Court Opinion

ID: 2641434
Source: CourtListenerOpinion
Date Created: 2013-11-07 01:02:39.664642+00
Date Added: 2024-06-11T09:55:56.892723
License: Public Domain

Filed 11/6/13 Pemstein v. Pemstein CA4/3

                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
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or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                     FOURTH APPELLATE DISTRICT

                                                DIVISION THREE

MARTIN PEMSTEIN,

     Plaintiff and Appellant,                                          G047338

         v.                                                            (Super. Ct. No. 30-2009-00119103)

HAROLD PEMSTEIN,                                                       OPINION

     Defendant and Respondent.

                   Appeal from a judgment of the Superior Court of Orange County, Gregory
H. Lewis, Judge. Affirmed.
                   Manahan, Flashman & Brandon, Amanda E. Manahan and Jeffrey S.
Flashman for Plaintiff and Appellant.
                   Harold Pemstein, in pro. per., for Defendant and Respondent.
              Martin Pemstein appeals from the judgment he obtained against his brother
Harold Pemstein1 in this action for damages relating to rent defaults on leases for two
commercial buildings. He challenges the amount of damages awarded. We find no error
and affirm.
                               FACTS AND PROCEDURE
Background
              Martin and Harold have been battling each other for years over the breakup
of their family business comprised of a corporation called The Pemma Corporation
(Pemma) and a partnership called HMS Holding Company (HMS). The corporate
dissolution action has already been the subject of many appeals, including one filed
concurrently with this opinion (Pemstein v. Pemstein (Nov. 6, 2013, G047107)
[nonpub. opn.]; Pemstein v. Pemstein (May 16, 2011, G043349) [nonpub. opn.];
Pemstein v. Pemstein (June 9, 2004, G030217) [nonpub. opn.]; Pemstein v. Pemstein
(June 9, 2004, G029394) [nonpub. opn.]; Pemstein v. The Pemma Corporation (June 9,
2004, G031227) [nonpub. opn.]).
              The real properties that are the subject of this action are two commercial
buildings located in Santa Ana at 515 South Santa Fe Street (the 515 Building), and
519 South Santa Fe Street (the 519 Building). Originally, HMS was the owner of the
buildings, and Pemma was the lessee. During the pendency of the corporate dissolution
action, Pemma and HMS filed for bankruptcy. In 2006, the bankruptcy court entered an
order allowing for Martin to become the sole owner of both buildings and for Harold to
become the lessee of both buildings. The bankruptcy trustee created new leases for each

1             We hereafter refer to the parties by their first names for ease of reading and
to avoid confusion, and not out of disrespect. (In re Marriage of James & Christine C.
(2008) 158 Cal.App.4th 1261, 1264, fn. 1.)

                                             2
building between HMS and Pemma and then assigned them to Martin and Harold
respectively.
                The two leases were identical. The lease term was for four years from
January 1, 2007, to December 31, 2010. The monthly rent was $3,657.50 for the first
year, subject to a three percent annual increase each year thereafter. The leases provided
for rent to be paid on the first day of each month and provided for imposition of late
charges and interest after five days. The leases also contained the following
paragraph 3.1, pertaining to early termination of the lease term, which provided in
relevant part: “While Lessee is in bankruptcy, Lessee . . . may terminate this Lease for
any reason whatsoever, after providing thirty (30) days written notice to Lessor. If this
Lease is terminated by Lessee during its bankruptcy, the maximum claim that Lessor may
have against Lessee for early termination shall be four (4) months of rent. After Lessee’s
bankruptcy, Lessee may terminate this Lease for any reason by providing at least
120 days written notice, and upon such early termination, Lessee shall pay to Lessor a
lump sum amount equal to four (4) months of rent.”
The Complaint
                Martin filed the instant action against Harold in May 2009, for damages
relating to rent defaults on both buildings.
                As to the 515 Building, Martin alleged that on October 30, 2007, Harold
gave written notice of his intent to terminate the lease, saying he would be off the
premises by November 30, 2007. Harold did not fully vacate the premises until
December 20, 2007. Harold paid Martin the December rent but no rent thereafter, and
did not make a lump sum payment equal to four months’ rent.
                As to the 519 Building, Martin alleged Harold was routinely late in his rent
payments. On December 7, 2007, Martin served Harold with a three-day notice to
perform covenant or quit, and on January 20, 2008, Martin commenced an unlawful
detainer action. Martin obtained a judgment in the unlawful detainer action, entered

