Idaho Migrant Council, Inc. v. Northwestern Mut. Life Ins. Co.

• Citation: 110 Idaho 804,718 P.2d 1242
• Decision Date: 11 April 1986
• Docket Number: No. 16155,16155
• Parties: IDAHO MIGRANT COUNCIL, INC., an Idaho private Nonprofit corporation, Plaintiff-Counterdefendant-Appellant, v. The NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY, a Wisconsin corporation, Defendant-Respondent, and Ronald K. McLean, District Agent, individually and in his capacity as District Agent, Defendant-Counterclaimant-Respondent.
• Court: Idaho Court of Appeals

Page 1242

718 P.2d 1242

110 Idaho 804

IDAHO MIGRANT COUNCIL, INC., an Idaho private Nonprofit corporation, Plaintiff-Counterdefendant-Appellant, v. The NORTHWESTERN MUTUAL LIFE INSURANCE COMPANY, a Wisconsin corporation, Defendant-Respondent, and Ronald K. McLean, District Agent, individually and in his capacity as District Agent, Defendant-Counterclaimant-Respondent.

No. 16155.

Court of Appeals of Idaho.

April 11, 1986.

Dennis H. Milbrath, Boise, for plaintiff-counterdefendant appellant.

Philip A. Peterson and James R. Schiller, Nampa, for respondents.

HUNTLEY, Judge Pro Tem.

The Idaho Migrant Council, Inc., (IMC) appeals the district court's order granting a judgment on the pleadings against IMC in its suit for damages allegedly resulting from breach of an orally modified lease. IMC, the landlord, contends that the pleadings allege sufficient facts to state a cause of action against the would-be tenant, respondent Northwestern Mutual Life Insurance, Co., et al. (Northwestern). We vacate the district court's order and remand for further proceedings.

Northwestern brought its motion for judgment on the pleadings under I.R.C.P. 12(c), which is identical to the federal rule of the same number. The motion for judgment on the pleadings in favor of Northwestern must be vacated unless it is clear that IMC is entitled to no relief. Susman v. Lincoln American Corp., 517 F.Supp. 931, 934, n. 7 (N.D.Ill.1981). We must assume that all facts alleged in IMC's complaint are true and draw in IMC's favor all reasonable inferences from those facts. Quality Mercury Inc. v. Ford Motor Co., 542 F.2d 466, 468 (8th Cir.1976), cert. denied, 433 U.S. 914, 97 S.Ct. 2986, 53 L.Ed.2d 1100 (1977). The district court erred in granting judgment on the pleadings if, given the above considerations, IMC's allegations are sufficient to permit recovery against Northwestern. Susman, 517 F.Supp. at 934, n. 7. We move on to examine IMC's allegations.

IMC owns a retail and commercial building, the El Mercado, in Caldwell, Idaho. On January 30, 1984, Northwestern entered a written five-year lease with IMC for office space in the El Mercado. ¹ The building was not completed when IMC and Northwestern entered into the lease.

In mid-December 1984, Northwestern informed IMC's marketing agent that Northwestern's office space requirements had decreased. Originally, the lease called for IMC to provide Northwestern with 1,984 square feet of office space which was to be laid out according to Northwestern's design specifications. In mid-December, IMC orally agreed to Northwestern's oral request to reduce Northwestern's office space to 1,694 square feet and change the layout of the space, with all other terms of the lease remaining the same.

The lease required IMC to deliver possession within 60 days of November 1, 1984--i.e., on or before December 31, 1984. Due to construction delays, IMC was unable to deliver possession by the deadline date. This failure placed IMC in breach of the lease as written. However, on several occasions prior to December 31, 1984, Northwestern orally agreed to change the commencement date of the lease to February 1, 1985, and stated that the latter date would better suit its convenience.

Further, on January 9, 1985, IMC entered a contract to improve the proposed office space, at a cost of $10,500, in reliance on Northwestern's request to reduce the size of the office space and on Northwestern's representation that it would accept the February 1, 1985 commencement date. This contract required completion of the improvements by January 25, 1985.

On January 11, 1985, Northwestern's agent toured the premises with IMC's agent. Northwestern did not assert during the tour that any possession deadline had passed. IMC informed Northwestern during the tour that IMC had entered the improvement contract, and Northwestern did not ask IMC to cancel the contract. Northwestern gave no indication that it intended to cancel the lease. By letter dated January 17, 1985, Northwestern first notified IMC of its intent to terminate the lease based on a breach of the possession clause. IMC then filed this action.

I. WAIVER

We hold that IMC has alleged sufficient facts to state a cause of action for breach of contract, based on its position that Northwestern impliedly waived the November 1, 1984 commencement date of the lease and the December 31, 1984 possession deadline.

Waiver is the voluntary relinquishment of a known right. Minidoka County v. Krieger, 88 Idaho 395, 411, 399 P.2d 962, 972 (1965). We have found no reason why a clause requiring contract modifications be in writing, or a clause stating the time for commencement of a lease, may not be waived. See Perry v. Perry, 551 P.2d 256, 257 (Okl.1976) (stating that rights conferred by contract may be waived). Further, a waiver need not be express but may be implied from conduct. More specifically, an implied waiver occurs where a party's neglect to insist upon enforcing a right results in prejudice to another party. Altman v. Alaska Truss & Manufacturing Company, Inc., 677 P.2d 1215, 1223 (Alaska 1983); Reiter v. Yellowstone County, 627 P.2d 845, 850 (Mont.1981); Milne v. Anderson, 576 P.2d 109, 112 (Alas...