No. 84-344
I N THE SUPREME COURT OF THE STATE O F MONTANA
1984
LIC, INC., a corporation,
P l a i n t i f f and R e s p o n d e n t ,
-vs-
WILLIAM H . BALTRUSCH,
D e f e n d a n t and A p p e l l a n t .
APPEAL FROM: D i s t r i c t C o u r t of t h e T w e l f t h J u d i c i a l D i s t r i c t ,
I n and f o r t h e C o u n t y of H i l l ,
T h e H o n o r a b l e P e t e r L. R a p k o c h , Judge p r e s i d i n g .
COUNSEL O F RECORD:
For Appellant:
L a w O f f i c e of F r a n k A l t m a n , H a v r e , Montana
For Respondent:
Smith & Rice; D a v i d G. Rice, Havre, Montana
S u b m i t t e d on B r i e f s : Nov. 20, 1984
Decided: January 4 , 1 9 8 5
JLI~ . iU85
4
Filed:
--
Clerk
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of
the Court.
Defendant, William H. Baltrusch (Baltrusch) appeals the
May 23, 1984, order of the Twelfth Judicial District Court,
County of Hill, granting plaintiff, LIC, Inc.'s, motion for
summary judgment in an action to recover damages from
Baltrusch for unpaid rent. We affirm the order of the Dis-
trict Court.
In March 1978, Baltrusch entered into a five-year com-
mercial lease with M&M Enterprises for a store located in the
Holiday Village Shopping Center, Havre, Montana. LIC, Inc.,
succeeded to M&M Enterprises' interest as landlord/lessor in
1980. Baltrusch leased the premises to provide his daughter,
Cheryl Allgood, with a location in which to operate a chil-
dren's clothing store.
Cheryl operated the clothing store from 1978 until the
summer of 1982. Prior to August 1982, Cheryl paid to L,IC,
Inc., monthly rent in the amount of $612.50, common area
maintenance of $60.94 and a security payment of $30.63, for a
monthly total of $704.07. In addition, merchant dues in the
amount of $91.88 were paid quarterly by Cheryl Allgood.
Whether or not Cheryl paid the July 1982 rent is disputed.
A going-out-of-business sale was held by Cheryl at the
end of August 1982, and the clothing store closed a.s of
September 1, 1982. On September 7, 1982, the mana.ger of
Holiday Village Shopping Center entered the premises with his
key. The store was virtually empty, with only what he con-
sidered to be fixtures remaining. Cheryl Allgood stated in
an affidavit that there were numerous items remaining in the
store as of September 7, 1982. They consisted of trade
fixtures and some personalty.
John Hathaway, Vice President and property manager for
LIC, Inc., sent to Baltrusch on September 8, 1982, a letter
giving notice of the delinquent rent and Cheryl's failure to
pay the rent, a request that Baltrusch pay the rent and a
statement that pursuant to Article 25 of the lease agreement,
LIC, Inc., would be attempting to find another tenant for the
space.
The locks on the premises were changed, per Hathaway's
orders, on September 20, 1982. Then, on October 20, 1982,
LIC, Inc., brought this action against Baltrusch to recover
damages for unpaid rent.
On October 29, 1982, Baltrusch demanded by letter that
LIC, Inc., return possession of the premises to him. That
demand was denied. Baltrusch filed an answer and
counter-compl-ainton March 18, 1983, alleging that LIC, Inc.,
was in illegal and unlawful detainer of the premises and
requesting treble damages. Counter motions for summary
judgment and supporting affidavits were filed by both sides.
A hearing was held on those motions February 17, 1984. LIC,
Inc.'s, motion was granted May 23, 1984, and judgment was
entered for LIC, Inc., in the amount of the rent for the
remaining lease term, $10,678.82 plus $1,291.99 in attorney's
fees.
On appeal, Baltrusch presents two major issues for
review:
1. Whether the District Court erred in granting LIC,
Inc. Is, motion for summary judgment for the unpaid rent; and
2. Whether the District Court erred in denying
Baltrusch's summary judgment motion for forcible or unlawful
detainer.
Specifically, Baltrusch argues that LIC, Inc., resumed
possession of the premises on September 7, 1982; that
Baltrusch had not abandoned the premises at that time; and
that, therefore, LIC, Inc., was required to give Baltrusch
three days' notice prior to repossessing, pursuant to
5 70-27-106, MCA. Since LIC, Inc., failed to give notice, it
was in unlawful possession of the premises. Thus, when LIC,
Inc., refused Baltrusch's demand to return possession of the
premises to him, it was guilty of forcible or unlawful
detainer and Baltrusch is entitled to treble damages. See
S S 70-27-103 and 70-27-206, MCA.
We agree with Baltrusch's contention that there is
little, i.f any, evidence to show abandonment of the premises.
Abandonment is an absolute relinquishment of premises by a
tenant. It consists of both an act or omission and an intent
to abandon. Tuschoff v. Westover (Wash. 1964), 395 P.2d 630,
632. A sub-tenant's vacation of the premises in no way
indicates an intent on the part of the tenant to abandon.
Riggs v. Murdock (Ariz. 1969), 458 P.2d 115, 118-119.
However, a finding of abandonment is not necessary. The
lease itself is dispositive.
