Appeal from the United States District Court for the District of Guam. D.C. No. CV-89-0040A. Terry J. Hatter, Jr., Cristobal C. Duenas, and Alex R. Munson, District Judges, Presiding.
Mary M. Schroeder, Betty B. Fletcher and Warren J. Ferguson, Circuit Judges. Opinion by Judge Fletcher.
Appellant Oxford Properties & Finance Ltd. ("Oxford"), appeals the judgment of the Appellate Division of the United States District Court for the Territory of Guam in favor of appellees Minor M. Engle, deceased, represented by Milton E. Frank, administrator, and Engle's Appliance Parts, Inc. (collectively referred to as "Engle"), in Oxford's action for unlawful detainer. We have jurisdiction pursuant to 48 U.S.C. § 1424-3(c) (1988), and affirm.
On November 30, 1966, Santiago Castro and George Frazer entered into a lease of real property located in Dededo, Guam, which allowed Frazer to sublet the property to third parties. Subsequently, Frazer entered into a sublease agreement with Engle, the commencement date of which is at issue in this dispute. The lease provided that the sublease was to commence on November 1, 1967, and also stated that the sublease agreement was entered into "this 1st day of November, 1967." The "1st" was entered by hand in the typed document. However, the notarization form at the bottom of the document states:
On this 22 day of December, 1969, before me, a Notary Public in and for the territory of Guam, personally appeared GEORGE H. FRAZER and MINOR M. ENGLE, known to me to be the persons whose names are subscribed to the within instrument and acknowledged to me that they executed the same.
The date "22 day of December, 1969" is written by hand over the words "] day of November, 1967" and initialed by the notary. The recordation notice on the back of the document indicates that the sublease was recorded on December 29, 1969.
The sublease agreement provided for a nine year term and required rent in the amount of $100 a month. It further gave Engle the option of extending the lease for two additional terms of ten years each on the same terms and conditions as the original lease, except that the rent for any such extension would increase to $150 per month. The sublease required written notice to be given to Frazer sixty days before the termination of the sublease in order to exercise the option to extend.
At some time prior to 1977, Frazer assigned his interest in the sublease agreement to James S. Lee & Company ("Lee"). On February 1, 1977, Engle sent Lee a letter, which contained a $1,000 check to cover the rent due from January 1977 to October 1977, and stated the following:
Enclosed is my check to cover lease payments until November this year. In November I will give you a check for $300.00 to bring me up to January 1, 1978. I will then give you a check for $1,800.00 for the year. As I like to pay as you know on a yearly basis. January to December.
Lee accepted the check. On October 5, 1977, Lee sent Engle a letter stating that Engle's sublease, which Lee claimed had commenced on November 1, 1967, had expired because Engle had failed to exercise his option to extend in a timely manner. The letter informed Engle that Lee was currently letting him lease the property on a month-to-month basis and asked him to renegotiate a new lease with Lee. The letter also returned the $300 rent check Engle had submitted for the months of November and December.
On November 8, 1977, Engle's attorney Stephen A. Cronin sent a letter contesting Lee's assertion that the sublease had expired. Cronin contended that the sublease commenced on November 1, 1969, not November 1, 1967, as Lee had claimed in his prior letter. According to Cronin's letter, "the words in Paragraph 1 of the lease which states 'for a term of nine (9) years commencing on the 1st of November, 1967' was [sic] obviously a typographical error, which should have stated 'for a term of nine (9) years commencing on the 1st of November, 1969.'" The Cronin letter enclosed a check for $300 for the November and December rental payment. On November 10, 1977, an employee of Lee's returned Cronin's letter and the check. However, on January 6, 1978, Lee accepted a check for $1200 from Engle for the period between November 1, 1977 and October 31, 1978. The record does not indicate whether any communication between the parties accompanied acceptance of the check.
On July 28, 1978, Engle's attorney filed a "Notice of Exercise of Option to Extend" stating that Engle was exercising his right to extend the sublease for a ten-year period running from November 1, 1978 to October 31, 1988. Lee was served with a copy of the ...