Galvin v. Lovell

• Decision Date: 02 May 1950
• Citation: 257 Wis. 82,42 N.W.2d 456
• Parties: GALVIN et al. v. LOVELL.
• Court: Wisconsin Supreme Court

Page 456

42 N.W.2d 456

257 Wis. 82

GALVIN et al. v. LOVELL.

Supreme Court of Wisconsin.

May 2, 1950.

Wm. M. Hayes, Baraboo, for appellant.

Curran, Curran & Curran, Mauston, for respondents.

FRITZ, Chief Justice.

All of the store premises involved in this action were owned by Kurt and Augusta Gebhardt, and they leased the store to Larcena L. Galvin on July 19, 1946. She with two copartners conducted a grocery business in part of the store under the name of 'Mauston Food Market'. Evidence introduced on the trial of the action fairly admitted of the court's findings (so far as material here) to the following effect:

That plaintiffs were at all times involved herein in possession of the store under the lease executed by Kurt and Augusta Gebhardt. That on October 2, 1947, plaintiffs entered into a lease with defendant whereby he agreed to rent for one year the meat department portion of the store at a rental of $275 per month, with an option to renew said lease at the expiration of said term for thirty-two months from November 1, 1948, to July 1, 1951, at the same rental and conditions. That pursuant to said lease, defendant entered into possession of the meat department in October 1947, and continued in possession and operated said department under the lease until the latter part of May 1948. That plaintiffs substantially complied with all the terms of the lease, and any breach of the terms on their part was unimportant and waived by defendant. That the lease, under which plaintiffs held possession of the premises from Kurt and Augusta Gebhardt, provided that without their written consent the premises could not be sublet; and that no such consent in writing was obtained by plaintiffs; but that Kurt Gebhardt had full knowledge of the agreement and lease to defendant and consented to the same, and assisted defendant while he was in possession of the meat department, and accepted the rent from the plaintiffs and waived any claim that Gebhardt may have had at the commencement of the occupancy of the premises by defendant to object to such occupancy, and at no time, prior to or after defendant's termination of the lease, objected to plaintiffs concerning their agreement and lease with defendant. That without any cause or justification defendant, by a written notice to plaintiffs on May 13, 1948, terminated his lease and subsequently vacated the premises in the latter part of May 1948. That defendant paid all rental due the plaintiffs under the lease through the month of May 1948, but paid no rental thereafter. That after June 1, 1948, plaintiffs took possession of the portion of the premises leased to defendant, and attempted to rent the premises to other persons during the balance of the term of the agreement but were unable to do so. That plaintiffs sustained damages by reason of the breach of the lease by defendant in that they lost the rental for the period from June 1, 1948, to October 1, 1948, and that the damage sustained by plaintiffs by reason of loss of rent is the sum of $1,375. That defendant's claim of fraud and false representations has not been sustained, and there is no competent evidence of any fraud or misrepresentation on the part of the plaintiffs; and that there is no evidence to sustain the defendant's counterclaim, and no evidence of any damages suffered by defendant by reason of any breach or improper act of the plaintiffs.

Upon those facts the court concluded that plaintiffs substantially complied with all terms of the lease between them and defendant; that he breached the terms of said lease; that there is no privity of contract between defendant and Kurt and Augusta Gebhardt, and they waived the provisions as to subletting set forth in the lease between them and the plaintiffs; that defendant's counterclaim be dismissed; and that plaintiffs have judgment on their complaint for $1,375.

Defendant contends that plaintiffs did not have a cause of action against him when they commenced this action on May 26, 1948. As defendant claims, prior to that date he had paid all rent due to June 1, 1948, under the lease, and there was no loss of rent until that date and thereafter. However there was a termination of the lease on May 13, 1948, by defendant's written notice to plaintiffs which reads: 'I hereby give each of you notice that I consider that you have broken the lease under which I have been operating that I consider myself released from said lease on account of your having sold equipment that was included in said lease--that I will vacate said premises covered by said lease as soon as it is physically possible, that I am herewith tendering compensation for occupancy of said premises to cover the period of time which will be necessary for me to vacate said premises.'

When defendant delivered that notice to plaintiffs on May 13, 1948, informing them that he considered himself released from the lease, and that he would vacate the premises as soon as possible, he thereby committed an anticipatory breach of the lease (unless he had become released therefrom as stated in his notice), and therefore plaintiffs had an immediate right of action for damages against defendant for such anticipatory breach of the lease which was for the period from November 1, 1947, to November 1, 1948. As stated in 51 C.J.S., Landlord and Tenant, § 250, p. 883, 'If the lessee renounces or repudiates the lease, or a material part thereof, and disables himself from performing his covenants or conditions, before the time fixed for such performance, or, in other words, if he commits an anticipatory breach, the lessor, by the weight of authority, may regard the lease as terminated as far as further performance is concerned, and may maintain an action at once for the damages occasioned by the breach, * * *.'

In Amberg Granite Co. v. Marinette Co., 247 Wis. 36, 18 N.W.2d 496, 498, we stated: 'Although it has been held that the right to rescind for an anticipatory breach is exceptional and can be permitted only where future breach is conclusively established, Smoot's Case, 1872, 15 Wall. 36, 82 U.S. 36, 21 L.Ed. 107; Dingley v. Oler, 1886, 117 U.S. 490, 6 S.Ct. 850, 29 L.Ed. 984, nevertheless where a party disables himself from performing the other party may treat the contract as rescinded and sue at once.' Pierson v. Dorff, 198 Wis. 43, 51, 223 N.W. 579; Washburn-Crosby Co. v. Kubiak, 175 Wis. 291, 185 N.W. 162; Restatement of Law on Contracts, p. 475, sec. 318.

In an action for damages for an anticipatory breach of contract, the plaintiffs are entitled to recover all damages, not only up to the time of the commencement of the suit, but also damages occurring during the pendency thereof and down to the date of trial. Becker v. Highway Trailer Co., 240 Wis. 490, 2 N.W.2d 725; McCrubb v. Bray, 36 Wis. 333; 25 C.J.S., Damages, § 193, p. 908.

The sole reason stated in defendant's notice of May 13, 1948, because of which he considered himself released from his lease was 'on account of' plaintiffs' 'having sold equipment that was included in said lease'. On the trial the only proof of a sale of any of the leased equipment was that plaintiffs sold a small meat grinder which defendant never used, but had wrapped and placed in a storage room of the store because he preferred to use two larger meat grinders, one of which was part of the leased equipment, and the other was owned by him. Although he knew of plaintiffs' sale of the small grinder for $45 in the early part of 1948, he did not object, and never asked to have it replaced. Under these circumstances the sale thereof was evidently so inconsequential that it did not constitute sufficient basis for defendant to consider himself released from the lease.

Although no other ground for terminating the lease was stated in defendant's notice of May 13, 1948, he alleged in his answer and counterclaim that plaintiffs had failed to obtain the consent of Kurt and Augusta Gebhardt to the subletting of the meat department to defendant. On the trial the lease between the Gebhardts and plaintiffs was not offered or received in evidence, and there is no proof in the record that plaintiffs were occupying the premises in 1947 and 1948 under a lease entered into in 1946 between the Gebhardts and the plaintiff Larcena L. Galvin. Mrs. Gebhardt was not called as a witness. But it appears from the testimony of her husband that he had knowledge of the arrangement between plaintiffs and defendant prior to and during defendant's occupancy of the premises, and had personally assisted in making necessary alterations so that defendant could occupy the premises and had assisted defendant in butchering and other duties after defendant entered into possession of the meat department; and that with full knowledge of the facts Gebhardt accepted the rent from plaintiffs at all times and...