Derman Rug Co., Inc. v. Ruderman
| Decision Date | 14 July 1976 |
| Citation | 4 Mass.App.Ct. 437,350 N.E.2d 727 |
| Parties | DERMAN RUG CO. INC. v. Jacob RUDERMAN et al. 1 (and a companion case 2 ). |
| Court | Appeals Court of Massachusetts |
Robert S. Wolfe, Boston, for Jacob Ruderman and another.
Alexandra P. Blimmel, Waltham, for Derman Rug Co. Inc., pro se.
Before HALE, C.J., and GRANT and ARMSTRONG, JJ.
These appeals have their origins in six independent actions all arising out of the same lease and landlord-tenant relationship. Four actions were consolidated for trial. The two remaining actions were also tried together. The resulting appeals were consolidated for oral argument in this court. We discuss the detailed factual and procedural background of these appeals only to the extent required by this decision. Matters appealed but not argued are deemed waived. Mass.R.A.P. 16(a)(4), as amended February 24, 1975, --- Mass. --- (1975).
On August 12, 1971, the Rudermans (landlord) leased for a term beginning August 15, 1971, the first floor and the basement of a two-story building on Moody Street in Waltham to Blimmel Corporation (tenant). 3 During the tenancy there were many disputes between the landlord and the tenant. The controversies arose from water damage caused by a leaking roof and walls, from a ruptured steam pipe, from a problem concerning allocation of insurance premiums, from a sewer backup, from electrical wiring problems, from a failure to provide heat to second floor tenants, and from disagreements over increased fuel oil costs. For a number of reasons, the tenant made a number of unauthorized deductions from its monthly rental payments. 4 4 These disputes gave rise to six actions. We discuss the four actions now before us on appeal.
In section 7(a) of the lease, the landlord covenanted to keep the foundations, the roof, and the floors and walls in the same condition of structural soundness as on August 12, 1971 (the date of the lease), excepting fire or other casualty and reasonable wear and tear. Section 7(a) also specified that the landlord should not be to begin any work necessary under that section until ten days after written notice from the tenant. Also, in section 8(f) the tenant waived all claims against the landlord for personal or property damage except for negligence by the landlord or his agents.
On May 7, 1973, the tenant commenced an action seeking to recover for additional water damage to merchandise. Among other things, the tenant alleged that the landlord had failed to keep the foundations, roof, and floors and walls of the building in the same condition of structural soundness as on August 12, 1971.
Under § 7(a) written notice was a condition precedent to the landlord's obligations to make repairs to maintain the condition of the building. Documentary evidence was presented to demonstrate that such written notice was given on July 27, 1972, September 28, 1972, and May 1, 1973. However, the tenant made claims for damages arising as early as November, 1971. 5 The trial judge was free to believe the tenant's testimony that written notice was also sent to the landlord in the fall of 1971. There was sufficient evidence to support the conclusion that the condition precedent to the landlord's obligations had been fulfilled.
The trial judge ruled that the landlord was obliged to use reasonable care to keep the roof, exterior walls, and foundation in at least the same condition as they were or appeared to be at the time of the execution of the lease and that the landlord failed to discharge that obligation. Judgment was entered awarding the tenant $8,116.73 in damages. Since the evidence shows that there were many leaks and that the landlord failed to make all repairs recommended to him by the roofing repairman he had employed, we conclude that the trial judge's decision is warranted in fact and in law. We also conclude that there was sufficient evidence in the record to support the amount of the damages awarded.
Section 2 of the lease provided that (The record shows that the italicized language was handwritten into blank spaces in a typewritten lease.)
