Legal Question in Real Estate Law in California
Real Estate - Church Property
Recently the church we are leasing asked us to leave by April. Our congregation has leased the church property for over ten years. We are part of the same denomination. There is no written lease agreement. We have received assurances from the denomination that we would not be evicted. During the ten years we paid monthly rent at or above market prices and we have spent nearly $75,000 improving the premises. We installed a new air conditioning unit, remodeled the mothers room, remodeled the fellowship hall, etc. Many times the leasor would request financial help and we would give it over and beyond the required rent. Are we entitled to any of the money we spent improving the facility? Do we have any recourse for being evicted in the fashion without cause? We bailed this church out many times financially. We have records of each transaction. Please advise us of any rights we have.
2 Answers from Attorneys
Re: Real Estate - Church Property
It sounds like you may have a case for unjust enrichment. Generally, fixtures added to property become the property of the landlord upon termination of the lease. But as the landlord assured you that the lease would not be terminated, it would be unjust for your landlord to benefit from his misstatements.
Re: Real Estate - Church Property
Unjust enrichment is one legal doctrine upon which you might prevail. I think, however, you have a better chance to prevail by asserting the doctrine of promissory estoppel. Actually, the former might be helpful in obtaining reimbursement for your improvement expenses, while the latter might be asserted to prevent the immediate eviction.
Here are the definitions of each from Black's Law Dictionary:
"Promissory estoppel. That which arises when there is a promise which promisor should reasonably expect to induce action or forbearance of a definite and substantial character by the promisee, and which does induce such action or forbearance, and such promise is binding if injustice can be avoided only by enforcement of promise. [citation] Elements of a 'promissory estoppel' are a promise clear and unambiguous in its terms, reliance by the party to whom it was made, with the reliance being both reasonable and forseeable, and injury to the party asserting the estoppel as a result of his reliance. [citations]"
"Unjust enrichment doctrine. General principle that one person should not be permitted unjustly to enrich himself at the expense of another, but should be required to make restitution of or for property or benefits received, retained or appropriated, where it is just and equitable that such restitution be made, and where such action involves no violation or frustration of law or opposition to public policy, either directly or indirectly. [citation] Unjust enrichment of a person occurs when he has and retains money or benefits which in justice and equity belong to another. [citation] Three elements must be established in order to sustain a claim based on unjust enrichment. A benefit conferred upon the defendant by the plaintiff; an appreciation or knowledge of the benefit by the defendant; and the acceptance or retention by the defendant of the benefit under such circumstances as to make it inequitable for the defendant to retain the benefit without the payment of its value."
The possible weakness in the promissory estoppel argument is that the promise not to evict you may not have been sufficiently definite, particularly as to the duration of the promise. However, I would argue that the court should order that there be no eviction until you've been able to amortize (recover through use) the fair value of your improvement labor and expenditure.
The chief weakness of the unjust enrichment argument is that the owner will argue that it is a general principle of landlord-tenant law that leasehold improvements inure to the landlord, and therefore there is nothing unjust in it retaining the benefits conferred without compensating you.
Both arguments strongly presented in a well-drafted complaint should have a chilling effect on the eviction attempt.