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Isbey v. Crews

Filed: December 1, 1981.


Appeal by defendants from Israel, Judge. Summary judgment for plaintiffs in the amount of $2,867.33 entered 16 March 1981 in District Court, Buncombe County. Heard in the Court of Appeals on 22 October 1981.

Hedrick, Judge. Judges Clark and Martin (Harry C.) concur.


Defendants assign as error the court's entry of summary judgment. Summary judgment is properly entered if there is no genuine issue of material fact, Branch Banking & Trust Co. v. Creasy, 301 N.C. 44, 269 S.E.2d 117 (1980), but a motion for summary judgment must be denied if there is such an issue of fact. Dendy v. Watkins, 288 N.C. 447, 219 S.E.2d 214 (1975). An issue of fact is material, for the purpose of determining whether a motion for summary judgment should be denied, if the facts as alleged

would constitute a legal defense or would affect the result of the action or would prevent the party against whom it is resolved from prevailing in the action. City of Thomasville v. Lease-Afex, Inc., 300 N.C. 651, 268 S.E.2d 190 (1980). In the present case, defendants argue that there were two issues of material fact which should have precluded summary judgment.

Defendants first argue that there was an issue of material fact as to whether plaintiffs unreasonably refused to consent to the sublease proposed by defendants. Defendants contend this issue is material because an unreasonable refusal would constitute a material breach, by plaintiffs, of the lease agreement and would thereby entitle defendants to terminate the lease and their obligations to pay rent thereunder. Defendants would have us read into the lease agreement an obligation on the part of the lessor not to unreasonably withhold consent to a subtenant proposed by the lessee.

A tenant for an estate for years, however, may be absolutely barred from transferring his term by either assignment or sublease if there is an express covenant in the lease forbidding assignments and subletting. J. Webster, Real Estate Law in North Carolina ยง 70 (1971); Rogers v. Hall, 227 N.C. 363, 42 S.E.2d 347 (1947). A fortiori, a tenant may be subjected to a lesser restraint than an absolute prohibition on alienation, to wit, an express covenant which allows the tenant to transfer his term if he receives the lessor's consent, but which bars the tenant from such a transfer if the lessor reasonably or unreasonably withholds his consent. The lease in the present case contains such an express restraint, forbidding the lessee from alienating the premises "without the written consent of the lessor;" nowhere did the lease state that such consent would not be unreasonably withheld. If it had, the lessor's withholding of consent could not be based on arbitrary considerations of personal taste, sensibility, or convenience, however honest the judgment. Jones v. Andy Griffith Products, Inc., 35 N.C. App. 170, 241 S.E.2d 140, disc. rev. denied, 295 N.C. 90, 244 S.E.2d 258 (1978). The lessor plaintiffs in the present case, however, did not relinquish their rights to exert their own subjective criteria in deciding who could or could not be subtenants. A court does not insert terms into a contract when the parties elected to omit such terms, Taylor v. Gibbs, 268 N.C. 363,

150 S.E.2d 506 (1966), and we will not here insert a requirement that the lessor not unreasonably withhold his consent.

The case of Sanders v. Tropicana, 31 N.C. App. 276, 229 S.E.2d 304 (1976) is distinguishable. Sanders held that the Board of Directors of a cooperative apartment could not unreasonably withhold its consent under a contract which restrained a tenant-shareholder from transferring his lease and stock subscription without the Board's consent. The Court's imposition of a "reasonableness" limitation on the Board's discretion may be attributed to the fact that Sanders involved the alienability of corporate stock as well as a leasehold, the Court noting at 281, 229 S.E.2d at 308 that "[r]estraints on alienation of coprorate stock in the form of consent requirements are generally disfavored." Restrictions on the alienability of corporate stock, however, are not at issue in the present case, and therefore Sanders, which centered more around such restrictions than on restraints on the alienability of leaseholds, is not apposite.

We hold, therefore, that the record discloses that the defendants breached their agreement with plaintiffs when they refused to make the rental payment which fell due on 17 September 1980, and plaintiffs are entitled as a matter of law to recover damages for such breach.

Defendants argue there is a genuine issue of material fact as to the amount of damages plaintiffs are entitled to recover for any breach. This argument presents the question of how damages are to be computed when a tenant abandons the leased premises and fails to pay rent therefor, in breach of the lease, and the lease agreement contemplates, as here, that the premises will be occupied by a specific type of tenant and will be put exclusively to a specific kind of use. In computing breach of contract damages,

the general rule is that a party who is injured by breach of contract is entitled to compensation for the injury sustained and is entitled to be placed, as near as this can be done in money, in the same position he would have occupied if the contract had been performed. Stated generally, the measure of damages for the breach of a contract is the amount which would have been received if the contract had been performed as made, which ...

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