Rock Springs Realty, Inc. v. Waid

• Decision Date: 12 July 1965
• Docket Number: No. 51125,No. 2,51125,2
• Citation: 392 S.W.2d 270,15 A.L.R.3d 774
• Parties: ROCK SPRINGS REALTY, INC., Appellant, v. Robert Lee WAID, Billie I. Waid, O. D. Moffett and Mrs. Helen Moffett, Leonard W. White and Mrs. Leonard W. White and Virgil Rogers, Respondents
• Court: Missouri Supreme Court

Page 270

392 S.W.2d 270

15 A.L.R.3d 774

ROCK SPRINGS REALTY, INC., Appellant, v. Robert Lee WAID, Billie I. Waid, O. D. Moffett and Mrs Helen Moffett, Leonard W. White and Mrs. Leonard W. White and Virgil Rogers, Respondents.

No. 51125.

Supreme Court of Missouri, Division No. 2.

July 12, 1965.

Paul H. Niewald, Gordon, Adams, Niewald & Risjord, Kansas City, for appellant.

Lloyd S. Hellman, Achtenberg, Sandler & Balkin, Clem W. Fairchild, Linde, Thomson, VanDyke, Fairchild & Langworthy, Kansas City, for respondents.

EAGER, Presiding Judge.

This suit is one by a successor lessor against the lessees of a building used as a restaurant, for damages caused by a fire alleged to have been negligently caused. An employee of the lessees was also joined. More specifically, the petition proceeds upon a res ipsa theory and it alleges that the fire was negligently started by the use of the restaurant stove. The prayer was for $60,720.70 for the damage to the building and $2,600 for loss of rents. The principal defenses were: a denial of negligence, a claim of assumption of risk, the contention that the lease contained provisions which exonerated defendants from all damage by fire, and a plea of estoppel. By answers to interrogatories, plaintiff admitted the issuance of fire insurance policies totalling $45,000 and of a policy covering loss of rents; also, that it had made claim on the fire policies for $60,726.70, had collected on those policies $42,167.15, and that it had collected separately $2,600 for loss of rents. The insurers are not joined as subrogees. Plaintiff contends that the loss was not fully covered by insurance. The fire occurred on May 6, 1963; suit was filed on June 1, 1964. After the interrogatories were answered and responses were made to requests for admissions, the defendants filed their motion for summary judgment under our Rule 74.04, which the court sustained; a final judgment for defendants was entered on this motion. It is not claimed here by appellant that there are any genuine issues of fact.

The one basic question raised, and the one upon which the trial court obviously based its judgment, is whether the provisions of the written lease constituted an exoneration or release of the lessees from liability for a fire caused by their negligence or that of their employees. The trial court held that it did; if we affirm, then the actual existence or nonexistence of negligence on the facts is immaterial. If we should reverse, then the case would necessarily be remanded for a determination of that issue, and perhaps others. We have determined that the judgment should be affirmed.

The pertinent provisions of the lease are as follows: '4. During the term, or any extension thereof, Tenant will not do, allow or permit:--* * * anything to be done or kept in the premises which will cause cancellation of, or increase in the premium for, fire and explosion insurance on the premises, or on the building of which the premises may be a part, or on contents belonging to anyone in the building, over the rate for occupancy of the business above mentioned; * * * 6. Tenant agrees:--to comply with all insurance regulations so the lowest fire, liability and explosion rates may be obtained; to pay all insurance premiums required to insure the full value at all times of all improvements made by Tenant in or to the premises * * *; to maintain the premises and appurtenances in a first class condition and to pay for all repairs within or appurtenant thereto; * * * to indemnify, protect and defend the Landlord from and against claims for damage or injury, of whatsoever kind or character, to person or property, howsoever caused, occurring in or about the leased premises, * * * 9. In case, during the term created or previous thereto, the premises hereby let, or the building of which said premises are a part, shall be destroyed or shall be so damaged as to become untenantable by fire or by providential means, then, in such event, at the option of Landlord, the term hereby created shall cease, * * *. In case Landlord shall not so elect to terminate this lease, in such event, this lease shall continue in full force and effect, and the Landlord shall repair the leased premises with all reasonable promptitude, placing the same in as good condition as they were at the time of the damage or destruction, * * * If Landlord cannot obtain fire insurance in responsible companies by reason of Tenant's occupancy, Landlord may terminate this lease. * * * 18. At the expiration of this lease, Tenant will surrender keys and peaceable possession of the leased premises to Landlord or Agent, in good condition; loss by fire, casualty, Providence and deterioration excepted. * * * 21. Tenant shall not store or deposit garbage or trash around or on the premises and will take special precautions as often as necessary to clean grease from exhaust fan and duct on roof to prevent danger of fire therefrom.' (The italics are ours.)

