250 NORTH COAST R. CO. v. KRAFT CO.
Syllabus. 63 Wash.
[No. 9278. Department One. April 21, 1911.]
NORTH COAST RAILROAD COMPANY, Respondent, v. KRAFT
COMPANY. Appellant. «1»
EMINENT DOMAIN - DAMAGES - LEASEHOLDS - RENEWALS - VALUE -
DETERMINATION - TERMS OF LEASE - ARBITRATION. Where a lease
provided for a renewal for five years at a rental to be agreed
upon or fixed by arbitrators, at the option of the lessee, and
the fee was acquired by a public service corporation, which
refused to consent to an extension for longer than eighteen
months, and refused at all times to agree upon the rental or
arbitrate the matter, but commenced a condemnation suit to
appropriate the leasehold, the court cannot, eleven months after
expiration of the original term, require an arbitration at that
time within one day pending a stay of the trial, and in default
thereof, take evidence and fix the value of the rental, in
disregard of the method prescribed in the lease, the lease
contemplating an adjustment of the rent before the expiration of
the original term.
SAME. In such case, the rights of the tenant in the
condemnation suit can only be protected by adhering to the view
that the rent reserved in the lease continued for the renewal
term, especially in view of the fact that the relator's agent
demanded and collected one month's rent at such rate, and the
lessee tendered the same each month, while the relator at all
times refused to comply with the terms of the lease requiring it
to agree upon or arbitrate the matter of the rent.
SAME - VALUE OF LEASEHOLD - EXPENSE OF REMOVAL - EVIDENCE. In
proceedings to condemn a leasehold, while the lessee's expense of
moving to a new place and damage to stock and fixtures therefrom
is not recoverable as specific items apart from the leasehold,
evidence thereof is admissible as showing the value of the
unexpired term.
SAME - RESTRICTIONS IN LEASE. In proceedings to condemn a
leasehold, the rental value of the unexpired term cannot be
measured by "the highest and best use" of the premises, where the
lease restricts its use to a specified business.
SAME - MEASURE OF DAMAGES TO A LEASEHOLD. In proceedings to
condemn a leasehold, the measure of damages is the difference
between the rent reserved and the rental value during the
remainder of the term, plus loss of profits while moving to a new
location.
«1» Reported in 115 Pac. 97.
NORTH COAST R. CO. v. KRAFT CO. 251
Apr. 1911 Opinion Per GOSE, J.
Appeal from a judgment of the superior court for Spokane
county, Huneke, J., entered January 17, 1910, upon findings
in favor of the plaintiff, after a trial on the merits before the
court without a jury, establishing the value of a leasehold
interest in real property, in proceedings to condemn land for
railroad purposes. Reversed.
Post, Avery & Higgins, for appellant.
Danson & Williams and Hamblen & Gilbert, for respondent.
GOSE, J. - This is an appeal from a judgment establishing
the value of a leasehold interest in real property, entered at
the suit of the respondent, a public service corporation. The
appellant, defendant below, is a corporation engaged in the
wholesale and retail harness, saddlery, and manufacturing
business. In November, 1903, the Northwestern & Pacific
Hypotheekbank leased to the appellant a brick building in
the city of Spokane, for the term of five years, beginning
January 1, 1904, and ending on the 31st day of December,
1908, at a monthly rental of $175 per month, payable
monthly and in advance upon the 1st day of each month
during the term. The lease contained the following
provision:
"Provided, however, That the said lessee, its successors and
assigns, shall have the privilege of renewing said least for
the term of five years from the expiration thereof upon giving
written notice at least ninety (90) days before the said
expiration, that they desire so to do, at such rental as may be
mutually agreed upon by the parties hereto, their successors
or assigns, and in case they are unable to agree upon the
rental to be paid, then the amount of said rental shall be
fixed by arbitrators. The method of which said arbitration
shall be as follows: One arbitrator shall be chosen by each
of the two said parties hereto, and if the two persons so
chosen shall be unable to agree, then a third person shall be
chosen by each of the two said arbitrators, and the decision
of the majority of the three arbitrators shall be binding
upon the parties hereto."
