Reidy v. Miller

CRAIG, Acting P. J.

This is a suit concerning the same transaction as

Miller

v.

Reidy,

No. 5580

(ante,

p. 757 [260 Pac. 358]). Only a few facts need be here mentioned in addition to those stated in the opinion in that case. In this action Reidy filed a complaint in which he sought to recover $2,000 with interest deposited with the lessors by the original lessee, Rutledge, as security for the faithful performance of the lease. After trial by the court without a jury judgment as prayed was entered for the plaintiff, and the defendants appeal therefrom. A number of grounds are advanced as reasons for reversal.

The assignment of his interest in the lease by Reidy to the Los Angeles Haynes Company did not constitute a breach of the covenant against assignment.

(Miller

v.

Reidy, supra.)

Appellants are not in a position to question the assignment to Reidy of the deposit money in dispute, since the amended complaint alleges such assignment to have been made, and the answer thereto makes no denial of that allegation; hence the trial court properly accepted it as true.

Appellants devote much of their briefs to argument that since the complaint alleges performance by the lessee, recovery must be had if at all upon proof of such performance, and that findings in favor of the plaintiff and

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respondent to the effect that the latter had broken a covenant of the lease, but that such breach had been waived by the lessors was unauthorized by law and erroneous. The simple answer to this contention is that the court made no such findings. In

Miller

v.

Reidy, supra,

findings of this nature were made, but, as appellants point out, in another part of their brief, these eases were not consolidated for the purposes of trial, but by stipulation are merely companion cases upon appeal. What the court did find in the instant case was that all the terms and conditions of the lease had been performed by the lessees and their assigns except that they did not pay rent after the first day of January, 1925, but remained in possession until and including the third day of January, 1925, and that the respondent should reimburse appellants for damages suffered to the premises in the sum of $173.20. This was a finding of substantial performance of the terms of the contract by the lessees and their assignees. The purpose of the deposit of $2,000 made by Rutledge was that it should be “security for the payment of rent and the faithful performance by the lessee of each and all of the obligations herein undertaken by him.” Such a stipulation does not warrant the stand of the lessors herein that the slightest default upon the part of the lessees will preclude them from receiving the balance of the money on deposit after deduction of a sum sufficient to fully compensate the lessors for all damage resulting from the default. In contemplation of the fact that the trial court found that the full damage resulting to the lessors amounted to but $173.20, appellants insist that they may retain the entire fund of $2,420, principal and interest, unless respondent is able to show complete compliance with every term and condition of the lease and that such necessity is a condition precedent which has not been met by respondent. Under the circumstances above stated the findings of the trial court are sustained by evidence and its adjustment of the matter is justified by principles both of equity and of law. It is in accord both with the fair interpretation of the contract as written and with the equitable aversion to the decreeing of a forfeiture, which would result if the lessors’ exaction in this behalf were upheld.