B-38290, JANUARY 1, 1944, 23 COMP. GEN. 477

B-38290, JANUARY 1, 1944, 23 COMP. GEN. 477

LEASES - LIABILITY FOR DAMAGE DUE TO GOVERNMENT EMPLOYEE'S NEGLIGENCE THE ACCEPTANCE BY THE GOVERNMENT OF A PROPOSAL OFFERING TO LEASE SPACE FOR USE OF THE POST OFFICE DEPARTMENT AT A SPECIAL ANNUAL RENTAL, SUBJECT TO THE FORM OF LEASE USED BY THE POST OFFICE DEPARTMENT, RESULTS IN A BINDING CONTRACT OBLIGATING BOTH PARTIES TO PERFORM IN ACCORDANCE THEREWITH, EVEN THOUGH THE STANDARD FORM GOVERNMENT LEASE AS MODIFIED FOR USE BY THE POST OFFICE DEPARTMENT HAS NOT BEEN EXECUTED ON BEHALF OF THE GOVERNMENT. WHERE, UNDER A LEASE FOR THE RENTAL OF PREMISES BY THE POST OFFICE DEPARTMENT EXPRESSLY RELIEVING THE LESSOR OF RESPONSIBILITY FOR REPAIRING DAMAGE CAUSED BY NEGLIGENCE OF GOVERNMENT EMPLOYEES, THE HEATING PLANT ON THE PREMISES WAS DAMAGED BEYOND REPAIR WITHIN THE LEASE TERM THROUGH NEGLIGENCE OF A GOVERNMENT EMPLOYEE, IT IS INCUMBENT UPON THE GOVERNMENT TO EFFECT INSTALLATION OF A NEW HEATING PLANT WITHOUT EXPENSE OR CONTRIBUTION FROM THE LESSOR, EVEN THOUGH THE PLANT AT THE TIME OF DESTRUCTION WAS FORTY PERCENT DEPRECIATED, IF IT BE ADMINISTRATIVELY DETERMINED THAT A NEW HEATING PLANT IS REQUIRED TO HEAT THE PREMISES DURING THE REMAINDER OF THE LEASE TERM.

COMPTROLLER GENERAL WARREN TO THE POSTMASTER GENERAL, JANUARY 1, 1944:

REFERENCE IS MADE TO LETTER OF OCTOBER 20, 1943 ( Q-CA-MF), FROM THE FOURTH ASSISTANT POSTMASTER GENERAL, AS FOLLOWS:

THERE IS TRANSMITTED A FILE OF SELF-EXPLANATORY CORRESPONDENCE CONCERNING THE LEASING OF QUARTERS FOR THE POST OFFICE GARAGE AT DENVER, COLORADO.

IT WILL BE NOTED THAT A CONTRACT TO RE-LEASE THE PREMISES WAS ENTERED INTO WITH MISS FAY E. CURRAN, THAT PAYMENT OF RENTAL WAS AUTHORIZED UNDER THE CONTRACT, AND THAT A FORMAL LEASE WAS DRAWN AND EXECUTED BY THE LESSOR. HOWEVER, IT APPEARS THAT DURING THE PERIOD OF THE CONTRACT IN QUESTION, THE HEATING PLANT WAS DAMAGED BY A POSTAL EMPLOYEE WHICH WILL NECESSITATE EITHER THE INSTALLATION OF A NEW PLANT OR THE PROVISION OF EMERGENCY REPLACEMENTS OF BOILER SECTIONS, ET CETERA. FOR THE DETAILS IN THIS REGARD, PARTICULAR ATTENTION IS INVITED TO THE COPY OF THE REPORT OF INSPECTOR CLARK DATED OCTOBER 2, 1943.

THE DEPARTMENT HAS NOT EXECUTED THE LEASE FOR REASONS SET FORTH IN THE LETTER TO THE POSTMASTER AT DENVER DATED SEPTEMBER 24, 1943. IT DOES NOT PROPOSE TO EXECUTE THE FORMAL LEASE UNTIL THE LETTER DATED SEPTEMBER 16, 1943, WRITTEN BY THE ATTORNEY FOR THE LESSOR, IS WITHDRAWN, AND IT APPEARS FROM THE PAPERS THAT SUCH WITHDRAWAL IS CONTINGENT UPON SETTLEMENT OF THE MATTER RELATING TO DAMAGE TO THE HEATING PLANT.

