Christensen v. Valdemar No. 12 of Danish Society

— 146 — By the Court, Coleman, J.: This appeal was taken upon the judgment roll alone. We will refer to the parties as they were designated in the trial court. Plaintiff pleaded the execution of an agreement on September 5, 1911, between one Dreyer and the defendant, wherein the said Dreyer leased unto the defendant the upper story of certain premises, upon the condition that the lessee should, at its own expense, remodel, improve, and make suitable such premises for lodge purposes. It is provided in the agreement, which is made a part of the complaint, that upon the completion cf such improvements , the total cost thereof should be embodied in a statement, to be verified and signed by both parties -to said agreement, and to be attached thereto and become a part thereof. The complaint pleads as a part of the agreement a statement which is signed by said Dreyer and the trustees of the defendant, showing items expended, aggregating $1,873.35. By the terms of the agreement of lease, the monthly rental is fixed at $10, which sum is to be credited each month upon the amount so expended in remodeling the premises, until the entire amount of the expenditure is consumed. The agreement recites the enactment by the legislature of a statute making it unlawful to gamble in the State of Nevada, and it is agreed that the lease shall run until the full sum so expended by the lessee — 147 — is consumed in the payment of rent at $10 per month, unless gambling should sooner become “legally authorized,” in which event the lessor might terminate the lease by giving the lessee three months’ notice and paying in cash the difference between the amount paid .as rental and the sum so expended by the lessee in remodeling and improving the premises. The agreement is made binding upon the grantees and assigns of the respective parties. It is alleged that the plaintiff is now the owner of the premises in question. It is also averred that on May 5, 1920, a written notice was served upon the defendant by the plaintiff, notifying it that gambling had been “legally authorized” in the State of Nevada, and that the lease mentioned would terminate August 6, 1920; demanding a statement of the amount due from plaintiff to defendant as the balance due upon the expenditures made in remodeling the premises, that payment thereof might be made; and also demanding possession of the premises on August 6, 1920. The defendant refused to consider the lease as canceled, to furnish a statement, or to surrender possession of the premises. The complaint prays that a decree be entered directing an accounting, adjudging that the lease be terminated and forfeited, and for general relief. ' A general demurrer was filed to the complaint, and, upon its being sustained, plaintiff declining to amend, judgment was entered in favor of the defendant; hence this appeal. The only question for determination is: Does the complaint state a cause of action? It is the contention of the defendant that the complaint shows that the amount of the expense incurred by the defendant in remodeling the building was agreed upon by the lessor and lessee on November 20, 1911, to be the sum of $1,873.35, and that it was the duty of the plaintiff to allege the payment or tender to defendant of the difference between that sum and the sum paid by defendant — 148 — as rentals, at the rate of $10 per month from September 5, 1911; and, failing so to do, the complaint does not state a cause of action. It is also contended by the defendant that gambling has not been legalized in this state. It is contended by the plaintiff that the “gross amount to be liquidated does not appear from anything contained in the lease to' be limited to the amount in the statement attached to the lease,” and that the plaintiff could not be charged with knowledge of additional expenditures made by the defendant; and hence it is insisted that the complaint is good. The position taken by the plaintiff is untenable. The lease clearly provides that the lessee might “remodel” and “improve” the upper story of the premises in question. This language is used several times in the lease, and it is clear from these words and the context that the improvements to be made were limited to those made in the progress of the remodeling, and that all of such expenditures should be listed in the statement to be attached to the lease, and which was approved and attached thereto. By rendering the itemized statement the defendant expressly recognized that the remodeling' and improving contemplated by the lease had been completed on November 11, 1911. The approving and attaching of the statement is of itself an interpretation by the parties to the lease to the effect that it contained all of the items chargeable, or that could be chargeable, on account of improving and remodeling by the lessee. There is a wide difference between expenses incurred in making improvements and in remodeling and those incurred in making repairs. Repairs were not contemplated by the parties. If the expenses to be listed in the statement and approved by the parties, as contemplated by the lease, were not limited to those incurred in remodeling, we are at a loss to know at what time it was intended by the parties that such statement should be approved and attached to the lease. If we accept the theory of counsel for plaintiff, remodeling and improv — 149 — ing may continue through all time, and a perpetual lease be created by the acts of the defendant, unless gambling becomes, or has become, lawful. It hardly seems probable that the lessor could have intended the making of such a freak contract. It appears from the language of the lease that the sole purpose of attaching the statement was to enable the parties, immediately after the completion of the work of remodeling, to” determine from the lease itself how long it would run; or, in case gambling should become legalized, and the lease terminated because thereof, the amount that the lessor would have to pay to effectuate its cancelation. No other reasonable interpretation can be placed upon the lease. Plaintiff’s brief suggests other points concerning the matter of which we have disposed, but we doubt if his counsel, so learned and experienced, can be serious in their presentation. At any rate, they do not deserve consideration in this opinion. As to the contention that gambling is “legally authorized” in Nevada, we might ask: What is meant by the provision relative to when “gambling shall be legally authorized”? ' Does it mean that gambling shall be authorized to the extent that a gambling debt may be a valuable consideration to sustain a contract, or in the sense that one shall not be subject to criminal prosecution for gambling or operating a gambling game? Does it mean gambling as it existed prior to the antigambling law of 1909? Does it mean gambling to a limited extent only? In answering the last question, we might have to determine whether gambling was “legally authorized” in any instance or to any extent at the time the lease was executed. If the last suggestion should be answered in the affirmative, can it be said that the contract in question is ambiguous? These questions, among others, might have to be disposed of if at any time we are compelled to pass upon the contention that gambling is “legally authorized” in the state. However, since the complaint does not state a cause of — 150 — action, as pointed out, it is not necessary to dispose of the contention that gambling is now “legally authorized.” It is ordered that the judgment appealed from be affirmed.