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Roy S. Oakes v. Harry Lane Nissan, Inc.
Citation: Not availableDocket: 03A01-9609-CH-00302
Court: Court of Appeals of Tennessee; August 17, 2004; Tennessee; State Appellate Court
Original Court Document: View Document
In the Court of Appeals of Tennessee, the case involves plaintiff Roy S. Oakes and defendant Harry Lane Nissan, Inc., concerning a lease breach. The trial court awarded Oakes $25,000 in damages, which Nissan is appealing, primarily questioning the damage award's validity. Oakes leased property in Morristown, Tennessee, to Nissan for five years at $1,500 monthly, stipulating that Nissan maintain the premises and return them in good condition upon lease termination. Nissan operated a dealership until 1991, after which the property remained mostly vacant. Testimonies indicated significant deterioration of the property, contrasting its well-maintained state at the lease's start. Notable damages included grease-stained rugs, missing restroom fixtures, a dismantled alarm system, and water damage. The appellate court reviews damage awards de novo, presuming the trial court's findings are correct. Nissan contends that the damages were inadequately substantiated and that the trial court failed to factor in property depreciation when calculating replacement costs. Plaintiff's recovery is contested by the defendant on the grounds that the plaintiff had a duty to mitigate damages after noticing ceiling leaks during a property visit in 1991. The defendant asserts that the plaintiff could have invoked Section Nine of the lease to regain possession and prevent further damage but failed to act for several years. As a result, the defendant argues that the plaintiff should not be entitled to the higher repair costs incurred at the end of the lease. The standard for mitigation requires reasonable care, supported by case law (Cummins v. Brodie; Hailey v. Cunningham). The Trial Court found the plaintiff's claims credible regarding his notifications to the defendant's staff about the leaks and the need for repairs. This finding carries a presumption of correctness, which the defendant's testimony did not overcome. The plaintiff's request for roof repairs was deemed reasonable, given compliance with other lease covenants and a presumption that the defendant would address the issues. The Trial Court acknowledged the duty to mitigate in determining damages and concluded that the evidence supported its assessment. The measure of damages for breach of the covenant to repair is the reasonable cost of restoring the premises, considering depreciation. The Court awarded $25,000 in damages, factoring in a reduced hourly labor rate, the remaining lifespan of the old roof, and avoided granting a windfall for the new roof by limiting damages to two-fifths of its cost. Depreciation for the missing awning resulted in an award of one-third of its cost, and the assessment for interior painting was notably lower than its total cost. The judgment of the Trial Court is affirmed, with the appeal costs assigned to the appellant.