Opinion ID: 1162130
Heading Depth: 1
Heading Rank: 2

Heading: Defendant's affirmative defenses.

Text: Defendant Hub first assigns as error the sustaining of plaintiff's demurrer to two affirmative defenses alleged in its original answer. Plaintiff's only response to this assignment is to contend that upon pleading over by the filing of an amended answer defendant waived its right to assign as error the sustaining of a demurrer to these affirmative defenses alleged in its original answer. Such a contention was rejected in Moore v. West Lawn Mem'l Park, 266 Or. 244, 248, 512 P.2d 1344 (1973), overruling previous decisions to the contrary. The first affirmative defense in defendant's original answer alleged that the skidder became totally unusable as a result of weather conditions which were so unprecedented and unforeseen as to constitute an Act of God and that this terminated the lease. Defendant contends that the obligation to pay rent under a lease of personal property may be terminated not only by its total destruction, but also by damage which renders such property totally unusable, at least in the absence of fault or want of care by the lessee. See New York, L.E. & W.R. Co. v. New Jersey Electric Ry. Co., 60 N.J.L. 338, 38 A. 828 (1897). In any event, a lessee of personal property has a duty to return it to the lessor in good condition, unless otherwise provided by contract or unless its failure to do so is excused as not being due to its fault or want of care. National Fire Ins. Co. v. Mogan et al, 186 Or. 285, 289, 206 P.2d 963 (1949). Thus, defendant was entitled to plead as an affirmative defense facts showing that damage to this equipment was not due to its fault or want of care, but was the result of weather conditions which were so unprecedented and unforeseen as to constitute an Act of God which was the sole cause of the damage to the equipment, so as to relieve defendant from responsibility for damage to the equipment (cf. Schweiger et ux v. Solbeck et ux, 191 Or. 454, 464-65, 230 P.2d 195 (1951)). Thus, the trial court erred in sustaining plaintiff's demurrer to this affirmative defense. In this case, however, defendant was permitted to amend its answer to allege, again as an affirmative defense, that the skidder was totally destroyed and rendered unusable by a cold snap and that such destruction was not caused by defendant's negligence. That defense, which was a proper one if supported by substantial evidence, did not require that defendant sustained the more difficult burden of proof that the cold snap was so extraordinary and unforeseeable as to constitute an Act of God which was the sole cause of the damage. See Schweiger et ux v. Solbeck et ux, supra at 464, 230 P.2d 195. ORS 19.125(2) provides that No judgment shall be reversed    except for error substantially affecting the rights of a party. In our opinion, defendant suffered no substantial prejudice from the sustaining of the demurrer to the affirmative defense as originally alleged. The second affirmative defense to which plaintiff's demurrer was sustained alleged that on or about December 12, 1972, defendant notified plaintiff that the skidder was of no use due to its damage; that Hub did not desire to use it and thus terminated any liability to pay rent. It is well established that the lease of personal property for an indefinite period of time is ordinarily terminable at any time at the will of either party. See Sawman Oil Co., Inc. v. Bush, 136 S.W.2d 938, 940 (Tex.Civ.App. 1940); Karp v. Perry, 164 N.Y.S. 685 (S.Ct. 1917). It is equally well established, however, as discussed below, that such a lessee ordinarily has a duty to return the leased property upon termination of the lease. Nat. Cash Reg. Co. v. I.M.C., Inc., 260 Or. 504, 509-10, 491 P.2d 211 (1971); cf. National Fire Ins. Co. v. Mogan et al, supra, 185 Or. at 289, 206 P.2d 963. In addition, it is held by most courts which have considered the question that if the lessee does not do so the lessor may elect to treat the lessee's continuance in possession as a renewal of the lease and demand payment of rent at the agreed rental rate for the entire period during which the lessee retains possession of the property. See Annot., 144 A.L.R. 1024 (1943), and cases cited therein. Indeed, this was the theory of the plaintiff in this case and the theory upon which the case was submitted to the jury. It is conceded by defendant Hub that even after it claimed to have given notice to plaintiff in early December 1972 that it was terminating the lease, defendant nevertheless did not return the equipment to plaintiff until February. It follows, in our judgment, that regardless of whether defendant was liable for rent for the subsequent period from February to April, the giving of notice to terminate the lease in December 1972 in and of itself would not have been sufficient to relieve defendant from the obligation to pay at least some further rent, at least unless defendant was able to establish that the damage to the equipment which caused it to be totally unusable was not due to defendant's fault or want of care. The affirmative defense alleged in defendant's original answer was that the giving of notice alone was sufficient to terminate this lease. Defendant's amended answer alleged as an affirmative defense that the damage to the machine was due to plaintiff's fault (rather than defendant's fault) and that defendant then notified plaintiff of the damage. It follows again, in our opinion, that under the facts of this case any error in sustaining the demurrer to the affirmative defense as originally pleaded did not substantially affect the rights of this defendant.