 

period prescribed in the lease. Apparently, this position was 

abandoned along the way. In any event, the district court held 

that the first additional period of the lease expired by its own 

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terms on April 30, 1987, and that the notice given on March 19, 

1987, was therefore untimely. In this same connection the 

district court also held that the reference in the letter from 

Car-X's lawyer to Kidd-Heller's lawyer on June 3, 1986, that Car-X 

wished "to continue [leasing the property] through the end of 

[the] last option term in 1992 and beyond," was not a valid 

exercise by Car-X of its option to renew, since, inter alia, the 

letter was neither served personally on Kidd-Heller nor sent her 

by certified mail at the place where rent payments were due. 

Be all that as it may, somewhere along the line Car-X apparently concluded that it had not made a timely notice to renew, and 

thereupon asked the district court to give it equitable relief 

from the lease provision that the option to renew be exercised at 

least six-months prior to the expiration date of the current 

leasehold term. The district court agreed that, all things 

considered, Car-X should not be held to the si~-months requirement. In support of its ruling the district court noted that 

there was no Kansas authority directly bearing on the present fact 

situation. However, the district judge was of the view that 

Kansas would follow what he deemed to be the prevailing rule in 

other jurisdictions1 that equitable relief may be available to a 

1 In diversity actions governed by state law, "[w]here no state 

court has addressed clearly the substantive legal issue, federal 

courts must use their own discretion to anticipate the rule state 

courts in similar circumstances likely would make." Herndon v. 

Seven Bar Flying Serv. Inc., 716 F.2d 1322, 1332 (lOth Cir. 1983), 

cert. denied, 466 u.s. 958 (1984). In so doing, federal courts 

"may consider all resources, including decisions • • of other 

states, federal decisions, and the general weight and trend of 

authority." Hartford v. Gibbons & Reed Co., 617 F.2d 567, 569 

(lOth Cir. 1980). 

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lessee such as Car-X to the end that the exercise of its option to 

renew, although untimely, would nonetheless extend the current 

lease for another five-year period. In reaching this conclusion 

the district court noted, inter alia, that the current five-year 

leasehold term had not expired when Car-X gave its notice of 

intent to renew on March 19, 1987; that Kidd-Heller did not 

contend that she never received a copy of the June 3, 1986 letter 

from Car-X's lawyer to her lawyer; that to declare the option as 

lost would do relatively great harm to Car-X; and that by allowing 

Car-X to remain a lessee for an additional five years would do 

relatively little harm to Kidd-Heller. 

Kidd-Heller's basic position is that under Kansas law a clear 

and unambiguous contract may not be altered nor may the 

performance of a condition be excused under the guise of equitable 

relief. The district court did not believe that Kansas law was 

that rigid. Nor do we. In Nelson v. Robinson, 184 Kan. 340, 345, 

336 P.2d 415, 420 (1959), the Kansas Supreme Court spoke as follows: 

We have no quarrel with decisions (citations 

omitted) cited by defendants, which hold it is 

not the function of courts to make new 

contracts for the parties but to enforce them 

as made. The trouble, from their standpoint, 

is that such decisions have no application to 

a situation where, by reason of the failure of 

one of the parties to comply with the terms of 

a contract, it becomes necessary to either 

forfeit the contract or in effect do away with 

it--as the court did in the instant case--

because of existing conditions which would 

make strict performance with its terms uniust 

and inequitable (emphasis added). 

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In Gill Mortuary v. Sutoris, Inc., 207 Kan. 557, 485 P.2d 

1377 (1971), a lessee sued the lessor seeking specific performance 

of two lease agreements after a futile attempt to exercise his 

options to renew both leases. The district court dismissed the 

lessee's action at the conclusion of the lessee's evidence. In so 

doing, the district court noted, inter alia, that the lessee had 

not only failed to prove that it was entitled to specific 

performance, but also that the lessee's evidence "is insufficient 

to establish any right, in equity, to compel the defendants • 

to specifically perform said lease agreements." Id. at 560, 485 

P.2d at 1380. Hence, although the district court in Gill refused 

to grant equitable relief to the lessee, it seemed to recognize 

that equitable relief may be appropriate under certain 

circumstances. On appeal, the Kansas Supreme Court affirmed. 

