Following a bench trial in this suit for rent and other damages, the Superior Court (Penobscot County) entered judgment in the amount of $27,110 for plaintiff-landlord Dahl. Defendant-tenant Comber brings this appeal. All of the issues argued by the
Comber and his business associate, Cler-mont Maheux, 1 leased from Dahl an industrial building located in Hermon that the latter constructed specially for them. The written lease agreement was to run from August 1,1978, to July 31,1983. It obligated the tenants to pay $1,252 in monthly rent, in return for the use of 6,400 square feet, and gave the tenants options to lease the remaining space in the building and to purchase the building for $135,000. On November 1, 1978, Comber and Maheux exercised their option to lease the remainder of the building. The amended lease prescribed a monthly rent of $1,852 and raised the option purchase price to $141,400.
The tenants’ business, which was the fabrication and testing of firearms through a corporation named Bushmaster Firearms, almost immediately fell on hard times, and Comber and Maheux failed to meet their rental obligation for the months of April, May, and June, 1979. They did, however, pay the full rent due for the month of July.
On August 16, 1979, Dahl obtained a writ of possession for the leased premises. Richard Dyke had in the meantime taken control of Bushmaster Firearms in an attempt to rescue the business. Rather than find an entirely new tenant for his custom-designed building, Dahl entered into a lease with the corporation for a term of five months starting August first, the lease being guaranteed by Dyke and carrying the same monthly rental as the Comber-Maheux lease. At trial Dahl testified that he had neither intended nor manifested an intent to release Comber and Maheux from their five-year lease agreement. On the other hand, Comber testified that Dahl had been “very re-: ceptive” to the idea of accepting a “substitute tenant,” although he could not recall if Dahl had used the word “release.”
Under Dyke’s management, the reorganized business stayed on as a tenant past the expiration of the interim agreement, continuing to pay rent through February, 1980. When the business finally ceased at the premises, Northeast Bank paid for two additional months’ rent to give it time to conduct an auction of the firm’s machinery on the premises. Dahl got none of the proceeds of that auction. He succeeded in reletting only parts of the building to other tenants; he conducted a fruitless search for a new tenant to use the whole structure and put the property on the market for sale for $196,800.
In this action for rent and damages, the trial justice held for Dahl, finding that there was not any effective surrender of the leased premises by the tenants, nor any acceptance of the surrender by the landlord. On appeal, Comber argues that Dahl’s consent to a “substitute” tenant (Bushmaster Firearms, guaranteed by Dyke) constituted acceptance of Comber’s surrender of the lease, thereby discharging him from further liability for rent. The existence of surrender and acceptance depends on the intent of the parties and is a question of fact. Moreover, the tenant bears the burden of proof that his attempted surrender was accepted by the landlord.
See Grueninger Travel Service v. Lake County Trust Co.,
Alternatively, the tenant, Comber, argues that in subsequently reletting parts of the building to other tenants after Bushmaster’s demise but during the term of the unexpired lease, Dahl (who claims only to have been acting for Comber’s account to mitigate damages
3
) effectively accepted surrender of the leasehold. This alternative argument of Comber is in part founded on paragraph 9 of the lease agreement,
4
which provides that “[i]n case of default by the Tenant in the payment of rent, ... the Landlord may at any time thereafter re-sume possession [of the building] by any lawful means ... and hold the premises as if this lease had not been made.” Thus, Comber urges a construction of this clause that would have resulted in rescission of the lease agreement upon Dahl’s taking possession. When read in context, however, the ambiguous language of paragraph 9 is equally amendable to interpretation as assuring the landlord the right, in order to mitigate damages, to reenter and relet the premises after the tenant’s default. The paragraph 9 language relied on by Comber must be read along with the other provision of that paragraph stating that after his surrender of the premises, “the Tenant shall remain liable as hereinafter provided.” The phrase “hereinafter provided” has meaning only if it refers to paragraph 18 of the lease
Comber also makes his attack against Dahl’s reletting on the basis of a pair of Maine cases. In
Callahan v. Roberts,
A tenant who abandons the occupancy of demised premises before the expiration of the lease, without the express or implied consent of the landlord or other legal justification, does not relieve himself thereby from payment of rent for the residue of the term. In case, however, the landlord, having resumed possession of the abandoned premises, relets them on his own account, it must be assumed that, as of the time of the reletting, he accepts a surrender and relieves the tenant from liability for future rent accruals. 6
(Emphasis added)
Id.
