{ "id": 8526332, "name": "MARINA FOOD ASSOCIATES, INC., and S. N. McKENZIE, Plaintiffs v. MARINA RESTAURANT, INC., CONVA P. KERSEY, ENRIQUE PAULA and ROBERT P. CORBETT, JR., and BENSON MARINE GROUP, INC., Defendants", "name_abbreviation": "Marina Food Associates, Inc. v. Marina Restaurant, Inc.", "decision_date": "1990-08-21", "docket_number": "No. 895SC1181", "first_page": "82", "last_page": "95", "citations": [ { "type": "official", "cite": "100 N.C. App. 82" } ], "court": { "name_abbreviation": "N.C. Ct. App.", "id": 14983, "name": "North Carolina Court of Appeals" }, "jurisdiction": { "id": 5, "name_long": "North Carolina", "name": "N.C." }, "cites_to": [ { "cite": "279 S.E.2d 356", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1981, "opinion_index": 0 }, { "cite": "302 N.C. 402", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8567083, 8567051, 8567132, 8567023 ], "year": 1981, "opinion_index": 0, "case_paths": [ "/nc/302/0402-03", "/nc/302/0402-02", "/nc/302/0402-04", "/nc/302/0402-01" ] }, { "cite": "272 S.E.2d 11", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1980, "opinion_index": 0 }, { "cite": "49 N.C. App. 516", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8522434 ], "year": 1980, "opinion_index": 0, "case_paths": [ "/nc-app/49/0516-01" ] }, { "cite": "351 S.E.2d 745", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 5, "year": 1987, "pin_cites": [ { "parenthetical": "fair market value defined as price a willing buyer would pay a seller willing, but not compelled, to sell" }, { "parenthetical": "citations omitted" } ], "opinion_index": 0 }, { "cite": "318 N.C. 693", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4732995, 4738084, 4734606, 4737813, 4737018 ], "year": 1987, "pin_cites": [ { "parenthetical": "fair market value defined as price a willing buyer would pay a seller willing, but not compelled, to sell" } ], "opinion_index": 0, "case_paths": [ "/nc/318/0693-05", "/nc/318/0693-04", "/nc/318/0693-03", "/nc/318/0693-02", "/nc/318/0693-01" ] }, { "cite": "348 S.E.2d 153", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1986, "opinion_index": 0 }, { "cite": "82 N.C. App. 692", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8359710 ], "year": 1986, "opinion_index": 0, "case_paths": [ "/nc-app/82/0692-01" ] }, { "cite": "265 S.E.2d 395", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1980, "opinion_index": 0 }, { "cite": "299 N.C. 328", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8574530, 8574467, 8574508, 8574447, 8574489 ], "year": 1980, "opinion_index": 0, "case_paths": [ "/nc/299/0328-05", "/nc/299/0328-02", "/nc/299/0328-04", "/nc/299/0328-01", "/nc/299/0328-03" ] }, { "cite": "260 S.E.2d 146", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1979, "opinion_index": 0 }, { "cite": "43 N.C. App. 648", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8553996 ], "year": 1979, "opinion_index": 0, "case_paths": [ "/nc-app/43/0648-01" ] }, { "cite": "47 S.E. 47", "category": "reporters:state_regional", "reporter": "S.E.", "year": 1904, "opinion_index": 0 }, { "cite": "134 N.C. 540", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 11273565 ], "year": 1904, "opinion_index": 0, "case_paths": [ "/nc/134/0540-01" ] }, { "cite": "278 S.E.2d 501", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1981, "opinion_index": 0 }, { "cite": "303 N.C. 256", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8572768 ], "year": 1981, "opinion_index": 0, "case_paths": [ "/nc/303/0256-01" ] }, { "cite": "139 S.E.2d 362", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1964, "opinion_index": 0 }, { "cite": "263 N.C. 139", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8568256, 8568203 ], "year": 1964, "opinion_index": 0, "case_paths": [ "/nc/263/0139-02", "/nc/263/0139-01" ] }, { "cite": "90 S.E.2d 228", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1955, "opinion_index": 0 }, { "cite": "243 N.C. 131", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8621927 ], "year": 1955, "opinion_index": 0, "case_paths": [ "/nc/243/0131-01" ] }, { "cite": "302 S.E.2d 271", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1983, "opinion_index": 