We agree with the district court in the instant case that 

under Kansas law even though a lease is clear and unambiguous, 

equitable relief may still be granted to relieve a party from 

strict compliance with one of the clear and unambiguous provisions 

in that lease. There remains, however, the question of whether 

the facts and circumstances of the present case warranted the 

grant of equitable relief. Our attention has not been drawn to 

any Kansas case with a fact situation akin to the present one. It 

was in such setting that the district court looked at the law 

outside of Kansas to resolve the present dispute. 

Based on his understanding of the law outside of Kansas 

concerning the granting of equitable relief from the terms of a 

clear and unambiguous lease, the district judge concluded that 

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this was an appropriate case for equitable relief. We agree. For 

a general discussion of this matter, see the annotation entitled 

"Circumstances Excusing Lessee's Failure to Give Timely Notice of 

Exercise of Option to Renew or Extend Lease" appearing at 27 ALR 

4th 266 (1984). See also such cases as Gardner v. HKT Realty 

Corp., 23 Ark. App. 148, 744 S.W.2d 735, 737-38 (1988); Linn Corp. 

v. LaSalle Nat'l Bank, 98 Ill. App. 3d 480, 424 N.E.2d 676, 678-79 

(1981); Ward v. Washington Distrib., Inc., 67 Ohio App. 2d 49, 425 

N.E.2d 420, 422-24 (1980); Wharf Restaurant, Inc. v. Port of 

Seattle, 24 Wash. App. 601, 605 P.2d 334, 340-41 (1979); J.N.A. 

Realty Corp. v. Cross Bay Chelsea, Inc., 42 N.Y.2d 392, 366 N.E.2d 

1313, 1316-18, 397 N.Y.S.2d 958, 960-63 (1977); Sosanie v. 

Pernetti Holding Corp., 115 N.J. Super. 409, 416, 279 A.2d 904, 

907-908 (1971); and F.B. Fountain Co. v. Stein, 97 Conn. 619, 118 

A. 47 (1922). See also, 1 A. Corbin, Corbin on Contracts S 35, at 

146-47 (1963); and 1 w. Jaeger, Williston on Contracts S 76 n.4, 

at 248-49 (3d ed. 1957). 

The application of these general principles of equity to the 

present case warrants the granting of equitable relief to Car-X. 

We note, as did the district court, that Car-X did exercise its 

option to renew the lease in clear and unambiguous language on 

March 19, 1987, at a time when the current five-year term of the 

lease was still in force and effect, i.e., that term did not 

expire until April 30, 1987. This distinguishes the present case 

from those cases where the holder of an option to renew attempts 

t . th t. ft th 1 h . d o exerc~se e op ~on a er e ease as exp~re . e a 

2 w 1 so no t e 

2 Car-X's reliance on Gill Mortuary v. Sutoris, 

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Inc., 207 Kan. 

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that Kidd-Heller was apparently made aware by her attorney of the 

contents of the June 3, 1986 letter from Car-X's counsel. 

Further, this is not an instance of an intentioned or willful 

failure to timely renew. 

We also agree with the district court that to declare the 

lease forfeited, and the option to renew lost forever, would cause 

relatively great harm to Car-X. It should be noted that we are 

here dealing with commercial property where an apparently profitable business was being conducted and had been conducted for the 

preceding ten years. 3 Further, Car-X and Mufflers, as indicated, 

had made certain alterations to the subject property at their own 

expense, including customizing the property to a commercial 

enterprise. Also, there was indication that Mufflers had leased 

certain property adjacent to the subject property which had been 

incorporated into the business being conducted. Finally, Mufflers 

557, 485 P.2d 1377 (1971) and Standard Oil Co. v. Reed, 126 Kan. 

63, 266 P. 735 (1928) is misplaced. In Gill, the leases in question had expired by their own terms prior to the purported attempt 

to extend them. In Standard Oil, there was an option to purchase 

realty at the expiration of a lease or upon the death of the life 

tenant, who was also one of the lessors, in the event her death 

occurred before the expiration of the lease. The life tenant died 

before the expiration of the lease and the Kansas Supreme Court 

held that the lessee had failed to exercise his option to purchase 

at the time of the life tenant's death, or within a reasonable 

time thereafter, and that accordingly the option was lost. 