                                               3
May 7, 2008, and served on Harold May 8, giving possession of the premises back to
Martin, and ordering Harold to pay Martin $1,463 in late fees for the months of
August 2007 through November 2007. The unlawful detainer judgment stated Harold
“may in the future become liable for daily damages, alleged in the complaint to be
$139.73 per day, [but] such future damages are not properly included in this
judgment . . . .” Harold did not vacate the premises until June 2008, and Martin was not
able to find a new tenant. Martin alleged Harold was liable for rent throughout the
remainder of the lease term, plus other damages. Martin’s complaint also contained a
cause of action seeking to recover attorney fees he had incurred prosecuting the unlawful
detainer action.
The Trial
              The matter proceeded to a bench trial in April 2012, conducted solely upon
the parties’ trial briefs, argument of counsel, and exhibits submitted to the court. The
joint exhibit list describes 90 exhibits that were provided to the court. Some of the
exhibits (we have been able to identify approximately 26 of them) are attached to the trial
briefs included in the clerk’s transcript, but most of the exhibits have not been provided
to us. Martin’s designation of the record on appeal identifies only one exhibit to be
included in the clerk’s transcript record on appeal (see Cal. Rules of Court,
rule 8.122(a)(3))—a notice of eviction—but that exhibit is not in the clerk’s transcript.
Martin has not filed a rule 8.224 notice (Cal. Rules of Court, rule 8.224) designating any
trial exhibits to be considered by this court, nor have any of the other exhibits been
transmitted to this court.2

2            “Where exhibits are missing we will not presume they would undermine
the judgment. [Citation.]” (Western Aggregates, Inc. v. County of Yuba (2002)
101 Cal.App.4th 278, 291; see also Heyman v. Franchise Mortgage Acceptance Corp.
(2003) 107 Cal.App.4th 921, 925, fn. 1.)

                                              4
              At the beginning of trial, the parties stipulated the primary legal issue to be
determined was the interpretation of paragraph 3.1 of the leases regarding what future
rent was owed upon early termination of the leases. Martin argued Harold was required
to pay rent during the 120-day notice period, and then upon expiration of the notice
period (i.e., termination of the lease) had to also pay an amount equal to another four
months of rent, i.e., eight months total for potential future rent from the time notice of
termination was given. Harold argued paragraph 3.1 established four months’ rent as the
maximum he would have to pay upon giving notice he was terminating the lease. Harold
argued if he had to pay rent during the 120-day notice period and then also pay an
amount equal to another four months’ rent, the latter would constitute an illegal penalty
or liquidated damages provision.
              The trial court apparently agreed with Harold’s position. It explained:
“A clear understanding of [paragraph 3.1] . . . is that [provision] allows for termination of
the lease by giving 120-days notice, and upon such early termination, meaning of the
notice period, that the lessee was to pay to less[or] a lump sum amount equal to four
months of rent, so I think that the four months of rent is tied into the notice period of
early termination of the 120 days. I do not believe that it’s disjunctive and would act as a
liquidated damage clause or a penalty, but it fails 1546 of the Civil Code3 in that regard.
That’s my ruling.” Before beginning presentation of evidence and argument, Martin’s
counsel confirmed his understanding of the court’s interpretation of paragraph 3.1 was
that he could only recover a maximum of four months of rent as future rent damages.