IN THE MEANTIME, PAYMENT OF RENTAL HAS BEEN SUSPENDED AND THE OWNER, THROUGH HER ATTORNEY, IS REQUESTING EXPEDITIOUS ACTION. A SUGGESTED METHOD OF SETTLEMENT WAS OUTLINED IN THE DEPARTMENT'S LETTER OF OCTOBER 8, 1943, TO MR. WALTER W. BLOOD, WHICH AS WILL BE NOTED FROM MR. BLOOD'S REPLY DATED OCTOBER 12, 1943, THE SETTLEMENT PROPOSED HAS NOT BEEN ACCEPTED.

IT APPEARS THAT THE DAMAGE TO THE HEATING PLANT WAS THE FAULT OF A GOVERNMENT EMPLOYEE AND THAT THE REPAIR WORK AND REPLACEMENTS REQUIRED ARE NOT IN THE NATURE OF REPAIRS SUCH AS ARE TO BE BORNE BY THE LESSOR UNDER THE PROVISIONS OF THE CONTRACT IN FORCE. HOWEVER, THE DEPARTMENT DOES NOT SUBSCRIBE TO THE VIEW OF THE ATTORNEY THAT IT IS INCUMBENT UPON THE DEPARTMENT TO FURNISH A NEW HEATING PLANT OR THE REQUIRED NEW PARTS WITHOUT GETTING CREDIT FOR THE FACT THAT ANY SUCH MATERIALS FURNISHED NOW WILL REPLACE SIMILAR MATERIALS THE PROPERTY OF THE LESSOR, WHICH WERE 20 YEARS AND FIVE MONTHS OLD.

THE PAPERS ARE ACCORDINGLY REFERRED TO YOU FOR REVIEW AND IT WILL BE APPRECIATED IF YOU WILL FAVOR THE DEPARTMENT WITH AN EXPRESSION OF YOUR OPINION AS PROMPTLY AS POSSIBLE AS TO WHAT LEGAL SETTLEMENT WOULD BE PROPER SO THAT THE MATTER CAN BE SETTLED, THE LEASE COMPLETED AND RENTAL PAYMENTS RESTORED.