252 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
It is further provided, that the lessors may reenter and
repossess themselves of the premises if the rent is not paid on
the day stipulated in the lease or for default in any of the
covenants; that the lessee shall not assign the lease or sublet
the premises without first having obtained the written
consent of the lessor; that the lessee will not make, or suffer to
be made, any change or alteration in the leased premises,
either external or internal, without first obtaining the written
consent of the owner; that it will not allow the same to be
used for any illegal or immoral purposes, but that it "will use
the same as a wholesale, retail, and manufacturing harness
and saddlery or similar business." On the 22d day of October,
1907, the respondent obtained a contract for the purchase
of the leased premises, and acquired the fee on April 20, 1909.
On the 24th day of September, 1908, the appellant gave
notice to the respondent that it exercised its privilege to
renew the lease, conformably to the stipulation, for the period
of five years from and after December 31, 1908, and that it
"Begs to advise you, and each of you, that it will undertake
to make an agreement with that party who is successor in
interest of the lessor, or who by virtue of any contract with
the owner of the fee simple title to said property, has the
right and power so to do, as to the rentals to be paid by the
undersigned, and that upon failure so to do, that the
undersigned will promptly name an arbitrator for the purpose of
undertaking to fix the amount of such rental, as in the lease
provided. The undersigned requests to be promptly notified
of the name of the person or corporation who has the right,
power and authority to agree upon the amount of such rental,
and in case of failure so to agree, to name an arbitrator for
and on behalf of the lessor. The undersigned further begs
to advise you that its representative will meet the person who
has the right, power and authority to agree upon the rental
on behalf of the lessor, or the representative of such person
or corporation, at any time and place to be named by them,
for the purpose of undertaking to mutually agree upon the
amount of such rentals."
The respondent disregarded the notice until after the
expiration of the original term, and until after January 8,
NORTH COAST R. CO. v. KRAFT CO. 253
Apr. 1911 Opinion Per GOSE, J.
1909. On January 25, 1909, the respondent, through its
attorneys, addressed the following letter to appellant:
"January 25, 1909.
"To the A.A. Kraft Company,
"Spokane, Washington.
"Gentlemen: As heretofore stated to you orally
the undersigned, The North Coast Railroad Company, is the
owner of lot 1 and part of lot 2 in block 3 of Resurvey and
Addition to Spokane Falls (now Spokane), and of the
building situate thereon, it having purchased same for railroad
purposes. On account of its needing said property for
railroad purposes it cannot renew the lease, which yon
heretofore held and which expired on December 31st, 1908, for a
longer period than eighteen months from January 1, 1909.
It is willing to renew said lease for said time and to allow you
to occupy said premises at a reasonable rental, said rental
to be agreed upon between it and your company, and in case
you cannot agree it will appoint an arbitrator, as provided
in said lease, who, with such arbitrator as you shall name,
shall find the reasonable rental value of said premises for said
period as provided in said lease. This will give you ample
time to secure another location and building for your use."
In response to this letter, the appellant advised the
respondent, in writing, to conduct its negotiations with its
attorneys, Messrs. Post, Avery & Higgins. This action was
commenced in April, 1909. The order of necessity having
been entered, the trial of the question of the value of the
leasehold interest commenced on November 29, 1909. The
rental value for the renewal period of five years had not then
been fixed by any of the methods agreed upon in the lease,
although eleven months had lapsed since the expiration of
the original term. On January 2, 1909, the appellant paid
to the agent of the respondent, who had theretofore collected
the rent, the sum of $175. This check was cashed by the
agent, and its check for the same amount was sent to
appellant on January 8. The appellant returned the check, and
thereafter tendered to the respondent $175 on the first of
each month.
254 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
Before writing the letter of January 25, there was some
conversation about the rent between the respondent's
attorneys and the appellant, and between the former and the
attorneys for the latter. The respondent, however, took the
position in each of the conversations, as it did in its letter,
that it would not participate in fixing the rent for a renewal
term longer than eighteen months from January 1, 1909.
The appellant stated that it considered that the payment of
the rent on January 1, 1909, fixed the rental value of the
premises at $175 per month for the renewal term, but
expressly directed the respondent to take the matter up with its
attorney as it did not care to talk about it. Pending the trial, the
respondent's attorney moved for a stay of proceedings, until
"appraisers could be appointed and the rental value
determined by them." In passing upon the motion, the court
stated that he was "inclined to grant a stay for a very short
time so that the trial can proceed tomorrow, with a view that
the parties agree upon arbitrators to fix the rental value, if
they cannot agree among themselves." The attorney for the
respondent then stated that he would name an arbitrator "at
once; by morning, if not sooner." Thereupon the appellant's
attorney inquired: "Your Honor will grant a stay until
tomorrow morning?" and the court replied: "I think not
longer than the afternoon, so as to proceed at that time."
