4350 NW 8 TERRACE, LLC, ET AL.

v.

COMMERCIAL LAUNDRIES, INC.

Third District Court of Appeal State of Florida

Opinion filed May¹⁴, 2025. Not final until disposition of timely filed motion for rehearing.

________________

No. 3D23-2040 Lower Tribunal Nos. 2023-1438-CC-05; 2023-001514-CC-05; 2023- 001515-CC-05; 2023-001516-CC-05; 2023-001518-CC-05; 2023-001522- CC-05; and 2023-001534-CC-05 ________________

4350 NW⁸ Terrace, LLC, et al., Appellants,

vs.

Commercial Laundries, Inc., Appellee.

An Appeal from the County Court for Miami-Dade County, Michael G. Barket, Judge.

León Cosgrove Jiménez, LLP, and Derek Eduardo León and Benjamin Weinberg, for appellants.

Tripp Scott, P.A., and Paul O. Lopez and Jennifer A. Bautista (Fort Lauderdale), for appellee.

Before EMAS, LINDSEY and LOBREE, JJ.

EMAS, J.

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INTRODUCTION

This appeal involves seven related lawsuits filed in the trial court, each involving a dispute over the construction of certain provisions contained in a long-term commercial lease. The Landlord, 4350 NW⁸ Terrace, LLC, appeals a final judgment entered in favor of the Tenant, Commercial Laundries, Inc., following a bench trial. The Landlord contends the trial court erred in its interpretation of an addendum to the parties’ commercial lease and, because of such interpretation, further erred in finding that the conditions to invoke a ten-year lease extension were satisfied. Upon our de novo review, we agree, and hold that the trial court erred in its construction of the addendum and in determining that the requisite conditions for the Tenant to invoke the ten-year lease extension were satisfied. We therefore reverse and remand with instructions to enter judgment in favor of the Landlord.

FACTS AND PROCEDURAL HISTORY

In October 1998, the parties executed a lease agreement providing rental space at seven properties for Commercial Laundries (Tenant) to operate a laundry machine business. The Lease provides for an initial ten-

3 year term and that rent be paid in the form of “50% of the gross revenue derived from the operation of said equipment.” The pertinent question raised below (and here on appeal) is: When did the lease terminate? Answering that question requires construction of the lease terms, in particular Paragraph Eight, as well as the Addendum to the Lease. Paragraph Eight of the Lease provides an option to extend the ten-year Lease for two successive seven-year terms: Lessee shall have an option to extend this Lease, upon identical terms and conditions as set forth herein, for two (2) successive periods of seven (7) years each, such options to be considered exercised unless Lessee notifies Lessor to the contrary of at least Six (6) months prior to the end of the original Lease term or the end of the first renewal term thereof.

(Emphasis added). In contrast, the Addendum, executed at or around the same time as the Lease, provides for a ten-year extension of the Lease at the end of the initial ten-year term: [Landlord] and [Tenant] agree that for any buildings still owned by the [Landlord] at the end of the initial¹⁰ year term [Tenant] shall then be entitled to extend the initial¹⁰ year term for an additional¹⁰ years in exchange for a payment of the then current market rate for similar laundry room leases.

1 The Tenant filed a counterclaim for liquidated and compensatory damages but withdrew it after the close of evidence at the bench trial.

The trial court then made its oral pronouncement: The way I read it, I have to read it with its given words,¹⁰ years. They get¹⁰ years after that and then the seven and seven will kick in. And to quote in paragraph eight, “Lessees shall have the option to extend this lease upon identical terms and conditions set forth herein.”

Identical, they were paying 50 percent. They continue to pay 50 percent and they continue to accept 50 percent. For those reasons, I find in favor of the Defendant today.

The trial court entered final judgment for the Tenant, finding in pertinent part: [A]t the expiration of the initial ten (10) year period of the Lease(s) the condition for the ten (10) year extension of the Lease(s) provided for in the Addendum was satisfied.

[] [D]uring the ten (10) year extension of the Lease(s), [Landlord] accepted the rent without objection.