at 24,
Neither of those cases says that reletting by a landlord necessarily constitutes acceptance of the tenant’s surrender of his lease. Rather, both hinge on the factual question whether the landlord relet “on his own account” or for the benefit of the tenant. The case law calls for a subtle, factual inquiry by the trial court: did the landlord relet to spare the defaulting tenant from paying the full rent he would otherwise be liable to pay, or did he in fact treat the lease as terminated and later in court seek to deny the termination? The justice below made no express finding of fact on this point, but her decision must be deemed to incorporate a finding that Dahl acted, not on his own account, but rather on Comber’s account in order to reduce the amount of rent due from Comber.
See Conover v. Conover,
Me.,
Since the record supports the view that upon Comber’s default in his obligation to pay rent Dahl merely attempted in good faith to mitigate the damages, the finding below that there was no effective surrender and acceptance is unassailable on appeal.
The entry must be:
Judgment affirmed.
All concurring.
Notes
. In the Superior Court Maheux was a named defendant against whom judgment was entered jointly and severally with his co-tenant, Comber. Maheux has not appealed.
. Paragraph 10 of the lease reads in full as follows:
The failure of the Landlord to insist in any instance on strict performance of any covenant hereof, or to exercise any option hereincontained, shall not be construed as a waiver of such covenant or option in any other instance. No modification of any provision hereof and no cancellation or surrender hereof shall be valid unless in writing, and signed by the Landlord.
(Emphasis added)
. In absence of an agreement to the contrary, a landlord has no obligation to mitigate damages where the tenant defaults in paying rent and even abandons the leased premises.
See Enoch C. Richards Co. v. Libby,
Abandonment of property is an invitation to vandalism, and the law should not encourage such conduct by putting a duty of mitigation of damages on the landlord.
Id.
at 392,
Even though under no duty to mitigate damages by reletting premises abandoned by the tenant, a landlord may nonetheless do so for the tenant’s account.
Id.
at 390,
. Paragraph 9 of the lease reads in full as follows:
If the Tenant defaults in the performance of any of the covenants or conditions herein contained, other than the covenants to pay rent, or if any conduct of the Tenant or occupants of the leased premises shall be objectionable, the Landlord may give to the Tenant ten days’ written notice thereof, and if such default has not been cured or the objectionable conduct stopped within said ten day period, then at the expiration of said ten days the Landlord may give the Tenant five days’ notice of the termination of this lease, and at the expiration of said five days’ notice the term of this lease shall expire, and the Tenant shall then surrender the leased premises to the Landlord, but the Tenant shall remain liable as hereinafter provided. In case of default by the Tenant in the payment of rent, or if the ten day notice above provided for shall have been given and the ten day period shall have elapsed without curing such default or stopping the objectionable conduct, and the five day notice above provided for shall have been given and the five day period shall have elapsed, or if the leased premises become vacant or deserted, the Landlord may at any time thereafter resume possession thereof by any lawful means, and remove the Tenant or other occupants and their effects, by dispossess proceedings, or otherwise, without being liable to prosecution or damage therefor, and hold the premises as if this lease had not been made.
(Emphasis added)
. We do not mean to hold out paragraph 9 as an example of good draftsmanship. It is to the advantage of both landlords and tenants to delineate more clearly than was done here exactly what rights and duties are contemplated under lease agreements. A good example of a lease provision assuring the landlord the right to reenter and relet without accepting surrender is section 10.1 of the contract at issue in
Grueninger Travel Service v. Lake Country
Trust Co.,
. The quoted language is dictum, since the plaintiff landlord in Callahan admitted that she relet on her own account, and accordingly sought damages only for the period between the tenant’s breach and the reletting.
