Wal-Noon Corp. v. Hill

Brief Fact Summary.

Wal-Noon Corp. (Plaintiff) sued Hill (Defendant) to recover damages for repairs made to Plaintiff’s roof under the lease agreement. Plaintiff appealed from a judgment, holding that the Plaintiff breached the lease agreement.

Synopsis of Rule of Law.

Performance of an express covenant to repair is conditioned on notice from the tenant.

Facts.

Plaintiff and Defendant entered into a lease agreement for the construction and occupancy of a building. Part of the building was to be occupied and used by Plaintiff for a market, and the other part was to be sublet by the Plaintiff for various satellite enterprises. The roof started to leak about ten years after the agreement was made. Complaints were made to Plaintiff by other tenants of similar leaky conditions. Repairs were made to the roof by the Plaintiff until the roofers told the Plaintiff that repair was no longer practicable and a new roof should be installed. Plaintiffs sought and obtained competitive bids for replacing the roof and awarded the job to the lowest bidder. The lease stated that the lessor agreed at their own cost to make all repairs to the roof and exterior walls to the new building and the Lessors shall have no obligation to make any repairs to the new building made necessary by the negligence or improper use by the lessee. The lease further provided
that all notices, demands, consents and denials shall be in writing and shall be sufficiently given and served. Prior to the repairs Plaintiff did not review the lease, but Plaintiff later became aware of the lease provision, which allocated the responsibility for such repairs to the Defendant. Thereafter, Plaintiff requested that Defendant reimburse them for the money spent on fixing the roof. Defendant refused and the Plaintiff brought this action. Plaintiff brought suit to establish the provisions of the lease and the circumstances surrounding repair and replacement of the roof. Defendant sought to show that they were prejudiced by Plaintiff’s failure to notify them of the defective condition of the roof at a time when they could exercise their contractual right to control repair or replacement. The contractor who replaced the roof testified that Plaintiff asked him for the cost of replacement not for repair and that some of the roof could have been caused in servicing the air con
ditioner on the roof by Plaintiff. Defendant testified that he had no knowledge of leaks in the roof, the need for repairs or that the roof had been replaced until it was advised when suit was filed. He thought the roof had a twenty-year warranty which had expired. The trial court found that the lease required Defendant to repair the roof except for repairs necessitated by Plaintiff’s negligent or improper use. Defendant had neither notice from Plaintiff nor knowledge of the need for repairs prior to completion of work. The court therefore found that Plaintiff breached the contact by failing to give notice.

Issue.

Whether the lease provision concerning the form and manner of notice is a condition precedent that notice to repair be given?

Held.

Yes. Judgment affirmed.
The lessee beached the contract by failing to give notice. The lease did not contain an express provision that Defendant be given notice to repair. However, Defendant’s duty to repair was conditional. This did not extend to repairs made necessary by negligence or improper use of the premises by the lessees. The unilateral actions of Plaintiff in repairing the roof on their own deprived the Defendant of their right to control the repairs. Performance by a lessor of an express covenant to repair is conditional on receiving notice from the Defendant. Here, as a result of the Plaintiff’s failure to provide the Defendant notice of repairs, the Defendant was deprived of their ability to make various decisions regarding the repairs of the roof, such as whether to repair the roof or replace the entire roof. Therefore, Plaintiff breached the lease by not providing the Defendant with notice of the repairs.

Discussion.

The court rejected Plaintiff’s claim that the payments for the roof should be granted on the quasi-contract theory of money paid by mistake. The court made this decision on the theory that where parties enter freely into contracts, it would be inequitable to imply a different liability and to withdraw benefits from one party for which he was entitled.