162 Wis. 272 | Wis. | 1916
Tbe plaintiff, owner of certain land, on October 1, 1909, executed a lease thereof for ninety-nine years
“Now, therefore, if the said principals shall erect and complete said theater building in full conformance with said plans and specifications not later than May 1, 1910, and save said obligee harmless from any and all liens and claims for liens for or on account of work, skill, or materials used in said constructions and from all costs, charges and damages (including costs of suits begun or completed, with a reasonable allowance for attorney’s fees) for or on account of such liens or claims for liens, then this obligation shall be null and void, otherwise of full force and effect.”
This bond was dated October 26, 1909, and immediately after its execution the lessees took possession of the demised premises and commenced the erection of the building provided for in the lease. They proceeded therewith as far as to construct a basement wall, when they ceased operations. After the execution of the lease and bond the lessees assigned their term to a corporation called the People’s Theater Company. Only two quarterly instalments of rent were paid under the lease. ' The lease contained, in addition to the covenant to build, covenants to pay rent quarterly and to pay taxes and assessments and also other covenants. Sec. 2197a, Stats., in force when this lease was executed, provided that in case of a default in the conditions or breach of the covenants of any lease of land for a term exceeding fifty years which required the lessee to construct improvements or buildings on the land demised at his cost exceeding in value $5,000, and in ease such improvements have been made, the lessor might
This statute confers very valuable rights upon tbe lessee described in the statute and cuts tbe lessor off from a somewhat summary remedy common to all other lessors. Those entering into a lease after tbe enactment of this statute are supposed to do so with knowledge of the statute. Tbe right to this foreclosure is given to tbe lessor in language permissive in form but perhaps mandatory where tbe lessee chooses to assert tbe valuable rights conferred on him by that statute. Whether improvements to tbe value of $5,000 or tbe improvements specified in tbe lease have actually been made is usually a question of fact.
In tbe instant case there was default in tbe payment of rent and there was also default in failing to construct tbe building required. For tbe damages flowing from the latter default tbe lessees and their surety, tbe appellant, are liable. Tbe question is here upon tbe rule of damages. On tbe part' of tbe appellant it is contended that tbe measure of damages should be tbe same or similar to that applied in cases of building contracts generally. This contention must be dismissed at once, for tbe relations of tbe parties are entirely different. There tbe owner agrees to pay a certain sum of money and
The learned circuit court itemized the damages allowed as follows:
Taxes accruing after the surety contract which should have been paid by the lessees and were necessarily paid by the lessor . $981 08
Rent unpaid and in arrears up to January 21, 1912, 1 year, 8 months, 19 days. 1,925 00
Costs and reasonable expenses for attorney fees paid by the plaintiff in the suit mentioned.. 257 15
Rentals from January 21, 1912, until plaintiff leased the property to a third person July 1, 1913. 1,395 00
Taxes and special assessments accruing after January 21, 1912, necessarily paid by plaintiff. 874 42
Total./. $5,432 65
This with interest to January 1, 1915, resulted in a judgment for $6,070. The plaintiff lost its security for the covenants of the lease. Compensation, which is the guiding rule in damages, would require this loss to be made good. The damages had all accrued on May 1, 1910, when the lessees failed in their contract to erect the building. But security for covenants to be performed or moneys to become due looks to the future. When the plaintiff on January 21, 1912, elected to resume possession and did resume possession of the demised premises free and clear of liens, it accepted this possession of the demised premises in cancellation of all obligations to become due thereafter on the lease. It elected for such subsequently accruing damages this remedy instead of the remedy for breach of covenant. It did not do so by mere threats to take possession or declaration that the lease was at an end, because it had the right to clear off liens at appellant’s expense; but it did by such notice and full possession taken free and clear of all liens in pursuance of such notice and the decree quieting title. We therefore think that the recovery should be reduced by the items of $1,395 for rents accruing
By the Court. — It is so ordered.