Musial v. Kudlik

Thayer, J. It is an admitted fact upon the pleadings that on the 2d day of August, 1909, the defendant conveyed to the plaintiffs a farm on which crops were then growing; the conveyance being by a warranty deed containing the usual covenants, including one that the premises were “free from all incumbrances whatsoever.” The’plaintiffs’ action is based upon the alleged breach of the last-named covenant. As admitted by the pleadings, there was at the time an outstanding lease of the farm to one Dolbeare, who was then in possession under the lease, the term of which did not expire until the first day of the following April. The defendant upon the trial claimed that this lease did not constitute an incumbrance upon the premises within the meaning of the covenants in the deed. The court charged that an unexpired lease upon premises of which a grantor gives a warranty deed is an incumbrance and a breach of the covenant against incumbrances. If a grantee, knowing of the existence of a lease upon the premises conveyed to him, accepts the lease, and the tenant attorns to him, it is doubtless true, as claimed by *167 the defendant’s counsel, that the lease is not a breach of the warranty against incumbrances for the reason that, by the understanding and consent of the parties, the tenant’s possession in such case is the possession of the grantee. The existence of a favorable lease upon premises might be one of the inducing causes of the purchase. It would depend upon the purpose for which the purchase was made, whether for an investment or for personal occupancy by the purchaser. In the latter case, the existence of a lease upon the premises for a longer or shorter period, unknown to the purchaser, might frustrate his purpose in purchasing and be a serious incumbrance and detriment to him. Where, without accepting the lease, the purchaser takes a conveyance of property relying upon the covenant against incumbrances, a lease existing upon the property for an unexpired term constitutes an incumbrance, and is a breach of the covenant. Demars v. Koehler, 62 N. J. L. 203, 205, 41 Atl. 720; Clark v. Fisher, 54 Kan. 403, 406, 38 Pac. 493, 495; Fritz v. Pusey, 31 Minn. 368, 369, 18 N. W. 94; Porter v. Bradley, 7 R. I. 538, 541. The fact that, as in this State, the rents under an outstanding lease pass as an incident to the reversion, so that the purchaser of the reversion is entitled to and may collect the rents due under an existing lease, does not deprive him of his legal rights under the covenant. Demars v. Koehler, 62 N. J. L. 203, 205, 41 Atl. 720. He may, if he sees fit, accept the tenant and waive his rights under the covenant, but is not bound to do so; for, as already mentioned, his purpose in purchasing may have been for personal occupancy, and consequently a serious damage may have resulted to him from the existence of the incumbrance. The fact that the law makes the rents incident to the reversion does not supply the place of an understanding that the property is conveyed subject to the lease, *168 In the present case the answer set up an agreement by the plaintiffs to accept the farm subject to the lease and with the lessee in possession as their tenant, and the court instructed the jury that if they found that there was such an agreement the verdict should be for the defendant. The two instructions mentioned properly presented the law to the jury, and their verdict;, being for the plaintiffs, shows that they found no such agreement as claimed by the defendant. The defendant’s motion for a directed verdict, motion to set aside the verdict as against the evidence, motion in arrest, and motion for a judgment notwithstanding the verdict, each based upon the claim that the lease was not an incumbrance, and his request to charge that the lease was not an incumbrance, were all properly denied. We think that the motion to set aside the verdict, because the damages were excessive, was also properly denied. The evidence in the case, as given, is not before us except by a summary agreed upon by the parties. The damages assessed were only $168.66. The court instructed the jury that if the plaintiffs were entitled to damages they could recover the rental value of the farm for the unexpired term of the lease, together with $14, the expense of moving their goods to the farm and taking them away when the tenant refused to deliver possession of the farm. The correctness of this instruction will be considered later. The damages are not large, probably do not exceed the cost to each of the parties of another trial. In a case of this character, where the rental value of a farm is to be determined from a variety of circumstances, as location, neighborhood, nearness or remoteness of markets, schools and churches, the character and productiveness of the soil, whether well watered or not, and whether healthful, and the fact that at the time of the conveyance there were growing crops upon the farm which the plaintiffs *169 would secure at the cost of harvesting, without expense for the labor and fertilizer which had been expended in producing them, circumstances with some of which it may be presumed the jury or some of them were familiar, the court will not be quick to set aside a verdict of this magnitude as indicating prejudice or partiality on the part of the jury. The defendant claimed that if the plaintiffs were entitled to damages they could only recover their actual damage up to the date of the writ, which was August 23d, 1909, and that this would be the rental value of the farm for the twenty-one days between the date of the conveyance and that of the writ. The case was not tried until after the term of the lease had expired, so that no question arose as to the possible surrender of the lease before the end of the term. Under the charge of the court they were permitted to recover the rental value of the farm for the entire term of the lease unexpired at the date of the conveyance of the farm. Whether there was error in this part of the charge depends upon the construction of the complaint. Section 766 of the General Statutes permits the recovery of damages that may have accrued from the same cause of action (an action founded on contract) subsequent to the bringing of the suit, provided reasonable notice be given the defendant of the damages so designed to be proved. The plaintiffs in their complaint, in stating their damages, allege that they “have been subjected to great loss and damage on account of being deprived of the possession and occupancy of said