The attorney for the appellant then stated that he did not
think that he was required to state in open court at that time
whether he would name an arbitrator. The court then
adjourned for the day. Upon convening of court the next day,
the appellant's attorney stated
"That his understanding of plaintiff's motion and the
court's ruling was that arbitrators should be appointed at
this time to determine the amount of rent to be placed in the
lease as though the arbitrators had met before January 1st,
1909, and for the purposes of this law suit only, and not
with the intent of allowing defendant to remain in possession
for the period of five years, as provided in the lease, and as
the fact was that the failure to appoint arbitrators was
NORTH COAST R. CO. v. KRAFT CO. 255
Apr. 1911 Opinion Per GOSE, J.
wholly the fault of plaintiff and plaintiff's attitude clearly
indicates that it did not desire arbitration but was satisfied
with the old rent and had accepted the same, that he believed
that it was improper for the court to ask defendant to now
arbitrate this question for the purposes of this law suit and
stay proceedings for that purpose, and defendant would
decline to name an arbitrator at this time."
The respondent made no reply, and the trial proceeded.
The respondent, in moving for a stay and in its offer in
open court to name an arbitrator, did not state whether it
adhered to its former policy of fixing the rent for eighteen
months only or for five years. It is apparent, from the
remarks of the appellant's counsel, that his understanding was
that the offer to arbitrate did not contemplate the fixing of
the rent for five years. If he misconstrued the motion, it was
the respondent's duty to so advise him. It did not do so.
The court then, over the objections of appellant, proceeded
to, and did, hear the testimony of witnesses as to the rental
value of the property for the renewal term. It is apparent
that, after a delay of eleven months and the respondent's
refusal to meet the appellant's demand for the appointment
of arbitrators to fix the rent for the renewal period, it could
not require the appellant to proceed with such haste in the
naming of an arbitrator and in having the question of rental
value passed upon by them. The time allowed by the court
was not sufficient. A reference to the provisions of the lease
makes it clear that it contemplates an adjustment of the rent
for the new term before the expiration of the original one.
This is made apparent by the clause authorizing a reentry
for a failure to pay the monthly rent in advance. At the close
of the case, the court found the facts as follows:
"(1) That the fair rental value of the premises occupied
by the A.A. Kraft Company for the term of five years
commencing January 1, 1909, was $375 per month.
"(2) That the fair rental value for the remainder of the
term from this date is $425 per month.
"(3) That the loss of profits during the time required
256 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
by said The A.A. Kraft Company to remove to another
location is the sum of $80.
"(4) That the damages which said The A.A. Kraft
Company is entitled to recover of and from said petitioner in
this condemnation proceeding is the difference between the
rental value of said premises per month on January 1, 1909,
and on the date of the trial, November 29, 1909, or $50 a
month for the unexpired term of 47 months being the sum of
$2,350, and the loss of profits during the time of removal,
or $80, making a total of $2,430."
and entered a judgment in accordance with the findings.
The appellant contended at the trial, and contends here,
that the refusal of the respondent to fix the rent for the
renewal term in accordance with the provisions of the lease
and its notice, and the acceptance of the rent on January 2,
1909, at the rate agreed upon in the original lease, fixed the
rental which it was required to pay for the renewal term.
The respondent's position is that, in view of all the facts
stated, it was competent for the court to fix the rental value
of the property upon opinion evidence submitted for that
purpose. The evidence does not show any express direction to
the agent to collect the rent on January 1, 1909. Nor does it
show that it had been directed not to collect it as it had
theretofore done. The fact that it went to the appellant's place
of business and demanded and received the rent is a
circumstance to be considered in connection with the respondent's
delay in meeting the appellant's demand of September 24 for
an adjustment of the rent for the new term. These facts and
the old lease were the only competent evidence before the
court of the rental value of the property for the five-year
term beginning January 1, 1909. The lease provides the
manner and form of fixing the rent. The respondent at all
times refused to meet the request of the appellant for an
adjustment conformably to the lease. It acquired the property
subject to the lease, and it was its duty to proceed in
accordance with its terms. The fact that it desired to devote
the property to a public use within the five years does not
NORTH COAST R. CO. v. KRAFT CO. 257
Apr. 1911 Opinion Per GOSE, J.
change the rule or dispense with its duty in the premises.