THE RECORD SHOWS THAT THE GARAGE BUILDING REFERRED TO IN THE FOURTH ASSISTANT POSTMASTER GENERAL'S LETTER, QUOTED ABOVE, WAS ERECTED SOME TIME DURING THE YEAR 1922; THAT THE HEATING PLANT WAS INSTALLED IN NOVEMBER 1922; AND THAT THE BUILDING HAS BEEN OCCUPIED UNDER VARIOUS LEASES BY THE GOVERNMENT SINCE JANUARY 1923, THE LAST LEASE DATED JUNE 27, 1938, AS EXTENDED, EXPIRING ON JANUARY 14, 1943. IT APPEARS THAT PRIOR TO THE EXPIRATION OF THE LAST LEASE THE FORMER LESSOR SUBMITTED A PROPOSAL DATED DECEMBER 5, 1942, OFFERING TO LEASE THE BUILDING FOR A NEW TERM OF 5 YEARS BEGINNING JANUARY 15, 1943, AT AN ANNUAL RENTAL OF $3,000 SUBJECT TO THE FORM OF LEASE USED BY THE POST OFFICE DEPARTMENT, AND TO FURNISH, AS PART OF THE RENTAL CONSIDERATION, PLUMBING, HEATING AND LIGHTING FIXTURES AND TO KEEP THE PREMISES IN GOOD REPAIR AND PROPER CONDITION, INCLUDING THE SAID PLUMBING, HEATING, AND LIGHTING FIXTURES; THAT THE OFFER WAS ACCEPTED BY THE FOURTH ASSISTANT POSTMASTER GENERAL ON FEBRUARY 4, 1943; AND THAT A FORMAL LEASE WAS DRAWN AND SUBMITTED TO MISS CURRAN FOR SIGNATURE. HOWEVER, IT APPEARS FURTHER THAT ON APRIL 10, 1943, BEFORE THE LEASE WAS SIGNED ON BEHALF OF THE GOVERNMENT, THE BOILER IN THE HEATING PLANT WAS DAMAGED WHEN A SPECIAL MECHANIC EMPLOYED IN THE GARAGE STARTED A FIRE IN THE FURNACE WITHOUT DETERMINING WHETHER THERE WAS SUFFICIENT WATER IN THE BOILER; THAT ABOUT HALF AN HOUR LATER THE SUPERINTENDENT ASKED THE SPECIAL MECHANIC IF THERE WAS PLENTY OF WATER IN THE BOILER WHEREUPON THE LATTER RETURNED TO THE BOILER ROOM AND TURNED COLD WATER INTO THE BOILER; THAT HE THEN OPENED THE VALVE TO SEE IF THERE WAS WATER BUT NO WATER RAN OUT AND ALMOST IMMEDIATELY THE BOILER BLEW UP CRACKING ALL NINE SECTIONS OF THE SAID BOILER. IN THE POSTAL INSPECTOR'S REPORT OF OCTOBER 2, 1943, IT IS STATED THAT THE INVESTIGATION DISCLOSED THAT FOR 10 DAYS OR 2 WEEKS PRIOR TO APRIL 10, 1943, THE DAY THE HEATING PLANT WAS DAMAGED, THE WEATHER WAS MILD AND AS NO HEAT WAS REQUIRED THE FIRE WAS ALLOWED TO GO OUT; THAT THERE HAD BEEN A LEAK IN ONE END OF THE BOILER, PROBABLY IN THE WATER JACKET, SOME TWO OR MORE YEARS AGO WHICH HAD BEEN REPAIRED BY A PLUMBER AT THE REQUEST OF THE LESSOR; THAT A SMALL LEAK REAPPEARED IN THE SAME PLACE DURING THE LAST HEATING SEASON BUT THAT IT SHOWED ONLY WHEN THE FIRE WAS OUT AND THE BOILER COLD; AND THAT THIS LEAK MAY HAVE BEEN RESPONSIBLE OR PARTIALLY RESPONSIBLE FOR THE DRAINING OF THE BOILER WHEN THE FIRE WAS ALLOWED TO GO OUT BUT THAT SAID LEAK HAD NO DIRECT CONNECTION WITH THE DAMAGE. THE POSTAL INSPECTOR EXPRESSED THE OPINION THAT THE DAMAGE TO THE HEATING PLANT WAS THE RESULT OF A CARELESS ACT ON THE PART OF THE SPECIAL MECHANIC IN MAKING A HOT FIRE WITHOUT DETERMINING WHETHER THERE WAS SUFFICIENT WATER IN THE BOILER AND THEN LATER TURNING COLD WATER INTO THE BOILER CAUSING IT TO BLOW UP. IT IS STATED FURTHER IN THE POSTAL INSPECTOR'S REPORT THAT REPRESENTATIVES OF FOUR HEATING COMPANIES WHO EXAMINED THE BOILER ROOM AFTER THE ACCIDENT ALL ADVISED THE SUPERINTENDENT THAT THE BOILER COULD NOT BE REPAIRED, EXCEPT FOR A SHORT EMERGENCY PERIOD, AND THAT IT WOULD HAVE TO BE REPLACED WITH A NEW BOILER; THAT THE MATTER WAS DISCUSSED WITH HEATING ENGINEERS OF RELIABLE COMPANIES AND REPRESENTATIVES OF LOCAL HEATING AND PLUMBING COMPANIES; THAT THEY ALL AGREED, INSOFAR AS IT WAS POSSIBLE TO ASCERTAIN, THAT THE BOILER HAD BEEN PRACTICALLY RUINED BY STARTING A HOT FIRE UNDER THE EMPTY BOILER AND THEN RUNNING COLD WATER INTO THE HOT BOILER; AND THAT THEY EXPRESSED THE OPINION THAT ANY REPAIRS WOULD BE SUCCESSFUL ONLY AS AN EMERGENCY MEASURE PROBABLY LASTING TO THE END OF THE PRESENT HEATING SEASON. ALSO, IT IS STATED IN THE POSTAL INSPECTOR'S REPORT THAT IT WAS GENERALLY AGREED THAT A BOILER OF THE TYPE INSTALLED IN THE GARAGE WOULD LAST AT LEAST 50 YEARS WITH PROPER CARE, BUT THAT IN THE PRESENT CONDITION THE BOILER HAD NO DEPENDABLE VALUE.