The basic contentions here, pro and con, revolve around the construction of the provision that the lessee will surrender possession of the premises in good condition, 'loss by fire, casualty, Providence and deterioration excepted.' Defendants say and the trial court agreed that this, considered along with the remainder of the lease, evidenced an intent to relieve the lessees from liability for all fires regardless of negligence, and that if the lessor had intended the contrary the stated exception should have been limited to 'fire caused without negligence of tenant.' Appellant insists that the exception does not contemplate a fire caused by the lessees' negligence and that if such were intended that intent should and must have been specifically and clearly stated. The issue here is thus rather narrow, though complicated. It is obvious that this lease, on a printed form with sundry and extensive protections to the lessor, was a 'landlord's' lease, namely, that it was prepared and presented by the lessor. We note this for whatever it may be worth. The case is actually one of first impression in Missouri on these or similar facts, although certain cases to which we will refer assume to state principles which might be controlling, if followed in the abstract.

We shall first dispose of the suggestion sometimes made that an agreement to exempt or exonerate one from the consequences of his own negligence is against public policy. In so far as private individuals and private interests are concerned, that doctrine has been definitely rejected. Kansas City Stock Yards Co. v. A. Reich & Sons, Mo., 250 S.W.2d 692; Cerny-Pickas & Co. v. C. R. Jahn Co., 7 Ill.2d 393, 131 N.E.2d 100; General Mills v. Goldman, CA 8, 184 F.2d 359, cert. denied 340 U. S. 947, 71 S.Ct. 532, 95 L.Ed. 683.

Seeking reversal of the summary judgment, appellant relies on the following cases and texts: Meyer Jewelry Co. v. Professional Building Co., Mo.App., 307 S.W.2d 517; Thomas v. Skelly Oil Co., Mo.App., 344 S.W.2d 320; Winkler v. Appalachian Amusement Co., 238 N.C. 589, 79 S.E.2d 185; Morris v. Warner, 207 Cal. 498, 279 P. 152; Sears, Roebuck & Co. v. Poling, 248 Iowa 582, 81 N.W.2d 462; Cerny-Pickas & Co. v. C. R. Jahn Co., 347 Ill.App. 379, 106 N.E.2d 828; Poslosky v. Firestone Tire & Rubber Co., Mo., 349 S.W.2d 847. Cerny-Pickas, supra, may readily be eliminated, as its theory was completely exploded by the Supreme Court of Illinois upon a subsequent appeal; we shall refer to that opinion later. 131 N.E.2d 100. Thomas involved an indemnity agreement and need not be discussed in detail; the opinion did state the principle that where one is to be indemnified against the results of his own negligence, the intention should be clearly expressed. In Morris, a California case of 1929, a redelivery clause in a lease excepting 'fire and ordinary use' was held not to exonerate the tenant from his own negligence, but it does not appear that the lease contained any provisions concerning fire insurance, the materiality of which will be shown later. We shall discuss the Meyer, Winkler, Sears Roebuck and Poslosky cases.

In Meyer Jewelry Co. v. Professional Building Co., Mo.App., 307 S.W.2d 517, a lease of first floor and basement space in an office building provided that lessor should not be liable for any damage to person or property '* * * by steam, gas, or electricity, or from water, (from certain specified sources and causes) * * * or for damages * * * from the acts or negligence of co-tenants or other occupants * * *.' (Words in parentheses are ours.) After plumbers had renovated the sewers in the basement quarters, water faucets were allowed to run and overflow during the night, this being due to acts of lessor's agents. The lessee sued the lessor for its damage. The court held that the lease did not exempt the lessor from liability for its negligence, although it did exempt it from certain negligent acts of third persons; further, that an exculpatory clause must, in order to be effective exonerate the landlord 'in plain terms' from its own acts of negligence. We note that the court there was not in any sense construing such a contract as we have here, and that no question of insurance was involved. Certain suggestions which we make later in connection with the Poslosky case are also applicable to this case.

In Winkler v. Appalachian Amusement Co., 238 N.C. 589, 79 S.E.2d 185, a theatre building was damaged by a fire caused by the careless operation of a popcorn machine by one of the tenant's employees. The lessor sued the lessee for negligent damage. The lease provided that the lessee would at the termination of the lease deliver up the premises in good condition, 'ordinary wear and tear and damage by fire or other casualty excepted.' A similar exception was made in the lessee's covenant to repair. The lessors had agreed to carry insurance to the full value of the property and to restore the property in case of fire. Plaintiff was nonsuited, but the...