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decided: February 26, 1988.


Appeal from the Order of the Superior Court entered December 6, 1985 at Nos. 496 and 533 Pittsburgh 1983 affirming in part and reversing in part the Order to the Court of Common Pleas of Fayette County, Civil Division, entered March 17, 1983 at Nos. 1615 and 1693 G.D. 1981. Nix, C.j., and Larsen, Flaherty, McDermott, Zappala and Papadakos, JJ. Hutchinson, Former J., did not participate in the consideration or decision of these cases.

Author: Mcdermott

[ 517 Pa. Page 380]

Appellant, Tony Bronich, appeals by allowance from an order of the Superior Court*fn1 denying him specific performance of an option to purchase certain property consisting of 26.25 acres in Perry Township, Fayette County, Pennsylvania. The Superior Court had affirmed in part and reversed in part an order of the Court of Common Pleas of Fayette County which had dismissed appellees' action in ejectment and granted appellant's prayer for specific performance.

The facts relevant to this controversy are as follows. On September 15, 1970, after approximately two years of negotiations appellees/lessors, Carl and Elizabeth Cimina, entered into a lease agreement with appellant/lessee, Tony Bronich, concerning 26.25 acres of real estate in Perry Township, located in Fayette County, Pennsylvania. The lease had an original term of two years with a right of renewal for ten additional one-year terms. The rental amount for this property was $100.00 per month. In addition, the lease afforded appellant an option to purchase the leasehold property for $18,600.00 at any time during the initial term of the lease, or any of the subsequent renewal periods.

This parcel was part of a larger tract owned by the Ciminas. Appellant occupied the adjacent property and desired to expand and utilize the premises as a location for his business of buying and selling used heavy construction equipment and earth-moving vehicles.

As adjoining neighbors the parties enjoyed an amiable relationship over the years. However, in early 1980 this association began to deteriorate when the Ciminas questioned the financial wisdom of their arrangement, particularly the purchase option held by appellant. Consequently, the Ciminas sought to terminate the lease, and this desire precipitated the present lawsuit.

Up until this point it was appellant's custom to hand deliver his payments in return for a signed receipt. However,

[ 517 Pa. Page 381]

    in the beginning of 1980 appellees began to resist signing a receipt and eventually the payments altogether were refused. This pattern of behavior continued until appellant, upon consulting with his attorney, established a rent escrow account and continued to make regular payments. It was at this time that appellant, through his attorney, informed appellees of his intention to hold them to their legal obligations and more significantly, to exercise his purchase option on the property prior to the expiration of the final renewal term of the agreement.

Over the course of the next several months the relationship continued to worsen. Finally, on June 18, 1981, appellee sent a letter which read in its entirety: "Request your payment of all money due me through March 14, 1981." Appellant was confounded by this request since he was under the impression that he was current in his payments. The situation finally peaked when appellant received on August 7, 1981, a "Notice to Quit" demanding that he forfeit the lease and vacate the premises within ninety days because of his alleged breach of the agreement. Specifically, appellees asserted that appellant was in breach of the provision regarding the payment of real estate taxes on the leased portion of the property.*fn2

It is undisputed that the lease specified that the tenant must pay the real estate taxes on the leasehold premise. The relevant provision of the agreement provided that:

During the term of this lease, Lessee will pay all real estate taxes levied and assessed against the subject premises, whether statements therefor are sent to Lessors or Lessee. If the real estate taxes on the leased premises

[ 517 Pa. Page 382]

    are combined with real estate taxes on other property now owned by Lessors, then Lessee will pay only those taxes attributable to the leased premises and any improvements which may hereafter be erected thereon.

However, from the inception of the lease the real estate taxes assessed to appellees' total acreage were paid each year by Elizabeth Cimina. Mrs. Cimina was apparently unaware of appellant's contractual liability, and was neither informed by her husband nor sought from appellant his share of the taxes. Appellant, on the other hand, maintained that at least once every year he asked Mr. Cimina if he owed any taxes and was assured that none were due. Appellant never refused to pay these taxes and always ...

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