Frittelli, Inc. v. 350 North Canon Drive, LP
135 Cal. Rptr. 3d 761
Cal. Ct. App.2011Background
- Frittelli, Inc. leased a Beverly Hills storefront for a gourmet doughnut shop in April 2006; the center owner changed to 350 North Canon Drive, LP and PPM managed the center.
- Lease provisions included a broad exemption of lessor liability in paragraph 8.8 and an remodeling-related liability/abatement framework in paragraph 2.12.
- Renovations began September 2008 with scaffolding and signage changes; tenants received rent concessions and cleaning measures to mitigate disruption.
- Frittelli alleged breach of the lease, breach of the implied covenant of quiet enjoyment, negligence, and rescission due to disruption from remodeling.
- In April 2009, a separate unlawful detainer action was filed by 350 North Canon; the actions were consolidated and summary judgment was granted for respondents.
- The trial court held paragraph 8.8 barred damages for breach of the lease and ordinary negligence, and the gross-negligence theory failed as a matter of law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether paragraph 8.8 exempts the lessor from liability for torts in the remodeling context | Frittelli argues 8.8 does not bar all negligence related damages | Respondents contend 8.8 broadly exempts from liability for breaches and negligence | Yes; 8.8 bars the claims for breach of the lease and ordinary negligence under undisputed facts |
| Consistency between 2.12 and 8.8 regarding damage recovery | 2.12 controls damages differently from 8.8, conflicting with 8.8 | 2.12 reaffirms 8.8 and provides rent abatement; no conflict | No conflict; 2.12 supports 8.8 and permits rent abatement, applying to remodeling all around |
| Whether 8.8 covers active negligence in remodeling | 8.8 does not mention negligence; only passive negligence would be barred | 8.8 includes negligence language and encompasses active negligence | 8.8 encompasses both active and passive negligence; barred as a matter of law |
| Scope and visibility of the general exemption in 8.8 | Exemption not conspicuous; shifts burden to lessee | Marin Storage approach: release is conspicuous enough given commercial context and disclosure | Enforceable; 8.8 was conspicuous and knowingly agreed to in a commercial lease |
| Gross negligence claim viability | Frittelli can pursue gross negligence; facts show extreme conduct | Remodeling mitigation measures and tenant’s financial condition undercut gross negligence | No triable issue; summary judgment proper on gross negligence as well |
Key Cases Cited
- Lee v. Placer Title Co., 28 Cal.App.4th 503 (Cal. App. 1994) (tenant may limit quiet enjoyment covenants by lease terms)
- CAZA Drilling (California), Inc. v. TEG Oil & Gas U.S.A., Inc., 142 Cal.App.4th 453 (Cal. App. 2006) (public policy limits on exculpatory clauses; active vs. passive negligence)
- Burnett v. Chimney Sweep, 123 Cal.App.4th 1057 (Cal. App. 2004) (special scrutiny of ordinary-negligence exemptions)
- Farnham v. Superior Court, 60 Cal.App.4th 69 (Cal. App. 1997) (contracts exempting from liability for willful or negligent acts generally disfavored)
- Santa Barbara v. Superior Court, 41 Cal.4th 747 (Cal. 2007) (public policy against releases of future negligence; controls interpretation of exculpatory clauses)
- Andrews v. Mobile Aire Estates, 125 Cal.App.4th 578 (Cal. App. 2005) (essence of interference with quiet enjoyment; damages rule for interference)
- CAZA Drilling, supra, 142 Cal.App.4th 453 (Cal. App. 2006) (contractual releases can cover active negligence under certain language)
- Marin Storage & Trucking, Inc. v. Benco Contracting & Engineering, Inc., 89 Cal.App.4th 1042 (Cal. App. 2001) (commercial setting; release enforceable if not hidden and parties had opportunity to read)
- Rosencrans v. Dover Images, Ltd., 192 Cal.App.4th 1072 (Cal. App. 2011) (evidentiary objections forfeited on appeal)
- Intershop Communications AG v. Superior Court, 104 Cal.App.4th 191 (Cal. App. 2002) (contractual impacts and enforceability considerations)