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District Court of Appeal, First District, Division 1, California.

HALE v. DEPAOLI et al.*

Civ. 13559.

Decided: April 28, 1948

Elmer P. Delany and William A. Sullivan, both of San Francisco, for appellant. Bronson, Bronson & McKinnon, of San Francisco, for respondents.

This is an appeal from a judgment of nonsuit rendered upon defendants' motion based upon the following grounds: ‘1. That no evidence had been introduced proving or tending to prove any breach of duty upon the part of said defendants. 2. That no evidence had been introduced proving or tending to prove any cause of action on behalf of plaintiff against said defendants.’

Plaintiff's complaint for personal injuries alleged that defendants were owners and also constructors of a dwelling rented by plaintiff's mother, her guardian ad litem, Idelle Wylie; that on April 22, 1943, the wooden railing enclosing the rear porch on said dwelling was latently defective ‘and constituted a dangerous nuisance in that wooden guard rail was attached to the posts hereinabove referred to with nails insufficient in number and length, to properly and securely hold it in place,’ and that on said date plaintiff stood with her back against the railing, which gave way, causing her to fall to a concrete walk approximately ten and one-half feet below. The complaint further sets forth that by reason of defendants' negligence plaintiff received certain physical injuries and shock to her nervous system. Contributory negligence was pleaded in the answer. By an amended complaint, plaintiff alleged upon information and belief that defendants ‘fraudulently concealed said defects and represented to the plaintiff that said premises were safe and habitable.’ Such allegation was denied in the answer to the amended complaint.

Certain facts were stipulated:

‘Mr. Sullivan [attorney for plaintiff]: If the court please, the following stipulation was entered into at noon time: I had here certain records from downstairs indicating a transfer of title to the realty, the premises known as 180 Santa Rosa Avenue, San Francisco County—those are the premises alleged in the complaint, where the plaintiff was injured—and the following stipulation was entered into: That prior to the erection of this building, namely prior to 1925, Louis Depaoli and his wife, who is now deceased, were the owners of the realty premises, and in 1926 they conveyed the property, which had a building on it, to Mr. and Mrs. Antonio Male; that in 1934 Mrs. Male's husband passed away and her husband's interest in the property was terminated to show that she was the sole owner of the property; in 1937 the property was reconveyed by Mrs. Male to the defendant Mr. Depaoli and so that as of that time, and that the property is now and was as of the date of this accident, in the sole name and ownership of the defendant Louis Depaoli—it being alleged in the complaint that the defendant is the owner of that building and the real property where this accident took place. Is that correct?

Mr. Driscoll [attorney for defendants]: That is a correct stipulation, yes.'

Thereupon without objection a fictitious name certificate showing that the New Era Building Company, a partnership, was composed of L. Ferreiros and L. Depaoli was introduced in evidence. A clerk in the Central Permit Bureau in the Department of Public Works testified that the plans and specifications were approved before the building was erected but that:

‘Well, we had so many plans and specifications about 1927 a number of them were destroyed, a number of the least important. We kept the larger buildings, and the masonary buildings. Most frame buildings, the plans were destroyed.

‘Q. This permit covers property constructed in 1925? A. That is correct.

‘Q. To the best of your knowledge the building specifications pertaining to 180 Santa Rosa Avenue, San Francisco County, were destroyed at the direction of your office? A. That is correct.’

In the determination of the question presented on this appeal, close attention must be given to the sharp distinction that must be made between Depaoli as a partner in the construction company, in which he was a constructing owner, and his position as a landlord, owner or lessor.

