Gold Mining & Water Co. v. Swinerton

In Gold Mining & Water Co. v. Swinerton, (1943) 23 Cal.2d 19, the lessor and lessees entered into a mining lease requiring the lessees to restore, maintain, and repair the water system. The lessees failed to restore and repair the water system before repudiating the lease (id. at pp. 23-24), and the California Supreme Court upheld an award of repair costs to the lessor (id. at p. 43). The court expressed the rule that after expiration or termination of the lease, the landlord may recover cost of repair damages for the tenant's breach of maintenance and repair covenants. (Id. at pp. 37-38.) Quoting 32 American Jurisprudence, Landlord and Tenant, section 801, the court recognized the general rule that injury to the reversion is the measure of damages when the lease has not expired or been terminated: " 'Where, during the continuance of the tenancy, the landlord brings an action for the breach of a covenant to repair by the tenant, the measure of damages is generally held to be the amount by which the reversion is injured on account of the property being out of repair. It would not be fair or just, particularly where the lease has a long time to run, to take the amount necessary to put the premises into repair as the measure of the damages; for in such cases, when the damages are awarded to the landlord, he is not bound to expend them in repairs, nor can he do so without the tenant's permission to enter on the premises.' " (Gold Mining, supra, at pp. 37-38.) Although the lease had not expired or been terminated, the lessees had repudiated it. Therefore, the Gold Mining court concluded: "In the case of a mining lease such as is here involved, where there has been a failure to perform and a repudiation by the lessees, the rule to be applied should be the same as where the term has expired; that is, the lessor is entitled to recover the reasonable cost of the improvements or repairs which the lessees agreed to make under the terms of the lease." (Id. at p. 38.) Gold Mining endorses the rule that a landlord may recover cost of repair damages only in a lawsuit brought after the lease has expired or been terminated; before then, the landlord's damages are limited to the amount of injury to the reversion. The Gold Mining court permitted the lessor to recover the cost of repair only because the lessees had repudiated the lease, in effect terminating it. (Gold Mining, supra, 23 Cal.2d at p. 38.)