Raco Corp. v. Acme-Goodrich, Inc., ACME-GOODRIC

• Decision Date: 09 May 1955
• Docket Number: I,ACME-GOODRIC,No. 18594,18594
• Citation: 126 N.E.2d 262,126 Ind.App. 168
• Parties: RACO CORPORATION, Appellant, v.nc., Appellee.
• Court: Indiana Appellate Court

Page 262

126 N.E.2d 262

126 Ind.App. 168

RACO CORPORATION, Appellant, v. ACME-GOODRICH, Inc., Appellee.

No. 18594.

Appellate Court of Indiana, In Banc.

May 9, 1955.

Stump & Emswiller, Indianapolis, for appellant.

Freeman Bradford, Indianapolis, for appellee.

KELLEY, Chief Judge.

On July 15, 1947, one Glenn A. Pritchard, the original lessor who was not made a party to this action, being then the owner of a two-story tile building, known as Redman's Hall, in the town of Oaklandon, Marion County, Indiana, leased the same, as party of the first part, by written lease, to the appellant, as party of the second part, for a term from July 15, 1947, to July 15, 1950, at a monthly rental of $75, with the privilege in appellant of renewing said lease for a period of two years, at a monthly rental of $100. Appellant immediately entered into the possession of said premises pursuant to said lease.

Said Glenn A. Pritchard sold said premises to appellee in April of 1949 and the transfer thereof, insofar as the matters here in issue are concerned, became effective as of May 1, 1949. Appellant fully paid to said Pritchard all the rent which accrued under said lease to the time said premises were transferred to appellee.

Appellant retained the possession of said premises under said lease until the first day of February, 1951, at which time it vacated said premises, but paid no rent to appellee during said time from May 1, 1949, to February 1, 1951.

Appellee commenced this action against appellant by complaint, afterward amended, in three paragraphs, the first two of which counted upon recovery for the unpaid rent which accrued under said lease from May 1, 1949, to February 1, 1951, and the third paragraph sought recovery for the reasonable value of the use and occupancy of the premises for said time.

To the amended complaint appellant filed an answer of admission and denial, and also an answer in the nature of a counter-claim.

The counter-claim, in substance, states: that appellee assumed all the obligations under the said lease owing to appellant 'originally by said Pritchard;' that Pritchard and appellee 'on its own part' failed to perform clause Sixth (hereinafter set out) of the lease; that Pritchard did not perform clause Eighth (hereinafter set out) of the lease; that for the period from July 15, 1947, to May 1, 1949, appellant suffered damage of $2902.50 for the loss of time of its employees in going elsewhere for drinking water and toilet facilities; that on or about May 1, 1949, appellant informed appellee it would not pay rent until appellee performed said clause Sixth and that with the intention of recouping its loss, it occupied the premises until February 1, 1951, and paid to rent during that time; that thereby appellant recouped $1087.50 of its 'loss resulting from the breach of the contract' leaving the sum of $1,815 owing by appellee to appellant; that Pritchard, by his failure to perform said clause Eighth, caused appellant loss of the 'value' of its business which appellant 'believes was in the amount of $1000.00.' Appellee's reply put at issue the allegations of said counter-claim.

Trial of the issues was to the court which found against the appellant on its counterclaim and for the appellee on its complaint and that appellee recover of appellant the sum of $1787.50 and costs. Appellant's motion for a new trial on the grounds that the evidence is insufficient to sustain the decision of the court and that the decision is contrary to law, was overruled and this appeal followed, the sole error assigned being the overruling of said motion for a new trial.

As it pertains to appellant's counter-claim, the challenge that the finding is not sustained by sufficient evidence is unavailable to appellant. Insofar as the court found the amount of rent due and unpaid by appellant, the latter's attack thereon must fail for the reason that the lease provides the amount of the monthly rental and appellant admits it did not pay the rent for the period stated in the amended complaint. Therefore, the amount of the recovery authorized by the finding was, under the pleadings and the evidence, purely a matter of computation. The remaining question, then, for our consideration is whether, under the specification in the new trial motion that the decision of the court is contrary to law, the evidence and the legal principles applicable thereto entitled appellant to relief which the court denied to it.

It is without gainsay that if the court correctly determined the issues pertaining to the alleged non-performance by appellee of clause Sixth of the lease and the alleged violation by Pritchard of clause Eighth thereof, appellant was not deprived of any legal relief contended for.

For sake of convenience, we will consider the stated matters inversely. Clause Eighth of the lease provided, in material part, as follows:

'Eighth: That in the event said premises are offered for sale the party of the second part shall have the first right to accept the offer of the party of the first part; * * *'

There is no claim or evidence that appellee in any way violated this clause. The contention is that Pritchard offered the premises for sale without affording appellant the first right to accept the offer and that appellee is liable therefor because it assumed all the obligations under the said written lease which were owing to appellant by Pritchard.

We find no evidence in the record of any agreement, express or implied, by appellee to assume, pay, or discharge any obligation or liability of Pritchard to appellant by reason of the asserted breach by Pritchard of said clause Eighth prior to appellee's acquirement of the reversion. In the absence of such agreement, it is difficult to perceive, under the circumstances evident here, upon what basis liability of the appellee can be predicated for acts committed by the original lessor, Pritchard, previous to the transfer to appellee of the reversion.

Assuming (but not deciding) that said clause, in practical contemplation, constitutes an option to purchase, it gave appellant 'no additional interest in praesenti in the land itself, but merely a right of personal recourse against the lessor,' Tiffany, Landlord and Tenant, Vol. 2, § 257, page 1677, and gave appellant no 'title to the land, either legal or equitable,' Kritz v. Moon, 1928, 88 Ind.App. 5, 18, 163 N.E. 112; 51 C.J.S., Landlord and Tenant, § 81b, page 635. The claim, then, that appellant attempts to assert against the appellee is not founded upon an interest in the land. In such circumstance, the rule that a purchaser is bound by all the equities which a tenant in possession can enforce against the vendor is not applicable and does not enable appellant, as lessee, to successfully counter-claim against the appellee, as the owner of the reversion, in the latter's action for the rent due it,...