Johnston v. De Lay

• Decision Date: 04 May 1945
• Docket Number: 3413.
• Citation: 158 P.2d 547,63 Nev. 1
• Parties: JOHNSTON et al. v. DE LAY et al.
• Court: Nevada Supreme Court

158 P.2d 547

63 Nev. 1

JOHNSTON et al. v. DE LAY et al.

No. 3413.

Supreme Court of Nevada

May 4, 1945

Appeal from District Court, Eighth District, Clark County; J. D Salter, Judge.

Action by D. H. Johnston and M. E. Ward against Maurice L. DeLay and others to recover possession of certain property and for damages, wherein defendants counterclaimed for damages. From an adverse judgment, plaintiffs appeal.

Affirmed in part and reversed in part.

Morse & Graves, of Las Vegas, for appellants.

Edgar B. Hervey, of San Diego, Cal., J. R. Lewis, of Las Vegas, and Merwyn H. Brown, of Winnemucca (Henry F. Walker, of Los Angeles, Cal., of counsel), for respondents.

ORR Justice.

In the district court the plaintiffs instituted an action asking that they be given possession of certain property situate in Clark County, Nevada, and for damages in the sum of $10,000 for the alleged wrongful withholding of said property, and at the instance of plaintiffs, the trial court appointed a receiver of said property. Said receiver duly qualified and took possession of the premises in question on February 20 1942, and has been in such possession since said date. Defendants counterclaimed in the action and asked damages in the sum of $10,000, the sum being later increased to $20,000 through amendments permitted by the court.

Plaintiffs Johnston and Ward are the owners, as tenants in common, of the property involved in this action, each owning an undivided one-half interest therein. On September 19, 1941, an instrument in writing was executed by and between Ward and Maurice L. DeLay, wherein the said Ward leased to DeLay the property referred to. Ward and DeLay, after certain negotiations, arrived at an agreement relative to the leasing of the property, and the terms and conditions of the said lease were dictated to Mrs. Perle Brown, who typed it, and it was later signed by M. E. Ward, as lessor, and Maurice L. DeLay, as lessee. The lease was not signed by plaintiff Johnston; neither was Mrs. Johnston apprised of the deal which had been made by Ward and DeLay, before its execution, and it nowhere appears that at any time she gave her assent thereto. The lease reads:

'Lease

'127266

'This Indenture made this 19th day of September, 1941, between M. E. Ward, of Las Vegas, Clark County, Nevada Lessor, and Maurice L. De Lay, Lessee,

'Witnesseth: That the said Lessor has leased and by these presents does grant, demise and lease unto said Lesseem and the said Lessee has hired and taken, and by these presents does hire and take of and from the said Lessor,

'All that certain premises known as Block 11 and Block 13, situated in Midway City, which includes tavern, cabins and house, (excepting the house with the fish pond) and such fixtures as are now at the premises. The Lessor grants the privilege of having trailor camps on said property.

'This lease is to become effective October 1, 1941, and to extend for a period of two years from date thereof. Payments are to be made in lawful money of the United States of America, on a basis of percentage, towit:

'A complete and accurate set of books is to be kept by Lessee, to be available at all times for inspection by the Lessor or his Agents. Lessee, his wife, Elsa May DeLay and William Dunn and wife, Ruth Wallace Dunn agree to furnish services free. Lessee is to act as Manager of said premises and is to have not less than $500.00 in merchandise and equipment on hand at all times, which shall be considered as security for the fullfilment of the contract by Lessor. Lessor agrees to paint the buildings, furnish cabins and houses with beds, to furnish water, electricity to the premises, and access to premises from Highway at all times. At the end of each and every month an inventory is to be taken and after deducting operating costs the balance of net proceeds is to be divided as follows: 66 2/3% to Lessee and 33 1/3% to Lessor. The Lessee agrees to pay on the 1st day of each month, starting November 1, 1941.

'The said Lessee hereby covenants to pay said Lessor in such manner and agrees further not to suffer any altration to be made without the written consent of Lessor. And, it is agreed that if any rent or percentage shall be due and unpaid, or if default shall be made in any of the covenants herein contained then it shall be lawful for the Lessor to re-enter the said premises and to remove all persons therefrom.