0 }, { "cite": "62 N.C. App. 31", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8520087 ], "year": 1983, "opinion_index": 0, "case_paths": [ "/nc-app/62/0031-01" ] }, { "cite": "332 S.E.2d 186", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "opinion_index": 0 }, { "cite": "76 N.C. App. 1", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8526521 ], "year": 1985, "opinion_index": 0, "case_paths": [ "/nc-app/76/0001-01" ] }, { "cite": "146 S.E.2d 97", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1966, "opinion_index": 0 }, { "cite": "266 N.C. 214", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8560019 ], "year": 1966, "opinion_index": 0, "case_paths": [ "/nc/266/0214-01" ] }, { "cite": "35 S.E.2d 240", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1945, "opinion_index": 0 }, { "cite": "225 N.C. 421", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8610306 ], "year": 1945, "opinion_index": 0, "case_paths": [ "/nc/225/0421-01" ] }, { "cite": "323 S.E.2d 923", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "opinion_index": 0 }, { "cite": "312 N.C. 622", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4755493, 4755336, 4753483, 4753324, 4752111 ], "year": 1984, "opinion_index": 0, "case_paths": [ "/nc/312/0622-01", "/nc/312/0622-05", "/nc/312/0622-03", "/nc/312/0622-04", "/nc/312/0622-02" ] }, { "cite": "319 S.E.2d 290", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "opinion_index": 0 }, { "cite": "70 N.C. App. 303", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521768 ], "year": 1984, "opinion_index": 0, "case_paths": [ "/nc-app/70/0303-01" ] }, { "cite": "334 S.E.2d 514", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1985, "opinion_index": 0 }, { "cite": "77 N.C. App. 209", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8521302 ], "year": 1985, "opinion_index": 0, "case_paths": [ "/nc-app/77/0209-01" ] }, { "cite": "326 S.E.2d 601", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1985, "opinion_index": 0 }, { "cite": "313 N.C. 33", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 4719700 ], "year": 1985, "opinion_index": 0, "case_paths": [ "/nc/313/0033-01" ] }, { "cite": "231 S.E.2d 678", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1977, "opinion_index": 0 }, { "cite": "291 N.C. 666", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8558910 ], "year": 1977, "opinion_index": 0, "case_paths": [ "/nc/291/0666-01" ] }, { "cite": "N.C. Gen. Stat. \u00a7 55-119", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 1982, "opinion_index": 0 }, { "cite": "N.C. Gen. Stat. \u00a7 55-54", "category": "laws:leg_statute", "reporter": "N.C. Gen. Stat.", "year": 1982, "pin_cites": [ { "parenthetical": "emphasis supplied" } ], "opinion_index": 0 }, { "cite": "321 S.E.2d 537", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "opinion_index": 0 }, { "cite": "71 N.C. App. 113", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8524116 ], "year": 1984, "opinion_index": 0, "case_paths": [ "/nc-app/71/0113-01" ] }, { "cite": "370 S.E.2d 416", "category": "reporters:state_regional", "reporter": "S.E.2d", "weight": 2, "year": 1988, "opinion_index": 0 }, { "cite": "322 N.C. 607", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 2513344, 2514721, 2514790, 2518795, 2515646 ], "year": 1988, "opinion_index": 0, "case_paths": [ "/nc/322/0607-02", "/nc/322/0607-04", "/nc/322/0607-05", "/nc/322/0607-01", "/nc/322/0607-03" ] }, { "cite": "361 S.E.2d 608", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1987, "opinion_index": 0 }, { "cite": "87 N.C. App. 438", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8358525 ], "year": 1987, "opinion_index": 0, "case_paths": [ "/nc-app/87/0438-01" ] }, { "cite": "315 S.E.2d 728", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1984, "opinion_index": 0 }, { "cite": "68 N.C. App. 655", "category": "reporters:state", "reporter": "N.C. App.", "case_ids": [ 8527787 ], "year": 1984, "opinion_index": 0, "case_paths": [ "/nc-app/68/0655-01" ] }, { "cite": "173 S.E.2d 281", "category": "reporters:state_regional", "reporter": "S.E.2d", "year": 1970, "opinion_index": 0 }, { "cite": "276 N.C. 