IN THE LETTER OF SEPTEMBER 16, 1943, FROM THE CONTRACTOR'S ATTORNEY, IT IS STATED AS FOLLOWS:

PURSUANT TO YOUR LETTERS OF SEPTEMBER 7TH AND SEPTEMBER 14TH, 1943, I AM SENDING YOU HEREWITH, IN FOUR COUNTERPARTS, THE LEASE SIGNED BY MISS FAY E. CURRAN, AS LESSOR, RELATING TO THE POST OFFICE GARAGE IN THIS CITY. MISS CURRAN HAS SIGNED THIS LEASE AND AUTHORIZED ME TO TRANSMIT THESE DOCUMENTS TO YOU UPON THE UNDERSTANDING, AND IF THE POSTAL AUTHORITIES SIGN THEM IT WILL BE UPON THE UNDERSTANDING, THAT MISS CURRAN WILL NOT BE OBLIGATED TO REPLACE OR REPAIR THE BOILER DAMAGED OR DESTROYED BY A GOVERNMENT AGENT OR EMPLOYEE, AS SET FORTH IN OUR LETTER OF AUGUST 20, 1943, TO YOU. IT IS MISS CURRAN'S POSITION THAT THE GOVERNMENT SHOULD RESTORE THE BOILER TO THE SAME GOOD CONDITION IF WAS IN BEFORE THE GOVERNMENT DAMAGED OR DESTROYED IT, AND SHOULD THE GOVERNMENT INSUFFICIENTLY RESTORE OR REPAIR IT WHEREBY IT MAY SUBSEQUENTLY BECOME DEFECTIVE DURING THE TERM OF THE LEASE THEN MISS CURRAN WILL REPUDIATE ALL LIABILITY OR OBLIGATION TO REMEDY IT AFTER SUCH INSUFFICIENT REPAIRS OR RESTORATION.

WHILE THE FACTS AS REPORTED BY THE POSTAL INSPECTOR SHOW THAT ABOUT TWO YEARS PRIOR TO THE EXPLOSION THERE WAS A LEAK IN THE BOILER WHICH WAS REPAIRED BY THE LESSOR AND THAT LATER THE LEAK REAPPEARED, YET, THERE IS NOTHING IN THE POSTAL INSPECTOR'S REPORT INDICATING THAT THE CONTRACTOR HAD BEEN REQUESTED TO MAKE REPAIRS OR THAT ANY COMPLAINT WAS MADE TO THE CONTRACTOR AS TO THE CONDITION OF THE HEATING FIXTURES. ALSO, WHILE THERE APPEARS NO EXPRESS PROVISION IN THE CONTRACT (PROPOSAL AND ACCEPTANCE) AS TO WASTE OR DAMAGE, NEVERTHELESS, IN A LEASING OF PROPERTY THERE ARISES, IN THE ABSENCE OF AN EXPRESS PROVISION OTHERWISE, AN IMPLIED OBLIGATION ON THE PART OF THE LESSEE TO SO USE THE PROPERTY AS NOT UNNECESSARILY TO INJURE IT--- THAT IS, AGAINST DAMAGE DUE TO THE WILLFUL OR NEGLIGENT CONDUCT OF THE LESSEE--- AND SUCH IMPLIED OBLIGATION IS A PART OF THE CONTRACT AS MUCH AS IF EXPRESSLY INCORPORATED INTO SAID CONTRACT. UNITED STATES V. BOSTWICK, 94 U.S. 53.

