Lead Opinion
The following opinion was filed June 18, 1928:
Under the terms of the lease, upon a breach of any of its conditions or covenants therein mentioned, the lessor may without notice declare the term ended. He may then also re-enter, with or without process of law. This re-entry, according to the terms of the lease, may be either with or without force. Such expulsion or removal by the lessor, or through the medium of legal proceedings, shall not affect the liability of said lessee for either past rent due or future rent to accrue.
In the case of Tower Building Co. v. Andrew,
A well-founded distinction is recognized by the statute with respect to short-term leases and long-term leases. The procedure to declare long-term leases forfeited is contained in sec. 234.19 of the Statutes (formerly sec. 2197c). Evidently the only purpose of providing a different procedure in long-term leases from that which obtains under short-term leases is based upon the theory that in long-term leases the lessee is under obligation to expend large sums of money for the improvement of the premises, with the result that his equity in the property is vastly greater than that possessed by a lessee under a short-term lease. The legislature considered that where a lessee takes possession of property for more than fifty years, under and pursuant to which he is required to construct or make extensive improvements upon the property, a period of three days such as is provided for by sec. 291.01 would ordinarily be inequitable and tend to work great injustice. Therefore, in long-term leases it is provided that, before a lease can be judicially declared forfeited and the lessee expelled from the premises, a year’s time shall be fixed as a period for redemption.
Such a long-term lease was involved in the case of Mohawk Co. v. Bankers Surety Co.
“When the plaintiff . . . elected to resume possession and did resume possession of the demised premises . . . 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 br'each of covenant.”
The portion of the opinion in the Mohawk Co. Case just quoted amounts to a reasonable construction of sec. 234.19,
The lease also provided that, where a surrender of the lease occurs, the acceptance thereof must be in writing, subscribed by the lessor or its duly authorized agent. There was no written acceptance of the surrender, as provided for in article Eleventh above quoted, and plaintiff’s counsel therefore insists that the surrender pursuant to the notice to quit does not operate as a release for future rent. We are of the opinion that the surrender referred to in sec. 291.01 results from the written demand of the lessor, duly signed by him or his authorized agent, and that when the lessee, upon the service of such a notice, fails or refuses to pay the rent, but
By, the Court. — The judgment of the circuit court is affirmed.
The following opinion was filed January 8, 1929 :
Rehearing
On a motion for a rehearing in this court it is argued by plaintiff’s counsel that the court erred in denying plaintiff’s right of recovery against the defendants, upon the ground that the omnibus provision contained in the lease, set forth at the foot of paragraph Eleventh (see original opinion, p. 477), which provision starts with the words “Provided always, and these presents are made upon the express condition,” etc., authorizes a recovery for rents accruing subsequent to the forfeiture; in other words, it is argued that the liability on the part of the defendants survives the forfeiture of the lease which resulted from the giving of the three days’ notice to quit and the failure of the tenant to pay the rent within such period. The provision above referred to expressly provides that where default occurs in the payment of the rent reserved it shall be lawful for the lessor, if he so elects, to re-enter the demised premises, either with or without process of law and without notice, and to expel the lessee and to. repossess such premises and enjoy the same as before the demise.
It is argued by defendants’ counsel that this language immediately preceding denotes merely the common-law remedy and does not include summary proceedings such as are provided for by the unlawful detainer statute of this state. If the provision ended there, the position of defendants’ counsel would be unquestionably correct, but the lease continues: “Without prejudice to any remedies which might otherwise
Subsequent to the semicolon which succeeds the word “covenant,” the following language is employed:
“And such expulsion or removal, whether by direct act of said lessor, its agents or employees, or through the medium of legal proceedings instituted for that purpose, shall not affect the liability of said lessee for the past rent due or future rent to accrue under this lease.”
