Smyth
Smyth v. Berman
Opinion
Lead Opinion
Hoffstadt, J.
*185 A tenant rented a building for his audio recording business under several written leases, the most recent of which contained an undefined "right of first refusal to purchase." After the landlord signed a contract to sell the building to a third party, the tenant submitted an offer to purchase it, but the landlord rejected the offer because the third party's offer was for "considerably more money." The tenant sued the landlord, the landlord's real estate agent and the third party. After sustaining demurrers with leave to amend to two complaints, the trial court sustained a demurrer without leave to amend. The tenant now appeals, and in so doing, raises a question of first impression: Does a right of first refusal contained in a written lease expire when that leasehold ends and the tenant becomes a "holdover" tenant, and when the lease specifies "the continuing [holdover] tenancy will be from month to month"? We conclude that a right of first refusal is not an *186 essential term that carries forward into a holdover tenancy unless the parties so indicate. Because there is no such indication in this case and because the tenant's alternative theories for enforcing the right of…