3            As there is no section 1546 of the Civil Code, we assume the trial court
meant section 1671 of the Civil Code, the provision that addresses the validity of
liquidated damages provisions. All further statutory references are to the Civil Code,
unless otherwise indicated.

                                              5
The 515 Building Evidence and Argument
              The following evidence/argument was presented to the trial court as to the
515 Building. Harold gave written notice to Martin on October 30, 2007, he was
terminating the lease on the 515 Building as of the end of November 2007. He did not
vacate the premises until December 20, 2007. On December 29, 2007, Martin signed a
one-year lease with new tenants for the 515 Building at a monthly rent of $4,250
($592.50 more than Harold’s rent) and the new tenant took possession on January 1,
2008. (The joint exhibit list indicates there was another lease provided to the trial court
for the 515 Building to a tenant named “Stellar,” but that lease has not been provided to
us.)
              The record contains copies of checks (most of which were a few days late)
from Harold to Martin for payment of rent on the 515 Building as follows: $3,657.50 for
the months of January, February and March 2007; $4,754.75 (rent and late fees) for
April 2007; and $3,657.50 for the months of May, June, July, and August 2007.
Although the record does not contain checks for September or October 2007, Martin’s
payment schedule provided to the trial court represented Harold timely paid rent for both
those months.
               The clerk’s transcript contains two different schedules prepared by Martin
of the amounts he claimed Harold owed on the 515 Building. One was attached to
Harold’s trial brief, but it is not clear if it was actually an exhibit admitted at trial—it
does not appear on the parties’ joint exhibit list. It showed no rent paid by Harold for
November or December 2007, but that Martin credited Harold’s security deposit to the
rent due for November 2007. This schedule showed late charges Martin assessed Harold
for several months in 2007, although those late charges are not at issue on this appeal.
               Martin’s trial brief contained a different schedule by which he calculated
what Harold owed him on the 515 Building. Martin claimed that as of October 2007,
Harold would have owed $2,091.13 in late charges and interest on late rent. When

                                                6
Harold gave notice in October he was terminating the lease, he became obligated to pay
Martin for four more months of rent (a total of $14,739.73) because the lease required
120 days notice before it terminated. Martin then credited Harold for his security deposit
(applying it to November rent), which brought the total to $14,400. Martin then added
10 percent annual interest through trial, to bring the claimed total to $20,640.
The 519 Building Evidence and Argument
              Various documents relating to the unlawful detainer proceeding on the
519 Building were before the trial court and we detail them first. Martin served a
three-day notice to perform covenant or quit on Harold on December 17, 2007, which
stated Harold owed $1,828.75 in late fees under the lease for the months of August
through December 2007, and declaring the lease forfeit.
              The unlawful detainer action was filed on January 20, 2008. In its April 23,
2008, statement of decision in the unlawful detainer action, the court found Harold
violated the lease by habitually making late rent payments and not paying the late charges
and the lease was forfeited. It found Martin was entitled to judgment for late fees for
August 2007 through November 2007—a total of $1,463. The court found Harold had
paid December 2007 rent and it “[could not] award additional sums for unpaid rent
following December of 2007, if any, as the evidence presented simply failed to establish
what if anything more was owed by Harold.” The court declined to award any damages
for a malicious holdover. The court found Martin was also “entitled to $139.73 per day
in daily damages from the date of entry of judgment.”
              The judgment in the unlawful detainer proceeding was entered May 7,
2008. It gave Martin possession of the premises and awarded him $1,463 for late fees.
The judgment stated, “Although [Harold] may in the future become liable for daily
damages, alleged in the complaint to be $139.73 per day, such future damages are not
property included in this judgment . . . .” Martin regained possession of the 519 Building
on May 29, 2008.

