Is electronic mail an acceptable method of notice under a lease? Maybe not, says a court in California – if the lease language is poorly drafted. Most of you are no doubt familiar with “notice” provisions that appear in leases and contracts. They tell us who, how and where to serve any required notification. Many of you also may have been involved in drafting such clauses, and know that they are not often given the same scrutiny as are the deal points of the transaction. The California Court of Appeal decision in Culver Center Partners East #1 v. Baja Fresh Westlake Village is an excellent reminder to be careful in drafting a notice provision that includes the use of “electronic means.”
Baja Fresh failed to pay its rent on the first of a month, so Culver Center tried to serve a notice to pay the overdue rent, or to quit the premises. Culver sent a certified letter to Baja’s manager, at her business office; sent a fax of the notice to the business office; and sent the notice as an attachment to the manager’s e-mail address. Unfortunately, regarding the certified mailing and the fax, neither were sent to Baja’s actual address for notice purposes. Baja admitted that it received the e-mail – but disputed that the notice was proper, and in any event proceeded to pay the amount due, which Culver promptly returned without cashing, claiming it was not paid within the required five-day period. Culver then filed an eviction action. Baja claimed the case should be dismissed because the notice was invalid. They won. Culver might have avoided this problem if it had sent the certified mail or fax to the correct address, but since it did not, the validity of the admittedly received e-mail became the crux of the case.
The notice provision in the lease allowed use of “electronic means” but stated that no matter what method of notice is chosen, the “notice must be delivered to the address provided in the lease.” The e-mail was received by the recipient at a physical address other than that required by the lease. This might seem irrelevant or antiquated, given that e-mail messages are not restricted by physical location. But the court rejected Culver’s argument that it should not matter where the recipient actually receives the message, while acknowledging e-mail can indeed be received anywhere a computer is located. Unfortunately for Culver, the lease language preempted the argument – it made no reference to an “electronic notification address,” instead requiring service at “address provided in the lease.” The court stated:
While this focus on the physical location of receipt (or delivery) of an e-mail has some artificiality (and technological naivete) in this age of laptop computers and smartphones, the fault, if there be any, lies in the language of the lease itself, which, while apparently contemplating “electronic service,” nonetheless omits any reference to an electronic notification address to accomplish that service.
The court referenced, by analogy, a California rule that allows electronic service if, among other things, a party indicates its willingness to accept electronic service by signing a notice so indicating that specifically includes the “electronic notification address at which the party agrees to accept service.” This would seem to be the solution: the notice provision should provide the specific e-mail address at which the notice will be accepted, regardless of the physical location. And, that address should be subject to a prompt change-of-address notification.
In the context of an unlawful detainer proceeding, where compliance with notice requirements will be strictly construed, the “actual receipt” of the message was not enough to allow Culver to prevail, given the language of the lease. In short, Culver “did not comply with the lease’s provisions.” The cause of the failure can be readily cured by careful attention to the electronic notice provision: do not link the electronic notification to a physical address, only to an “electronic notification address.”