premises; and they will continue to suffer great loss, expense, annoyance and inconvenience, until said lease expires on April 1st, 1910.” This clearly gives notice to the defendant that damages will be claimed for the rental value of the premises subsequent to the date of the writ (to the end of the term). No other damages accruing *170 subsequent to the date of the writ were permitted under the charge, the $14 allowed for moving goods having accrued prior to the bringing of the action. The complaint gave the defendant sufficient notice of the claim for which damages were allowed, subsequent to the bringing of the action, to answer the terms of the statute. If he had desired fuller particulars of the claim he should have moved for them. The c.omplaint also gave the defendant sufficient notice to allow proof and a recovery of the $14 expended in moving the goods prior to the bringing of the suit. The allegation was that the plaintiffs, in consequence of having been kept out of the possession of the premises, “have been obliged ... to undergo great trouble, expense and discomfort in seeking and obtaining another place of abode.” Had the defendant desired an itemized statement of this expense he should have sought it by a motion. It appears in the statement of the evidence that it was he who moved the plaintiffs and received pay for it and he was thus fully advised of the amount. But the real contention as to this item is that it was not properly allowable in an action upon the covenant. It is said that the rule of damages in an action upon this covenant, where the incumbrance is an outstanding lease, is the fair rental value of the premises during the time the plaintiffs were deprived of their use. This is the rule in the absence of special circumstances which enhance the damage. The underlying principle is that the damages should be estimated according to the real injury arising from the existence of the incumbrance. Fitz v. Pusey, 31 Minn. 368, 370, 18 N. W. 94; Clark v. Fisher, 54 Kan. 403, 406, 38 Pac. 493, 495. This is a personal covenant not running with the land and affecting only the possession.. It is broken at once upon the delivery of the deed of conveyance, if there is an out *171 standing term which the tenant refuses to surrender. In Bernhard v. Curtis, 75 Conn. 476, 54 Atl. 213, where a lessor failed to deliver the premises which he had leased, we held that the lessees might recover, as special damages, the reasonable cost of steps taken to protect themselves from loss and to diminish the loss from proper acts of preparation to occupy the leased premises. There can be no reason why in this case these plaintiffs, who purchased this farm for a home and hired the defendant to move them to it, should not recover back the amount paid to him for such removal, when it appears that the expense was incurred in good faith on their part, and that what was thus paid was lost to them because of his failure to keep his covenant. As the purchaser may disclaim the lease and look to the grantor for damages on the covenant, his damages in the latter case cannot be diminished by the amount of the rent which the tenant could be compelled to pay had the purchaser chosen to recognize the lease and accept the tenant. An attempt to collect the rent would be to recognize the lease, and would be inconsistent with his claim under the covenant. The defendant, therefore, was not entitled to the charge requested by him, that in determining the damages on the basis of the fair rental value of the farm, the same should be reduced by the amount of the rent which the plaintiffs might have collected from the tenant under the lease. The question raised by the sixth reason of appeal is whether the court improperly refused to charge the defendant’s third request. That request related to the effect of the conveyance of the farm, and asked the court to instruct the jury that it “carried with it the right to the rent payable under the lease in the absence of any special contract providing otherwise, and Dolbeare *172 would become the tenant and his possession would be their possession.” That the request as a whole was properly refused appears from what has already been said. This is the only question raised by this reason of appeal, but in paragraph two of the defendant’s brief it is claimed that he was entitled to have the jury instructed that the conveyance'carried the right to rents as bearing not only upon the question of the plaintiffs having accepted Dolbeare as their tenant, but also on account of its relation to the damages to the plaintiffs. We think that the appeal does not properly give notice that such a claim was to be raised, and that the request gave the court no notice that it was filed for the purpose of raising any such question. The plaintiffs were not entitled to recover as damages the value of the crops which were growing upon the farm at the time of its purchase, nor for the expense and trouble to which they were put after the date of the writ in seeking another place to live, nor for sums paid for board and rent until April 1st, 1910, when they obtained possession of the farm. There was error in overruling the defendant’s objections to evidence of this character which the plaintiffs were permitted to introduce. The court recognized this, and in the charge told the jury that the evidence of the value of the crops must be limited, and correctly told them that it was only to be considered as bearing upon the rental value of the premises, and, as already mentioned, told them that the plaintiffs could only recover the rental value of the premises and the $14 paid for moving to the place before suit was brought, when they supposed that possession of the farm was to be given them. This made it so plain to the jury that they were not to allow any damages for the expenses referred to in the objectionable testimony that its admission was harmless error. *173 As this testimony was in effect eliminated from the case by the charge, it is unnecessary to consider several assignments of error relating to the court’s refusal to charge requests having reference to it and to the facts which it tended to prove. It is also unnecessary to refer specifically to other assignments of error which relate to mere verbal errors in the charge, which manifestly could not have misled the jury, and to the court’s refusal to charge certain requests for which the evidence shows that there was no foundation. There is no error. In this opinion Prentice, C. J., Roraback and Beach, Js., concurred.