MEDICAL MULTIPHASIC TESTING, INC., Formerly Health Evaluation Centers Incorporated, a Nevada Corporation, Appellant, v. LILLIAN B. LINNECKE, Executrix of the ESTATE OF HARRY F. LINNECKE, and LILLIAN B. LINNECKE, Individually, Respondents
Medical Multiphasic Testing, Inc. v. Linnecke
Mowbray, C. J., and Manoukian and Batjer, JJ., concur.
MEDICAL MULTIPHASIC TESTING, INC., Formerly Health Evaluation Centers Incorporated, a Nevada Corporation, Appellant, v. LILLIAN B. LINNECKE, Executrix of the ESTATE OF HARRY F. LINNECKE, and LILLIAN B. LINNECKE, Individually, Respondents.
MEDICAL MULTIPHASIC TESTING, INC., Formerly Health Evaluation Centers Incorporated, a Nevada Corporation, Appellant, v. LILLIAN B. LINNECKE, Executrix of the ESTATE OF HARRY F. LINNECKE, and LILLIAN B. LINNECKE, Individually, Respondents.
No. 9792
November 9, 1979
602 P.2d 182
Leonard T. Howard, Sr., Chartered, of Reno, for Appellant.
Petersen & Petersen, of Reno, for Respondents.
OPINION
By the Court,
Thompson, J.:
Linnecke commenced an unlawful detainer action for nonpayment of rent against Medical Multiphasic Testing, Inc. (MMTI), in which MMTI denied its liability for rent and counterclaimed for damages for a constructive eviction.
Trial occurred before a jury. When all proofs had been offered Linnecke moved for a directed verdict on the ground that no defense to the claim for unpaid rent had been shown, and that there was no constructive eviction as a matter of law. The trial court doubted whether a constructive eviction had been shown, but preferred to submit all issues to the jury reserving power to correct a mistake should the jury make one. Consequently, it denied the motion for a directed verdict.
The jury returned its verdict in favor of MMTI, and awarded MMTI damages of $27,000 upon its counterclaim. Judgment was éntered on the verdict. Thereafter, Linnecke moved for judgment notwithstanding the verdict. That motion was granted and a judgment in the sum of $14,200 for rent due upon surrender of the premises less the last month's rent paid in advance was entered for Linnecke. In its decision the court observed that there was no constructive eviction of MMTI by Linnecke. This appeal is from the judgment n.o.v. For the reasons hereafter expressed, we affirm.
In March 1970 Linnecke leased a building to MMTI for a term of 10 years at a rental of $1,100 per month for the first 5 years and $1,200 per month for the second 5 years. The term of the lease commenced May 15, 1970. Rent was paid, usually late, through June 1971. Rent due July 15, 1971, was not paid. Therefore, on July 16 Linnecke gave appropriate notice to pay rent or quit the premises. On the last day for the payment of rent pursuant to the notice, MMTI requested a one-day extension of time. It is disputed whether Linnecke extended time until noon the following day or for the full day. In any event, during the late afternoon of the next day rent was tendered to an employee of Linnecke who refused to accept the tender because he had not been authorized to do so. A subsequent tender by counsel for MMTI to counsel for Linnecke also was refused. On July 28, 1971, Linnecke filed an unlawful detainer action.
That action was decided in February 1972, the court ruling that Linnecke had waived timely payment of rent with the result that there was no unlawful detainer. No appeal was taken. While that action was pending, Linnecke, in January 1972, caused another notice to pay rent or quit to be served upon MMTI demanding rent due from July 1971 through January 1972. The present action was commenced September 8, 1972, to recover rent due.
The' lease gave MMTI the right to sublet. The tenant had insisted upon such a provision since it would have no use for the building if its medical testing program proved unsuccessful. The tenant did cease doing business about nine and one half months after the lease commenced and, therefore, proceeded to search for a subtenant. In July and August 1972, MMTI negotiated with Economic Opportunity Board, a prospective subtenant. The Board was willing to pay the sum of $13,600 covering the full subrental period on the condition that Linnecke would forego her demand for accrued rent until the end of the lease term. She refused to do so.
In asking this court to set aside the judgment n.o.v. and reinstate the judgment entered upon jury verdict, the appellant contends that substantial evidence was introduced to establish all essential elements of a constructive eviction as alleged in its counterclaim. We turn to discuss this central issue.
1. The district court, in ruling that there was no constructive eviction as a matter of law, relied upon our opinion in Baker v. Simonds, 79 Nev. 434, 386 P.2d 86 (1963). We there noted that a constructive eviction results from an active interference with, or disturbance of, the tenant's possession by the act of the landlord because of which the whole, or a substantial part of the premises is rendered unfit for occupancy for the purpose for which it was demised. Moreover, the tenant must elect to treat such interference as an eviction and surrender the premises within a reasonable time. There can be no constructive eviction if the tenant continues in possession even though disturbed in the beneficial enjoyment of the premises.
When the mentioned principles are applied to the case at hand, it is clear that the district judge was compelled to enter judgment n.o.v. The assertion that the first unlawful detainer action instituted by Linnecke together with her refusal to defer collection of accrued rent until the end of the lease term, constituted a constructive eviction, is specious. A landlord is not guilty of constructive eviction by commencing an unlawful detainer action against a tenant who has not paid rent as agreed. Rent had not been paid when due. The court, on conflicting evidence, found that the landlord had waived timely payment and that as a result there was no unlawful detainer. Surely, this is not to be treated as a nontrespassory intrusion upon the tenant's right to possession when the tenant did not so treat it and did not surrender possession within a reasonable time thereafter. Baker v. Simonds, supra.
The spark which ignited this controversy was the inability of MMTI to pay the rent it had agreed to pay. The failure of MMTI to pay rent does not form the basis for a damage claim against Mrs. Linnecke. Neither may a tenant claim a constructive eviction when it continues in possession after the landlord's commission of acts which the tenant contends would justify abandonment of the premises. In such circumstances the tenant waives any claim for damages resulting from an alleged constructive eviction. Here, MMTI continued in possession for about one year and three months after the first unlawful detainer action was commenced, which action forms the main predicate for the tenant's claim of a constructive eviction.
It is evident that the reason a sublease with Economic Opportunity Board was not consummated was the inability of MMTI to pay rent then accrued. That default may not be charged to Mrs. Linnecke.
2. The appellant asserts that the lower court erred when it awarded Linnecke the sum of $14,200 for unpaid rent. The amount of unpaid rent is not disputed. The appellant simply contends that it is not obliged to pay that sum because it was constructively evicted from the premises. Since we agree with the district court that there was no constructive eviction as a matter of law, this claim of error fails.
Affirmed.
Mowbray, C. J., and Manoukian and Batjer, JJ., concur.