SEGALAS v. MORIARTY (1989)

Michael James Moriarty, an attorney, vacated office space rented by him from Charles A. Segalas nine months before the term of his lease expired.   Moriarty refused to pay rent for time he did not occupy the space and Segalas sued for the unpaid rent.   Moriarty cross-complained against Segalas for wrongful eviction and conversion.   A jury found in favor of Segalas on both the complaint and the cross-complaint, awarding him approximately $16,000 in damages.   Judgment was accordingly entered.   The court, upon Segalas' motion, awarded him attorneys' fees in the amount of $17,176 on the complaint and $4,737 on the cross-complaint.

Moriarty appeals from the judgment and the order granting attorneys' fees, as well as from an order granting prejudgment interest.   Since no appellate contention relates specifically to the award of prejudgment interest, we shall not review that order.

STATEMENT OF FACTS

Segalas is the owner of a building located at 485–489 Third Street, San Francisco.   Moriarty by written agreement leased office space in the building for the period from June 1, 1981 through May 31, 1984.   During his occupancy other space in the building was remodeled into a restaurant.   The restaurant was completed by December 1982.   Moriarty moved into new office space in late August 1983.   The parties do not contest the terms of the written lease or the amount of rent stated therein.

Moriarty based his claim of constructive eviction on several factors.   He claimed that vagrants often occupied the steps of the building, and often left food and garbage on the steps even when they were not physically present.   He claimed that Segalas had failed to honor an oral promise to install a gate to keep the vagrants off the steps.   Moriarty argued that the noise resulting from the remodeling of the neighboring space into a restaurant was disruptive and that the space attracted mice and cockroaches, which also invaded Moriarty's offices.   Moriarty claimed that by the culmination of these factors he felt he had become constructively evicted as of November or December 1982.   Nonetheless he remained on the premises until the end of the following August when he moved into office space he had purchased in February 1983, and which, between February and August, had been remodeled to suit his needs.

I.

The Erroneous Verdict was Caused by the Improper Jury Instruction

The principles behind the doctrine of constructive eviction were described by the court in Petroleum Collections Inc. v. Swords (1975) 48 Cal.App.3d 841, 846–847, 122 Cal.Rptr. 114:

“The foundation for the tenant's obligation to pay rent is his right to use and possess the leased property for the purposes contemplated by the tenancy;  rent is the compensation paid by the tenant in consideration for the use, possession and enjoyment of the premises.   Consequently, when a tenant's possession of leased property has been interfered with, physically, by the landlord, or someone claiming under him, or by a person with paramount title, the tenant's covenant to pay rent is no longer supported by valid consideration and he is relieved of that obligation.   The loss of possession, in short, goes to the very root of the consideration for the tenant's promise to pay rent, and after the eviction the obligation to do so ceases.  [Citation.]  It is in this sense that the implied covenant of quiet enjoyment and the covenant to pay rent are mutually dependent.

“However, when the act of molestation merely affects the tenant's beneficial use of the premises, the tenant is not physically evicted and he has a choice in the matter.   He can remain in possession and seek injunctive or other appropriate relief or he can surrender possession of the premises within a reasonable time thereafter.   If the tenant elects to remain in possession, his obligation to pay rent continues unless the landlord has breached some other express or implied covenant which the covenant to pay rent is dependent upon.  [Citations.]  If, on the other hand, the tenant elects to surrender possession of the premises, a constructive eviction occurs at that time and, as in the case of an actual eviction, the tenant is relieved of his obligation to pay any rent which accrues thereafter.  [Citation.]”  (Emphasis in original.)

 A tenant who does not vacate the premises within a reasonable time after the breach is not entitled to relief from the obligation to pay rent.  (Petroleum Collections Inc. v. Swords, supra, 48 Cal.App.3d at p. 847, 122 Cal.Rptr. 114;  Pierce v. Nash (1954) 126 Cal.App.2d 606, 612–613, 272 P.2d 938.)   What constitutes a “reasonable period of time” ordinarily is a question for the trier of fact after considering all of the circumstances.   (Petroleum Collections Inc. v. Swords, supra, 48 Cal.App.3d at pp. 847–848, 122 Cal.Rptr. 114.)

