Myles M. Mattenson
ATTORNEY AT LAW
5550 Topanga Canyon Blvd.
Suite 200
Woodland Hills, California 91367
Telephone (818) 313-9060
Facsimile (818) 313-9260
Email: MMM@MattensonLaw.com
Web: http://www.MattensonLaw.com
You Negotiate And Sign A Coin Laundry Lease,
But The Landlord, Who Doesn't Sign,
Signs A Lease With A Competitor!
Can You Sue To Enforce The Lease Or For Interference?

      Myles M. Mattenson engages in a general civil and trial practice including litigation and transactional services relating to the coin laundry and dry cleaning industries, franchising, business, purchase and sale of real estate, easements, landlord-tenant, partnership, corporate, insurance bad faith, personal injury, and probate legal matters.

      In providing services to the coin laundry and dry cleaning industries, Mr. Mattenson has represented equipment distributors, coin laundry and dry cleaning business owners confronted with landlord-tenant issues, lease negotiations, sale documentation including agreements, escrow instructions, and security instruments, as well as fraud or misrepresentation controversies between buyers and sellers of such businesses.

      Mr. Mattenson serves as an Arbitrator for the Los Angeles County Superior Court. He is also past chair of the Law Office Management Section of the Los Angeles County Bar Association. Mr. Mattenson received his Bachelor of Science degree (Accounting) in 1964 and his Juris Doctorate degree from Loyola University School of Law in 1967.

      Bi-monthly articles by Mr. Mattenson on legal matters of interest to the business community appear in alternate months in The Journal, a leading coin laundry industry publication of the Coin Laundry Association, and Fabricare, a leading dry cleaning industry publication of the International Fabricare Institute. During the period of May 1995 through September 2002, Mr. Mattenson contributed similar articles to New Era Magazine, a coin laundry and dry cleaning industry publication which ceased publication with the September 2002 issue.

      This website contains copies of Mr. Mattenson's New Era Magazine articles which can be retrieved through a subject or chronological index. The website also contains copies of Mr. Mattenson's Journal and Fabricare articles, which can be retrieved through a chronological index.

      In addition to Mr. Mattenson's trial practice, he has successfully prosecuted and defended appeals on behalf of his clients in various areas of the law. Some of these appellate decisions are contained within his website.


You Negotiate And Sign A Coin Laundry Lease,
But The Landlord, Who Doesn't Sign,
Signs A Lease With A Competitor!
Can You Sue To Enforce The Lease Or For Interference?

      You  negotiate with a landlord of a shopping  center  under
construction  for approximately seven months!  Finally,  after  a
major  investment  of time and energy, you conclude  negotiations
for  a  lease  of the coin laundry location within  the  shopping
center.   The lease, provided to you by the landlord, sets  forth
an  initial term of 10 years.  You sign the lease as president of
your corporation through which you will conduct the business, and
a personal guaranty.  You return the documents to the landlord by
mail.

      About one month later, when your mailbox does not produce a
counter signed copy of the lease from the landlord, you call  the
landlord's secretary for a progress report.  She informs you,  in
a  syrupy  sweet  voice, that a lease has been  executed  by  the
landlord, but not with you!  She advises that the landlord signed
a  lease  for  the coin laundry location with a competitor  at  a
slightly higher rental.

       Emotionally  devastated  by  the  information,  and  after
consuming three or four "boiler makers" at a neighborhood tavern,
you  decide that the landlord needs to be sued to either  enforce
the  lease  or compensate you for anticipated loss of profit  and
emotional distress.

     Any chance for success?

      Bed,  Bath & Beyond of La Jolla, Inc., on somewhat  similar
facts,  apparently  thought there would be a chance  of  success.
Bed,  Bath  & Beyond had negotiated with La Jolla Village  Square
Venture Partners for a lease of retail space in a shopping center
from  May  1992 through January 1993.  During February  1993,  La
Jolla's attorneys presented Bed, Bath & Beyond with the lease and
a guaranty to be signed by its parent corporation.  The documents
were signed and returned to La Jolla.  During late March 1993,  a
representative  of  La Jolla contacted Bed,  Bath  &  Beyond  and
informed the company that La Jolla had not executed the lease and
instead planned to lease the property to Linen 'N Things.

