Case Title: Ind. Leasing Corp. v. Roberts Myrtlewood Factory

Citation: 240 Or. 577, 401 P.2d 698

Docket Number: 

State: oregon

Court: Oregon Supreme Court

Date: 1965-05-12T00:00:00Z

Document:
Affirmed May 12, 1965.
Petition for rehearing denied June 22, 1965.
*578 Morgan S. Pritchett, Portland, argued the cause and filed the brief for appellant.
Clifford E. Nelson, Portland, argued the cause for respondent. With him on the brief were Phelps, Nelson & Shepherd, Portland.
Before McALLISTER, Chief Justice, and SLOAN, GOODWIN and HOLMAN, Justices.
AFFIRMED.
HOLMAN, J.
On September 27, 1961, plaintiff leased two items of office equipment to defendant for a period of sixty months commencing October 1, 1961, at a monthly rental of $16.12. The contract contained the following provision setting forth plaintiff's remedies in case of default:
The contract contained no provision for the acceleration of future rental payments in case of default.
*579 Defendant defaulted in its payments of rental. On March 28, 1963, plaintiff brought an action in the small claims department of the District Court for Multnomah County for rent due for the months of February and March of 1963 and received judgment which was paid. On May 9, 1963, another action was commenced for an additional month's rent which was dismissed by the court without prejudice. On August 7, 1963, plaintiff instituted this action in Circuit Court for rent for each and every month during the balance of the contract.
To this complaint defendant filed two affirmative answers setting up the two prior actions in the District Court. Plaintiff demurred to these answers and the demurrers were sustained. Defendant's first assignment of error contends that the trial court should not have sustained the demurrers. Defendant urges that at the time of the two prior actions defendant's breach was total, that all payments under the contract were then due and owing, that therefore plaintiff, by suing for less than was due, waived all rights to the difference now sought to be recovered. Defendant contends that to allow this action permits plaintiff to split its cause of action to defendant's detriment.
1. Corbin on Contracts discusses the matter as follows in Volume 3A, § 698, page 300:
There appears to be no reasonable ground of difference between the illustrations in Corbin and the factual situation in this case. In the absence of circumstances relating to breach other than the nonpayment of rent, plaintiff would be permitted to bring an action for each payment as it became due.
2. In order to constitute an anticipatory total breach the conduct must have shown a positive, definite, absolute, unconditional and unequivocal intent not to perform in any event. Mohr v. Lear, 239 Or 41, 395 P2d 117 (1964); Swick v. Mueller, 193 Or 668, 676, 238 P2d 717 (1952).
Defendant contends, however, that there are circumstances other than the failure to make payments and that the breach was total because the bailed articles were returned to and accepted by plaintiff and that this relinquishment of possession was a repudiation by defendant of the contract to make future payments that amounted to an anticipatory breach which accelerated *581 the balance of the payments, making them due prior to plaintiff's commencement of the first action.
Defendant's answers may have been proper on their faces and not subject to demurrer because they allege as a fact that the amount sued for in this case had accrued prior to the actions in district court. However, defendant asked for and was granted an opportunity to make an offer of proof upon behalf of its answers to which demurrers had been sustained. This is an unusual procedure that is novel to the court, but which served a useful purpose in this case as we now have all the proof which would have been available had the answers not been demurred out.
From the evidence we can say that even if the demurrers were improperly sustained, defendant was not prejudiced thereby as its proof falls short of that which was necessary to sustain its answers. The evidence does not show that the bailed articles were returned prior to the dates that the two actions were instituted in district court. It shows only that the bailed articles were returned prior to June 4, 1963, which was almost a month subsequent to the last action in district court. Therefore there is no proof that the circumstances which are depended upon to prove the total breach were in existence at the time of the prior actions in district court. It is therefore unnecessary for the court to decide whether, under the circumstances, the return and acceptance of the bailed articles constituted an anticipatory repudiation amounting to a total breach.
The next assignment of error is that defendant's motion for a nonsuit was denied. The assignment contends that plaintiff's evidence showed that defendant was not in default at the date the present action was *582 instituted as there were adequate funds in plaintiff's hands, for which defendant was entitled to credit, to make the monthly payments past that date.
3. Including the two payments which were secured through judgment in district court and applying the deposit of $16.12 there were 19 payments made. This would pay the rent to May 1, 1963. The bailed property was sold under the terms of the contract for a net of $95. From these proceeds 10 per cent of the original cost of the articles, or $69.47, had to be deducted. The difference of $25.53 was applied to rent for May and left $9.41 to apply on June. This case was filed August 7. It is apparent the contract was in default and the motion was not well taken.
Absent an acceleration clause, there is doubt whether the plaintiff may properly recover, at the time of the institution of this action, for all payments of future rent provided in the contract. However, the measure of damage issue has not been made the basis of an assignment of error on appeal. The lack of such an issue can be understood because by the time the appeal in this court will have been completed most of the payments will have become due and, were recovery for future installments denied, another action would ensue.
The judgment of the trial court is affirmed.