In the present case the jury was instructed in accordance with this settled law.¹  However, after some deliberation, the jury returned a question to the court:  “If grounds for constructive eviction existed in fact and then ceased to exist before the tenant was able to secure new premises, is the tenant, still entitled to exercise his right under the constructive eviction law?”   Each party was given the opportunity to research the issue after which the court, informed that there was no California law exactly on point, instructed the jury in accordance with language taken from 49 American Jurisprudence 2d, Landlord and Tenant, section 304, page 321, that “The lessee, which is the tenant, loses his right to abandon the premises if before he has carried out his intention to abandon the cause for abandonment has ceased to exist.”

 By the instant contention Moriarty argues that the instruction misstated the law.   He argues that it cannot be said as a matter of law that a tenant waives the right to claim constructive eviction by failing to physically vacate until after the actionable interference is remedied.   We agree, and we find that the court's instruction was overbroad.   However, upon the facts found by the jury, the instruction was of no prejudice to Moriarty and reversal is not required.

Contrary to much of Moriarty's argument, it is commonly recognized that a tenant loses his right to abandon premises after the cause for abandonment has ceased to exist.  (See Annot., Time within which tenant must yield or abandon premises after claimed constructive eviction (1963) 91 A.L.R.2d 638, 651–653, and cases collected therein.)   We are not, however, of the opinion that the rule is absolute.   Rather, it is simply an extension of the principle, discussed above, that a tenant who fails to vacate the premises within a reasonable period of time waives the right to claim constructive eviction and is not released from the obligation to pay rent.   While uncommon, situations might arise in which a tenant abandons premises within a reasonable time after the breach, notwithstanding that the breach has been cured prior to the abandonment.   For example, a tenant might reasonably believe that the landlord will not cure a breach and upon that belief sign a lease with another, committing himself to move into new premises.   In such circumstances it clearly would be inequitable to compel the tenant to remain in the old premises and risk a suit for breach of the new lease agreement simply because the landlord belatedly, and before the tenant is able to move into the new premises, cures the breach.  (See discussion in Yaffe v. American Fixture, Inc. (Mo.1961) 345 S.W.2d 195, 198–199.)

Such was not, however, the situation here.   Assuming that the jury found that a breach had earlier occurred but was cured before Moriarty's vacation, it must have rejected Moriarty's claims that a material breach resulted from the continuing problems of vagrants, mice and cockroaches.   The finding of breach, if any, could have been based only on the injury resulting from the remodeling of other space in the building into a restaurant.   The remodeling was essentially completed by December 1982, and Moriarty did not commit himself to moving until February 1983, some three months later.

 We have rejected the argument that a tenant who fails to abandon premises prior to the cure of the breach of the covenant of quiet enjoyment never, as a matter of law, abandons within a reasonable time.   We now hold as a matter of law that a tenant who has not altered his position by commitment to new premises or in some other significant fashion prior to the cure of the landlord's breach, cannot thereafter abandon and claim that the abandonment occurred within a “reasonable time.”

 Moriarty attempts to distinguish between causes of a breach of the covenant of quiet enjoyment, arguing that the rule that no abandonment can occur after cure of the breach (to which rule we do not subscribe) relates only to breaches caused by the failure to provide heat.   The argument has no support in logic or in the law (see Merritt v. Tague (1933) 94 Mont. 595, 23 P.2d 340 or Goldberg v. Lloyd (1908) 110 N.Y.S. 530).   Nor is there any logic in Moriarty's claim that the rule should be limited to noncommercial leases.   We reject both arguments.

General Industrial & Mfg. Co. v. American Garment Co. (1920) 76 Ind.App. 629, 128 N.E. 454, cited by Moriarty, provides him no aid.   In that case the landlord failed to provide heat.   The tenant notified the landlord of its intention to vacate while the weather was still cold, but was unable to locate suitable space immediately.   It therefore vacated the premises some months later, and at a time when the weather was warmer and the tenant temporarily would not require artificial heating.   Moriarty apparently cites the case in support of his claim that the cure of a breach does not bar a tenant's right to vacate.   The breach in General Industrial & Mfg. Co., however, was not cured as of the date the tenant vacated;  the landlord had done nothing to remedy the problem, which thus would interfere with the tenant's right of quiet enjoyment once the weather again turned cold.   Nor had the tenant committed itself to a new lease on different premises after the cure, which, as noted, never occurred.