                                              7
              The clerk’s transcript contains checks for Harold’s payment of rent on the
519 Building as follows: $3,657.50 for the months of January, February, and March
2007; $4,753.75 (rent and late fees) for April 2007; $3,657.50 for the months of May,
June, July, and August 2007; $3,657.50 for the months of November and December
2007; and $3,657.50 for the months of January, February, and March 2008. Although the
record does not contain a check for April 2008, Martin’s payment schedule presented to
the court represents that Harold timely paid rent for that month and Martin applied
Harold’s security deposit to the May 2008 rent. Although the parties’ joint exhibit list
indicates the 519 Building was subsequently re-let, the documents pertaining to the new
lease are not before us, and thus, we do not know when and for how much. Martin’s
counsel represented the new lease was obtained eight months after he regained
possession.
Judgment
              The trial court entered a judgment awarding Martin damages of $4,939.56
relating to the 515 Building lease and no damages as to the 519 Building lease. It
declined to award Martin any damages on his cause of action seeking attorney fees for
the unlawful detainer action because he did not present any evidence on that cause of
action.
              A statement of decision was not requested, however, the trial court made
comments on the record explaining its ruling. As to the 515 Building lease, the court
concluded when Harold gave notice at the end of October 2007, he was terminating the
lease he would have owed Martin for four more months rent pursuant to paragraph 3.1.
Martin re-let the premises effective January 1, 2008, so Harold only owed for November
and December 2007, plus late fees and interest. The court explained Harold owed Martin
a total of $8,597.55, less the security deposit of $3,657.50, for a total of $4,939.56. As to
the 519 Building, the court commented Harold had paid all rents due for January,
February, March, and April 2008. The security deposit was used for May 2008 rent.

                                              8
Possession of the premises was returned to Martin on May 29, 2008, so no further rental
damages would be ordered.
                                       DISCUSSION
1. Standard of Review
              “[I]t is settled that [on appeal]: ‘A judgment or order of the lower court is
presumed correct. All intendments and presumptions are indulged to support it on
matters as to which the record is silent, and error must be affirmatively shown. This is
not only a general principle of appellate practice but an ingredient of the constitutional
doctrine of reversible error.’ [Citations.]” (Denham v. Superior Court (1970) 2 Cal.3d
557, 564.) Therefore, an appellant has an affirmative duty on appeal to overcome the
presumption of correctness and demonstrate prejudicial error. (Hearn v. Howard (2009)
177 Cal.App.4th 1193, 1207.)
              Questions of law, such as the proper interpretation of a contract when it
does not turn on the credibility of extrinsic evidence, are reviewed de novo (City of
Manhattan Beach v. Superior Court (1996) 13 Cal.4th 232, 238), but if a party does not
request a statement of decision, the appellate court will imply all necessary factual
findings to support the judgment. (In re Marriage of Arceneaux (1990) 51 Cal.3d 1130,
1133-1134.) Here, because no statement of decision was requested, we “imply all
findings necessary to support the judgment, and our review is limited to whether there is
substantial evidence in the record to support these implied findings.” (In re Marriage of
Cohn (1998) 65 Cal.App.4th 923, 928.)
2. The 519 Building
              Martin contends the trial court improperly applied res judicata/collateral
estoppel principles to conclude the unlawful detainer action resolved all rent damage
issues as to the 519 Building lease and, thus, it erred by failing to award him the early
termination fee provided for under paragraph 3.1 of the lease. We reject his contentions.

