Opinion ID: 757518
Heading Depth: 3
Heading Rank: 2

Heading: Termination of damages.

Text: 65 The trial judge held that as a matter of law, the jury could not award damages for Unocal's breaches of its lease obligations, to the extent that such damages might have accrued after the end of the lease. Portland 76 argues that this was mistaken, because damages were foreseeable subsequent to the lease period. Portland 76 argues that Harold Schnitzer Properties v. Tradewell Group, Inc., 104 Or.App. 19, 799 P.2d 180 (1990), and Vonravensberg v. Houck-Carrow Corp., 60 Or.App. 412, 653 P.2d 1297 (1982), so hold. 66 The trial judge was correct. Harold Schnitzer Properties is irrelevant, because it is an appeal from an arbitration award, and the court held that arbitrators have the power to decide the law and act within their authority even if they apply the law erroneously. Vonravensberg is also irrelevant, because it is a tort action against a third party, not an action by a tenant against its landlord for breach of the lease. 67 A third party is not necessarily entitled to take advantage of a landlord's right to end a lease, where it is foreseeable that the landlord will renew the lease. That is the proposition supported by Vonravensberg. But a landlord is entitled to take advantage of its own lease provision providing a termination date to the tenant's right to possess the property and profit from possession. Unocal's duties to Portland 76 regarding the real estate ended when the lease ended. Leaseholds that end do not, by their very nature, bind the parties indefinitely. United States v. 42.13 Acres of Land, 73 F.3d 953, 956 (9th Cir.1996). We held in an analogous case that a landlord does not have to pay for its own contractually preserved right to do as it chooses: 68 It is one thing for the market to value the probability that a third party will exercise its liberty in a particular way, and make [a defendant] pay for that market value, but quite another to make [the defendant] pay for its own contractually preserved right to do as it chooses. 69 42.13 Acres of Land, 73 F.3d at 956. 70 Portland 76 argues that because Unocal failed to perform its maintenance duties under the lease, it began its relationship with its new landlord, National, with an inferior facility, and that led to subsequent damages, citing Arnott v. American Oil Co., 609 F.2d 873, 887 (8th Cir.1979). Arnott does involve a lease by the defendant to the plaintiff, but is not in point, because the theories upon which damages for the period subsequent to the lease were awarded were fraud, breach of fiduciary duty, and price fixing in violation of antitrust laws, not breach of the lease. Unocal had no duty under its lease with Portland 76 to ensure that Portland 76's next lease with a different lessor was of a particular grade of facilities.