Sinclair v. Burke

• Decision Date: 01 May 1930
• Citation: 133 Or. 115,287 P. 686
• Parties: SINCLAIR v. BURKE ET AL. [a1]
• Court: Oregon Supreme Court

287 P. 686

133 Or. 115

SINCLAIR v. BURKE ET AL. ^[a1]

Supreme Court of Oregon

May 1, 1930

Department 2.

Appeal from Circuit Court, Multnomah County; Jacob Kanzler, Judge.

Action by J. F. Sinclair against John L. Burke and another, in which defendants filed a counterclaim. From a judgment for plaintiff, the defendants appeal.

Reversed and rendered.

Oscar Furuset, of Portland, for appellants.

Jesse G. Warrington, of Portland, for respondent.

BEAN J.

This is an action to recover from defendants $1,200, which plaintiff paid them in advance in payment of the last six months' rent, less $585, rent due at the time of the termination of the lease.

The cause was tried to the court without the intervention of a jury. Judgment was rendered in favor of plaintiff for $615 from which defendants appeal.

The parties entered into a written lease on October 17, 1924. At the time, the plaintiff was occupying the garage premises under a lease which expired December 31, 1925. The term of the new lease was from January 1, 1926, to December 31, 1930 for the agreed rental of $200 per month, payable in advance. The lease, which is exhibited with the complaint, in addition to the covenant on the part of the plaintiff to pay the rent promptly, contained the following provision: "In addition to the above mentioned rentals said lessee is to pay to said lessors the following payments at times specified herein to apply on the last six months rental totaling twelve hundred ($1,200.00) dollars, as follows:"

Then follow the dates and manner of payments, the last installment of which became due and payable on or before January 15 1926.

The testimony tends to show that, in consideration of the plaintiff making certain improvements upon the premises, it was mutually agreed that the rentals should be reduced to $175 per month, and that plaintiff paid defendants on that basis up to about May, 1927, there being $585 accrued rentals in arrears at the time of the termination of the tenancy about August 25, 1927. See Sherman, Clay & Co. v. Buffum & Pendleton, 91 Or. 352, 179 P. 241; 35 C.J. p. 1170, § 448.

There was a dispute in the testimony in regard to the reduction of the rent, the defendants claiming that the $25 per month was only deferred until the latter part of the term. This question is foreclosed by the finding of the trial court, which has the force and effect of the verdict of a jury, and there being some competent evidence to support such finding, it cannot be disturbed.

In August, 1927, defendants attempted to collect the rent in arrears for May, June, July, and August. Plaintiff declared he could not pay the rent he owed, and that he was quitting the place. Plaintiff, as soon as he sold the gas in the tank on August 27, 1927, turned the keys over to Mr. Burke and quit the premises, and defendants took possession thereof and leased the same to other parties.

Defendants assign that the court erred in rendering judgment in favor of plaintiff, and also in refusing to render judgment in their favor upon their counterclaim for the rent in arrears. The questions are raised by appropriate motions and requested findings of facts.

It is contended by defendants that the payment of the $1,200, as rentals for the last six months of the term of the lease, was simply a payment of the rent in advance for that time and cannot be recovered by plaintiff.

Plaintiff contends, in effect, that the $1,200 was a deposit as security for the last six months' rentals, and to be applied "when the same shall become due and collectible" and should not be forfeited. Citing Cunningham v. Stockon, 81 Kan. 780, 106 P. 1057, 19 Ann. Cas. 212, and other similar authorities. It is agreed that the question in regard to the return of the $1,200 is one of law.

That sum was paid by plaintiff to defendants pursuant to his covenant in the lease to do so, which money was to be applied upon the last six months' rent. The money thereby became the absolute property of defendants. It was simply an absolute payment of rent in advance, as stipulated by plaintiff in the lease. It was not a deposit as security for the performance of the agreement. The statement in plaintiff's brief in regard to the $1,200 "to apply on the last six months' rental, when the same shall become due and collectible," contained the words, which we have underscored, that are not found in the stipulation of plaintiff in the lease.

To construe the agreement, as if it contained such language, would be making a new contract for the parties, which the court cannot do. 13 C.J. p. 541, § 513.

The general rule deducible from the cases involving the right of a landlord to retain rent paid by the tenant in advance, in the event of the termination of the lease, is that, in the absence of provisions therefor, rents paid in advance cannot be recovered by the tenant upon termination of the lease, unless such termination was wrongful as against such tenant. 50 L. R. A. (N. S.) page 1034, note; 36 C.J. p. 340, § 1149; 16 R. C. L. p. 1137, § 658, see also p. 931, § 438. Moumal v. Parkhurst, 89 Or. 248, 173 P. 669; Rockwell v. Eiler's Music House, 67 Wash. 478, 122 P. 12, 39 L. R. A. (N. S.) 894; Galbraith v. Wood, 124 Minn. 210, 144 N.W. 945, 50 L. R. A. (N. S.) 1034, Ann. Cas. 1915B, 609.

The principle involved was enunciated by Mr. Justice Rand in the case of Phegley v. Enke's City Dye Works, 127 Or. 539, 272 P. 898, at page 900, in the following language: "The effect of a valid surrender of a lease is to discharge the lessee from the payment of any rent thereafter to become due, but it does not have the effect of releasing the lessee from his liability for any sum then due."

In the present case, the $1,200, the rentals for the last six months of the lease, were due and payable on the dates mentioned in the lease. It was paid on or about such dates, which was long prior to the termination of the lease.

16 R C. L., p. 1137, § 658, reads in part thus: "The liability for rent accrued at the time of the forfeiture is not, however, affected thereby, and, according to the generally accepted view, this includes liability for...