It will be observed that by the expression “or through the medium of legal proceedings instituted for that purpose,” it was the intention of the parties not to confine the lessor, in the event of breach, to the common-law remedy of ejectment, but, on the contrary, legal proceedings are authorized. The legal proceedings may be proceedings under the statute as well as under the common law. The lease, therefore, is sufficiently explicit to authorize summary proceedings under the unlawful detainer statute of this state, and if this.is so (and we are now convinced that it is), then the liability for rents accruing during the term and after the forfeiture-survives:
There can be no dispute that, when the notice to quit in the instant case was served, the lessee’s estate thereby became forfeited, and from this forfeiture the tenant could only relieve itself by the payment of the rent within the three-day period, and such páyment so made would have reinstated it in all respects to its former estate, as though no default with respect to payment of rent had occurred. When such forfeiture thus became effected the relationship of landlord and tenant ceased. The lessee, however, expressly covenanted in the lease that it would pay the rent for the entire term in accordance with the provisions of the lease, forfeiture or no forfeiture; so that, while the relationship of landlord and
In 36 Corp. Jur. p. 336, it is said:
“The tenant may continue liable to the landlord after the termination of the tenancy because of the inclusion in the lease of provisions imposing liability for rent, damages, or the deficiency arising in the case of the reletting.”
The text so quoted from Corpus Juris is supported by a long list of authorities, both federal and state, and the rule as so pronounced is the prevailing law in this country, according to the overwhelming weight of authority. This is persuasive of the error of the court in its original decision.
The lessee expressly covenanted in the lease to pay the annual rental for each year during the term in monthlv instalments, in advance, each instalment to be paid on the first day of each and every month. The guaranty clause under the lease reads as follows :
“For value received, the undersigned, Emelie L. Bai-reuther and Leo James Lentzen, hereby guarantee that the lessee named in the within lease will promptly pay the rent and other charges herein reserved when due, and perform all the covenants and conditions of said lease, and in case default is made in the payment of rent and other charges or performance of the covenants and conditions of said lease, the undersigned hereby agree to become and be jointly and severally liable with the lessee for each and every separate default.”
It is plausibly argued by counsel for the defendants that the guarantors bound themselves solely for the prompt payment of the monthly instalments of rent as they fall due; that the guaranty does not contain a provision for the payment of'damages; and that if it had been in contemplation of the parties that the guarantors would be held liable for
Here it must be noted that the guarantors did not only guarantee the prompt payment of the rent reserved, when due, but they also agreed to perform all the covenants and conditions of said lease, and among the covenants and conditions of said lease are the foregoing covenants, which in substance provide that in case of a forfeiture the lessor might again take possession of the leasehold estate and hold the lessee liable for all rents, including future rents which have not yet accrued. The point made by counsel that there is a vital distinction between rents and damages as applicable to the instant case is rather technical, to say the least. The damages consist of unpaid rents. They are based upon the rents, and upon nothing else. In the instant case it is clear that the lessor elected to relet the premises and to minimize the damages. It is clear that there are authorities which hold that a lessor need not relet the premises but can charge the lessee with all of the rent reserved. Matter of General Assignment of one William G. Hevenor for the Benefit of Creditors,
The rule is properly stated in Galbraith v. Wood,
“It is the law that, upon the assertion of a forfeiture by the landlord, he is still entitled to rent which had previously*486 become due, but not entitled to recover rent subsequently to become due. Indeed, such a forfeiture terminates the relation of landlord and tenant, and no rent can subsequently become due. 1 Tiffany, Landl. & T. 1174; 18 Am. & Eng. Ency. of Law, 392; Stees v. Kranz,32 Minn. 313 ,20 N. W. 241 . This is clearly the settled doctrine where there is no express stipulation in the lease giving the landlord the right to recover the rent for the balance of the term. Where there is such a stipulation the tendency of the decisions is to hold it valid, and to continue the liability of the tenant in spite of the termination of the lease. Such liability is for any deficiency in the amount of rent obtained on a lease to another. 1 Tiffany, Landl. & T. 1175 et seq., and cases cited. This is not strictly a liability for rent but a contractual liability based upon the agreement in the case.”
See, also, Central Inv. Co. v. Melick,
When the lessor accepted the premises after the lessee’s default, it did not accept the same as an ultimate surrender so as to release the defendants from further liability, but under authority granted in the lease, pursuant to which the defendants would still be liable for future rents until the end of the term.
By the Court. — The original opinion is withdrawn, and the judgment of the lower court is reversed and the cause is remanded with directions that the plaintiff file a supplemental complaint so as to include all of the damages, if any, up to the end of the term, the entire term having in the meantime elapsed, and that further proceedings be had in accordance with law.