Stifel Estate Co. v. Cella

• Decision Date: 11 January 1927
• Docket Number: No. 19631.,19631.
• Citation: 291 S.W. 515
• Parties: STIFEL ESTATE CO. v. CELLA et al.
• Court: Missouri Court of Appeals

291 S.W. 515

STIFEL ESTATE CO. v. CELLA et al.

No. 19631.

St. Louis Court of Appeals. Missouri.

January 11, 1927.

Rehearing Denied February 21, 1927.

Appeal from St. Louis Circuit Court; George E. Mix, Judge.

Action by the Stifel Estate Company against Charles J. Cella and another. Judgment for plaintiff, and order overruling defendants' motion for new trial, and defendants appeal. Affirmed.

Boyle & Priest, G. T. Priest, and Robert E. Moloney, all of St. Louis, for appellants.

Rassieur & Goodwin, of St. Louis, for respondent.

BENNICK, C.

This is an action against defendants as guarantors of the payment of rent and certain other sums reserved in a lease. There was a directed verdict in favor of plaintiff and against defendants in the sum of $6,548.88, and from the judgment rendered thereon defendants, after an unavailing motion for a new trial, have appealed.

Plaintiff was the owner and in possession of certain premises at the southeast corner of Tenth and Pine streets, in the city of St. Louis, Mo., known as the Imperial Theater and Hotel building. This structure was built in two sections, the north section fronting on Pine street and designed for commercial use, while the southern section, fronting on Tenth street, was constructed for a theater. The masonry of the two sections adjoined at two points, and there was an alley five feet in width between the two structures.

On March 1, 1919, plaintiff leased the southern structure to Imperial Theater Company, a corporation, for a term of five years, at an annual rental of $8,250, payable in monthly installments of $687.50 each. There was a further provision that the lessee should pay one-half of any taxes that should be assessed against said premises during the period of the lease in excess of the sum of $4,500 per year. The lease recited that the premises described therein were demised to the lessee in their present condition and state, and that the lessee might make any desired alterations in said premises for its purposes for use as a theater, with lessor's consent, at its own expense, and that all regular and ordinary repairs to the premises should be made by and at the expense of the lessee.

It was further stipulated and agreed that the lessee should furnish good and sufficient surety for the payment of the rent and any other sums payable under said lease, such surety to be satisfactory to the lessor and to be given at the time of the execution of the lease for a period of one year from March 1, 1919, and from year to year thereafter.

The lessee performed its obligation to give surety for the first year of the lease by giving the guarantee of defendants, whereby they jointly and severally guaranteed the payment of the rent reserved in the lease and of any other sums payable or accruing thereunder.

On March 4, 1920, in compliance with its covenant to give surety, the lessee caused to be executed and delivered to plaintiff the following contract of defendants, which was introduced in evidence as Plaintiff's Exhibit B:

                "St. Louis, Mo., March 4, 1920
                "Guaranty
                

"Whereas, there was entered into, as of the 1st day of March, 1919, by and between Stifel Estate Company as lessor, and Imperial Theater Company as lessee, a certain lease for a portion of the building situated at the southeast corner of Tenth and Pine streets, in city block No. 275, the demised portion being known as the Imperial Theater; and whereas it is stipulated in said lease that the lessee shall furnish good and sufficient surety, satisfactory to the lessor, for the payment of all sums payable under the terms of the said lease, such surety to be given for each succeeding year during the term of the lease:

"Therefore, for and in consideration of the sum of one dollar ($1.00) to us in hand paid by the Stifel Estate Company, and the receipt of which is hereby acknowledged, and in further consideration of the covenants and agreements made by said Stifel Estate Company in the above-mentioned lease, we hereby jointly and severally guarantee the payment to said Stifel Estate Company of the rent reserved in said lease and any other sums payable thereunder or accruing thereunder during the period of one year from and after March 1, 1920.

                                "Charles J. Cella. [Seal.]
                                "Frank R. Tate. [Seal.]
                