Evidence of defective construction came from Buran Spears, who was living at 180 Santa Rosa Avenue, April 22, 1943, while working as a chipper in the ship yards, and from Henry Ute, a carpenter, who lived next door. Mr. Spears testified that when he came back from work on April 22, 1943, he examined the portion of hand railing which was lying in the yard and found ‘On one end there were two small finish nails. * * * I don't remember seeing any nails at all in the other * * * [they were] around two to two and a half inches.’ He identified two nails as ‘finish’ nails and stated they were similar to the ones at the end of the reil. He testified that he replaced the railing, using larger and heavier nails—more [than two] of them—nailing some blocks for support under the railing. Mr. Ute testified that on April 22, 1943, when he came home from work—about five–thirty—he examined the rail and found that there were two six penny finishing nails at each end. He explained that finishing nails are driven below the surface of the wood; that putty is used to conceal them and that after the nail has been painted over it is invisible. He testified that he did not think the rail had been ‘properly nailed in the first place.’ He testified that from another portion of the railing he took out one six penny and one eight penny finishing nail, which were introduced in evidence. He further testified that the railing had not been toenailed properly—four eight-penny finishing nails at each end would be proper. There is no evidence that from the date of erection of the rail to the date of the accident it had been rebuilt or changed in any manner.

Doris Hale and her sister—the only eyewitness—both testified that the accident occurred when Doris leaned against the rail which gave way causing her to fall backward. Neither she nor Mr. Yeneles, her companion, sat on the rail before the accident. Mrs. Wylie testified that she might have told a man in uniform (police officer) that Doris and a sailor had been sitting on the rail but that she did not see them. Both Doris and her mother testified to the practice of hanging kitchen mops on the back rail to dry and Mrs. Wylie spoke about throwing drop rugs over the railing. There is substantial evidence that the rail as originally constructed and on the day of the accident was defective.

Subject to modification when based upon facts and circumstances to which special rules are applicable, the general rule is that a lessor is liable for defects in premises which are not visible when the lessor knows of such latent defects, and they are unknown to the lessee. The lessor is not liable when, as a reasonable and prudent person, he is unaware of such defects. Stanley v. Lander, 3 Cal.App.2d 284, 39 P.2d 225; 15 Cal.Jur. 705; 1 Tiffany, Landlord and Tenant, 563. It is said in Shotwell v. Bloom, 60 Cal.App.2d 303, 309, 310, 140 P.2d 728, 732: ‘The general rule is that the landlord is not liable for injuries to the person or property of the tenant or his invitees caused by defects in the leased premises. This general rule of non-liability is an application of the doctrine of caveat emptor. In general, the lessee takes the premises as they are. There is no duty on the landlord to inspect with the object of locating latent defects nor to repair patent defects. [Citing cases.]

‘To this general rule there is a well-settled exception. This exception, supported by cases from many states, is stated in 1 Tiffany, Landlord and Tenant, p. 562, § 86, sub. d, as follows: ‘The rule above stated, that the lessor is under no obligation to the lessee as regards the condition of the premises at the time of the demise, is subject to an exception to the effect that, if there is some hidden defect in the premises, or danger thereon, which is known to the lessor at the time of making the lease, but which is not apparent to the intending lessee, the lessor is bound to inform the latter thereof, and failing so to do, he is liable for injuries to the tenant arising therefrom.’ This is the rule announced by the Restatement of Law of Torts, vol. 2, p. 969, § 388, and has been frequently declared in this state. [Citing cases.] The exception above mentioned applies not only in favor of the tenant but also in favor of those who enter in the right of the tenant, that is, in favor of members of the tenant's family * * *. As to such inviteesof the tenant (except as to the lease of public or semi-public buildings), the landlord is liable to the same extent as he would have been had the tenant been injured. Stated another way, the landlord's liability, except in the case of public and semi-public buildings where his liability is greater (see King v. New Masonic Temple Ass'n, 51 Cal.App.2d 512, 125 P.2d 559), is no greater to the invitee of the tenant then it would be to the tenant himself. [Citing cases.]'