'And that, at the expiration of said term or any sooner determination of this lease the said Lessee will quit and surrender the premises hereby demised, in as good order and condition as reasonable use and wear thereof will permit, damages by the elements excepted. And if the Lessee shall hold over the said term with the consent expressed or implied, of the lessor, such holding shall be construed to be a tenancy only from month to month, Lessee to have an option for a period of two additional years on the same basis. The Lessee will not be obligated to this contract if the premises are placed under government supervision whereby liquor or gambling are restricted.

'Lessee further agreed to use Slot Machines and Music Equipment to be furnished by Richard Roschl.

'In witness whereof the said parties have hereunto set their hands this 19 day of September 1941

'M. E. Ward

'Lessor

'Maurice L De Lay

'Lessee

'Ruth W. Dunn

'Elsa Mae De Lay'

Defendants went into possession under the lease on October 1, 1941, began operating a trailer camp, installed a sewage system, and renovated the tavern. The cabins situate on the property being in poor condition, Ward had work performed on the buildings, and as the cabins were finished the defendants cleaned them up and started renting them. Under the terms of the lease the lessor, Ward, agreed to furnish water, and the supply of water being short, the possibility of development of new sources was discussed by the parties, and DeLay gave Ward the sum of $500 as advance rent, for water development. This money was delivered to Ward on or about November 26, 1941. The defendants secured requisite licenses and began the operation of a bar and gambling games in what is known as the old tavern, situate on said property. In November, 1941, defendant DeLay and Miss Mary Haney entered into a partnership, and DeLay and a Mr. Parry entered into an agreement whereby Parry agreed to erect a building adjoining the old tavern, at a cost of several thousand dollars. Parry was to have the right to conduct gambling games in the new building, and was to pay 25% of the profits derived therefrom to DeLay. DeLay was to have the right to conduct all bar business in the new building as well as the old tavern, and all gambling games in the old tavern. The agreement between Parry and DeLay was to become operative and effective only when consented to by Lessor Ward. On the date of the execution of the agreement between Parry and DeLay, the lessor, Ward, signed his name thereto under the words: 'Approved and consented to.' Parry caused the new building to be constructed, and it was opened for business on February 20, 1942.

On the 8th day of January, 1942, plaintiff Johnston caused a notice to vacate to be served upon DeLay. But defendant DeLay continued to occupy the premises until he surrendered possession to the receiver.

The execution of the lease from Ward to DeLay is admitted, but the appellants contend that the lease between Ward and DeLay was subject to an oral understanding that it would not become effective until approved by the plaintiff Johnston. The trial court found, and there is substantial evidence in the record to sustain that finding, that no such condition was attached to the execution of the said lease.

A jury was impanelled in this case, and certain questions were submitted to them for determination. The questions submitted and the answers thereto are as follows:

Question No. 1: 'Do you find from the evidence that the plaintiff, M. E. Ward, during his negotiation with the defendants, Maurice L. DeLay, William Dunn, Ruth Wallace Dunn and Elsa Mae DeLay, informed the said defendants that he was without authority to enter into an agreement or lease for said property to them unless the same should be approved by the said D. H. Johnston.' The jury answered said question: 'Yes.'

Question No. 2: 'Do you find from the evidence that the defendants, Maurice L. DeLay, Elsa Mae DeLay, William Dunn and Ruth Wallace Dunn, accepted said instrument identified as Exhibit 'A' attached to plaintiff's Amended Complaint with the understanding between the plaintiff, M. E. Ward, and the defendants herein that said instrument would be approved by the plaintiff herein, D. H. Johnston.' The jury answered said question: 'Yes.'

The court rejected the answers of the jury on the ground that the evidence did not sustain them. Appellants contend that the verdict of the jury was binding. Respondents answer that this is an action in equity, and that in an equity action there is no right to a trial by jury; that in an equity action where a jury is impanelled the verdict is merely advisory and may be disregarded by the chancellor in determining the case. Crosier v. McLaughlin, 1 Nev. 348; Lake v. Tolles, 8 Nev. 285; Brichetto v. Raney, 76 Cal.App. 232, 245 P. 235; Union Oil Co. v. Reconstruction Oil Co. et al., 20 Cal.App. 170, 66 P.2d 1215.

Appellants deny that the action was one in equity, but we thing that the trial was had by both parties and the court upon the theory that the action was one in equity and that the verdict of the jury was merely advisory. At the time of the return of the answers by the jury to the questions submitted appellants made no claim that the verdict was final and that judgment could be entered thereon, and consented...