3 See Geo. w. Millar & Co. v. Wolf Sales & Serv. Corp., 65 Misc. 

2d 585, 318 N.Y.S.2d 24, 26 (1971), where it was observed that an 

option to renew a lease is of great value to commercial tenants 

and that the grave injury to the life of a business implicit in a 

forfeiture coupled with the lack of prejudice to the landlord 

"presents a compelling case for invoking the equitable power of 

the Courts" when a commercial lessee, through oversight, has 

failed to timely exercise his right to renew. See also, Ward v. 

Washington Distrib., Inc., 67 Ohio App. 2d 49, 425 N.E.2d 420, 424 

(1980); and Sosanie v. Pernetti Holding Corp., 115 N.J. Super. 

409, 416, 279 A.2d 904, 907-908 (1971). 

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had been at this location for about ten years and there was 

"customer recognition" of Mufflers' location. 

We are in further agreement with the district court that in 

granting Car-X equitable relief and extending the lease for five 

years Kidd-Heller would not suffer substantial harm. Kidd-Heller, 

at the time, had taken no substantial steps to lease the premises 

to another, although she had notified a real estate agent of the 

situation. Also, the lease agreement provided for an increase in 

the rental for the last five-year period. 

In sum, we are not inclined to disturb the district court's 

holding that Car-X was entitled to equitable relief from the 

provision in the lease that the option to renew had to be 

exercised at least six months prior to the expiration of the current leasehold term. 

II. Unjust Enrichment 

As indicated, about a month after Kidd-Heller leased the 

premises to Car-X in April, 1977, Mufflers, Car-X's sub-lessee, 

made certain changes to the property which apparently resulted in 

the removal and destruction of certain personal property belonging 

to Kidd-Heller. The latter did not discover this until some two 

years later, in 1979. A dispute then arose as to whether these 

changes and removals were in accord with the two leases with which 

we are here concerned, i.e., the Hellers' lease with the Tanquarys 

and Car-X's lease with Kidd-Heller. Kidd-Heller threatened to 

bring suit and Mufflers, seeking to avoid the expense of litigation, agreed to pay Kidd-Heller $100.00 for one month, and $75.00 

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per month thereafter for so long as it remained a tenant if KiddHeller would forebear bringing suit. Kidd-Heller agreed and did 

not bring suit, and Mufflers made the agreed payments from May, 

1979 to April, 1987, totalling $7,300.00. 

This matter was tried to the court, which held that Mufflers' 

action in making changes to the subject premises and destroying 

Kidd-Heller's personal property without first obtaining her 

permission did not violate either of the two leases. Thus, the 

district court ordered Kidd-Heller to return the $7,300.00 to Mufflers on the basis that to permit Kidd-Heller to keep the 

$7,300.00 would result in unjust enrichment to Kidd-Heller. We 

think this analysis misses the mark. 

We are not here really concerned with whether Mufflers' 

alterations and removal of personal property violated either of 

the leases. The critical facts are that a dispute between KiddHeller and Mufflers concerning these changes and removals did 

arise, and the dispute was resolved by the parties by a verbal 

agreement which both parties adhered to for the succeeding seven 

years, the verbal agreement being that in return for Kidd-Heller's 

forbearance in bringing suit, Mufflers would make certain monthly 

payments. 

The principle that forbearance to sue may constitute adequate 

consideration for a contract is well established in Kansas. Evco 

Distrib., Inc. v. Brandau, 6 Kan. App. 2d 53, 626 P.2d 1192, 1196 

(1981). See also, Frets v. Capitol Fed. Sav. & Loan Ass'n, 238 

Kan. 614, 621, 712 P.2d 1270, 1276 (1986); and Snuffer v. 

Westbrook, 134 Kan. 793, 795, 8 P.2d 950, 951 (1932). In Frets, 

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the Kansas Supreme Court recognized that as a general rule the 

relinquishment of a legal right, or a contract right or privilege 

is sufficient consideration for a promise. 238 Kan. at 621, 712 

P.2d at 1276. Similarly, in Snuffer, the Kansas Supreme Court 

stated that a forbearance to prosecute or defend a claim or action 

is usually sufficient consideration for a contract based thereon, 

unless the claim or defense is obviously invalid, worthless, or 

frivolous. 134 Kan. at 795, 8 P.2d at 951. 