The evidence shows that Depaoli ‘did go on the premises when [he] sold it to Mr. and Mrs. Male’ in 1926. There was nothing wrong with the back porch as far as he could see. When the property was reconveyed to Depaoli in 1937 by Mrs. Male ‘the house locked all right’ to Depaoli. There was nothing wrong with the back porch. Depaoli may have gone on the premises, but made no inspection thereof at the time they were leased to Mrs. Wylie. There is no circumstance called to the attention of the court that should have caused Depaoli, as landlord-lessor, to make an inspection of the rail at the time of leasing the premises to Mrs. Idelle Wylie, the mother of Doris Hale, the injured minor.

If this case presented the question of DePaoli's liability as landlord in the year of the accident only, without reference to his previous capacity as constructing owner, the problems presented on this appeal would probably be at an end. However, the question is whether Depaoli as one of the constructing owners is liable because of a latent defect in the railing whose construction was supervised by Ferreiros, Depaoli having no actual knowledge of such latent defect.

In the year 1925 the New Era Building Company, a partnership composed of L. Ferreiros and Louis Depaoli, erected the building involved in this action. Among their other activities they were constructing owners. Ferreiros was the superintendent of construction while Depaoli gave most of his time to the sales department.

The evidence does not show that Ferreiros, the partner of Depaoli, personally installed the railing, but as superintendent and one of the constructing owners he was charged with knowledge that the porch railing was defectively constructed. In a word, there is no evidence that Depaoli had actual knowledge but as the partner of Ferreiros he had constructive knowledge of the defective railing. ‘Every partner is an agent of the partnership for the purpose of its business.’ Civil Code, sec. 2403. The purpose of the business of the present partnership was the erection and selling of homes. If it had been proved by a preponderance of the evidence that there was actual knowledge on the part of Ferreiros of the defective porch rail it would have been the duty of Ferreiros to either correct the defect or notify his partner or perhaps both. ‘Hence, in order to determine whether the knowledge of the agent should be imputed to the principal, it becomes of primary importance to ascertain the exact scope and extent of the agency.’ 2 Pomeroy's Equity Jurisprudence, Fifth Ed., sec. 668. ‘Notice to agent, when notice to principal. As against a principal, both principal and agent are deemed to have notice of whatever either has notice of, and ought, in good faith and the exercise of ordinary care and diligence, to communicate to the other.’ Civil Code, sec. 2332.

If Depaoli is considered merely as a landlord-leasor, Couch v. Pacific Gas & Elec. Co., Cal.App., 183 P.2d 91, is not applicable. In the Couch case the defendant was the owner of an electric power house and of certain cottages connected with the plant. As a landlord it rented the cottages to its employees. A child of one of the employees was killed as a result of defective wiring. The primary question presented was—was the defect latent and was it known to the landlord-defendant? The court in its decision comments that defendant was not only the landlord, ‘but the vendor of electricity’ and ‘controlled the electric system’ of the ‘house * * * assigned to plaintiffs.’ ‘In its dual capacity it was charged with greater responsibility than it would have had as the mere landlord.’ Page 95 of 183 P.2d. ‘Notice to any partner of any matter relating to partnership affairs, and the knowledge of the partner acting in the particular matter, acquired while a partner or then present to his mind, and the knowledge of any other partner who reasonably could and should have communicated it to the acting partner, operate as notice to or knowledge of the partnership.’ Civil Code, sec. 2406. ‘An authority to sell personal property includes authority to warrant the title of the principal, and the quality and quantity of the property.’ Civil Code, sec. 2323. ‘Whenever the agent's knowledge of certain facts exists only in contemplation of law,—that is, when he has received a constructive notice,—the imputation thereof to the principal is no less reasonable and clear. If, under any circumstances, a party, while dealing for himself, must be treated, in contemplation of law, as one who has acquired certain information, and must be charged with constructive notice thereby, the same result must follow when, under like circumstances, the party is dealing by means of an agent. * * * As the doctrine is thus based entirely on motives of policy; it should never in its application transcend the scope and limits of those motives. Whenever its operation in a given state of facts would produce manifest injustice, the courts should, if not absolutely compelled by express authority, withhold such operation. A tendency to restrict the doctrine—to confine it within the limits already established—is clearly exhibited by many of the recent decisions.’ 2 Pomeroy's Equity Jurisprudence, Fifth Ed., pp. 933, 934, sec. 676.

