Court Opinion

ID: 9572880
Source: CourtListenerOpinion
Date Created: 2023-08-21 20:45:22.437699+00
Date Added: 2024-06-11T12:34:33.523536
License: Public Domain

SOSA, Senior Justice, and LORENZO F. GARCIA, District Judge, dissenting. The majority holds that the district court erred in its determination that El Paso’s acts in seeking to increase the rent, declaring the lease terminated, and in seeking a judicial termination of the lease were done maliciously and in bad faith, and, therefore, constituted constructive eviction. From this determination, we respectfully dissent. A trial court is called upon to exercise sound judgment in resolving factual disputes presented by the parties. In making those determinations, the court looks at all of the evidence presented and the reasonableness of the testimony of each witness in light of all the evidence. The factfinder must determine the weight and the credit to be given to each witness’ testimony. Judgment calls are made as to the witness’ manner while testifying, his demeanor, and any interest, bias or prejudice he may have. The trier of fact, not the appellate court, must resolve conflicts in the testimony of witnesses. Grisham v. Nelms, 71 N.M. 37, 376 P.2d 1 (1962). On appeal, the court should not substitute its judgment for that of the trier of fact. The issue is not what decision would have been rendered had this Court heard the evidence, but whether there is substantial evidence to support the findings of the trial court. Tapia v. Panhandle Steel Erectors Company, 78 N.M. 86, 428 P.2d 625 (1967); Sauter v. St. Michael’s College, 70 N.M. 380, 374 P.2d 134 (1962). “Substantial evidence” means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion and if there is such evidence in the record to support a finding, it will not be disturbed. [Citation omitted.] Moreover, in examining such evidence an appellate court will view the evidence in a light most favorable to the prevailing party below and will not disturb findings, weigh evidence, resolve conflicts, or substitute its judgment as to the credibility of witnesses where evidence substantially supports the findings of the trial court. [Citation omitted.] Den-Gar Enterprises v. Romero, 94 N.M. 425, 429, 611 P.2d 1119, 1123 (Ct.App.), cert. denied, 94 N.M. 628, 614 P.2d 545 (1980). To sustain a cause of action for interference with a covenant of quiet enjoyment, a tenant must show that he has been actually or constructively evicted. Barfield v. Damon, 56 N.M. 515, 245 P.2d 1032 (1952); El Paso Natural Gas Co. v. Kysar Ins. Agcy., Inc., 93 N.M. 732, 605 P.2d 240 (Ct.App.1979) (El Paso I); see Kennedy v. Nelson, 76 N.M. 299, 414 P.2d 518 (1966). There is no dispute that Kysar was not actually evicted from the Petroleum Plaza Building and, accordingly, before El Paso can maintain its cause of action, it must show that it falls under an exception to the general rule, as discussed by the majority opinion. There is no claim that El Paso comes under the first exception; therefore, their case must fall under the second exception. In El Paso I, supra, the appellate court discussed how the second exception applies. An action for constructive eviction can be maintained without actual vacation of the premises where the landlord repeatedly acts with malice and in bad faith in his attempts to oust a tenant in rightful possession. In Kuiken v. Garrett, 243 Iowa 785, 51 N.W.2d 149 (1952), Iowa’s Supreme Court found the issue of constructive eviction to turn on whether there was malice and bad faith by the landlord. The Court stated that “[i]f [the landlord] serves repeated notices, and institutes repeated actions, alleging different grounds, and fails to prove any of them upon trial, we think a fair inference of malice may be drawn by a jury.” Id. 51 N.W.2d at 157. After discussing the application of this second exception, the majority then reviews the evidence and draws distinctions between the evidence presented in Kuiken, supra, and the evidence presented here. In Kuiken, the Court did find constructive eviction based upon repeated acts of malice and bad faith. In that case, ten separate notices were submitted by the landlord to the tenant and four petitions were filed in court. The petitions were dismissed or decided in the tenant’s favor. In this case, the majority distinguishes the kinds of notices sent and minimizes the effect of such notices on Kysar. It is undisputed that a written lease agreement existed between the parties setting out a sum certain for monthly rent. On July 29, 1977, the Senior Vice-President for El Paso Natural Gas Company wrote to Raymond L. Kysar and advised him that the net effect of the lease agreement was that Kysar was paying only $0.77 per square foot of space per year, and that such a figure was substantially lower than the rent being paid by any other tenant in the building. El Paso Natural Gas Company advised Raymond Kysar that: Your testimony at the trial was to the effect that the differexice in rental value was made up by your management of the building and your recoupment of costs incurred in redecorating your office. Inasmuch as you are no longer managing the building and will shortly be removing the non-permanent improvements from your space, we must insist upon increasing the rental you are paying to a commercially reasonable level. We will be charging a rate of $6.00 per square foot per year, making the rental charge for your space $1,561.00 per month. This new rental rate will be effective August 1, 1977. The effect of this letter is to make a demand on Kysar to increase rental premiums by some $1,361.00 per month. On August 2,1977, Kysar responded to El Paso’s July 29, 1977, letter and explained that they were tenants under a lease agreement dated May 1, 1972, which called for $200.00 per month rent. Kysar indicated that, pursuant to such a lease, it had an option to renew for two successive five-year terms and that the first renewal was exercised on September 3, 1974. Under the terms of the renewal lease, Kysar was to continue to be a tenant at the rate of $200.00 per month. Kysar advised that the lease was not subject to unilateral modification for amendment and tendered $200.00 rent. By letter of August 11, 1977, the Senior Vice-President for El Paso Natural Gas rejected Kysar’s tender of monthly rent and indicated that the past rental rate was commercially unreasonable and had been increased. El Paso directed the sum of $967.50 as monthly rental. Commencing in August of 1977, and each month thereafter, El Paso submitted statements to Kysar Insurance demanding rental payments. The statements covered the period of August 1977 to October 1979, for a period of 27 months. On September 20, 1979, Kysar gave written notice of the exercise of its option to extend the lease for an additional five-year term. The receipt of the letter prompted a response by El Paso’s Vice-President to the effect that there existed no lease, and therefore Kysar was unable to exercise any option. By this time, litigation was in progress. The trial court further found that, coincidental with El Paso’s July 1977 letter, some of the janitorial services which were previously performed were halted. The majority distinguishes the kinds of activities occurring in this case from those that occurred in Kuiken. We are unable to draw the same distinction. In this case, while only three demands were sent, El Paso’s monthly statements served as a constant reminder of their position that rent was not being paid in accordance with El Paso’s determination of what was a commercially reasonable rent. This Court’s determination that the actions in the case at bar fall short of malice and bad faith constitutes a substitution of its judgment for that of the trier of fact. For example, if El Paso’s actions do not constitute an inference of bad faith, how many notices, monthly computer statements and lawsuits are sufficient to infer malice or bad faith? This Court would be put in the position of saying three notices are insufficient, but four or five might be sufficient. It would appear that such a determination becomes one of degree best made by the trier of fact. We determine that there is substantial evidence to support the trial court’s findings, and accordingly would affirm the trial court and Court of Appeals on this issue. The trial court refused to award attorney’s fees as a recoverable item of damage, and relied on Lujan v. Merhage, 86 N.M. 26, 519 P.2d 122 (1974). I would reject the Court of Appeals’ resolution of this issue and would adopt the dissenting opinion as it relates to the denial of attorney’s fees, finding that our decision in Lujan v. Merhage, supra, is controlling, and reconsideration of this issue, if any, is reserved to this Court.