Opinion ID: 1374499
Heading Depth: 1
Heading Rank: 5

Heading: the award of damages for lost rental income

Text: The trial court found that it would have taken 1 year to complete the repairs necessary to place the premises in the condition required by the lease, and that the reasonable lost rental income for this period was $117,000. It awarded Fisher this sum as consequential damages. Arden challenges the trial court's award of damages for lost rent, relying on two different theories. First, Arden contends that Fisher unreasonably delayed giving notice that it wanted the premises restored to their original condition, thereby preventing Arden from restoring the premises during the lease term. Thus, Fisher cannot recover damages for lost rent during the time that would have been required for restoration. Arden observes that, while it gave Fisher the required 1-year notice of termination of the lease, Fisher did not notify Arden that it wanted the premises restored until 24 days before the termination of the lease. Arden contends that if Fisher had notified it of its desire shortly after Arden gave notice of termination, restoration might have been accomplished by the end of the lease term. Arden argues that Fisher's delay prevented it from restoring the premises before the end of the lease term, and Fisher cannot take advantage of this by recovering damages for lost rent during the period required for repair. Arden relies on the principle that a party to a contract who prevents another from performing an obligation cannot recover for the nonperformance. Hydraulic Supply Mfg. Co. v. Mardesich, 57 Wn.2d 104, 105, 352 P.2d 1023 (1960). Our review of the evidence, however, indicates that Fisher did not unreasonably delay giving notice to Arden of its desire that Arden restore the premises. The trial court found that Fisher gave Arden notice to restore the premises within a reasonable time and did not unreasonably delay enforcing any of its rights under the lease. There is substantial evidence to support these findings. The lease did not specify a particular time when Fisher had to provide notice of its desire that Arden restore the premises. Therefore, it was not unreasonable for Fisher to give Arden notice when it did. Furthermore, there is no evidence that Arden would have restored the premises had Fisher made its request earlier. In an unchallenged finding of fact, the trial court stated that [t]here is no credible evidence that Arden at any time changed its position to its detriment as a result of any action or nonaction by Fisher. Arden's second argument is based on a different construction of the lease. Arden contends that the lease did not even require Arden to restore the premises before the end of the lease term. It notes that the lease states, on the termination or expiration of this lease the said Lessee shall restore and repair the demised premises in their original condition, should the Lessor so desire. Arden asserts that this language contemplates that any restoration will occur after termination. Therefore, it could have complied with its obligations under the lease by beginning restoration in June 1979 when the lease term ended and finishing it in June 1980. Arden argues that, had it so performed, there would have been no breach and Fisher would have earned no rent, and by awarding Fisher rent for that year, the trial court put Fisher in a better position than it would have been in had Arden performed. We disagree with Arden's argument that the language of the lease quoted above means that the restoration process must begin at the end of the lease term. We do not believe that this provision was specifically intended to establish the point in time when restoration would have to begin. Rather, it appears that this language was simply intended to establish the lessor's right to require the lessee to restore the premises once it was clear that the lease would terminate. [6] Once Fisher notified Arden that it wished it to restore the premises, Arden was obligated to do so under the lease. Arden did not, in fact, comply with this obligation. Where a lessee breaches a covenant to return the premises in a prescribed condition, it is proper to award damages for the lessor's loss of rent during the time needed to restore the premises to the condition required by the lease. 2 M. Friedman, Leases § 18.1 (2d ed. 1983); Iverson v. Spang Indus., Inc., 45 Cal. App.3d 303, 308, 119 Cal. Rptr. 399 (1975). We, therefore, affirm the trial court's award of damages for lost rental income.