      Bed,  Bath  & Beyond filed an action against La  Jolla  and
Linens  'N  Things asserting various causes of action,  including
specific  performance, breach of contract and fraud  against  the
landlord  and causes of action for interference with  contractual
relations  and prospective economic advantage against  Linens  'N
Things.

     The trial court essentially granted summary judgment against
Bed, Bath & Beyond, and in favor of La Jolla and Linen 'N Things.
Bed, Bath & Beyond thereafter appealed to the California Court of
Appeal.

     The proposed La Jolla lease provided for a term of 10 years.
The  California  Civil Code requires that an agreement  to  lease
real  property for a term longer than one year must be in writing
and signed by "the party to be charged."  Since the landlord,  as
the  "party  to be charged" did not sign the 10 year  lease,  the
agreement was invalid and therefore unenforceable.

     Thus, as to enforcing the lease by specific performance, the
court concluded:

                "Whether viewed as an oral agreement or
          written agreement, plaintiff's alleged  lease
          agreement  is  unenforceable  because  it  is
          undisputed  that  La Jolla,  the  lessor  and
          "party to be charged" never signed the  draft
          instrument the plaintiff signed."

      The plaintiff argued that the lease was not subject to  the
statute  of  frauds  because,  under certain  circumstances,  the
agreement could have been performed within one year from the date
of  its making.  Plaintiff argued that the tenant could terminate
the lease before the rental term commenced if the landlord failed
to  begin certain work on the property and the landlord  had  the
right  to  terminate the lease before commencement of the  rental
term  if the landlord was unable to obtain certain permits.   The
court, nonetheless, held an agreement to lease real property  for
a  period in excess of one year must be in writing and signed  by
the  party  to  be  charged "regardless  whether  such  agreement
provides that it may be canceled or terminated within one year of
the date of its making and prior to the commencement of the lease
term."

     The Court of Appeal also affirmed the trial court's decision
that  the  plaintiff could not pursue a cause of  action  against
Linen 'N Things for intentional interference with the contractual
relationship  between Bed, Bath & Beyond and  La  Jolla  for  the
simple  reason  that  such  a  cause  of  action  requires:   "an
underlying  enforceable contract.  Where  there  is  no  existing
enforceable   contract,  only  a  claim  for  interference   with
prospective advantage may be pleaded."

     The Court of Appeal also dispensed with plaintiff's cause of
action for interference with prospective economic advantage.

     The Court notes that:

                "the only active interference alleged .
          . . was that Linen 'N Things offered La Jolla
          more  money  per  square  foot  to  rent  the
          subject  retail space.  Linen 'N Things  also
          presented evidence that it did not  act  with
          the intention of illegally restraining trade,
          but  only  with the intent of competing  with
          plaintiff for attractive retail space."

     The Court of Appeal thus concludes:

                "California  law has long recognized  a
          `competition  privilege' which  protects  one
          from  liability for inducing a  third  person
          not  to  enter into a prospective contractual
          relation  with  a  business competitor.   The
          privilege  applies where `"(a)  the  relation
          [between  the  competitor and  third  person]
          concerns a matter involved in the competition
          between the actor and the competitor, and (b)
          the actor does not employ improper means, and
          (c)  the  actor  does not intend  thereby  to
          create  or  continue an illegal restraint  of
          competition, and (d) the actor's  purpose  is
          at  least in part to advance his interest  in
          his  competition with the other." .  .  .  .'
          [citation].    In   short,  the   competition
          privilege   furthers   free   enterprise   by
          protecting the right to compete fairly in the
          marketplace.    One  may   compete   for   an
          advantageous  economic  relationship  with  a
          third  party  as  long as one  does  not  act
          improperly or illegally."

     The moral of the story?  Don't deliver a lease for execution
by  mule  and go on a cruise.  Use a messenger service.  Make  an
appointment to personally deliver the lease to the landlord.  See
if  you can obtain the landlord's signature on the spot!  If not,
call the next day to inquire as to when you can expect to receive
the executed lease.  In short, if you snooze, you may lose.


[This column is intended to provide general information only  and
is  not intended to provide specific legal advice; if you have  a
specific  question  regarding the  law,  you  should  contact  an
attorney  of your choice.  Suggestions for topics to be discussed
in this column are welcome.]


Reprinted from New Era Magazine
Myles M. Mattenson  1997-2002