Bifano v. Young

OPINION

NYE, Chief Justice.

This is a suit on a written lease agreement. Appellee, Dorothy Jean Young, brought suit against appellants, Anthony Thomas Bifano and Charles Bifano, Jr., individually and d/b/a Bifano Brothers, for the amount of unpaid contractual rental due for the last four months of the lease term. Appellee also claimed reimbursement for tax and utility payments owed on the lease property and reasonable attorney’s fees. Appellants answered and pled fraud in the inducement, both as an affirmative defense and as a counterclaim. Following a jury trial, the court rendered judgment in favor of appellee for actual damages, plus attorney’s fees. Appellants appeal to this Court on an equalization transfer from the Supreme Court. We affirm the judgment of the trial court.

In November of 1978, appellee purchased a building located in Dallas, Texas, owned by the appellants. At the time of sale, appellee and appellants executed a lease agreement, leasing the subject property back to appellants for a period of one year, beginning on December 15, 1978, and ending on December 14, 1979. Appellants were in the retail fur business and leased the property to store fine furs, cleaning equipment and machines used for repair. The lease stipulated a monthly rental of $1,478.60, not subject to offset or deduction. The lease agreement also specified that appellants pay as “additional rent” all real estate taxes on the property, as well as the cost of all utility services.

It was undisputed that appellants paid all the lease payments through August 1979 and delivered to appellee their check for the September 1979 rent payment. Later, however, appellants directed the drawee bank to stop payment on this check. Appellants did not make further rental lease payments to appellee for the last three months of their lease. Appellee claims that, in addition to the last four months lease payments that were not paid, appellants owe for the county, city and school real estate taxes due and payable on the leased premises.

Appellants contend on appeal that prior to the lease execution, appellee negotiated to repair leaks in the roof of the premises and, alternatively, to replace the roof in exchange for a $5,000.00 reduction in the purchase price of the building. Appellants further alleged and attempted to prove at trial that this promise had been made fraudulently, without any intent that it be performed, and that, since this promise was a material element, and had been relied upon, the lease was void.

Appellee testified that she was unaware of any problems concerning the roof at the time the lease agreement was signed. Ap-pellee was notified by appellant, Anthony Bifano, by letter dated July 12, 1979, that the roof on the building leaked. Appellee contends that, during the early part of September, the roof was repaired. Appellant, Anthony Bifano, testified they began to move furs from the building shortly after notice of the condition of the roof was given to appellee and completed moving the furs in August of 1979. Appellants contend they had abandoned the premises by the time the repairs were made in September because the roof leaked so severely it endangered their goods. However, the record shows appellants continued to use the building for storing their cleaning and other heavy equipment.

At trial, appellee sought to recover the unpaid contractual rental under the lease agreement. In answer to special issues, the jury found that appellee did not know nor should have known of leaks in the roof of the building prior to July 12, 1979; that appellee’s failure to repair the leaks or replace the roof prior to September of 1979 did not interfere with appellants’ use of the premises; appellants did not abandon said premises as a result of the failure to repair the leaks on the roof; and appellee’s refusal or failure to repair or replace the roof on the Inwood premises was not a producing cause of damage to appellants. Judgment was entered in favor of appellee for the amount of unpaid lease rental, taxes and attorney’s fees.

Appellants’ first through fourth points of error complain that the trial court refused to consider and act upon appellee’s failure to pursue her exclusive remedy under the terms of the lease and to present evidence proving the damages provided by such remedy.