Cases cited by defendant, which involve the rule that knowledge acquired by an agent before the commencement of the agency is not notice to the principal unless it appears that such knowledge was present in the mind at the time the agent acted for the principal, are not applicable here. The acts of each partner as a rule are attributable to the other. 20 Gal.Jur. 737. The rule is that the contractor-owner is liable if the work is negligently defective and the contractor-owner knows, or should know, of the dangerous situation created. The rule is sound, but is it applicable here? Its operation may result in a denial of monetary assistance to the minor for injuries or the imposition of a wrong on Depaoli, but at least sympathy for the injured plaintiff or prejudice against contractor-owners must not be the determining factor. Whether it should be put in force is questionable when a treatise such as Pomeroy's Equity Jurisprudence, which is characterized by intimate knowledge of the subject treated and the modern trend of opinion on the point under consideration, advises caution in the adoption of the rule. The doctrine of imputed negligence is not to be loosely applied. 19 Cal.Jur. 660. To promulgate, without limitation, a rule that a partner-agent (Depaoli) in the capacity of a constructing owner, who took no part in the actual construction of the building, but whose partner (Ferreiros) knew or should have known of the defective railing and whose knowledge or duty of knowledge is imputed to him (Depaoli), is responsible some eighteen years later for an accident attributable at least in part to the defect in construction under the assumed direction of Ferreiros, about which there is no evidence of actual knowledge of Depaoli, may be a rigorous rule. Its harshness as applied to the present case may be tested somewhat as follows: It is the law in California, which must be followed, that in ruling whether a nonsuit was proper, every inference which can reasonably be drawn and every presumption which can fairly be deemed to arise in support of plaintiff's case must be accepted as true, and that all evidence, direct and indirect, which has a tendency to sustain plaintiff's case, irrespective of its weight or value, must be accepted as true. Burlingham v. Gray, 22 Cal.2d 87, 137 P.2d 9. The rule relative to a directed verdict is the same as the rule granting a nonsuit. Estate of Lances, 216 Cal. 397, 14 P.2d 768.

The constructive knowledge, under the circumstances of this case, would not impute to Depaoli personal negligence but rather knowledge of the negligence of his partner. Under the evidence and the law he would not, merely acting as a landlord, be liable. The question then is—did Depaoli in renting the premises to Mrs. Wylie do or omit to do something that contributed to the subsequent accident? The answer appears in his own testimony: ‘Q. Well, as far as you know, you did go on the premises when you sold it to Mr. and Mrs. Male, did you not? A. Yes.’ In 1937 after the death of Ferreiros, and after the death of Mr. Male, Mrs. Male, who had previously purchased the property with her husband, reconveyed the property to Depaoli. At that time Depaoli made an inspection of the house and a general inspection of the ‘back porch and stairs.’ In 1942 when the premises were leased to Mrs. Wylie the defendant failed to make an inspection of any part of the premises. Whether he was negligent and should have made such inspection in view of the original constructive knowledge he received and the circumstances of making an inspection when the premises were reconveyed to him but failed to inspect when he rented the same premises to Mrs. Wylie is a question of fact.

It is the duty of one who owns land and has actual knowledge of danger to notify an incoming tenant. If the knowledge is constructive, the surrounding facts and circumstances control the duty of the owner. Failure, in a proper case, to notify the tenant is negligence. Under the holding in the recently cited cases and many others this fact should have been presented to the jury. The order granting the motion for a nonsuit was improper. This determination of this question on appeal should not be interpreted as an indication that the members of this court believe Depaoli was negligent. That question, with perhaps some elaborations from each side, and the issue of contributory negligence, remain for presentation in a subsequent trial.

The judgment on nonsuit is hereby reversed.

WARD, Justice.

PETERS, P. J., and BRAY, J., concur.