Genovese v. Bergeron

• Decision Date: 07 November 1997
• Docket Number: No. 2702,2702
• Court: South Carolina Court of Appeals
• Parties: Thomas GENOVESE and Linda Genovese, Respondents, v. Joseph BERGERON and Theresa Bergeron, of whom Theresa Bergeron is Appellant.

Page 608

490 S.E.2d 608

327 S.C. 567

Thomas GENOVESE and Linda Genovese, Respondents, v. Joseph BERGERON and Theresa Bergeron of whom Theresa Bergeron is Appellant.

No. 2702.

Court of Appeals of South Carolina.

Submitted June 3, 1997.

Decided July 21, 1997.

Rehearing Denied Sept. 3, 1997.

Certiorari Dismissed Nov. 7, 1997.

John P. Qualey, Jr., Hilton Head Island, for appellant.

Otto W. Ferrene, Jr., Hilton Head Island, for respondents.

GOOLSBY, Judge.

Thomas Genovese and Linda Genovese (landlords) brought this action against Theresa Bergeron (tenant) to recover unpaid rent and property damages. The trial court directed a verdict in favor of the landlords and awarded them $10,400 in unpaid rent. The jury awarded the landlords $2,000 for property damage caused by the tenant. The tenant appeals. We affirm in part, reverse in part, and remand. ¹

FACTS

Beginning on October 1, 1988, the tenant entered into six consecutive one-year leases with the landlords whereby the landlords agreed to rent to the tenant a residence in the Shipyard Plantation on Hilton Head Island. The final lease, which is at issue here, commenced on October 1, 1993, and ended on September 30, 1994, at a monthly rent of $1,300.

Doris Warner managed the property for the landlords throughout the period during which the tenant rented the property. In December 1993, the tenant informed Warner she had been offered employment in New York and she desired to terminate the lease with the landlords. Because the lease required the landlords' permission before the tenant could sublease the property, the tenant requested that Warner ask the landlords whether she could either sublease the property In January 1994, Warner inspected the property and presented the tenant with an itemized list of damages to the property totaling $1,360. Warner told the tenant that her deposit only covered $1,000 of the damages so the tenant wrote a check to Warner's employer for $369.54.

[327 S.C. 570] or terminate the lease. Warner informed the tenant the landlords did not want her to sublease the property and the landlords were considering selling the property. Warner told the tenant she could vacate the premises. The tenant complied with Warner's request to put her desire to terminate the lease in writing and to indicate she planned to vacate the property.

At trial, the landlords moved for a directed verdict on their unpaid rent claim. In opposition to the landlords' directed verdict motion, the tenant argued there was sufficient evidence for a jury to conclude Warner had the apparent authority to release the tenant from her obligations under the lease. The trial court disagreed and granted the landlords' directed verdict motion, awarding the landlords $10,400 in unpaid rent. The trial court also disagreed with the tenant's contention that the landlords failed to mitigate their damages.

DISCUSSION

I.

The tenant argues the trial court erred in directing a verdict on the unpaid rent issue because she presented sufficient evidence of apparent authority to survive a directed verdict motion. We agree.

In deciding whether to grant a directed verdict motion, the trial court must view the evidence and all reasonable inferences in the light most favorable to the nonmoving party. Dalon v. Golden Lanes, Inc., 320 S.C. 534, 466 S.E.2d 368 (Ct.App.1996). The court is only concerned with the existence or non-existence of evidence and does not have the authority to decide credibility issues nor to resolve conflicts in testimony. Garrett v. Locke, 309 S.C. 94, 419 S.E.2d 842 (Ct.App.1992). The trial court should deny a directed verdict motion if the evidence presents more than one reasonable inference or if its inferences are in doubt. Smith v. Wal-Mart Stores, Inc., 314 S.C. 248, 442 S.E.2d 606 (1994).

Apparent authority to do a particular act "is created as to a third person by written or spoken words or any other conduct of the principal which, reasonably interpreted, causes the third person to believe the principal consents to have the act done on his behalf by the person purporting to act for him." Muller v. Myrtle Beach Golf and Yacht Club, 303 S.C. 137, 142, 399 S.E.2d 430, 433 (Ct.App.1990) (citing RESTATEMENT (SECOND) OF AGENCY § 27 (1958)) (emphasis added). The principal must either intend to cause the third person to believe the agent is authorized to act for him, or he should realize his conduct is likely to create such belief. Id.