487", "category": "reporters:state", "reporter": "N.C.", "case_ids": [ 8561836 ], "year": 1970, "opinion_index": 0, "case_paths": [ "/nc/276/0487-01" ] } ], "analysis": { "cardinality": 1099, "char_count": 33434, "ocr_confidence": 0.748, "pagerank": { "raw": 4.246998140024194e-07, "percentile": 0.9149162750415178 }, "sha256": "6c8a83018b5afeee66ee2c8df2974b2cf27be186de3926c2d6bec388b6b469a3", "simhash": "1:9dcfc8901efc1ac6", "word_count": 5418 }, "last_updated": "2023-07-14T14:37:10.855162+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [ "Judges Parker and Duncan concur." ], "parties": [ "MARINA FOOD ASSOCIATES, INC., and S. N. McKENZIE, Plaintiffs v. MARINA RESTAURANT, INC., CONVA P. KERSEY, ENRIQUE PAULA and ROBERT P. CORBETT, JR., and BENSON MARINE GROUP, INC., Defendants" ], "opinions": [ { "text": "WELLS, Judge.\nWe note at the outset that plaintiff has not brought forward and argued its single cross-assignment of error; it is therefore deemed abandoned pursuant to Rule 28(b)(5) of the N.C. Rules of Appellate Procedure.\nThe pertinent facts are as follows: In January 1981, plaintiff leased property from defendant Marina Restaurant (Marina) for the operation of a restaurant. The initial term of the lease ran from 1 January 1981 to 28 February 1982, and contained three renewal options allowing extensions of one year, three years, and five years. The lease provided for a minimum annual rent of $40,000. Shortly after plaintiff began operating the restaurant, the roof began leaking. Plaintiff was able to deal with the leaks by periodically patching the roof and making other necessary repairs, such as replacing ceiling tiles that were damaged due to the leaks. During this time plaintiff also purchased restaurant equipment and other fixtures and renovated the restaurant.\nDuring 1984 the leaking worsened and a series of discussions began between defendant Marina and plaintiff concerning the need to replace the roof. There was initial disagreement over who was obligated to replace the leaking roof. Over the course of 1985, conditions inside the restaurant deteriorated due to damage caused by the leaks. For this reason, plaintiff closed the restaurant in January 1986. Ultimately, defendant Marina had the roof replaced in March 1986.\nIn October 1985, Marina listed the restaurant property for sale. Plaintiff exercised its option to extend the lease for an additional five years in December 1985. Negotiations for the purchase of the property by Benson Marine Group began in January 1986.\nAfter replacing the roof in March 1986, defendant Marina notified plaintiff that it could reopen the restaurant. Prior to reopening, plaintiff arranged for the necessary building inspections. The results of the inspections were to the effect that the building could not be reopened until repairs were made to the restaurant\u2019s interior.\nPlaintiff brought this action in October 1986. On 22 December 1986 the sale of the property to Benson Marine Group was closed. At that time, all assets of defendant Marina were assigned to the shareholders, individual defendants in this action.\nIn this appeal defendants assign as error two evidentiary rulings, rulings allowing amendment of the pleadings, the instructions to the jury, the denial of their motions for directed verdict and for judgment notwithstanding the verdict. We find no error in the trial.\nDefendants\u2019 first two assignments of error concern evidentiary rulings made by the trial court. Defendants first contend that it was error to admit into evidence defendants\u2019 January 1986 offer of $150,000 to plaintiff to terminate the lease. In support of this contention defendants assert that the offer should have been excluded pursuant to N.C. Gen. Stat. \u00a7 8C, Rule 408 of the N.C. Rules of Evidence, or alternatively, pursuant to G.S. \u00a7 8C, Rule 402. We find these arguments to be without merit. First, Rule 408 does not apply unless there is an existing dispute when the offer \u201cto compromise a claim which [is] disputed\u201d is made. See, e.g., Wilson County Bd. of Ed. v. Lamm, 276 N.C. 487, 173 S.E.2d 281 (1970); Horton v. Goodman, 68 N.C. App. 655, 315 S.E.2d 728 (1984). In the present case a series of discussions concerning the leaking roof had taken place throughout most of 1985. By the fall of 1985, defendant Marina had apparently agreed to replace the roof but wanted a specific roofing company to do the work. Plaintiff had exercised its option to renew the lease for five more years and was planning to reopen the restaurant after the roof was replaced. Consequently, in late January 1986, there was no dispute concerning the repair or replacement of the roof and the $150,000 buy-out offer was therefore not an offer to settle or compromise a disputed claim. Prior to its offer to plaintiff, defendant Marina had accepted an offer to sell the restaurant property to Benson Marine Group for $1.1 million. When plaintiff rejected defendant Marina\u2019s buy-out offer, the purchase price of the property was reduced to $925,000. Bill Benson of Benson Marine Group acknowledged that $150,000 of the reduction in price was attributable to the value of the lease. (The remaining $25,000 difference was attributable to the cost of replacing the roof.) It is clear that the buy-out offer was an effort on the part of defendant Marina to satisfy a condition of the sale of the restaurant property to Benson Marine Group and was not violative of Rule 408. Finally, the admission of the offer is also not barred by Rule 402. The offer was evidence of the value of the lease and is therefore relevant to the issue of damages in this case.\nDefendants also assert that the trial court erred in admitting into evidence a letter from attorney Douglas Fox to the individual defendants and their accountant. Defendants contend that the letter was protected by the attorney-client privilege. We disagree. The attorney-client privilege extends only to confidential communications. A communication intended to be disclosed to a third party is not confidential. See 1 Brandis on North Carolina Evidence \u00a7 62 (3d ed. 1988). The letter in question was communicated to a third party and was therefore not a confidential communication protected by the attorney-client privilege. These assignments are therefore overruled.\nDefendants next assign error to the grant of plaintiffs motion, pursuant to N.C. Gen. Stat. \u00a7 1A-1, Rule 15 (1983) of the N.C. Rules of Civil Procedure, to amend its pleading to include breach of the implied covenant of quiet enjoyment and to clarify that the claim of conversion of personal property applied to these defendants as well as to Benson Marine Group. In order to conform the pleadings to the evidence and raise issues tried by the express or implied consent of the parties, G.S. \u00a7 1A-1, Rule 15(b) authorizes amendment of pleadings at any point in trial, even after judgment. Mosley & Mosley Builders, Inc. v. Landin Ltd., 87 N.C. App. 438, 361 S.E.2d 608 (1987), cert. dismissed, 322 N.C. 607, 370 S.E.2d 416 (1988). The trial court\u2019s ruling on such a motion is not reviewable absent an abuse of discretion. Id. In the present case plaintiff offered evidence in support of constructive eviction. If found, constructive eviction as a matter of law constitutes a breach of the implied covenant of quiet enjoyment. Dobbins v. Paul, 71 N.C. App. 113, 321 S.E.2d 537 (1984). Furthermore, evidence in support of plaintiff\u2019s claim for conversion was not objected to by defendants at trial and defendants\u2019 counsel signed, and did not contest, a pretrial order in which plaintiff stated that one of the issues for trial was whether defendant Marina had converted personal property. These amendments did not prejudice defendants and were properly allowed.