Court Opinion

ID: 9550817
Source: CourtListenerOpinion
Date Created: 2023-08-07 18:43:00.401466+00
Date Added: 2024-06-11T15:22:30.785986
License: Public Domain

CARTER, J.
I dissent.
I find myself in the middle of two extreme positions as I cannot agree with the opinion of either Justice Schauer or Justice Edmonds.
We have a case here in which a landlord, under a provision in a lease, may terminate a lease on 60 days’ notice if the building presently on the property covered thereby is to be removed and a new one erected. Pursuant to that option the lessor gives to the tenant an unequivocal notice that the lease is terminated and the lessee must vacate. Acting in response to that notice, not of his own volition, the tenant vacates the property. He then brings an action for damages for eviction (or for a breach of the covenant of quiet enjoyment), asserting that the landlord had no right to terminate the lease because when the notice was given, governmental restrictions made it unlawful to construct buildings without obtaining permission from the War Production Board and such permission had not been obtained. Now that issue, namely, did the termination clause justify a termination of the lease under the conditions present (hereafter referred to as termination issue), is the only issue ever presented in the case until Justice Schauer injects a new question, that is, did such termination constitute an eviction. It was alleged by the plaintiff-tenant and not denied by the defendant-landlord, ‘ That on or about November 28, 1944, defendants, by instru*692ment in writing, terminated said lease and ordered plaintiff to vacate said premises as of January 31, 1945.” [Emphasis added.] The parties never doubted that a termination of the lease was accomplished by the notice and that, as such, it constituted an eviction of the tenant. The sole question was the termination issue. The issue was so stated to the jury in the lessor’s opening statement, and in his motion for a directed verdict (which was granted and is here involved), lessor’s counsel said: “And the other case is Southeastern Land Co. v. Clem, 239 Ky. 417 [39 S.W.2d 674], where the Court said that where a lease is terminable only on certain conditions, the lessor cannot terminate the lease except in pursuance of a bona fide intent to carry out the improvements on the property referred to.
“And that is exactly all we are concerned with here. There is no reason why we should be compelled to have a jury pass on this thing, in view of the evidence here, because the situation is such that reasonable men could not differ on the conclusion to be reached. Can any reasonable person then say these people did not have a bona fide intent of wrecking that building and going ahead with the improvements within a reasonable time after that notice took effect?” [Emphasis added.] The motion for a directed verdict was granted. Thus the trial court did not at any time pass upon the eviction question.
As I understand Justice Sehauer’s opinion, he does not decide the termination issue. He tacitly assumes that the notice of termination and to vacate was not proper under the lease and existing circumstances. He then holds that a notice to vacate, if given by the lessor with a good faith, though erroneous, belief that he was entitled to give it, followed by a vacation of the premises by the tenant, does not constitute an eviction.
In the first place, it should be clear that giving a wrongful but unequivocal notice of termination of the lease and to vacate, which amounts to a demand for possession, followed by a vacation of the premises by the tenant as a result thereof, should alone constitute a constructive eviction, and it has been so held. (Eggers v. Paustian, 190 Iowa 638 [180 N.W. 873]; American Jewelry Co. v. Barrs Self-Driver Co., 48 Ohio App. 239 [192 N.E. 865].) Indeed, that should be the law for the lessor has taken the initial step and position that the tenant should get out. The tenant should be entitled to rely upon such action by the landlord, and the latter should run the risk of whether he is right or wrong in his termination *693of the tenancy. The tenant should not be required to take the chance and face an unlawful detainer action with its harassment and expense, together with the uncertainty of his tenancy. If the circumstances were reversed and the tenant repudiated the lease, he would assume the risk of the legality of his stand. In contract law, it cannot be doubted that an unequivocal repudiation of the contract by the promisor is not only justification for the promisee’s failure to perform thereafter, but gives an immediate cause of action for damages. (Gold Min. & Water Co. v. Swimerton, 23 Cal.2d 19 [142 P.2d 22].)
Moreover, in the instant case we have more than a mere notice to quit. As heretofore seen, the lessor admitted that the lease was terminated by the notice and that the tenant must vacate. The lessor was adamant in his talks with the lessee that he must vacate. What more is necessary to constitute an eviction?
If it be assumed that Justice Schauer holds (and it seems to be the case) that, although there may have been an eviction by reason of the notice, yet such does not occur if the lessor believed in good faith that he had a right to terminate the lease. In other words, a lessor may evict a tenant and breach the covenant of quiet enjoyment with immunity from damages if he honestly believes he has legal ground for the eviction, even though he is clearly wrong. With that I cannot agree. In most instances the promisor’s or lessor’s claim for possession is in good faith, but if he is wrong, he is liable. It is no excuse for a breach of contract that the promisor honestly thought he was justified in breaking it. In any event, however, the question of whether the landlord acted in good faith is one of fact.
In regard to the termination issue, it appears that the generally accepted rule is that the lessor cannot terminate the lease unless he in good faith intends and has a reasonable expectancy of being able to erect a bnilding on the property. “Where a lease is terminable only on certain conditions, the lessor cannot terminate the lease, except in pursuance of a bona fide intent to carry out the purpose referred to.” (Southeastern Land Co. v. Clem, 239 Ky. 417 [39 S.W.2d 674].) (See, also, Dubois v. Gentry, 182 Tenn. 103 [184 S.W. 2d 369]; Clise Inv. Co. v. Stone, 168 Wash. 617 [13 P.2d 9]; 163 A.L.R. 1034.) In such a ease, in order to justify the termination of the lease, the burden of proof is on the lessor *694to show he was entitled to terminate it. The tenant in the eviction action shows the eviction. It is then incumbent on the landlord to show he in good faith intended to build and had an honest and reasonable expectancy that he would. In Allen v. Kilpatrick, 277 Mass. 237 [178 N.E. 511] the lessor had the option of terminating if the premises were rendered unfit for habitation by fire, and in the eviction action the court said: “The burden of proving justification of termination of the tenacy was on the defendants [landlord].” In the instant case, the ease should have been submitted to the jury. It could have disbelieved the lessor’s evidence that he “felt” he could get a permit to build and thus the burden would not have been sustained. Taking the evidence outlined by Justice Schauer, it appears that no permit had been obtained prior to the notice of termination; in fact, it does not appear that an application for a permit had even been made. Yet the lessor said in his notice that arrangements had been made; they had not. It was not until after the notice (at least the lessor did not prove the contrary) that an architect for the new building was employed. These and other factors would justify the jury in inferring that there was no good faith intent to construct the new building or a reasonable probability of accomplishment. It is no answer to say that the landlord wanted to get his notice in early to avoid the 60-day delay. The 60-day period was for the lessee’s benefit. He was justified in insisting that it not run until good faith arrangements had been made for a new building. The burden was on the landlord to prove that such arrangements had been made. This presented an issue of fact for the jury and the trial court erred in granting defendants’ motion for a directed verdict.
I would, therefore, reverse the judgment.
Appellant’s petition for a rehearing was denied March 2, 1950. Edmonds, J., Carter, J., and Traynor, J., voted for a rehearing.