Gamble-Robinson Co. v. Buzzard

• Decision Date: 29 June 1933
• Docket Number: No. 9686.,9686.
• Citation: 65 F.2d 950
• Parties: GAMBLE-ROBINSON CO. v. BUZZARD et al.
• Court: U.S. Court of Appeals — Eighth Circuit

65 F.2d 950 (1933)

GAMBLE-ROBINSON CO. v. BUZZARD et al.

No. 9686.

Circuit Court of Appeals, Eighth Circuit.

June 29, 1933.

Alfred Longley, of Waterloo, Iowa (Longley, Ransier & Frank, of Waterloo, Iowa, on the brief), for appellant.

B. F. Swisher, of Waterloo, Iowa, for appellees.

Before GARDNER, SANBORN, and BOOTH, Circuit Judges.

SANBORN, Circuit Judge.

The parties will be referred to as in the lower court, the appellees as plaintiffs, and the appellant as defendant. The appeal is from a judgment in an action at law to recover rent for the last two years of a ten-year written lease expiring October 1, 1932. The plaintiffs' petition set up the lease of premises described as "a three-story brick building 70 by 109 feet and basement with railroad trackage on the Illinois Central Railroad in the City of Waterloo, Black Hawk County, Iowa," and the failure of the defendant to pay the rent due October 1, 1930, and thereafter.

The defendant's answer, in its final form, was in five divisions. Division 1 admitted the execution of the lease, but denied all other allegations of the petition. Division 2 alleged constructive eviction. Divisions 3, 4, and 5 averred, respectively, failure of consideration, fraudulent representations by the plaintiffs inducing the execution of the lease, and its rescission by defendant upon discovery of the fraud, and fraudulent concealment by the plaintiffs of known latent defects in the leased premises, inducing the execution of the lease, and the rescission of the lease by the defendant upon discovery of the fraud.

The plaintiffs filed demurrers to divisions 2, 3, 4, and 5 of the answer, specifying the grounds as required by the Code of Iowa (1931) § 11135. These demurrers were sustained and, the defendant electing not to plead further, judgment was entered against it as upon default.

This appeal challenges the orders of the court sustaining the demurrers to divisions 3, 4, and 5 of the answer, and the entry of judgment in the face of the general denial contained in division 1 of the answer.

Since a demurrer has no relation to the actual merits of a controversy and raises nothing except questions of pleading, all facts well pleaded are, for the purpose of the demurrer, taken to be true. See Sullivan v. Iron Silver Mining Co., 109 U. S. 550, 555, 3 S. Ct. 339, 27 L. Ed. 1028; Work v. United States ex rel. Rives, 267 U. S. 175, 185, 45 S. Ct. 252, 69 L. Ed. 561; Concordia Ins. Co. of Milwaukee v. School District No. 98 of Payne County, Okla., 282 U. S. 545, 550, 51 S. Ct. 275, 75 L. Ed. 528.

Division 3 of the defendant's answer, so far as material, is as follows:

"That prior to September, 1930, the interior structure and framework of the building occupied by this defendant and through neither fault on the part of the defendant nor any failure to perform upon its part any obligation required of it by said lease, rotted and deteriorated to such a point that the continued used of the premises by the defendant, which required the storage in said building of large quantities of heavy merchandise and the movement on the floors of said building of heavy merchandise, might reasonably be expected to result in the collapse of the entire structure of the building.

"That because of the condition as aforesaid the premises were unsafe for human habitation and particularly unsafe and wholly unfit and useless for the conduct of the business carried on by the defendant in conformity with the terms and provisions of the said lease."

The grounds of demurrer to this division of the answer are:

"1. That no obligation rested upon plaintiffs with respect to the condition of the premises in question during the time referred to in said Division Two of Defendant's Answer, and said plaintiffs were not liable to the defendant for the condition of said premises during such time.

"2. That there is no showing of any covenant or undertaking on the part of the plaintiffs that the premises in question would be kept in a condition fit and suitable for the purposes for which they were leased or intended."

At common law, injury to or deterioration of the leasehold or buildings thereon under a lease such as that here involved did not relieve the tenant of his obligation to pay rent. The Supreme Court of the United States has recognized this rule: "The common law regards such a lease as the grant of an estate for years, which the lessee takes a title in, and is bound to pay the stipulated rent for, notwithstanding any injury by flood, fire, or external violence, at least unless the injury is such a destruction of the land as to amount to an eviction; and by that law the lessor is under no implied covenant to repair, or even that the premises shall be fit for the purpose for which they are leased." Viterbo v. Friedlander, 120 U. S. 707, 712, 7 S. Ct. 962, 30 L. Ed. 776; Sheets v. Selden, 7 Wall. 416, 423, 424, 19 L. Ed. 166. See also: Belfour v. Weston, 1 T. R. 310, 99 Repr. 1112; Izon v. Gorton, 5 Bing. N. C. 502, 132 Repr. 1193; Gregg v. Coates, 23 Beav. 33, 53 Repr. 13; Waite v. O'Neil (C. C. A. 6) 76 F. 408, 416, 34 L. R. A. 550; Harris v. Heackman, 62 Iowa, 411, 17 N. W. 592, 593; Smith v. Kerr, 108 N. Y. 31, 34, 15 N. E. 70, 2 Am. St. Rep. 362; Pizitz-Smolian Co-op. Stores v. Randolph, 221 Ala. 458, 129 So. 26, 31; Whittaker v. Holmes, 165 Ark. 1, 263 S. W. 788; Abrams v. Simon, 243 Ky. 773, 49 S.W.(2d) 1031; Lieberthal v. Montgomery, 121 Mich. 369, 80 N. W. 115; Gralnick v. Magid, 292 Mo. 391, 238 S. W. 132, 28 A. L. R. 1530; Post v. Brown, 142 Tenn. 304, 218 S. W. 823; 1 Tiffany, Landlord and Tenant (1910), p. 1191; 2 Wood, Landlord and Tenant (2d Ed., 1888), p. 1130; 36 C. J. 325.