                                              9
              Before addressing what we discern Martin’s argument to be, we address
what it cannot be. Martin’s argument is couched in terms of attacking the trial court’s
failure to award him the early termination fee (equal to four months’ rent) provided for in
paragraph 3.1. But by its terms, the provision has no applicability to the 519 Building
lease for the simple reason Harold did not elect to terminate the 519 Building lease early.
It was Martin who terminated the 519 Building lease by evicting Harold for nonpayment
of approximately $1,400 in late fees. Thus, Martin was not entitled to payment of an
early termination fee under Paragraph 3.1 as to the 519 Building. We turn then to
Martin’s argument the trial court improperly concluded principles of res judicata and
collateral estoppel precluded Martin’s recovery of “future rents” for the 519 Building.
              “‘“The doctrine of res judicata gives certain conclusive effect to a former
judgment in subsequent litigation involving the same controversy.” [Citation.] The
doctrine “has a double aspect.” [Citation.] “In its primary aspect,” commonly known as
claim preclusion, it “operates as a bar to the maintenance of a second suit between the
same parties on the same cause of action. [Citation.]” [Citation.] “In its secondary
aspect,” commonly known as collateral estoppel, “[t]he prior judgment . . . ‘operates’” in
“a second suit . . . based on a different cause of action . . . ‘as an estoppel or conclusive
adjudication as to such issues in the second action as were actually litigated and
determined in the first action.’ [Citation.]” [Citation.] “The prerequisite elements for
applying the doctrine to either an entire cause of action or one or more issues are the
same: (1) A claim or issue raised in the present action is identical to a claim or issue
litigated in a prior proceeding; (2) the prior proceeding resulted in a final judgment on the
merits; and (3) the party against whom the doctrine is being asserted was a party or in
privity with a party to the prior proceeding. [Citations.]”’ [Citation.]” (Boeken v. Philip
Morris USA, Inc. (2010) 48 Cal.4th 788, 797.) In this context, the phrase “cause of
action” means “the right to obtain redress for a harm suffered, regardless of the specific

                                              10
remedy sought or the legal theory (common law or statutory) advanced. [Citation.]” (Id.
at p. 798.)
              The res judicata effect of an unlawful detainer proceeding is narrow, but
substantial. “Generally speaking, an unlawful detainer judgment has limited res judicata
force because it typically follows a summary proceeding focused only on deciding a
party’s right to immediate possession of property.” (Gombiner v. Swartz (2008)
167 Cal.App.4th 1365, 1371.) “But when litigants to an unlawful detainer proceeding
fully try other issues besides the right of possession, the unlawful detainer judgment is
conclusive as to those other litigated issues. [Citations.]” (Ibid.)
              Martin is correct the unlawful detainer judgment does not preclude an
award of damages that was not adjudicated therein. “In the unlawful detainer action, the
statute prescribes the exclusive measure of damages. The landlord can only recover
damages in the unlawful detainer proceeding incidental to the recovery of possession.
His or her recovery is limited to the past due rent and damages for the value of possession
after termination of the lease and prior to judgment in the unlawful detainer action.”
(7 Miller & Starr, Cal. Real Estate (3d ed. 2012) § 19:208, fns. omitted.) In the unlawful
detainer action, Martin was only entitled to recover the delinquent rent due on the
effective date of the three-day notice to quit (in this case the unpaid late fees as of
December 17, 2007), and any post-notice, prejudgment damages, i.e., the reasonable
rental value of the property during the time Harold “wrongfully” occupied the property
after failing to surrender possession. (Ibid.; see also § 3334, subd. (b)(2); Code Civ.
Proc., § 1174.) Any claims Martin had for damages accruing after entry of the unlawful
detainer judgment, and prior to his regaining possession of the property, and for “future
rent damages,” i.e., damages for the remainder of the lease term after regaining
possession, were only recoverable in a separate action for damages brought under
section 1951.2. (7 Miller & Starr, Cal. Real Estate, supra, § 19:209, fns. omitted; see

