Opinion ID: 1374499
Heading Depth: 1
Heading Rank: 2

Heading: the lessee's repair obligations

Text: The next issue concerns the trial court's assessment of Arden's repair obligations under the repair and surrender covenants of the lease. The pertinent part of the repair covenant provides that the lessee will, throughout said term, at its own expense, make and do all repairs of all kinds, both inside and outside the demised premises, including the roof and walls thereof, and keep the same in good order and repair, damage by fire excepted ... The surrender covenant provides that when the lease terminates, the lessee will surrender and yield up unto the Lessor the demised premises, including all additions and improvements added thereto by either of the parties ... in as good state and condition as reasonable use and wear and damage by fire will permit. The trial court found that these two provisions, read together, meant that no component or element of the building which was required to be returned at the termination of the Lease be in a state or condition beyond (substandard to) its normal maintenance cycle. It concluded that Arden was to perform whatever repairs and maintenance were necessary to keep the premises in good repair throughout the lease term, and that to the extent Arden failed to keep the premises in good repair within the applicable maintenance cycle, it was required to correct those deficiencies under the surrender covenant. It held that Arden breached these obligations and awarded Fisher damages therefor. [2] Arden first argues that the trial court erred in finding that this lease was a long-term triple net lease and in construing Arden's repair obligations accordingly. The length of a lease is a relevant factor in determining a lessee's repair obligations. In a long-term net lease, the tenant has a virtually complete obligation to repair, whereas in a short-term lease the tenant's obligation is comparatively less. 1 M. Friedman, Leases § 10.8 (2d ed. 1983). Arden argues that since 1952, when the original lease term expired, the parties had been engaged in a series of short-term leases, rather than a single, long-term lease. We disagree with Arden's characterization of this transaction. Although each agreement executed after the original agreement covered a short period, taken together these agreements constituted a single, comprehensive transaction. Several factors indicate that the agreements subsequent to the original agreement constituted a continuation of the original lease. First, the terms and conditions of the original lease remained in effect as to succeeding agreements. The agreements subsequent to the original agreement also stated that they extended the lease term. Finally, from 1960 on, every lease extension agreement referred to the original lease, its addenda and extensions, as said Lease, indicating that the series of agreements constituted a single lease. Therefore, we conclude that the trial court reasonably construed the lease in this case as a long-term lease. Since the lease is long term, it is proper to construe broadly the lessee's repair obligations thereunder. Arden next contends the trial court erred in interpreting the repair and surrender covenants by failing to consider the depreciation of the building resulting from Arden's reasonable use. Arden argues that when the trial court held that Arden was required to keep every element of the premises which was to be returned at the termination of the lease within its normal maintenance cycle, it failed to consider the provision for reasonable use and wear in the surrender covenant of the lease. Fisher responds, however, that the analysis used in the Austin reports and adopted by the trial court did give effect to both the repair covenant and the surrender covenant's provision for reasonable use and wear. [3] The initial question we must resolve is who has the burden of proving if repairs claimed are for damage which resulted from reasonable use and wear, and thus are not within the lessee's repair obligations under the lease. No prior case in Washington has answered this question, and other jurisdictions are split. Compare Santini v. Kocher, 38 Conn. Supp. 506, 509, 452 A.2d 318 (1982) with Stegeman v. Burger Chef Sys., Inc., 374 So.2d 1130, 1131 (Fla. Dist. Ct. App. 1979). We hold that, while the lessee is responsible for introducing evidence that damage claimed by the lessor is due to reasonable use and wear, the lessor has the burden of proving that the damage is beyond reasonable use and wear. Because the lessor is the party claiming damages for a breach of the covenant, the lessor must bear the burden of proof. Fisher argues that Arden produced no substantial evidence that any repair which Austin identified was for damage resulting from reasonable use and wear. Arden asserts, however, that the testimony of its expert appraiser, Stephen Olson, constituted such evidence. Olson's testimony indicates that normal use of the building for an ice cream factory caused some damage. However, Fisher also has produced substantial evidence that the condition of the premises was beyond what would result from reasonable use and wear. There is evidence in the record from Robert Grafer and Gorley Sauer that Austin took into account the building's age, use, and wear in determining the extent of necessary repairs. The estimates which Austin produced constituted substantial evidence of repairs required for damage which was beyond reasonable use and wear. Therefore, Fisher satisfied its burden of proving that the damages it sought were beyond the surrender covenant's provision for reasonable use and wear. We affirm the trial court's award of damages for Arden's failure to comply with its repair obligations under the repair and surrender covenants of the lease. Arden also contends that the trial court's damages award and the Austin report on which it is based, contain the costs of certain repairs to utilities which were beyond the scope of Arden's repair obligations under the lease. Arden contends that the trial court erred by assessing damages for lighting repairs for which it was not responsible, for costs related to the boiler, and for testing and repairing radiators, water and sprinkler systems. In each of these matters, the record contains substantial evidence to support the trial court, and we affirm those awards.