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Shocklee v. Albers Chiropractic Health Centre, P.C

Court of Appeals of Missouri, Eastern District, Fifth Division

July 10, 2018

GREG SHOCKLEE and DEBORAH SHOCKLEE, Appellants,
v.
ALBERS CHIROPRACTIC HEALTH CENTRE, P.C, Respondent.

          Appeal from the Circuit Court of St. Charles County Honorable Matthew E.P. Thornhill

          LAWRENCE E. MOONEY JUDGE

         The parties to a commercial lease dispute whether the tenant effectively exercised her option for the renewal of the lease. Landlords Greg Shocklee and his wife Deborah Shocklee appeal from the trial court's judgment ruling in favor of tenant Albers Chiropractic Health Centre, P.C., and ordering specific performance, renewing the lease between the parties. We reverse because Dr. Albers did not provide a definite and unqualified statement exercising her option to renew, in a manner consistent with the terms of the lease.

         Factual and Procedural Background

         The Shocklees and Susan Albers, as President of Albers Chiropractic Health Centre, P.C., entered into a commercial lease in April of 2012. That lease, which expired on March 31, 2017, contained a renewal provision providing that absent default, at the end of the initial or any renewal term:

Lessee shall have the option to renew this lease for two (2) consecutive five (5) year terms commencing on the expiration of the initial term (and each succeeding renewal term) by giving written notice of the exercise thereof to Lessor no later than ninety (90) days [prior to expiration], by registered mail, return receipt requested.

         In a letter dated November 15, 2016, Dr. Albers wrote Mr. Shocklee regarding the lease, stating:

My current lease comes up for renewal on April 1, 2017. I would like to exercise my option to renew for a period of three years ending April 1, 2020. If you want me to provide a copy of the lease as I have done in the past for your review I will be happy to do so. I would like to get this finalized as soon as possible. Thank you for your consideration.

         The Shocklees did not respond to Dr. Albers's letter. Mr. Shocklee did not believe the letter effectively exercised Dr Albers's right to renew, because she had changed the renewal term from five years to three years. Instead, he considered the letter an attempt by Dr. Albers to renegotiate the terms of the lease, and thus he considered the lease unrenewed and set to expire on March 31, 2017.

         By letter dated February 28, 2017, the Shocklees advised Dr. Albers of certain alleged breaches of the lease, and informed Dr. Albers that the lease would terminate effective March 31, 2017. They directed Dr. Albers to vacate the premises by that date. She did not do so.

         The Shocklees sued Dr. Albers for breach-of-contract and unlawful detainer.[1] Dr. Albers counterclaimed for specific performance of the lease, seeking a judgment ordering the Shocklees to renew the lease for a five-year term.

         The circuit court held a bench trial, and then ruled in favor of Dr. Albers. As to the doctor's request for specific performance, the circuit court found and ordered that the parties had entered into a five-year lease, commencing April 1, 2017. The circuit court reasoned that once Dr. Albers said "I want to renew," Dr. Albers had renewed the lease. The circuit court considered as superfluous any other language in Dr. Albers's letter - including the language requesting a three-year term. The circuit court further explained that it ordered a five-year instead of a three-year term because in its view, any renewal under the lease had to be for five years.

         At a hearing on their motion for new trial, the Shocklees argued that Dr. Albers had not effectively renewed the lease. In sum, they argued that Dr. Albers had made a counteroffer, not an election to renew. They maintained that when Dr. Albers added the extra term of "for three years" instead of the negotiated term of five years, Dr. Albers had made a counteroffer, which the Shocklees had not accepted. Thus they argued that because Dr. Albers only submitted a counteroffer and not an election to renew for the five-year term, she never actually elected to renew before the lease expired.

         The circuit court disagreed, and reiterated its conclusion that Dr. Albers had exercised her ...


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