\nDefendants also argue that it was error to grant partial summary judgment against the individual defendants regarding liability for damages recovered against the corporate defendant in this action. We disagree. Former Chapter 55, in effect at the time of this action, provides that shareholders, as well as directors, are liable to the corporation for any unlawful amounts received by them. Unlawful amounts received by shareholders include any redemptive or purchase price or distribution from the corporation at a time when the corporation is unable to meet its obligations in the ordinary course of business, or \u201cwhen the shareholder has knowledge that such receipt diminishes assets of the corporation\u201d in a manner contrary to the provisions of Chapter 55. N.C. Gen. Stat. \u00a7 55-54 (1982) (emphasis supplied). To that end, the procedures for dissolution of a corporation include the provision that a corporation adequately provide for the payment of all of its obligations before distributing assets among its shareholders. See N.C. Gen. Stat. \u00a7 55-119 (1982). It is undisputed that the individual defendants were the directors and only shareholders of the corporation and that on 22 December 1986 the assets of the corporation were assigned to them. The individual defendants were aware of the present action when they received distribution of the restaurant\u2019s assets. The undisputed testimony of Douglas Fox showed that no assets or sum of money had been set aside for the payment of any liability or claims arising out of this action. Obviously, the redemption or distribution completely diminished the assets of the corporation, thus subjecting the individual defendants to liability for corporate obligations. Defendant correctly points out, however, that shareholders\u2019 liability under Chapter 55 is limited to the amount received by them. See G.S. \u00a7 55-54.\nThe record before us indicates that no appropriate factual determination has been made to determine the extent of liability of the respective individual defendants. While partial summary judgment was correctly entered as to their being liable, we must remand for the' trial court to take evidence and make findings as to the extent of liability of each individual defendant. When that has been accomplished, the judgment of 14 June 1989 shall be appropriately modified.\nDefendants next contend that plaintiff\u2019s evidence was insufficient to support the jury\u2019s verdict that defendant Marina breached the lease agreement, converted personal property of plaintiff, and that plaintiff suffered damages as a result. A motion for directed verdict tests the legal sufficiency of the evidence to take the case to the jury. Manganello v. Permastone, Inc., 291 N.C. 666, 231 S.E.2d 678 (1977). In ruling on a defendant\u2019s motion for directed verdict under N.C. Gen. Stat. \u00a7 1A-1, Rule 50, the plaintiff\u2019s evidence must be taken as true and all the evidence must be taken in the light most favorable to the plaintiff. Id. All conflicts in the evidence must be resolved in plaintiff\u2019s favor and he is entitled to the benefit of every inference that could reasonably be drawn in his favor. West v. Slick, 313 N.C. 33, 326 S.E.2d 601 (1985). Only where the evidence, when so considered, is insufficient to support a verdict in the plaintiffs favor should the defendant\u2019s motion be granted. Id. If there is even a scintilla of evidence to support plaintiff\u2019s prima facie case then the motion should be denied. Burris v. Shumate, 77 N.C. App. 209, 334 S.E.2d 514 (1985). A motion for judgment notwithstanding the verdict is essentially the renewal of a prior motion for a directed verdict, and the same rules regarding the sufficiency of the evidence to go to the jury are equally applicable. Henderson v. Traditional Log Homes, Inc., 70 N.C. App. 303, 319 S.E.2d 290, disc. rev. denied, 312 N.C. 622, 323 S.E.2d 923 (1984).\nWhether defendant Marina breached its lease agreement with plaintiff depends upon whether it had a duty to replace the roof and, if so, whether its failure to do so in a timely manner resulted in a constructive eviction.\nIn the absence of a lease agreement to the contrary, a landlord is under no common law obligation to repair leased premises. See, e.g., Harrill v. Refining Co., 225 N.C. 421, 35 S.E.2d 240 (1945) and cases cited therein. The lease agreement at issue contained a provision regarding repairs which the court found to be ambiguous. An ambiguous clause in a lease is construed in favor of the lessee, particularly where the lease was drafted by the lessor. See Coulter v. Finance Co., 266 N.C. 214, 146 S.E.2d 97 (1966) and cases cited therein. In addition, the intent of the parties, where not clear from the contract, may be inferred from their actions. See Branch Banking and Trust Co. v. Kenyon Inv. Corp., 76 N.C. App. 1, 332 S.E.2d 186 (1985). Subsequent conduct of the parties is admissible to show their intent when the meaning of a contract is ambiguous. See MAS Corp. v. Thompson, 62 N.C. App. 31, 302 S.E.2d 271 (1983).