Bevis v. Terrace View Partners, LP, 244 Cal. Rptr. 3d 797 (2019)

Citation: Bevis v. Terrace View Partners, LP, 244 Cal. Rptr. 3d 797 (2019)
Parent Document: Bevis v. Terrace View Partners, LP, 244 Cal. Rptr. 3d 797 (2019)
Jurisdiction: California (state)
Effective Date: 2019-02-28
Original Source: https://www.courtlistener.com/opinion/6240337/bevis-v-terrace-view-partners-lp/ ↗

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Defendants' discretion over assignment of leases under paragraph 11.3 does not give rise to a valid claim for breach of the implied covenant of good faith and fair dealing. Paragraph 11.3 expressly gave defendants the right to either require assignment of the lease to a buyer of a home in the park or to terminate the lease and enter into a new lease agreement with the buyer. The implied covenant of good faith and fair dealing cannot be read to require defendants to take a particular action that is discretionary under the contract when the contract also expressly grants them the discretion to take a different action. To apply the covenant to require a party to take one of two alternative actions expressly allowed by the contract and forego the other would contravene the rule that the implied covenant of good faith and fair dealing may not be "read to prohibit a party from doing that which is expressly permitted by an agreement." ( Carma, supra , 2 Cal.4th at pp. 374, 376, 6 Cal.Rptr.2d 467, 826 P.2d 710.) No contractual obligation may be implied if it would obliterate "a right expressly given under a written contract." ( Gerdlund v. Electronic Dispensers International (1987) 190 Cal.App.3d 263, 277, 235 Cal.Rptr. 279.) To imply that defendants were obligated under paragraph 11.3 to offer buyers of plaintiffs' homes new leases with lower rent and were prohibited from requiring selling homeowners to assign their leases to the buyer would obliterate defendants' right expressly given under the written leases to require a lease assignment.

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