It is well settled in Texas that, upon the failure of a lessee to pay rent, the lessor has the option of either suing immediately for anticipatory breach of the contract and recovering damages as a result of such breach, or the lessor may stand on his contract and sue for the past-due rentals after they come due. Taco Boy, Inc. v. Redelco Co., Inc., 515 S.W.2d 319 (Tex.Civ.App.—Corpus Christi 1974, no writ); Western Flavor Seal Company v. Kallison, 389 S.W.2d 521, 522 (Tex.Civ.App —San Antonio 1965, no writ); Employment Advisors, Inc. v. Sparks, 364 S.W.2d 478 (Tex.Civ.App.—Waco 1963), writ ref’d n.r.e., 368 S.W.2d 199 (Tex.1963); Amco Trust v. Naylor, 311 S.W.2d 257, 260 (Tex.Civ.App.—San Antonio 1958), rev’d on other grounds, 159 Tex. 146, 317 S.W.2d 47 (1958); Willis v. Thomas, 9 S.W.2d 423 (Tex.Civ.App.—San Antonio 1928, writ dism’d); 35 Tex.Jur.2d, Landlord & Tenant § 142 (1962). The results can be almost identical on short-term leases. Here, there were only four months remaining in the lease at the time of default.

If the lease contract specifically provides for only one remedy and denominates that this is the only remedy, then the lessor is bound by the exclusive remedy set out in the contract. Remedies provided for in a contract may be permissive or exclusive. See Vandergriff Chevrolet Company, Inc. v. Forum Bank, 613 S.W.2d 68 (Tex.Civ.App.—Fort Worth 1981, no writ); Stergois v. Babcock, 568 S.W.2d 707, 708 (Tex.Civ.App.—Fort Worth 1978, writ ref d n.r.e.). The mere fact that the contract provides a party with a particular remedy does not necessarily mean that such remedy is exclusive. Vandergriff at 70; West Texas Utilities Company v. Huber, 292 S.W.2d 702, 703 (Tex.Civ.App.—Eastland 1956, writ ref’d n.r.e.). A construction which renders the specified remedy exclusive should not be made unless the intent of the parties that it be exclusive is clearly indicated or declared. Ryan Mortgage Investors v. Fleming-Wood, 650 S.W.2d 928 (Tex.App.—Fort Worth 1983, no writ); Tabor v. Ragle, 526 S.W.2d 670, 676 (Tex.Civ.App.—Fort Worth 1975, writ ref’d n.r.e.); Wilburn v. Missouri-Kansas-Texas Rail Co. of Texas, 268 S.W.2d 726, 731 (Tex.Civ.App.—Dallas 1954, no writ). In determining the intent of the parties to an unambiguous written instrument, the general rule is that every clause must be given effect with a view toward what is objectively stated in the language of the instrument. Cherokee Water Co. v. Forderhause, 641 S.W.2d 522 (Tex.1982); Vandergriff, at 70; Skyland Developers, Inc. v. Sky Harbor Associates, 586 S.W.2d 564, 570 (Tex.Civ.App.—Corpus Christi 1979, no writ).

Appellants contend that the lease can only be interpreted as stipulating that the exclusive remedy upon default was the termination of the lease and recovery of damages. Section 20(A) of the lease contract states:

20. REMEDIES OF LANDLORD: Upon the occurrence of any of the events of default listed in section 19, the landlord shall have the option to pursue any one or more of the following remedies without any notice or demand whatsoever:

A. Terminate this lease, in which event tenant shall immediately surrender the demised premises to landlord_ Tenant shall pay to landlord on demand the amount of all loss and damage which landlord may suffer by reason of such termination, whether through inability to relet the demised premises on satisfactory terms or otherwise.

* * * * ⅜ *

Following the express remedy in § 20(A), there are two other alternate remedies set out in paragraphs (B) and (C) of § 20 of the “form type” lease. One is to the effect that appellee could “Enter upon and take possession of the demised premises by force ... etc,” and a final paragraph to the effect that the above remedies were non-exclusive. In the “form type” lease signed by appellants and appellee, paragraphs (B) and (C) of the form and the non-exclusive paragraph of the form were marked through and initialed by both parties. Appellants contend that, by striking through these form provisions for remedies on default, the parties intended that there was only one remedy available to appellee and that was the remedy specified in paragraph (A). We disagree. The lease specifically provided that the appellee had the option to pursue any one or more of the following remedies without any notice or demand whatsoever. This provision was not marked through or eliminated by the parties.