Further, we find nothing in Petroleum Collections Inc. v. Swords, supra, 48 Cal.App.3d 841, 122 Cal.Rptr. 114 supportive of Moriarty's arguments.   The court in that case refused to find as a matter of law that the tenant's 11–month delay in vacating after breach was unreasonable, noting that the delay might be excused because of promises made by the landlord to remedy the problem.   The action was thus remanded for a trial on that issue.   The breach in that case, however, unlike that in the present case, was still in existence as of the date the tenant vacated the premises.

II.

The Court Improperly Excluded Evidence

A first argument, which Moriarty does not appear to assert as causing reversible error, is that Segalas misstated the truth.   The jury determined otherwise.   We will not disturb that determination.  (In re Elise K. (1982) 33 Cal.3d 138, 149, 187 Cal.Rptr. 483, 654 P.2d 253;  Tupman v. Haberkern (1929) 208 Cal. 256, 262–263, 280 P. 970.)

A second argument is that the court erred in refusing to permit Moriarty to call two witnesses in rebuttal:  Natum Rajpara and Norm Arand.   Moriarty had never disclosed to Segalas that he might call either individual as a witness, notwithstanding that Segalas had propounded to him an interrogatory requesting him to supply a list of all potential witnesses.

 Where a party willfully fails to name a potential witness in response to an interrogatory, the witness properly is excluded from testifying at trial.  (Thoren v. Johnston & Washer (1972) 29 Cal.App.3d 270, 273–275, 105 Cal.Rptr. 276;  see also Code Civ.Proc., § 2017, subd. (a) and § 2023, subd. (b)(3).)   Further, a trial court has discretion over the scope of rebuttal, and that discretion is not abused by excluding cumulative evidence.  (Diamond Springs Lime Co. v. American River Constructors (1971) 16 Cal.App.3d 581, 604, 94 Cal.Rptr. 200.)

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Finally, Segalas, as the prevailing party in an appeal arising from a contract providing for an award of attorneys' fees, is entitled also to attorneys' fees on appeal.  (Babcock v. Omansky (1973) 31 Cal.App.3d 625, 107 Cal.Rptr. 512.)

The matter is remanded to the trial court for a determination of the amount of attorneys' fees to be awarded on appeal.   In all other respects, the judgment is affirmed.

FOOTNOTES

1.   “A tenant has the right to terminate his lease and abandon the subject premises whenever a landlord's acts or omissions render the premises unfit for the purposes for which they were leased.“The eviction may occur without an actual ouster.   Any disturbance of the tenant's possession whereby the premises are rendered unfit or unsuitable for occupancy in whole or in substantial part for the purposes for which they were leased or any interference with the beneficial enjoyment of the premises will amount to a constructive eviction if the tenant vacates within a reasonable time.“An actual eviction occurs when the tenant is physically dispossessed of the property.   On the other hand, a constructive eviction occurs when an act or omission of the lessor interferes with the tenant's beneficial use of a substantial part of the leased premises.“However, for any act of interference to constitute a constructive eviction, the tenant must vacate the premises within a reasonable time from the date of the interference.   Otherwise, the tenant is to be considered to have waived the right to abandon the premises.“If you find that the tenant has not been deprived of the beneficial use of a substantial part of the leased property, you must find that there has been no constructive eviction.“If, on the other hand, you find that there has been an interference with the tenant's beneficial use of a substantial portion of the property, you must also find that the tenant vacated the premises within a reasonable time after the date of interference in order to determine that a constructive eviction occurred.   Otherwise, the tenant is deemed to have waived ․ his right to vacate the premises.“What constitutes a reasonable period of time is a question of fact to be determined by you after considering all the circumstances.”

STEIN, Associate Justice.

NEWSOM, Acting P.J., and HOLMDAHL, J., concur.