This rule of the common law has not been universally adhered to in this country. See Whitaker v. Hawley, 25 Kan. 674, 684, 685, 689, 37 Am. Rep. 277; Saylor v. Brooks, 114 Kan. 493, 220 P. 193; Wattles v. South Omaha I. & C. Co., 50 Neb. 251, 266, 267, 69 N. W. 785, 36 L. R. A. 424, 61 Am. St. Rep. 554; Coogan v. Parker, 2 S. C. 255, 16 Am. Rep. 659.

Whether the rule is good or bad, it is the rule, and, the Legislature of Iowa not having seen fit to change it, we do not feel at liberty to disregard it.

The defendant argues that, even though this rule is applicable, this lease falls within the generally recognized American exception that, where the leasehold is a room or apartment in a building and the building is destroyed, the leasehold ceases to exist, and the lessee is therefore no longer under any obligation to pay rent. Waite v. O'Neil (C. C. A. 6) 76 F. 408, 416, 34 L. R. A. 550; Ainsworth v. Ritt, 38 Calif. 89; Sigal v. Wise, 114 Conn. 297, 158 A. 891, 894; Moran v. Miller, 198 Ind. 429, 153 N. E. 890, 893; Graves v. Berdan, 26 N. Y. 498; Harrington v. Watson, 11 Or. 143, 3 P. 173, 50 Am. Rep. 465; Moving Picture Co. of America v. Scottish U. & N. Ins. Co. of Edinburgh, 244 Pa. 358, 90 A. 642; Post v. Brown, 142 Tenn. 304, 218 S. W. 823; White v. Steele (Tex. Civ. App.) 33 S.W. (2d) 224; Arbenz v. Exley, Watkins & Co., 52 W. Va. 476, 44 S. E. 149, 61 L. R. A. 957; 1 Tiffany, Landlord and Tenant (1910), pp. 222, 1196; 36 C. J. 327.

Some of the courts of this country would apply this exception in situations where an entire building has been rented and where it was considered that the leasehold was primarily the building rather than the land upon which it stood. Pizitz-Smolian Co-op. Stores v. Randolph, 221 Ala. 458, 129 So. 26, 31, 32; Buerger v. Boyd, 25 Ark. 441, 442; Whittaker v. Holmes, 165 Ark. 1, 263 S. W. 788; Norman v. Stark G. & E. Co. (Tex. Civ. App.) 237 S. W. 963. Other courts have refused to apply the exception to leases for entire buildings. Sigal v. Wise, 114 Conn. 297, 158 A. 891, 893, 894; Nashville, C. & St. L. R. Co. v. Heikens, 112 Tenn. 378, 79 S. W. 1038, 65 L. R. A. 298. In any event, the exception to the rule has been applied to the lease of a building and the tenant relieved from payment of rent only where it appeared that the leasehold was totally destroyed, and not in cases where it was merely injured or damaged. This conclusion is based upon the theory that the exception does not apply where the thing leased continues in existence.

"The exception requires that the building, or portions of the building, leased shall be not merely damaged or injured, but destroyed. Smith v. McLean 123 Ill. 210, 14 N. E. 50, supra. Total destruction, perhaps, does not mean such a destruction as does not leave one stone lying upon another, but it must be such as destroys the leased property in its character as a room or a building. The question, under the exception, is as to the condition to which the thing leased has been reduced by the fire, and here the walls and basement were intact. The building, as a building, was not destroyed, but required a new roof and new floors above the first floor." Humiston, Keeling & Co. v. Wheeler, 175 Ill. 514, 51 N. E. 893, 894; Sigal v. Wise, 114 Conn. 297, 158 A. 891; Lieberthal v. Montgomery, 121 Mich. 369, 80 N. W. 115; Graves v. Berdan, 29 Barb. (N. Y.) 100, affirmed 26 N. Y. 498; New York R. E. & B. I. Co. v. Motley, 3 Misc. 232, 22 N. Y. S. 705, 736, affirmed 143 N. Y. 156, 38 N. E. 103; Post v. Brown, 142 Tenn. 304, 218 S. W. 823; Norman v. Stark G. & E. Co. (Tex. Civ. App.) 237 S. W. 963; White v. Steele (Tex. Civ. App.) 33 S.W. (2d) 224; 1 Tiffany, Landlord and Tenant, (1910), p. 1197; 36 C. J. 327.

Assuming, without deciding, that the destruction of the leased building in the instant case would have constituted a failure of consideration, we are of the opinion that its deterioration during the term of the lease to the point where it had become unsafe for use is not the equivalent of its destruction. Moreover, the lease here refers to a building and trackage, and it is our opinion that this lease was as much a lease of real estate as though it had described the land upon which the building and trackage was situated without referring to the building.

The de...