§17.9 - Renewals and Extensions

• Jurisdiction: Washington

§17.9 RENEWALS AND EXTENSIONS

In ordinary terms, "renew" signifies a beginning over and repetition of a thing, while "extend" means a continuation of the original thing. In some jurisdictions, "renewal" of a lease will require execution of a new leasing agreement. In others, the court will look not merely to which of the two words the parties chose, but to the totality of the circumstances to decide which effect the parties intended. Decisions following this approach usually conclude that it would be unnatural to suppose the parties meant renewal in the technical sense, since this would call for them to execute a new agreement. Yet a third view is to treat the words "renew" and "extend" as calling for an extension, so that no new agreement is needed. 1 AMERICAN LAW OF PROPERTY §3.85 (A. James Casner ed., 1952)

Washington clearly does not follow the first of the above views. The choice between the second and third has not expressly been made, though the cases seem consistent with the third view. Language in two opinions, amounting at least to strong dicta, suggests that no distinction exists between renewals and extensions. Labor Hall Ass'n v. Danielsen, 24 Wn.2d 75, 163 P.2d 167 (1945); Henry v. Bruhn & Henry, 110 Wash. 321, 188 P. 506 (1920). In determining the length of term of a lease for purposes of statutes of frauds, the period of any renewal or extension must be added to the original term. Labor Hall Ass'n, 24 Wn.2d 75. Exercise of a renewal option may be made by giving notice, without the necessity for executing a new lease. Jones v. Dexter, 48 Wn.2d 224, 292 P.2d 369 (1956) (dictum); Gattavara v. Cascade Petroleum Co., 27 Wn.2d 263, 177 P.2d 894 (1947) (alternative holding). If the lease does not require a notice, the tenant may renew merely by remaining in possession after the end of the term. Gattavara, 27 Wn.2d 263 (alternative holding).

(1) Operation of renewal/extension provisions

A tenant's renewal option must be for valuable consideration. When the lease itself contains the option, the tenant's several covenants will provide consideration. But if the renewal option is contained in a separate instrument executed at a time apart from the lease, then there must be fresh consideration. Hill v. Corbett, 33 Wn.2d 219, 204 P.2d 845 (1949). New consideration may not be required when the separate instrument is executed on the same day as the lease, as part of the same transaction. Spotts v. Westlake Garage Co., 116 Wash. 255, 199 P...