The appellants knew very well the remedy that the appellee pursued as a matter of fact of what actually took place prior to trial. The appellants did not object or except to appellee’s pleading. Appellants’ pleadings offered at trial did not raise the issue of “exclusive remedy” under the lease agreement. Rather, appellants’ defense and counterclaim for damages focused on allegations of fraudulent inducement by appellee as their basis for termination of the agreement and release of further liability. Appellants raised the “exclusive remedy” argument for the first time on Motion for Directed Verdict at the close of all testimony at trial. The motion was overruled by the trial court. Appellants failed to pursue this same exclusive remedy argument on Motion for New Trial. Appellants now bring forward their “exclusive remedy” contention on appeal, following judgment rendered against them for the amount of unpaid rental based on the rental terms of the lease agreement. The facts conclusively show that, upon appellants’ failure to pay rent when due, appellee did not deliver written notice of such default to appellants, as set out in the lease as a condition precedent to an action for anticipatory breach. Appellee did not give notice of termination of the lease and demand that appellants surrender the premises, as the anticipatory breach provision provided. Appellee, as landlord, waited until the lease had expired at least four months after the initial breach and then initiated this action on the contract.

In reviewing a trial court’s judgment where findings of fact and conclusions of law are not filed, as here, we must uphold the judgment on any legal theory that is supported by the evidence. Davis v. Huey, 571 S.W.2d 859, 862 (Tex.1978); Seaman v. Seaman, 425 S.W.2d 339, 341 (Tex.1968); Reading & Bates Construction Company v. O’Donnell, 627 S.W.2d 239, 242 (Tex.Civ.App.—Corpus Christi 1982, writ ref’d n.r.e.).

Appellants did not object to appel-lee’s pleadings nor to the evidence of the amount owed under the lease. Appellants acknowledged at trial that they were obligated under the rental terms of the lease agreement to pay the full amounts contracted for throughout the lease term. We hold that the wording of the lease agreement did not exclude appellee’s common law remedy for appellants’ breaching the lease. Alternatively, we hold that appellants have effectively waived their “exclusive remedy” contention. Appellee could and did elect to keep the lease alive on appellants’ failure to pay the stipulated rental amounts. She brought suit for the balance appellants agreed to pay. Stubbs v. Stuart, 469 S.W.2d 311 (Tex.Civ.App.—Houston [14th Dist.] 1971, no writ); Wukasch v. Hoover, 247 S.W.2d 593 (Tex.Civ.App.—Austin 1952), aff’d, 152 Tex. Ill, 254 S.W.2d 507 (1953); Willis v. Thomas, 9 S.W.2d at 425.

The second question presented by appellants’ first through fourth points of error concerns the requisite proof of damages by appellee at trial. As we have held, appellee was entitled, upon proper pleading and proof, to recover the balance due of the agreed rent for the contractual period pled. Crain v. Southern Warehouse Corp., 612 S.W.2d 283 (Tex.Civ.App.Houston [14th Dist.] 1981, no writ); Maida v. Main Building of Houston, 473 S.W.2d 648, 651 (Tex.Civ.App.—Houston [14th Dist.] 1971 no writ); Western Flavor Seal v. Kallison, 389 S.W.2d 521, 522 (Tex.Civ.App.—San Antonio 1965, no writ); see also Evons v. Winkler, 388 S.W.2d 265, 289 (Tex.Civ.App.—Corpus Christi 1965, writ ref’d n.r.e.). Appellee testified, and appellants admitted at trial, to the fact that appellants had not paid the monthly rental as stipulated in the lease agreement for the last four months of the lease period. Appellee also pleaded and proved that appellants had not paid other amounts designated as “additional rental” and utility payments as agreed to by appellants under the lease contract. We hold that there is sufficient evidence to support the implied finding by the trial court that appellee proved her damages. Points of error numbers one through four are overruled.

Appellants’ fifth through eighth points of error concern the central theme of the trial. These points complain of the trial court’s exclusion of evidence of fraud in the inducement pleaded by appellants both as an affirmative defense and as a counterclaim. Appellants complain that the trial court’s error in excluding such evidence grew out of the court’s granting of appel-lee’s motion in limine and extended to the court’s subsequent refusal to permit such testimony upon offer at trial.

