Walsh v. E. G. Shinner & Co. ( 1927 )

WOOLLEY, Circuit Judge

(after stating the facts as above). The sole question here for review is whether, under Ohio law, it is the duty of a landlord, who claims damages for breach of a lease by the tenant, to mitigate, if he can, the damages ho has sustained.

This question touches two general rules of law and an exception to one of them. The first is the familiar rule that one, when injured by breach of a contract, is bound to minimize the resulting damage, and that to the extent his damages are due to his failure to perform that duty, he cannot recover. 8 R. C. L. 442. But this rule does not uniformly apply to damages resulting from a breach of a contract of lease. Distinguishing the rule applicable to contracts generally, the general rule applicable to contracts of lease is that when a tenant breaches such a contract by vacating the premises during the term, the landlord is under no duty to mitigate the damages by seeking a new tenant. According to this rule, the landlord may allow the premises to lie idle and recover the rent stipulated. Abraham v. Gheens, 205 Ky. 289, 265 S. W. 778, 40 A. L. R. 186, 190 note a. If, however, the landlord does not allow the premises to remain constructively in the possession of the.tenant but, as in the ease at bar, re-enters and takes possession, some courts have regarded this action as making an exception to the general rule in respect to contracts of lease and have held that the landlord must then use diligence in obtaining a tenant in order to lessen his damages. Bradbury v. Higginson, 162 Cal. 602, 123 P. 797; Baker v. Eilers Music Co., 26 Cal. App. 371, 146 P. 1056; Marling v. Allison, 213 Ill. App. 224; John Church Co. v. Martinez (Tex. Civ. App.) 204 S. W. 486; Robinson Seed & Plant Co. v. Hexter (Tex. Civ. App.) 167 S. W. 749; 40 A. L. R. 197.

Except for the trend of the argument, this case does not concern general law or its exceptions; it concerns specifically the law of Ohio under which the lease in suit was entered into. That is the law which the learned trial judge was required to find and apply. In finding it, he was aided perhaps by an Ohio lawyer who testified in accord with the landlord’s contention that under the law of that state a landlord is not required in any circumstance to mitigate damages arising from a breach of a contract of lease. But without regard to this testimony the learned trial court was bound by the pronouncements of the courts of that state on the subject, if any had been made and were available. There were six. These the attorneys for the landlords sought to distinguish, and

to establish that five of them amounted only to dieta. No matter how persuasive theii .argument may have been when fortified by the testimony of a lawyer familiar with the law of his own state, still the trial court, was required to apply the law as declared by the •courts of that state; and on the subject the Supreme Court of Ohio- and five Courts of Appeals of. Ohio — intermediate appellate courts — had spoken in terms more or less plain. The Supreme Court, in Bumiller v. Walker (1917) 95 Ohio St. 344, 116 N. E. 797, L. R. A. 1918B, 96, clearly stated that it is the “legal duty” of a. landlord, when leased premises have been vacated during the term to seek a new tenant and thus mitigate the resulting damages. In Baker v. Herrlinger (1922) 16 Ohio App. 253, a Court of Appeals laid down the measure of damages and, quoting Bumiller v. Walker, said that it was the legal duty of the landlord to re-rent the premises if a proper tenant were available. In Muth v. Wrubel, 24 Ohio Cir. Ct. R. (N. S.) 426, the eourt held that it was the duty of the landlord to rent the premises and to see that it was kept remunerative, and to reduce the damages which would flow by reason of the tenant’s breach of the contract. In Stuart v. Ford, 11 Ohio Cir. Ct. R. 453, 5 O. C. D. 260, another court intimated such a duty. In Shipman v. Stone, 16 Ohio Cir. Ct. R. (N. S.) 468, still another court said it was the landlord’s moral duty to do so. But in White v. Smith (1917) 8 Ohio App. 368 the court held, without referring to the Supreme Court’s decision in Bumiller v. Walker rendered a short time before, that such was not the landlord’s duty.

We think these decisions, though varied in terms and not quite unanimous, declare the rule of -Ohio that a landlord having reentered and regained possession of yacated premises must mitigate damages by re-renting to a new tenant when one is available. Certainly the highest court of the state declared that to be his duty. If this pronouncement was a dictum, as urged by the landlords, this dictum had been made by other courts of the state and had been repeated so' frequently that, even if dictum, we are bound to accept it as law of the state so familiar to those having authority to pronounce it that it occurs in decision after decision. In such a situation a federal court should hesitate long before holding that the law of Ohio is different from what the courts of Ohio have said it is. If error was involved in their statement of local law, the federal trial eourt, being wholly without power to correct it, committed no error in following it.

Finally, the landlords maintain that the pronouncements of Ohio courts, to' which we have referred, are not law because some of them do not appear in the syllabi of the cases, citing thé so-called Syllabus Rule of Ohio. This rule had its origin in a statute of that state (Page & Adams’ Ohio Code, § 1473) which authorized the Supreme Court to prescribe rales for the regulation of its practice, one of which, subsequently made, provides that the syllabus of the points decided by the eourt in each ease shall be stated in writing by the judge assigned to deliver the opinion of the court and shall be confined thereto. The landlords maintain that only matters which appear in the syllabi constitute matters decided by the eourt and anything else in the opinion which has the appearance of the court’s decision is, in truth, no decision at all. State v. Hauser, 101 Ohio St. 404, 407, 131 N. E. 66; Hart v. Andrews, 103 Ohio St. 218, 221, 132 N. E. 846; Adalbert College v. Wabash Ry. Co. (C. C. A.) 171 F. 805, 811, 812, 17 Ann. Cas. 1204; Coney Island Co. v. McIntyre (C. C. A.) 200 F. 901, 908. Even so, this rale— under which, as we read it, the syllabus of the ease alone constitutes the law of the case —whatever its force and however observed, is a rale of the Supreme Court of Ohio and applies only to the decisions of that eourt. Flannery v. Ry. Co., 26 Ohio Cir. Ct. R. (N. S.) 49. Therefore it does not apply to the decisions of the other courts we have cited, one of which, as we have indicated, adopted the language of the Supreme Court in Bu-miller v. Walker and thus made the quotation its own law.

We are constrained to hold that in taking the law of Ohio from the reported eases and in applying it to the instant ease, the learned trial court committed no error and therefore the judgment must be affirmed.