\nThe evidence tended to show the following: The lease agreement contained a statement to the effect that the lessee \u201cwill keep the parking area and the exterior of said building including roof and outside walls in good repair, normal wear and tear excepted.\u201d The lease agreement was prepared by defendant Marina\u2019s attorney, Douglas Fox. In March 1985, when it became apparent that the roof could no longer be repaired, but instead had to be replaced, Fox wrote to S. N. McKenzie requesting that plaintiff replace the roof. Sam Poole, president of plaintiff corporation, subsequently met with Fox and asserted that it was defendant Marina\u2019s obligation to replace the roof. At one point, plaintiff, through Poole, offered to replace the roof and deduct the cost from the rent. Defendant Marina did not respond to this overture and, after the initial request that plaintiff replace the roof, defendant did not raise the issue with plaintiff again. In subsequent discussions about replacing the roof, Fox assured Poole that the roof would be replaced and never stated that it was not the landlord\u2019s responsibility to replace the roof. In answer to repeated questions as to why work had not yet begun, Fox told Poole and McKenzie that it was due to the unavailability of the roofing company defendant wanted to do the work. In December 1985 Fox wrote to the individual defendants and their accountant advising them that it was his opinion that if the roof damage was \u201cnormal wear and tear\u201d then it was \u201cour problem to correct.\u201d In a conversation with the restaurant\u2019s manager, Conva P. Kersey, majority shareholder, officer and director of defendant corporation, acknowledged that defendant corporation would have to replace the roof. Ultimately, defendant Marina had the roof replaced in March 1986.\nWhen taken in the light most favorable to the plaintiff, we hold that this was sufficient evidence to support the jury\u2019s verdict that defendant had breached its lease agreement regarding repair of the roof.\nAdditional claims associated with breach of the lease agreement which defendants contend were not supported by the evidence include constructive eviction and breach of the implied covenant of quiet enjoyment. We disagree. An act of a landlord which deprives his tenant of that beneficial enjoyment of the premises to which he is entitled under his lease, causing the tenant to abandon them, amounts to a constructive eviction. 49 Am. Jur. 2d, Landlord and Tenant, \u00a7 576 (1970). Put another way, when a landlord breaches a duty under the lease which renders the premises untenable, such conduct constitutes constructive eviction. 1 American Law of Property, \u00a7 3.51 (1952 & Supp. 1962). Furthermore, a lease includes the implied covenant of quiet enjoyment. Andrew & Knowles Produce Co. v. Currin, 243 N.C. 131, 90 S.E.2d 228 (1955); Carolina Helicopter Corp. v. Cutter Realty Co., 263 N.C. 139, 139 S.E.2d 362 (1964). Where a lessee has been constructively evicted, the covenant of quiet enjoyment has also been breached. Dobbins, supra.\nBased on our conclusion that the evidence of breach of the lease was sufficient to support the jury\u2019s verdict, we must reject defendants\u2019 contentions with regard to these claims as well. The landlord\u2019s breach of the lease rendered the premise unfit for plaintiff\u2019s purposes. Such action constituted constructive eviction which automatically operated as a breach of the implied covenant of quiet enjoyment.