The renewal of the lease would not prevent the appropriation
of the property to a public use. 2 Lewis, Eminent Domain
(3d ed.), SSSS 414-416. This rule is based upon the principle
that the appropriation of the property of another to a
public use is an exercise of sovereignty which cannot be
relinquished by contract. The respondent at all times refused to
agree upon the rent, or to name an arbitrator to fix it for a
longer term than eighteen months. In other words, it
proceeded to appropriate the property in utter disregard of the
contract. If it had made a bona fide effort to comply with
the contract, and had named an arbitrator, and the arbitration
had been fruitless, or if the failure to arbitrate had
been due to the refusal of the appellant to meet it upon the
terms of the lease, then the power of the court to determine
the rent at its suit, upon opinion evidence, could not be
questioned. The rule in such cases rests upon the principle
that the court will determine the facts at the suit of the
innocent party, upon the best evidence obtainable; but the
court cannot disregard the contract in a suit by the
wrongdoer, and make for the parties a contract materially
different from the one they made for themselves. These views
have abundant support in the adjudged cases.
In Sherman v. Cobb, 16 R.I. 82, 12 Atl. 232, it was held
that, where a lease provides that upon its renewal the rent
for the extended term shall be fixed by appraisers, the
landlord cannot maintain an action for the recovery of the
reasonable rental value until be has exhausted the methods
provided in the contract. Where a contract provides for a
method of adjusting all differences that may arise between
the parties, that method must be pursued before either party
can resort to the courts for an adjustment. Zindorf
Construction Co. v. Western American Co., 27 Wash. 31, 67
Pac. 374; Hughes v. Bravinder, 9 Wash. 595, 38 Pac. 209;
Lidgerwood Park Water Works Co. v. Spokane, 19 Wash. 365,
9 - 63 WASH.
258 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
53 Pac. 852. In Ryder v. Jenny, 2 Rob. (N.Y. Sup'r
ct.), 56, a case with covenants for renewal expired on the
25th day of April, 1856. The lease provided that the
landlord would execute a renewal of the lease for the term of
twenty-one years, "at such annual rental as should be agreed
upon by the parties;" and provided for a mode of appraisement
in the event that they could not agree upon the rent.
The tenant continued in possession until February, 1861,
without paying any rent, before asking for a renewal
of the lease. On January 30, 1862, an appraisement
was made by appraisers chosen by the parties conformably
to the lease, and on July 21 following, a lease was
tendered. The rent under the old lease was $100 per year.
The appraisers fixed the rental value at $140 per year. Upon
these facts it was held that, until the rent was determined and
a lease tendered, the tenant was only liable for the amount
of rent previously paid, and that "the lease was not tendered
until July, 1862, and the increased rent only became payable
at that time."
The respondent relies upon the following authorities:
Hegan Mantel Co. v. Wood, 22 Ky. Law 427, 57 S.W.
929, 17 Am. Dec. 159; Wright v. Hardy, 76 Miss. 524,
24 South. 697; Andrews v. Marshall Creamery Co., 118 Iowa
595, 92 N.W. 706, 96 Am. St. 412, 60 L.R.A. 399; 24
Cyc. 1008; Kaufmann v. Liggett, 209 Pa. St. 87, 58 Atl.
129, 103 Am. St. 988, 67 L.R.A. 353; Jones, Landlord and
Tenant, SS 346; Uhrig v. Williamsburg City Fire Ins. Co.,
101 N.Y. 362, 4 N.E. 745; Lowe v. Brown, 22 Ohio St. 463,
and Grosvenor v. Flint, 20 R.I. 21, 37 Atl. 304.
