No. 53213-8-IThe Court of Appeals of Washington, Division One.
Filed: January 18, 2005 UNPUBLISHED OPINION
Appeal from Superior Court of King County. Docket No. 03-2-23408-7. Judgment or order under review. Date filed: 09/25/2003. Judge signing: Hon. Palmer Robinson.
Counsel for Appellant(s), Stephen Cummings Kelly, Kelly
Associates, 11000 NE 33rd Pl Ste 300, Bellevue, WA 98004-1441.
Counsel for Respondent(s), Athan Emmanuel Tramountanas, Preston Gates Ellis LLP, 925 4th Ave Ste 2900, Seattle, WA 98104-1158.
PER CURIAM
Kelly Associates, P.S. failed to pay rent and, before expiration of its lease with LHT Corporation, vacated its offices. LHT sued Kelly for breach of lease and, on summary judgment, won damages for the amount Kelly failed to pay. The court reduced the damages by the rent paid by a new tenant during the term of Kelly’s lease. Kelly appeals, claiming that the trial court should also credit it with the new tenant’s rent for the period after Kelly’s lease expired. We affirm, and also award attorney fees and costs to LHT.
I.
Kelly Associates, P.S. leased commercial space from LHT Corporation. Although the lease did not expire until July 31, 2003, Kelly stopped paying rent and other charges in December 2002, and vacated the premises on or about March 31, 2003. From December to the end of the lease, Kelly was obligated to pay $4,216.67 per month.
LHT then leased the premises to Mahadeep Virk, who took possession and started paying rent on or about April 1, 2003. Virk’s lease was for two years with a $2,875 monthly payment for the first year. Virk declared that he would not have considered moving his offices downtown if Kelly had not provided an office space with a telephone switch, internet connection, and `virtually all the furniture (conference room table and chairs, two office desks, office chairs, fax machine, reception station, two partition work stations and custom book shelves) and the kitchen appliances (microwave and refrigerator).’ Virk also explained that it was an associate in Kelly’s office that recruited him, not LHT or LHT’s property management company, GVA Kidder Mathews Property Services.
LHT did not make an agreement to pay Kelly for leaving furniture on the premises, nor did LHT agree to pay Kelly brokerage fees or a commission for assistance in finding a new tenant.
LHT sued Kelly for (1) unpaid rent from January 1, 2003 through March 31, 2003; (2) the amount of unpaid rent from April 1, 2003 through July 31, 2003 less the amount LHT received from Virk for that period; and (3) attorney fees and interest. Kelly appeals summary judgment in favor of LHT.
II.
We review an order granting summary judgment de novo and engage in the same inquiry as the trial court.[1] Under CR 56(c), a trial court may grant a summary judgment `if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.’[2] Kelly challenges only the trial court’s decision to not reduce the damages by the amount of rent paid by Virk after the expiration date of Kelly’s lease. Kelly argues that under Hargis v. Mel-Mad Corporation,[3] the court should apply equitable principles to credit Kelly for its efforts that benefit LHT beyond what LHT would have received had Kelly merely fulfilled its obligation in the lease.
Kelly misconstrues the ruling in Hargis. In Hargis, a new tenant leased property that had been abandoned before the expiration of the lease by the defendant.[4] The defendant claimed that it was entitled to a setoff because the rent from the new tenant exceeded the plaintiff’s loss as a result of the abandonment.[5] But the court decided not to apply the rule that `gains accruing to the injured party . . . that would not have occurred but for [the] breach constitute a windfall and should be deducted from the amount the injured party would otherwise recover.’[6]
The court reasoned that (1) the amount of damages owed by the tenant already were mitigated by the new tenant’s rent payments for the remainder of the breaching tenant’s lease term; (2) crediting the breaching tenant’s obligation to pay was unfair because the possibility of the landlords receiving future rent was speculative; (3) `the landlord should not be made to bear immediate out-of-pocket losses, while the receipt of the new rent, even assuming the new tenant does not breach, is years away;’ and (4) `[i]f there is an inequity that, by virtue of the facts of this case, must fall on either of the parties, we have decided that it should fall on the party who breached the lease.’[7]
Like the breaching tenant in Hargis, the damages owed by Kelly were mitigated by Virk’s rent payments for the remainder of Kelly’s lease term. LHT’s possibility of receiving Virk’s future rent payments is speculative. LHT should not be forced to bear immediate out-of-pocket losses. And if there is an inequity that must fall on one of the parties, it should fall on the party who breached the lease.
Moreover, nothing in the law or in the lease creates an obligation on LHT’s part to compensate Kelly for acquiring a tenant. Kelly offers no legal authority for the creation of such an obligation. The lease contains no language from which such an obligation could be inferred.
LHT requests attorney fees under RAP 18.1. Because a provision in the lease provides for the payment of attorney fees by the losing party in litigation for the recovery of rent, we grant reasonable attorney fees to LHT for this appeal.
AFFIRMED.
BAKER, J., BECKER, J. and ELLINGTON, A.C.J., concur.
(1982).