"The above surety for payments under the above-mentioned lease is hereby accepted for the period of one year from and after March 1, 1920. Stifel Estate Company,

                "Edwin H. Conrades, President."
                

The evidence disclosed that the lessee failed to pay the rent reserved in said lease for the months of August, 1920, to February, 1921, inclusive, and that it likewise failed to pay its proportionate share of the taxes levied against said premises for the year 1920. This action was brought to recover said sums from defendants upon their above contract denominated as Plaintiff's Exhibit B.

Defendants filed an answer setting up certain affirmative defenses. The motion of plaintiff to strike out all of such answer, with the exception of the general denial, was, however, sustained by the court. Thereafter defendants asked, and were refused, leave to file their second amended answer, admitting the execution of the lease and of Plaintiff's Exhibit B, in which for affirmative defense it was alleged that immediately upon the taking possession of the demised premises by the lessee it became the duty and obligation of plaintiff to keep said building and all parts thereof in its possession in good repair and condition, so that no damage would be caused to the theater leased by plaintiff to said lessee; that the contract referred to as Plaintiff's Exhibit B was expressly conditioned upon the faithful performance by plaintiff of the terms of its contract with the lessee; that plaintiff; unmindful of its duty and obligation aforesaid, permitted that portion of the premises over which it had absolute dominion and control, including the roof, walls, foundation, guttering, and downspouts, to deteriorate and decay; that as a consequence thereof rain and snow leaked through that portion of the building under plaintiff's control and seeped into the portion occupied by the lessee; that, by reason of the acts of plaintiff aforesaid, said theater became so weakened and damaged that it could not be used for theatrical purposes; and that by reason of the neglect of plaintiff to carry out and perform its obligations lessee was discharged of any obligation to pay the rent reserved in said lease, and the obligation of defendants was likewise discharged.

Defendants further stated that by reason of the failure of plaintiff to carry out its obligations to lessee, said lessee was forced to cancel a booking contract, whereby it was damaged in the sum of $50,000.

It was further alleged that thereafter the lessee entered into negotiations with plaintiff with the view of having plaintiff repair the damages aforesaid in consideration of an increased rental to be paid it by the lessee; that plaintiff did not conduct said negotiations in good faith, but merely for the purpose of preventing the lessee from giving notice of termination of the lease; and that when the lessee learned of such design on the part of plaintiff, it could not thereafter declare the cancellation of the lease without admitting liability for rentals previously accrued ; that, by reason of the wrongful acts and conduct of plaintiff, both lessee and defendants had been discharged of all obligation under the lease and contract of guaranty.

Finally, it was alleged that defendants, pursuant to the provisions of sections 12687, 12688, and 12689, R. S. 1919, had notified plaintiff to institute an action against the lessee ; that plaintiff had filed such suit but had failed to prosecute the same to judgment ; and that defendants, by reason of such failure of plaintiff, were discharged from any and all liability under the terms of Plaintiff's Exhibit B.

Defendants argue that the court erred in striking out the affirmative defenses set up in their first amended answer and likewise in refusing to permit them to file their second amended answer. It is their contention that Plaintiff's Exhibit B was a bond and that the obligation of defendants was that of sureties on such bond; that the answers which they sought to file alleged a good defense, if pleaded by the lessee in an action against it by plaintiff; and that defendants, as sureties, had the right to set up in their answer such defenses as were available to their principal. Plaintiff, to the contrary, asserts that the matters relied upon by defendants would have constituted no defense to an action for rent, even if advanced by the lessee; that Plaintiff's Exhibit B was purely a contract of guaranty; and that defendants, as guarantors, could not set up counterclaims or setoffs accruing to their principal (the lessee) against plaintiff (the guarantee) as a defense to an action on such contract of guaranty.

In determining the liability of defendants under Plaintiff's Exhibit B we are clearly of the opinion that such obligation was not a bond. We are not unmindful that any instrument in writing that legally binds a party to do a certain thing may satisfy the requirements for a bond. 9 C. J. 7. This court-has defined a bond as a written...