They do not support its contention. The Wood case
announces the rule that a reasonable delay in the appraisement
does not debar either party from thereafter having the
property appraised according to the lease. In the Wright case,
there was a stipulation for the selection of appraisers who
should fix the rental value of the property in the event of a
disagreement between the parties. The lease further
NORTH COAST R. CO. v. KRAFT CO. 259
Apr. 1911 Opinion Per GOSE, J.
provided, "that should either party fail or refuse to make an
appraisement, or to select a referee to appraise said lots, the
other party may cause said lots to be appraised by three
disinterested freeholders to be selected by said party." There
had been no appraisement prior to the commencement of the
action. It was held that, "The right to a revaluation has
not been forfeited or waived by its not having been made or
insisted upon earlier," and that a court of chancery may fix
the valuation. It does not appear from the opinion which
party was in default. However, under the clause in the
lease which we have quoted, the parties were equally at fault,
as the power was ample in either to have the appraisement
made. The Andrews case holds that, where the tenant has
affirmatively indicated his election to renew, he has done all
that is necessary to create a renewal. The same rule is stated
in 24 Cyc. 1008, and it is further said that, "while the
execution of the lease is not necessary. . . . it may nevertheless
be required by either of the parties after the election has been
exercised." The Kaufmann case is an instructive one. There
the lease provided that the lessees should have the privilege
of a renewal. It also provided that the rental, in event the
lessees elected to renew, should be fixed by arbitrators selected
in a specified way; also that, if the arbitrators and umpire
failed to agree within a fixed time, then others should be
chosen in the same manner. There was no provision in the
lease covering the contingency of the failure of the second
set of arbitrators to agree. The lessees exercised their
privilege of renewal, and gave the stipulated notice. Both sets
of arbitrators failed to agree. The landlords then gave
notice to the lessees to surrender possession of the premises.
Thereupon the lessees filed a bill in equity, praying that the
court determine the amount of rental to be paid under the
renewal. The court said:
"But that in cases of renewal leases, the weight of
authority clearly favors the view that the tenant in such a case
has a quasi proprietorship; a right, lacking merely a valuation;
260 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
and that the grossest inequity would be worked, should
he lose his right through a failure upon the part of the
arbitrators to fix a valuation. While, therefore, a court of
equity will not undertake to compel an arbitration, which it
cannot control, it will in such case make an appraisement
itself, or direct it to be done by its own officer, and will
thereafter enforce specific performance of the contract, upon the
terms so found."
"In case the rent under a lease is to be fixed by appraisal,
then, if the referees appointed under the contract or lease to
make the appraisal are unable to make it, the lessor will be
entitled to sue for a reasonable rent. This right to sue
depends upon a condition precedent, namely, his having tried
to get the rent fixed in pursuance of the terms of the lease,
and failing to do so." Jones, Landlord and Tenant, SS 346.
In the Uhrig case, the court said:
"Under the arbitration clause, it was the duty of each
party to act in good faith to accomplish the appraisement in
the way provided in the policy, and if either party acted in
bad faith so as to defeat the real object of the clause, it
absolved the other party from compliance therewith; and if
either party refused to go on with the arbitration, or to
complete it, or to procure the appointment of an umpire so that
there could be an agreement upon an appraisal, the other
party was absolved."
The Lowe and Grosvenor cases announce the rule we have
stated, viz., that when the arbitrators have failed to agree,
or when one party refuses to proceed in conformity with the
contract, the court, at the instance of the innocent party, will
determine the question of value. We do not deem it necessary
to follow counsel for the respondent in the discussion of
the technical differences in meaning between the words
"renew" and "extend." The appellant gave the requisite notice,
and its right to hold for the extended term thereby became
fixed. The only matter left for determination was the
appraisement of the rental value of the property. We think
that the respondent's attitude upon that question has been
such that the rights of the appellant can only be protected by
NORTH COAST R. CO. v. KRAFT CO. 261
Apr. 1911 Opinion Per GOSE, J.
adhering to the view that the rent provided in the lease
continued for the renewal term. Aside from the lease and the
circumstances of the collection of the rent and the delay of
the respondent, there was no competent evidence before the
court upon the question of the rental value of the property on
January 1, 1909.
Evidence was admitted, over the objection of the respondent,
showing the expense of moving the machinery, stock, and
fixtures to a new place of business, the damages to the same
resulting from the removal, and the value of the fixtures lost
because not removable. These items were not allowed as
specific or independent damages. The refusal to allow them
is assigned as error. 2 Lewis on Eminent Domain (3d ed.),
SS 728, says:
"But the damages to personal property, or the expense of
removing it from the premises, cannot be considered in
estimating the compensation to be paid."
A large number of cases are cited as supporting the text.