The Landlord moved for rehearing, contending the trial court misconstrued the Addendum and that “[n]o evidence was presented at trial to support a finding that [the Landlord] drafted either the Lease or the

STANDARD OF REVIEW

“The interpretation of a lease agreement is a question of law and the applicable standard of review is de novo.” Covelli Fam., L.P. v. ABG⁵, L.L.C., 977 So. 2d 749, 752 (Fla. 4th DCA 2008). However, “[i]n an appeal from a bench trial, the trial judge’s findings of fact are clothed with a presumption of correctness on appeal, and these findings will not be disturbed unless the appellant can demonstrate that they are clearly erroneous.” Id. (quotation omitted). Here, the trial court found the conditions in the Addendum were satisfied, extending the Lease’s initial ten-year term an additional ten years. To the extent this conclusion is a fact-based one, we review this finding for clear error. La Ley Sports Complex at City of Homestead, LLC v. City of Homestead, 255 So. 3d 468, 469 (Fla. 3d DCA 2018) (“We apply a clear error standard to the findings of fact, and a finding will not be disturbed unless

2 There was no admissible evidence presented on which party drafted the Addendum. Although Ricardo Sarria, vice president of the Landlord, testified that the Addendum was drafted by the Tenant, the trial court sustained the Tenant’s objection to Sarria’s testimony on this issue. The Landlord later requested in its motion for rehearing that the trial court reopen the case to allow for additional testimony on which party drafted the Addendum. The request was denied.

ANALYSIS AND DISCUSSION

The Landlord contends the trial court erred in its interpretation of the Addendum to the Lease, and that there was no evidence presented below to prove the Tenant, prior to the end of the initial ten-year term in 2008, attempted to determine the then-current market rate for similar laundry room leases, or that the Tenant, in exchange for the ten-year extension of the initial ten-year term, made a “payment of the then current market rate for similar laundry room leases,” as required by the Addendum’s plain terms.

We look first to the plain language of the Lease and the Addendum. The Lease provides for an initial ten-year term, and monthly rent to be paid in the form of “50% of the gross revenue derived from the operation of said equipment.” Reading the Lease and Addendum together, the Tenant was presented with two methods by which to extend the Lease beyond its initial ten-year term: (1) The Automatic Extension Under the Lease: Lessee shall have an option to extend this Lease, upon identical terms and conditions as set forth herein, for two (2) successive periods of seven (7) years each, such options to be considered exercised unless Lessee notifies Lessor to the contrary of at least

The language of this Lease provision is clear: The Tenant was given the option to extend the lease for seven years and again for a second sevenyear extension; the terms of the seven-year extensions were identical to those terms and conditions stated in the Lease for the original ten-year term; and the option was automatic. The option was “to be considered exercised” unless the Tenant opted out by notifying the Landlord to the contrary at least six months before the end of the Lease term. (2) The Ten-Year Extension Under the Addendum in Exchange for Payment of Then-Current Market Rate:

[Landlord] and [Tenant] agree that for any buildings still owned by the [Landlord] at the end of the initial 10 year term [Tenant] shall then be entitled to extend the initial 10 year term for an additional 10 years in exchange for a payment of the then current market rate for similar laundry room leases.

There are two conditions attached to the exercise of the extension under the Addendum. The parties agree the first condition—that the Landlord still own the buildings at the end of the initial ten-year term—was satisfied. As for the second condition—that the Tenant was entitled to a ten-year extension “in exchange for a payment of the then current market rate for similar laundry room leases”—the parties agree (and the trial court found) that the Tenant continued to make payments in the same manner as it

3 The dispute instead centers, in large part, on who bore the burden to request that payment be changed to “then current market rate for similar laundry room leases.” According to the Tenant, because the “Landlord permitted Tenant to remain on the Properties without ever requesting the then-current market rate payment or raising the issue with the Tenant,” the “Landlord by its actions waived the Addendum’s condition of a then-current market rate payment . . . .” The Tenant further offers that the Landlord presented no evidence that the payments—which undisputedly remained the same throughout the initial-ten-year term—were not in fact “current market rate for similar laundry room leases.” We disagree with both positions for the reasons discussed infra.

The evidence at trial, considered in light of the plain language of the Lease and Addendum, established that the Tenant—though entitled to

We find no merit in the remaining arguments raised by Tenant.

CONCLUSION

We hold that the trial court’s determination—that the condition for the ten-year extension of the Lease provided for in the Addendum was satisfied—is clearly erroneous, and is not supported by competent and substantial evidence, or was “induced by an erroneous view of the law.” La Ley Sports Complex, 255 So. 3d at 469. We reverse and remand with directions to enter final judgment for the Landlord.

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Reversed and remanded.