The record contains no order granting a motion in limine. Even if such an order was before this Court, the granting or overruling of a such motion will not, in and of itself, constitute reversible error. Hartford Accident & Indemnity Company v. McCardell, 369 S.W.2d 331, 335 (Tex.1963); Redding v. Ferguson, 501 S.W.2d 717, 722 (Tex.Civ.App.—Fort Worth 1973, writ ref’d n.r.e.). The purpose of a motion in limine is to avoid the injection into the trial of matters which are irrelevant, inadmissible and prejudicial. The granting of the motion is not a final ruling on the evidence. Wilkins v. Royal Indemnity Company, 592 S.W.2d 64, 66 (Tex.Civ.App.—Tyler 1979, no writ).

Regarding the question of whether the trial court committed reversible error in excluding the evidence of fraud in the inducement, as set out in appellants' bill of exception, both parties direct this Court’s attention to Hobbs Trailers v. Arnett Grain Company, Inc., 560 S.W.2d 85 (Tex.1977). The Supreme Court, in Hobbs Trailers, held that a written lease contract between the parties was controlling and that evidence of prior negotiations which varied and contradicted the clear and exclusive terms of the contract was inadmissible under the parol evidence rule. The Texas Supreme Court reiterated the established rule of law that “the very purpose of putting the agreement in writing is to definitely settle its terms and to exclude all oral understandings to the contrary.” Hobbs, 560 S.W.2d at 87 (quoting Super-Cold Southwest Co. v. Elkins, 140 Tex. 48, 166 S.W.2d 97, 98 [1942], and Hubacek v. Ennis State Bank, 159 Tex. 166, 317 S.W.2d 30 [1958]).

Appellants contend that the decision in Hobbs Trailers, is not controlling. Appellants point out that the “parol evidence rule will not prevent proof of fraud or mutual mistake,” citing Santos v. Mid-continent Refrigerator Co., 471 S.W.2d 568, 569 (Tex.1971). Appellants contend, therefore, that the parol evidence rule is not applicable as the basis to exclude the proffered testimony of fraud in the inducement for it is introduced not to vary the terms of the writing, “but to show that the writing itself from its inception, never became legally effective.” See Santos, 471 S.W.2d at 569; Guisinger v. Hughes, 363 S.W.2d 861 (Tex.Civ.App.—Dallas 1962, writ ref’d n.r.e.).

The final draft of the lease signed by appellants and appellees states:

“2. ACCEPTANCE OF PREMISES: Tenant acknowledges that it has fully inspected the demised premises and accepts the demised premises, and any buildings and improvements situated thereon, as suitable for the purpose for which the same are leased in their present condition, except .... ”

This provision of the lease was undisturbed. There was no evidence of any exception or reservation made by appellants on acceptance of the premises. Appellants’ pleadings and the evidence presented at trial, even considering the excluded testimony, did not establish the requisite elements for a claim of fraudulent inducement, thereby permitting the introduction of extrinsic evidence to vitiate an otherwise valid contract. Where admission of such testimony would not have required a finding for appellants, the alleged error in exclusion of the testimony offered by appellants was harmless. Crawford v. Haywood, 392 S.W.2d 387, 389 (Tex.Civ.App.—Corpus Christi 1965, no writ).

Appellants have not demonstrated that the exclusion of the proffered testimony caused or probably caused the rendition of an improper judgment. Tex.R.Civ.P., R. 434; Lemon v. Spann, 633 S.W.2d 568, 571 (Tex.App.—Texarkana 1982, no writ); Vega v. Royal Crown Bottling Company, 526 S.W.2d 729, 732 (Tex.Civ.App.—Corpus Christi 1975, no writ); Thomas v. Southern Lumber Co., 181 S.W.2d 111, 115 (Tex.Civ.App.—Waco 1944, no writ). We have considered all of appellant’s points of error, and they are overruled.

The judgment of the trial court is affirmed.

KENNEDY, J., dissents.