Article 25 of the subject lease states:
"LESSEE OBLIGATED FOR RENTS
"It is mutually agreed that in case said premises
are left vacant and/or any part of the rent herein
reserved be due and unpaid, then the Lessor may,
without in anyway being obliged so to do, and
without terminating this lease, retake possession
of said premises and rent the same for such rent,
and upon such conditions as the Lessor may think
best, making such changes and repairs as may be
required, giving credit for the amount of rent so
received less all expenses of such changes and
repairs and said Lessee shall be liable for the
balance of the rent herein reserved until the
expiration of this lease. Lessor, may, at his
option terminate this lease if said premises are
left closed for business or vacant by the Lessee
for longer than five (5) days. Such termination,
however, does not prejudice Lessor's right to
recover the balance of any rental or other payments
then due or to pursue any other remedy hereunder or
by law provided. Any property of Lessee remaining
in the leased premises, maybe (sic) removed
therefrom by the Lessor and stored at Lessee's
expense. " (emphasis supplied) .
The store was both closed for business and vacant for at
least five days prior to September 7, 1982. The rent had not
been paid for at least two months. Thus, LIC, Inc., was
entitled, pursuant to its lease with Baltrusch, to reenter
and relet the premises.
Baltrusch further contends that he was not given proper
notice of LIC, Inc. Is, intent to reenter the premises. We
cannot agree. Section 70-27-106, MCA, states:
"Reentry - when and how to be made. Whenever the
right of reentry is given to the grantor or lessor
in any grant or lease or otherwise, such reentry
may be made at any time after the right has
accrued, upon 3 days' notice, as provided in this
chapter. "
LIC, Inc.'s, right to reenter accrued no later than September
6, 1982, five days after the store was vacated. A letter was
mailed to Baltrusch on September 8, 1982, detailing the
amount of rent owed and LIC, Inc. ' s, intention to find a new
tenant. Mailing of the letter was proper under Article 34 of
the lease, which provides that all notices shall be mailed to
the parties at their respective post office box numbers. The
contents of the letter left no doubt regarding either
Baltrusch's position or LIC, Inc.'s, demands.
Baltrusch apparently made no effort to bring the rent
payments current and LIC, Inc., took legal possession of the
premises on September 20, 1982, more than three days after
giving the notice required by statute.
Baltrusch argues that LIC, Inc., actually took
possession of the premises on September 7, 1982. We cannot
agree. On September 7, the shopping center's manager used
his key to enter the premises only to determine for John
Hathaway the use of the premises by Baltrusch. It was not
until September 20, 1982, that LIC, Inc., actually
repossessed the premises by changing the locks. Since LIC,
Inc., legally repossessed the premises, there is no basis for
either a forcible or an unlawful detainer action. The trial
court properly denied Baltrusch's motion for summary judgment
on that issue.
Baltrusch breached his lease agreement with LIC, Inc.,
both when he failed to pay several months rent a.nd when he
allowed the premises to remain vacant for more than five
days. The order of the trial court awarding LIC, Inc.,
damages in the amount of the rent remaining on the lease and
attorney's fees is affirmed.
We concur:
%44,(&q&
Chief Justice '
Justices
Mr. Justice L. C. Gulbrandson, dissenting.
I respectfully dissent to that portion of the majority
opinion affirminq the order of the trial court granting
summary judgment to the plaintiff.
The trial judge found, in his finding of fact no. 11,
as follows:
"That since prior to September 1, 1982,
and thereafter, the Defendant has not
occupied or used the premises so as to be
deemed in possession - in fect had
and
abandoned them prior to the-plaintif=
initial entry." (Emphasis added.)
The ma.jority has n.ow found that the finding of
aba-ndonment was erroneous but that such a finding was not
necessary and that the lease itself is "dispositive."
I disagree with that position on the basis that, if
there was no abandonment by the defendant, then there remains
a factual dispute as to whether the required notice, under
the statute or under the lease, was given by the plaintiff.
The majority cites Article 34 of the Lease as providing that
mailed notice is appropriate. I wculd agree if the
affidavits, admissions or answers to interrogatories showed
that the mailed notice was sent by reqistered mail, as
required by Article 34, or if there was proof of actual
receipt of legally sufficient notice.
The majority goes on to state : "Thus, L I C , Inc ., was
entitled, pursuant to its lease with Baltrusch, to terminate
that lease and to reenter the premises." (Emphasis added.)
Although the judgment for plaintiff is being affirmed, that
statement by the majority will surprise counsel for plaintiff
who clearly took the position that the plaintiff was not
terminating the lease. During oral argument, counsel for
plaintiff stated as follows :
"And the court can see that the plaintiff
was not willing to fall into that trap at
that time and indicate that these
premises were being repossessed.
Probably for the fear that we are not
talking about a t e r m i n a t i ~ ~ F
O this
lease. ..
~ r t i c l c 25 has a c o u ~ l e of
different possi-bil-ites. One is retake
the property, hold it, continue to hold
the tenant liable for rent. Another one
is to terminate the lease by some action,
and cut off the defendant's requirement
or the tenant's requirement to pay rent.
- were certainly not going alleged that
We -
that situation - - - it
and have
- - - into
to fall
- - terminated the lease." (Emphasis
we have
added.
In view of plaintiff's answer to defendant's
interogatory that the plaintiff "took control of [the
premises] on or about September 7, 1982" and the conflicting
statements in his affidavits, I would remand for trial on the
issue of whether the defendant is liable for rents due after
September 7, 1982.