                                              11
also Code Civ. Proc., § 1174.5 [unlawful detainer judgment does not bar subsequent
action for damages under section 1951.2].)
              Martin served a three-day notice to perform covenant or quit on Harold on
December 17, 2007, and filed his unlawful detainer action on January 20, 2008. The
unlawful detainer complaint is not part of the record on this appeal. Accordingly, we
have no record as to the damages Martin sought to adjudicate. But the court in the
unlawful detainer action determined Harold owed Martin $1,463 in late fees for August
2007 through November 2007. As for Martin’s post-notice, prejudgment damages, the
court in the unlawful detainer action concluded Harold paid the December 2007 rent, and
Martin failed to introduce any evidence as to any additional amounts Harold owed, i.e.,
the reasonable rental value of the premises from January 2008 until the unlawful detainer
judgment was entered on May 7, 2008. Moreover, to the extent Martin argues the
unlawful detainer action did not adjudicate those post-notice, prejudgment damages, the
trial court in this case noted (and the evidence in this record demonstrates) Harold in fact
paid rent for January, February, March, and April 2008, and Martin retained Harold’s
security deposit which covered the rent for May 2008 (thus, also covering the rental value
from the entry of judgment on May 7, until Martin regained possession on May 29,
2008). In short, the record supports the implied findings by the trial court in this case that
all rent claims due up until the time Martin regained possession were resolved.
              Martin argues he was also entitled to prospective damages for the unpaid
rent for the remainder of the original lease term—an amount he asserts would be equal to
the early termination fee specified in paragraph 3.1, i.e., four months rent. (As we
already have noted above, Martin was not entitled to an early termination fee, because
Harold did not terminate the lease—Martin did.)
              A lessor may only recover damages for the balance of a lease term in
accordance with section 1951.2, subject to his duty to mitigate those damages. Under
that section, “Subject to certain limitations, as additional damages caused by the tenant’s

                                             12
breach of the lease, the landlord may recover the amount by which the unpaid rent for the
balance of the lease term that accrues after the time of the award exceeds the amount of
rent loss the tenant proves could reasonably have been avoided by the landlord,
discounted at the discount rate of the Federal Reserve Bank of San Francisco at the time
of the award, plus 1%.” (7 Miller & Starr, Cal. Real Estate, supra, § 19:209,
fns. omitted; see § 1951.2, subds. (a) & (b).)
              A lessor cannot recover the excess of the unpaid rent for the balance of the
term unless: “(1) The lease provides that the damages [the lessor] may recover include
the worth at the time of award of the amount by which the unpaid rent for the balance of
the term after the time of award, or for any shorter period of time specified in the lease,
exceeds the amount of such rental loss for the same period that the lessee proves could be
reasonably avoided; or [¶] (2) The lessor relet the property prior to the time of award and
proves that in reletting the property he acted reasonably and in a good-faith effort to
mitigate the damages, but the recovery of damages under this paragraph is subject to any
limitations specified in the lease.” (§ 1951.2, subd. (c)(1) & (2).)
              Martin has made no argument, let alone any showing, he satisfied the
requirements of section 1951.2. Indeed, he does not mention the statute. Because there
is no statement of decision, we must imply findings by the trial court that the requisites
for recovery of future rents for remainder of the lease term were not met. Martin has not
demonstrated any error by the trial court in declining to award damages for the remainder
of the rent term.
3. The 515 Building
              Martin also challenges the damage award as to the 515 Building lease.
Martin’s argument is not entirely clear, but the bottom line is he believes he should have
been awarded four months’ rent attributable to the 120-day notice period from the time
Harold notified him he was terminating the lease—offset by the rent he received upon re-

