Abstract: Starting from a model of microscopic interactions between C-70 molecules, we have developed a theory which describes the orientational dynamics and its coupling to lattice displacements in the rhombohedral phase of C-70 fullerite. The Landau free energy is calculated. We obtain a first-order phase transition to a monoclinic structure with the space group P2(1)/m. The transition is driven by the condensation of orientational quadrupoles at the F point of the Brillouin zone of the rhombohedral lattice. We find no evidence that the monoclinic structure is connected with the freezing in of orientations around the fivefold molecular axis. We calculate the lattice strains that are associated with the transition to the monoclinic structure. The theory is compared with a range of experimental data on the phase transition.