By letter of July 10, 1974, the tenant notified the landlord 'of the renewal for an additional three year term of the lease . . ..' On July 17, 1974, the landlord's lawyer sent the tenant notice that, the tenant having failed to extend, the premises should be vacated by August 15, 1974. 6 In the early fall of 1974, the landlord sought to evict the tenant, claiming that it had remained on the premises after the expiration of the term of the lease. A District Court decided in favor of the tenant, and the landlord appealed to the Superior Court. On January 16, 1975, the tenant brought an action seeking a declaratory judgment that the lease had been duly extended. On July 10, 1975, after a consolidated trial, the judge ruled that the lease had been extended for an additional three years from August 15, 1974. Judgment was entered accordingly. A judgment was also entered for the tenant in the eviction case. The landlord appeals from both judgments.
A lease may contain express conditions precedent to the exercise of a right of renewal or extension. Thus, the right to renew or extend may be expressly conditioned upon compliance by the tenant with any or all covenants of the lease. D. A. Schulte, Inc. v. Brockton Y.M.C.A., 273 Mass. 335, 342, 173 N.E. 414 (1930). Schwartz, Lease Drafting in Massachusetts, § 5.20 (1961). See Bickford v. Dillon, 321 Mass. 82, 83, 71 N.E.2d 611 (1947). Here, the lease made the tenant's right to extend conditional on (1) the giving of notice thirty days prior to the expiration of the original term and (2) the tenant's not being in default. Where, as here, a tenant's right to extend the lease is expressly dependent upon its performance of covenants or conditions, breach or nonperformance will defeat the tenant's right to extend. Squire v. Learned, 196 Mass. 134, 136, 81 N.E. 880 (1907). Saxeney v. Panis, 239 Mass. 207, 209, 131 N.E. 331 (1921). If the tenant fails to give timely notice or is in default, its right to extend is defeated. Assuming timely notice in the present case (as the judge impliedly found), the question presented is whether the lease required that the tenant not be in default at the time of such notice or required only that the tenant not be in default at the time of the expiration of the original term of the lease.
As of the date by which notice of extension was required (July 15, 1971), the tenant was in default. However, after that date, but before the expiration of the original term of the lease, the tenant tendered payment of an amount sufficient to cure the default. The trial judge ruled that '(t)he tenant was not in default at the end of the original term of the lease and therefore it properly exercised the option to extend the lease.' We are of the opinion that the lease required that the tenant not be in default at the time of notice rather than at the expiration of the original term. Because the tenant was in default on July 15, 1971 (date of notice), it had lost its right to extend the lease. Therefore we conclude that the trial judge erred in ruling that the lease was extended.
An extension clause should be construed in light of the language used by the parties, employing established principles of construction as a guide. Talbot v. Rednalloh, 283 Mass. 225, 230, 186 N.E. 273 (1933). We find support for our conclusion from the language of the lease. First, the default proviso is appended to a sentence which specifies when notice must be given. Second, we think that the phrase 'prior to the expiration of the original lease' bears no direct relationship to the default proviso. Instead, it is an integral part of a longer phrase ('thirty (30) days prior to the expiration of the original Lease') which was used as a means of expressing a particular date. When the clause was drafted the parties did not know exactly when the original term would begin or end. This is evidenced by the fact that 'August 15' was later written into the appropriate blank spaces of the lease. Since the parties initially did not know when the original term would end, they used the phrase, 'thirty (30) days prior to the expiration of the original Lease' as a formula to determine the date, then unknown, when notice would be required. Substituting July 15, 1974, for that phrase, we think it is clear that the tenant's default or lack thereof should be viewed as of that time (the time of notice) rather than as of the expiration of the original term. Third, it seems clear that it was the intention of the parties that the landlord know by July 15, 1971, whether the lease would be extended or whether he would have to seek new tenants. 7 In order to have such knowledge, the landlord would (1) have to have notice and (2) determine whether the tenant was then in default. Therefore, the condition precedent to the right to extend the lease must be viewed as pertaining to the time of the notice rather than to the time of the expiration of the original term.
On November 21, 1974, the landlord commenced an action seeking damages for failure by the tenant to heat the second floor of the building. The complaint alleged in count one that the tenant had failed to keep the heating system in good repair and failed to provide heat to the second floor tenants, thereby forcing the landlord to pay a portion of the heating...
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