                                             13
letting the premises two months into the 120-day notice period—plus the lump sum
payment provided for in paragraph 3.1 of the lease. We reject Martin’s contention.
              Although not clearly articulated in his brief, the gist of Martin’s argument
appears to be the trial court incorrectly interpreted paragraph 3.1. Before trial, the court
appeared to interpret paragraph 3.1 as establishing four months’ rent as the maximum
Harold would have to pay Martin in the event the lease was terminated early. Martin
does not discuss any law concerning contract interpretation. We apply a de novo
standard of review. (Morgan v. City of Los Angeles Bd. of Pension Comrs. (2000)
85 Cal.App.4th 836, 843.)
              “A lease agreement is subject to the general rules governing the
interpretation of contracts. [Citation.] ‘A contract must be so interpreted as to give effect
to the mutual intention of the parties as it existed at the time of contracting, so far as the
same is ascertainable and lawful.’ [Citation.] When possible, the parties’ mutual
intention is to be determined solely from the language of the lease. ‘The “clear and
explicit” meaning of these provisions, interpreted in their “ordinary and popular sense,”
. . . controls judicial interpretation.’ [Citation.] ‘Interpretation of a contract “must be fair
and reasonable, not leading to absurd conclusions. [Citation.]”’ [Citation.]” (Bill Signs
Trucking, LLC v. Signs Family Limited Partnership (2007) 157 Cal.App.4th 1515, 1521.)
              We generally agree with Martin as to the interpretation of paragraph 3.1.
The provision must be read in full: “While the Lessee is in bankruptcy, Lessee . . . may
terminate this Lease for any reason whatsoever, after providing thirty (30) days written
notice to Lessor. If this Lease is terminated by Lessee during its bankruptcy, the
maximum claim that Lessor may have against Lessee for early termination shall be four
(4) months of rent. After Lessee’s bankruptcy, Lessee may terminate this Lease for any
reason by providing at least 120 days written notice, and upon such early termination,
Lessee shall pay to Lessor a lump sum amount equal to four (4) months of rent.”

                                              14
              A plain reading of paragraph 3.1 envisions two early termination
circumstances. The first (encompassed by the first two sentences) was if the lessee
(originally Pemma) was still in bankruptcy, the lease could be terminated on 30 days
written notice and the maximum damages the lessor (originally HMS) could recover
would be “four (4) months of rent.” The second circumstance, which the parties agree is
the one applicable here, was that after the bankruptcy the lessee (now Harold) could
terminate the lease by giving 120 days notice to the lessor (now Martin), and upon the
termination of the lease, paying “a lump sum amount equal to four (4) months of rent.”
Because the lease would not have terminated until expiration of the 120-day notice
period (see, e.g., Highland Plastics, Inc. v. Enders (1980) 109 Cal.App.3d Supp. 1, 8
[“[t]he tenancy is not terminated on the giving of the notice but on expiration of the
notice period”]), paragraph 3.1 envisions payment of rent during the notice period (while
the lease remained in effect) and then payment of a lump sum upon the termination of the
lease at the conclusion of the notice period.
              But we disagree with Martin his subsequent re-letting of the premises had
no bearing on whether Harold was obligated to make the paragraph 3.1 payment. Harold
gave notice on October 30, 2007, he was terminating the lease. Although Harold
purported to give 30 days’ notice, the lease would not have terminated until expiration of
the 120-day period in February 2008. Martin re-let the property effective January 1,
2008, at a significantly higher rent, before the expiration of Harold’s lease and before any
early termination payment accrued. “‘It has long been the settled law of this state, that
while re-entry by the landlord and his resumption of the benefits, use and enjoyment of
the premises terminates the lease, so far as the landlord’s right to rentals subsequent to
such entry is concerned, this does not affect the tenant’s liability for rent accrued prior to
such re-entry.’ [Citations.]” (Space Properties, Inc. v. Tool Research Co. (1962)
203 Cal.App.2d 819, 826.) Gould v. Corinthian Colleges, Inc. (2011) 192 Cal.App.4th
1176, the sole authority Martin cites in support of his argument, does not aid him.

                                                15
Although Gould observed a lease’s early termination payment provision was not “rent”
but rather “payment[] for the exercise of a right or privilege” of terminating the lease
early (Id. at p. 1180), it did not involve a circumstance like we have here—where the
premises was re-let prior to expiration of the termination period. In sum, the trial court
did not err by concluding Harold was liable only for the unpaid rent prior to re-letting the
premises.
                                      DISPOSITION
              The judgment is affirmed. In the interests of justice, each side shall bear
their own costs on appeal. (Cal. Rules of Court, rule 8.278(a)(5).)

                                                  O’LEARY, P. J.

WE CONCUR:

RYLAARSDAM, J.

BEDSWORTH, J.

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