However, forbearance of the right to institute legal action 

does not carry with it the further requirement that the party must 

also show that he would have prevailed in such litigation if it 

had been filed. He need only show that he gave up his right to 

file a non-frivolous claim. Such, under Kansas law, is adequate 

consideration to support the promise Mufflers made in May, 1979, 

to pay Kidd-Heller $100.00 for one month, and $75.00 per month 

thereafter for the balance of the lease. See Reed v. Hess, 239 

Kan. 46, 716 P.2d 555, 560 (1986); Evco, 6 Kan. App. 2d 53, 626 

P.2d at 1196-97; and Schiffelbein v. Sisters of Charity of 

Leavenworth, 190 Kan. 278, 280, 374 P.2d 42, 45 (1962). 

In Schiffelbein, the Kansas Supreme Court said that 

"[f]orbearance to sue can be good consideration for a promise, 

regardless of the actual validity of the claim, if the one who 

forbears has a reasonable and sincere belief in its validity." 

190 Kan. at 280, 374 P.2d at 45 (quoted in Reed, 239 Kan. 46, 716 

P.2d at 560; and in Evco, 6 Kan. App. 2d 53, 626 P.2d at 1197). 

The Schiffelbein court explained that "[t]he reality of the claim 

which is given up must be measured, not by the state of the law as 

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it is ultimately discovered to be, but by the state of the 

knowledge of the person who at the time has to judge and make the 

concession." 190 Kan. at 280, 374 P.2d at 45 (quoting 12 Am. Jur. 

§ 87, at 581 (1938). 

The record is devoid of any evidence that Kidd-Heller's 

threatened action against Mufflers was invalid, worthless, or 

frivolous. Rather, every indication in the record is that KiddHeller had a reasonable and sincere belief in the validity of her 

claim against Mufflers. In this regard, we note that it is apparently conceded that Mufflers disposed of Kidd-Heller's guttering, 

lights, and fence without first obtaining her permission. 

Further, the provision in the lease between the Hellers and the 

Tanquarys concerning improvements, changes and alterations to the 

leased property, which was later incorporated by reference into 

Car-X's lease with Kidd-Heller, is less than clear and 

unambiguous. In our view, this provision could be read as requiring Car-X or its sublessee, Mufflers, to obtain Kidd-Heller's approval before making any improvements, changes or alterations, 

regardless of their nature (i.e., interior or exterior), if the 

cost of such improvements, changes or alterations exceeded 

$10,000.00. Under such an interpretation, Mufflers would have 

been required to get Kidd-Heller's permission before making the 

improvement and removals in question. 

We also reject the district court's suggestion that since the 

May, 1979 agreement, whereby Mufflers promised to pay Kidd-Heller 

$100.00 for the first month and $75.00 each month thereafter in 

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return for Kidd-Heller's forbearance to sue, was not made a written addendum to Car-X's lease with Kidd-Heller, as required by 

Section 21 of that lease, it was not legally binding on the parties. Section 21 of the lease agreement between Kidd-Heller and 

Car-X provided that "no modification of this lease shall be binding upon the parties unless evidenced by an agreement in writing • 

• • . " However, it is well settled in Kansas that "the terms of a 

written contract may be varied, modified, waived, annulled, or 

wholly set aside by any subsequently executed contract, whether 

such subsequently executed contract be in writing or in parol." 

See Coonrod & Walz Const. Co. v. Motel Enterprises, Inc., 217 Kan. 

63, 535 P.2d 971, 979-80 (1975); Fast v. Kahan, 206 Kan. 682, 481 

P.2d 958, 961 (1971); Gibbs v. Erbert, 198 Kan. 458, 424 P.2d 276, 

283 (1967); and Bailey v. Norton, 178 Kan. 104, 283 P.2d 400, 403 

(1955). This is true even when the written contract contains a 

provision purporting to require that subsequent modifications be 

evidenced by a writing. See Nichols & Shepard Co. v. Maxon, 76 

Kan. 607, 92 P. 545, 546 (1907). Hoard v. Jones, 119 Kan. 138, 

237 P. 888, 895-96 (1925); and Bailey, 178 Kan. 104, 283 P.2d at 

404-405. See also, 6 A. Corbin, Corbin on Contracts § 1295, at 

206 (1962); 4 W. Jaeger, Williston on Contracts§ 591, at 203 (3d 

ed. 1961); and 15 w. Jaeger, Williston on Contracts§ 1828, at 496 

(3d ed. 1972). 

The judgment in favor of the plaintiffs, Car-X and Mufflers, 

and against Kidd-Heller for unjust enrichment (Count III), in the 

amount of $7,300.00 is reversed. Otherwise, the judgments are 

affirmed. 

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