In Pause v. Atlanta, 98 Ga. 92, 26 S.E. 489, the rule
announced by Mr. Lewis was applied to the owner of a leasehold
in real estate. The court said:
"The measure of her damages is the injury to her property
which is injuriously affected by the public improvement. In
arriving at that damage, neither the profits of the business
conducted on the premises, nor the cost to the tenant of
fixtures and improvements placed therein, nor the articles
purchased for the purpose of enabling the lessee to conduct the
business, nor diminution in the value of fixtures, improvements,
or articles such as are removed by the lessee, can be
recovered as damages, but the increased value of the premises
for rent in consequence of the putting in of such fixtures and
improvements may properly be considered in computing the
damages to the leasehold estate."
"Injury to business, loss of profits, inconvenience to the
owner, damages to personal property or the expense of
removing it, are not to be estimated as distinct elements of
262 NORTH COAST R. CO. v. KRAFT CO.
Opinion Per GOSE, J. 63 Wash.
damages." St. Louis, K & N.W.R. Co. v. Knapp-Stout
Co., 160 Mo. 396, 61 S.W. 300.
See, also, Cook & Rathborne Co. v. Sanitary Dist. of Chicago,
177 Ill. 599, 52 N.E. 870.
We think the evidence was admissible, not as a basis for a
specific claim, but as showing the value of the unexpired term.
Schuykill River E.S.R. Co. v. Kersey (Pa.), 19 Atl. 553;
Braun v. Metropolltan West Side El. R. Co., 166 Ill. 434,
46 N.E. 974; McMillin Printing Co. v. Pittsburg etc. R. Co.,
216 Pa. St. 504, 65 Atl. 1091; Metropolitan West Side El.
R. Co. v. Siegel, 161 Ill. 638, 44 N.E. 276. The appellant
relies upon the following cases: Patterson v. Boston, 23
Pick. 425; Jacksonville & S.E.R. Co. v. Walsh, 106 Ill. 253:
Commissioners of Parks and Boulevards v. Moesta, 91 Mich.
149, 51 N.W. 903; Grand Rapids etc. R. Co. v. Weiden,
69 Mich. 572, 37 N.W. 872; Philadelphia & R.R. Co. v.
Getz, 113 Pa. St. 214, 6 Atl. 356. These cases support the
contention that such losses are recoverable. "Damages" in
law, means an adequate compensation for the loss suffered or
the injury sustained. The rule itself is well settled and
simple of statement, but its application is often attended with
difficulty, on account of the great diversity of circumstances
surrounding different cases where the principle is sought to
be applied. As was said in Seattle & M.R. Co. v. Scheike.
3 Wash. 625, 29 Pac. 217, 30 Pac. 503:
"It is difficult, if not impossible, to lay down a rule of
universal application as to what may be considered as elements
of damage, as the equities of the parties must more or less
depend upon the particular facts and circumstances of each
case."
This is particularly true as applied to a leasehold which
may have no market value in excess of the rent reserved. The
appellant is entitled to be paid the value of the unexpired
term. The items under consideration are but constituent
elements of that value. In principle, and according to what
we consider the better authority, they are not recoverable as
NORTH COAST R. CO. v. KRAFT CO. 263
Apr. 1911 Opinion Per GOSE, J.
something apart from the leasehold interest. They form an
essential part of its value. There is a material conflict in
the evidence offered by the respective parties. The court
could have found the rental for the remainder of the term
either more or less than $425 per month, and the finding
would have had abundant support in the evidence. The
court saw the witnesses in action and viewed the premises, and
we are not disposed to disturb the finding as to rental value
for the unexpired term.
The appellant's contention that evidence should have been
admitted as to the rental value of the unexpired term,
measured by "the highest and best use" of the premises, cannot be
sustained. It is correct as a general principle. The lease,
however, limits the appellant's use to "wholesale, retail, and
manufacturing harness and saddlery or similar business." It
further prohibits the use of the premises for certain specific
purposes. The question for the court to determine, and the
one which it did determine, was the value of the leasehold for
the unexpired term, in view of the restrictive clause in the
lease.
Error is assigned in the admission and exclusion of certain
testimony respecting adjoining property owned by the
respondent and the use to which it would be devoted. The court
gave both parties wide latitude in presenting the facts
tending to show the value of the leasehold. The case was tried to
the court, and as we have said, the finding as to the value of
the unexpired term is supported by competent evidence.
The judgment is reversed, with directions to enter a
judgment in favor of appellant for a sum equal to the difference
between $175 and $425 per month for the remainder of the
term, plus the $80, loss of profits.
DUNBAR, C.J., PARKER, and MOUNT, JJ., concur.