Pacific Tank & Pipe Co. v. Pacific Box Corp.

SPENCE, J. This action was brought by the plaintiff, the lessor, against defendant, the assignee of the lessee, to recover damages for alleged breaches of lease executed on October 1, 1929. The complaint was in four counts. The cause was tried by the court sitting without a jury and in the judgment entered, plaintiff was denied any recovery upon the second and third counts. Plaintiff appeals from those portions of the judgment relating to said second and third counts.

We will first turn to count two of the complaint which was based upon an alleged breach upon the part of defendant by reason of its failure to “install” a sprinkler system in the box factory upon the premises. The first lease between plaintiff and defendant’s assignor, Mercantile Box Company, was executed on October 1, 1924. There were no buildings upon the premises at that time. The clauses of the 1924 lease which may throw light upon the questions involved with respect to the 1929 lease will be set forth in full. The italics are ours.

Paragraph 3 of the 1924 lease provided: “The Lessee agrees to erect and maintain upon said leased premises, suitable buildings for the manufacture of box material including sprinkler equipment and wiring, which shall be security for the performance of its part of the terms of this lease, and which shall become the property of the Lessor at the termination of this lease.”

Paragraph 9 of said lease provided: “The Lessor grants to the Lessee the privilege of connecting with the water tank of the Lessor for the purpose of installing a sprinkler system in said building. The Lessor also grants to the Lessee the right to connect with the East Bay Channel for a sewer in connection with their plant. ’ ’

Paragraph 11 of said lease provided: “The Lessee agrees to pay all costs of the erection and maintenance of all buildings, improvements or alterations made, or operations carried on, by the Lessee, in about or in connection with the leased [519]premises, to pay all taxes and charges in connection therewith, and to comply with all laws, orders or regulations of the federal, state, county, municipal, or other lawful authority, appertaining to or affecting said leased premises. ’ ’

Paragraph 14 of said lease provided: “The Lessee agrees to erect and maintain a sprinkler system in all buildings and to maintain such rules and conditions required by the Board of Fire Underwriters to not in any way increase the fire hazard of either party.”