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Taylor v. King Cole Theatres

September 6, 1944

RALPH TAYLOR AND MALCOLM TAYLOR
v.
KING COLE THEATRES, INCORPORATED, ET ALS



Appeal from a decree of the Circuit Court of Wise county. Hon. George Morton, judge presiding.

Present, Campbell, C.J., and Hudgins, Gregory, Eggleston and Spratley, JJ.

Gregory

[183 Va Page 118] GREGORY, J., delivered the opinion of the court.

Ralph Taylor and Malcolm Taylor, the appellants here, filed their bill of complaint in the court below asking the court to direct who now has the power and authority to extend a certain lease for the ground floor of a building in which the complainants operated a moving picture theatre. King Cole Theatres, Inc., the assignee of the lease, was made a party defendant, and it is the only defendant in so far as this appeal is concerned. The court below was of opinion that no extension or renewal of the lease could be made without the consent and approval of King Cole Theatres, Inc.

The facts are not in dispute. In the early part of 1938 the appellants were operating a small theatre in Gate City and, needing larger space, sought out B. K. Barker, Birdie K. Quillin, and Beverly Barker, the owners of a certain lot situate in the business section of Gate City, and requested that they erect a building on the lot, the downstairs of which would serve as a place to project moving pictures.

This was agreed to by the owners and the appellants. They entered into a written contract on March 21, 1938, wherein the owners agreed to erect a building on the said lot and lease the ground floor to the appellants, for which they, the appellants, were to pay the owners twenty-five per cent of the gross receipts of each performance. The owners agreed to install in the theatre the necessary seats and other equipment, and the appellants agreed to use this space for a moving picture theatre, and they also agreed to furnish the necessary moving picture machines and other like equipment. The lease was to continue over a period of five years from the time of the occupancy of the building, and there was provided in the lease a renewal agreement upon terms to be agreed upon for an additional five-year period.

The building was erected and the appellants began the operation of their theatre on July 15, 1938, and they continued their operation under the contract with the owners until April 20, 1939. On that date the owners assigned in writing to King Cole Theatres, Inc., all their right, title and

interest as landlords under the lease agreement of March 21, 1938, with the appellants. Thereafter, the appellants continued to operate the theatre, recognizing King Cole Theatres, Inc. as their landlord by making the payment of the said twenty-five per cent of the gross receipts to it for two years.

In April, 1941, the appellants desired to renew their lease for the ground floor for an additional five-year period under the renewal agreement contained in the first contract of March 21, 1938. Instead of obtaining this renewal from King Cole Theatres, Inc., they entered into another contract on April 19, 1941, with Birdie K. Quillin, B. K. Barker, and Beverly Barker, the original lessors, for an additional term of five years to commence on July 15, 1943, for a specified rental of $180 per month. This latter contract was entered into without the knowledge or consent of King Cole Theatres, Inc., the assignee. Thereupon, a controversy arose between King Cole Theatres, Inc., the appellants, and the original owners of the building, as to who had the right and authority to execute a renewal of the lease. As a result of this controversy, this suit was instituted and decided against the appellants.

As we have already indicated, there were three written contracts involved. First, a contract of lease of March 21, 1938, between the owners as lessors, and Ralph Taylor and Malcolm Taylor, the appellants, as lessees. Second, a contract of April 20, 1939, between the said owners as lessors, and King Cole Theatres, Inc., assigning unto the latter all of their right, title and interest in the lease contract, including the right of renewal. Third, a contract of lease of April 19, 1941, between the original lessors, and the appellants, granting an extension of the original lease for five years from July 15, 1943, at a rental of $180 per month.

[1] There is no provision in the original lease contract prohibiting the lessors or the lessees from assigning their rights under the lease. In the absence of an express prohibition, all leases are assignable. Wainwright v. ...


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