IN THIS PARTICULAR INSTANCE THE RECORD REASONABLE ESTABLISHES THAT THE DAMAGE TO THE BOILER WAS DUE TO THE NEGLIGENCE OF THE SPECIAL MECHANIC, A GOVERNMENT EMPLOYEE, AND WHILE IT IS STATED IN THE FOURTH ASSISTANT POSTMASTER GENERAL'S LETTER OF OCTOBER 20, 1943, QUOTED ABOVE, THAT THE POST OFFICE DEPARTMENT HAS NOT EXECUTED THE LEASE SIGNED BY THE LESSOR, THE ACCEPTANCE OF HER PROPOSAL RESULTED IN A BINDING CONTRACT AND OBLIGATED BOTH PARTIES TO PERFORM IN ACCORDANCE THEREWITH. UNITED STATES V. NEW YORK AND PORTO RICO STEAMSHIP COMPANY, 239 U.S. 88, AND UNITED STATES, V. PURCELL ENVELOPE COMPANY, 249, U.S. 313.

IT IS WELL ESTABLISHED THAT A LANDLORD IS NOT BOUND TO REPAIR IN THE ABSENCE OF A CONTRACT TO DO SO. LASKEY V. RUDMAN, 85 S.W.2D 501; MARDEN V. RADFORD, 84 S.W.2D 947; NEHRING V. FERGUSON, 40 PAC./25 1040; JOHNSTOWN MILLWORK AND LUMBER COMPANY V. VARNER, 177 ATL. 325. ALSO, IT HAS BEEN HELD THAT, IN THE ABSENCE OF AN AGREEMENT BY THE LANDLORD TO REPAIR, THE TENANT CANNOT RECOVER THE COST OF SUCH REPAIRS. POWELL V. BECKLEY, 56 N.W. 974; KING AND METZGER V. CASSELL ET AL., 150 S.W. 682. THERE IS NOTHING IN THE CONTRACTOR'S PROPOSAL OBLIGATING HER TO MAKE REPAIRS OR TO CONTRIBUTE TO THE COST OF REPAIRS ON ACCOUNT OF DAMAGES ARISING FROM THE NEGLIGENCE OF THE GOVERNMENT'S AGENTS OR EMPLOYEES. MOREOVER, THERE IS NOTHING INCONSISTENT WITH THE STATEMENTS IN THE LETTER OF SEPTEMBER 16, 1943, FROM THE CONTRACTOR'S ATTORNEY WITH RESPECT TO THE CONTRACTOR'S OBLIGATION FOR REPLACING OR REPAIRING THE DAMAGED HEATING PLANT AND HER OBLIGATIONS UNDER PARAGRAPH 7 OF THE STANDARD FORM GOVERNMENT LEASE AS MODIFIED FOR USE BY THE POST OFFICE DEPARTMENT. UNDER SAID PARAGRAPH 7 THE LESSOR EXPRESSLY IS RELIEVED OF RESPONSIBILITY FOR REPAIRING DAMAGE CAUSED BY THE NEGLIGENCE OF THE GOVERNMENT'S AGENTS AND EMPLOYEES.

ACCORDINGLY, IF IT BE ADMINISTRATIVELY DETERMINED THAT A NEW HEATING PLANT OR NINE NEW BOILER SECTIONS ARE REQUIRED TO HEAT THE QUARTERS FOR THE PURPOSES LEASED FOR THE REMAINDER OF THE TERM IT WILL BE INCUMBENT UPON THE GOVERNMENT TO EFFECT THE INSTALLATION WITHOUT ANY EXPENSE OR CONTRIBUTION FROM THE LESSOR, NOTWITHSTANDING IT IS ESTIMATED THAT AT THE TIME THE HEATING PLANT WAS DAMAGED SAID HEATING PLANT WAS 40.8 PERCENT DEPRECIATED. ALSO, RENTAL PAYMENTS MAY BE MADE TO THE LESSOR AT THE RATE STIPULATED IN THE LEASE, IF OTHERWISE PROPER.