Litchfield Co. of South Carolina, Inc. v. Kiriakides

Gardner, Judge

(dissenting):

I dissent. My brethren confuse the law of the majority of states with the minority view, which South Carolina follows.

A careful study of encyclopedic authority reveals that the vast majority of states view a provision of a lease allowing forfeiture of the lease for nonpayment of rent as one intended to provide only security for the payment of the rent. This is not the case in South Carolina. Sections 27-35-140 and 27-37-10, Code of Laws of South Carolina (1976), are the bases of our present case law. Section 27-35-140 provides that failure to pay the rent agreed upon when due shall terminate all tenancies for years (leases) and that the tenant shall forthwith vacate the premises without notice. Section 27-37-10 provides that an action for eject*228ment shall accrue upon the failure of the tenant to pay the rent.

Based on the above statutes, our Supreme Court in Wright v. Player, 233 S. C. 223, 104 S. E. (2d) 289 (1958), held that a landlord is under no obligation to accept past due rent tendered after an ejectment proceeding has been commenced because a right of ejectment accrues upon default in the payment of the rent. This, in fact, is exactly what happened in the case before us; under the subject lease itself, read in the light of the applicable South Carolina statutory law and the applicable facts before us, a situation is presented by which Messrs. Kiriakides have an accrued right of ejectment against Litchfield.

The terms of the subject lease provide that if the tenant fails to pay any installment of rent and if such installment shall not be cured within ten days after written notice of failure to make the payment “then, and in any such event, the lessor shall have the right at its election, then or any time thereafter while such default or defaults shall continue after lessee’s failure to cure such default or defaults as provided in this paragraph, to give the lessee notice of lessor’s intention to terminate the lease....”

A careful reading of the lease reflects that the words “or at any time thereafter while such default or defaults shall continue after lessee’s failure to cure such default or defaults as provided in this paragraph” are not meant to cut down or variegate the clear meaning of the word “then” which twice preceded the quoted language. The quoted words simply mean, I would hold, that after the right to terminate vests, the right remains unless the lessors accept, at their election, payment of the past due rent. If this were not so, there would be no purpose in limiting the time to “cure” a default; to hold otherwise would require us to ignore the word “cure” twice used in the lease.

Messrs. Kiriakides gave notice on June 6 and July 1 that the rent due those two months had not been paid. When ten days passed from July 1, the right of action for ejectment accrued and could not be negated by a tender and I would so hold.

And I would also hold that the notice of termination of the lease was sufficient. Mr. Douglas F. Patrick, of counsel for *229Messrs. Kiriakides, by letter of July 8,1983, wrote Litchfield this:

Please be advised that we have been retained by Alex and John Kiriakides. Enclosed you will find a notice signed by the them [sic] as lessors of a lease agreement dated January 15, 1976 and modified in 1983, in which they make demand for return of the premises because of Litchfield’s violation of the lease agreement.
Our clients are attempting to find suitable replacement tenants for this property and wish to put your company on notice that any losses incurred because of a lapse of rental income or a reduction in rental income will be the responsibility of your company because of this wilful breach of the lease agreement.
I will be more than happy to discuss this matter with you in advance of the July 31 deadline, however, failure to vacate on or before this date will result in immediate legal action.

This letter clearly sets forth the demands of Messrs. Kiriakides that Litchfield vacate the premises. In South Carolina, even when the statutory law required a formal notice to vacate,1 it was held that the notice was not to be strictly construed and would be sufficient if the intention to exercise the option was fairly communicated and if it amounted to a demand to vacate by a fixed time. See Biber v. Dillingham, 111 S. C. 502, 98 S. E. 798 (1919). Mr. Patrick’s letter clearly sets forth July 31, 1983, as the deadline. I would hold that the notice complied with the lease provisions.

Moreover, I most emphatically disagree with the proposition that in South Carolina equity will as a matter of course relieve against a forfeiture of a lease incurred for the bréach *230of a covenant to pay rent. This may be the law of other states but is not the law of South Carolina. Section 27-35-140 provides that the failure to pay rent when due terminates the lease and directs that the tenant shall forthwith vacate the premises without notice; thus, the statutory law of this state speaks to the issue of forfeiture and speaks strongly. The general law cited in the majority opinion is inapplicable in South Carolina and I would so hold. '

Moreover, the holding, of my brethren that the issue of material breach is not raised by exception and argument is, in my opinion, unduly technical and not in keeping with the rules of our court. Exception number three is that the trial court erred in granting summary judgment because the undisputed evidence shows the defendants breached the lease by failing to make the June and July rental payments. The brief of Messrs. Kiriakides then argues the materiality of the breach. Bartles v. Livingston 282 S. C. 448, 319 S. E. (2d) 707 (Ct. App. 1984), holds that while the Court of Appeals is generally confined to the issues raised by the exceptions, it is not limited to the reasoning of the parties or the trial court in addressing those issues. The issue of breach is raised by exception; the issue of material breach is argued. Materiality of the breach is clearly before the court. Here again the statutory law speaks to materiality; Section 27-35-140 defines the nonpayment of rent as being so material that it terminates all tenancies for years and provides that upon the nonpayment the tenant shall forthwith vacate the premises without notice.

I would reverse by holding that Messrs. Kiriakides are vested with an accrued right of ejectment but subject to defense of whether, under all the circumstances of the case, the enforcement of the lease termination provision would be unconscionable; unconscionability was not considered by the appealed order and should be deferred for the trial of the case.

I would .reverse the appealed order.

Section 8813, Code of Laws of South Carolina (1942) (the same statute cited in Biber v. Dillingham, 111 S. C. 502, 98 S. E. 798 (1919), as Section 3509 of the 1912 Code), required notice to vacate before a right of ejectment accrued. In 1946 the General Assembly enacted a comprehensive Landlord and Tenant Act (1946 S. C. Acts 873), now codified in part as Section 27-35-140. This Act obviated the requirement to give demand for possession (the right of notice) by repealing Section 8813 of the 1942 Code. Section 27-35-140 squarely places South Carolina among non-notice States; this is the essence of the error of the majority opinion.