Generally, agency is a question of fact, so that if there are any facts tending to prove an agency relationship, it then becomes a question for the jury. Gathers v. Harris Teeter Supermarket, Inc., 282 S.C. 220, 317 S.E.2d 748 (Ct.App.1984).

It is undisputed that Warner was the landlords' agent. At issue, then, is the extent of Warner's agency. Bergeron testified he gave Warner broad authority to manage the property. For instance, as the rental property manager for the landlords throughout the five-year period during which the tenant occupied the property, Warner managed the lease, received rent payments, and ordered necessary repairs to the property. Warner also prepared the rental agreements between the landlords and the tenant for their signing and negotiated the terms with the tenants. The landlords always dealt with the tenant through Warner and there were no contacts between the landlords and the tenant except through Warner.

When the tenant requested in writing whether she could terminate the lease or be allowed to sublet the property, Warner told the tenant the landlords were thinking about selling the property, and the landlords did not want the tenant to sublease it, so the tenant could vacate the property. The landlords did not communicate their opposition to this arrangement between the tenant and Warner until they filed this lawsuit.

Viewing the evidence in the light most favorable to the tenant, as we are required to do, we find there is some evidence in the record for a jury to conclude that, under the doctrine of apparent authority, the conduct of the landlords in clothing Warner with so much authority to manage the property would allow a reasonably prudent person in the tenant's position to believe Warner had the authority to release the tenant from her obligations under the lease. See Rickborn v. Liberty Life Ins. Co., 321 S.C. 291, 468 S.E.2d 292 (1996) (under the doctrine of apparent authority, a principal is bound by the acts of its agent when it has placed the agent in such a position that persons of ordinary prudence, reasonably knowledgeable with business usages and customs, are led to believe the agent has certain authority and they in turn deal with the agent based on that assumption); Fernander v. Thigpen, 278 S.C. 140, 293 S.E.2d 424 (1982) (agency may be implied or inferred and may be shown directly or circumstantially by the conduct of the purported agent exhibiting a pretense of authority with the knowledge of the alleged principal); 3 AM.JUR.2d Agency § 79, at 584 (1986) ("The apparent authority of an agent results from ... conduct ... or other manifestations of the principal's consent, whereby third persons are justified in believing that the agent is acting within his authority.... [S]uch authority is implied where the principal passively permits the agent to appear to a third person to have the authority to act on his behalf.").

II.

The tenant contends the trial court erred in directing a verdict in favor of the landlords because they failed to mitigate their damages. We disagree.

A party injured by the acts of another is required to do those things a person of ordinary prudence would do under the circumstances to mitigate damages; however, the law does not require unreasonable exertion or substantial expense for this to be accomplished. McClary v. Massey Ferguson, Inc., 291 S.C. 506, 354 S.E.2d 405 (Ct.App.1987). Moreover, the party who claims damages should have been minimized has the burden of proving they could reasonably have been avoided or reduced. Tri-Continental Leasing Corp. v. Stevens, Stevens & Thomas, P.A., 287 S.C. 338, 338 S.E.2d 343 (Ct.App.1985).

The landlords requested that Warner attempt to rent the property. From January until March 1994, Warner advertised the property. In June of 1994, the landlords had the property listed for sale. By the date of trial, the property was no longer listed for sale.

The tenant failed to present any evidence showing what types of advertising would have been reasonable, how much sooner the landlords could have rented or sold the property through other methods, or that the landlords' actions to rent the property were inadequate or improper. We conclude, therefore, the tenant failed to sustain her burden of proving the landlords could have reasonably avoided or reduced their damages. See Brendle's Stores, Inc. v. OTR, 978 F.2d 150, 158 (4th Cir.1992) (wherein the court, applying South Carolina law, held the tenant's assignee failed to show that the landlord did not mitigate damages and noted that, "although [the landlord] did not expedite repairs of the building, [the tenant's assignee] failed to present evidence showing that this inaction discouraged any prospective tenants or that extensive advertising would have resulted in a new tenant").

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

HOWELL, C.J., concurs.

ANDERSON, J., concurs in part and dissents in part in a separate opinion.

ANDERSON, Judge (concurring in part and dissenting in part in a separate opinion):

I concur with the decision to affirm the trial judge on the issue of mitigation of damages. I dissent with that part of the majority opinion that reverses the trial judge in directing a verdict on the apparent authority issue.

THE DOCTRINE OF APPARENT AUTHORITY

(Unpaid Rent)

Tenant argues the trial court erred in granting a directed verdict to the landlords as to the amount of rent owed by tenant under the lease. Tenant contends Warner, as agent of the landlords,...