This section contains the nature of the case and procedural background.

Crechale & Polles, Inc. (P) and Smith (D), the lessee, entered into a five-year lease. The rent was $1,250 per month. As the end of the lease approached, D attempted to extend it on a month to month basis because a new building he was moving to was not yet completed. D claimed that P agreed to a month to month lease, but P denied any agreement. D paid the rent for February, and the check was accepted and cashed by P. D paid the rent for March, but that check was not accepted by P because it was marked final payment. In April, D then sent a letter tendering the premises to P for inventory. P refused to inventory the building. P then sent a letter stating that P was treating the actions of D as a renewal of the lease for another term of five years. D tendered another check for the final month’s occupancy, and it was rejected by P. P sent another letter and eventually after another year P wrote D demanding past due rent. D’s attorney gave the keys to P. P filed suit, claiming that D was a holdover tenant. The trial court awarded P $1,750 in back rent and $760 for damages to the leasehold premises. P appealed.

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