\nDefendants\u2019 second asserted ground for directed verdict is that plaintiff failed to produce sufficient evidence that defendant converted the personal property of plaintiff. Conversion is the unauthorized assumption and exercise of right of ownership over goods or personal property belonging to another to the alteration of their condition or the exclusion of the owner\u2019s rights. Spinks v. Taylor, 303 N.C. 256, 278 S.E.2d 501 (1981). The evidence showed that in January 1986 when plaintiff vacated the building due to the worsening condition of the interior of the restaurant, restaurant equipment and supplies it had purchased remained in the building. Representatives of plaintiff repeatedly testified that the closing was not meant to be permanent but rather that it was their intent to reopen the restaurant. Plaintiff had exercised a five-year renewal option on the lease. Then, on 22 December 1986, when defendants closed the sale of the building to Benson Marine Group, plaintiff\u2019s attorney received a letter from defendants stating that they were taking possession of the building. Plaintiff\u2019s equipment and other fixtures remained in the building. The essence of conversion being wrongful deprivation of an owner\u2019s property by another, defendant Marina\u2019s actions in denying plaintiff access to its property was sufficient to support the jury\u2019s verdict as to conversion. Id.\nDefendants\u2019 final contention with regard to their motions for directed verdict and judgment notwithstanding the verdict is that the evidence was insufficient to show that plaintiff suffered damages as a result of defendant\u2019s conduct. We disagree. A breach of a lease agreement by the lessor may give rise to a claim for damages by the lessee. See, e.g., Produce Co. v. Currin, supra. In this case the lessor\u2019s breach resulted in constructive eviction of the tenant. It is well settled that a tenant may recover damages that proximately result from a wrongful eviction. Burwell v. Brodie, 134 N.C. 540, 47 S.E. 47 (1904); Goler Metropolitan Apartments, Inc. v. Williams, 43 N.C. App. 648, 260 S.E.2d 146 (1979), disc. rev. denied, 299 N.C. 328, 265 S.E.2d 395 (1980). A tenant\u2019s general damages in such a case are the value, at the time of the eviction, of the unexpired term, less any rent reserved. See generally 52 C.J.S., Landlord and Tenant, \u00a7 461(4) (1968). However, a tenant\u2019s recovery is not limited to the value of the leasehold interest only, but may also include compensatory damages for pecuniary losses proximately resulting from the eviction, including conversion of personal property and, in the case of a business, loss of profits when such loss is ascertainable to a reasonable degree of certainty. Id. at \u00a7 461(1). Therefore, plaintiff\u2019s evidence as to the value of its lease was sufficient to support the jury\u2019s verdict for damages resulting from breach of the lease agreement.\nLikewise, the evidence was sufficient to support the jury\u2019s award of damages for conversion of plaintiff\u2019s personal property. The measure of damages for conversion is the fair market value of the chattel at the time and place of conversion, plus interest. Esteel Co. v. Goodman, 82 N.C. App. 692, 348 S.E.2d 153 (1986), disc. rev. denied, 318 N.C. 693, 351 S.E.2d 745 (1987) (fair market value defined as price a willing buyer would pay a seller willing, but not compelled, to sell). A plaintiff must present evidence that will furnish a basis for determination of damages; however, it is not necessary to prove damages with absolute certainty. Id. (citations omitted). The evidence viewed in the light most favorable to plaintiff established that the total value of all of the furniture and equipment owned by the corporation was in excess of $150,000. After defendant Marina took possession of the restaurant building, a videotape was made of the interior of the restaurant showing the equipment and other fixtures owned by plaintiff. Raymond Williams, the former manager of the restaurant, testified that the value of the goods shown in the videotape was over $150,000. This evidence was sufficient to support the jury\u2019s award of damages for conversion.\nDefendants also assign as error the trial court\u2019s instructions to the jury on the issues of breach of the landlord\u2019s duty to repair, breach of the covenant of quiet enjoyment, ambiguity, and conversion contending that the evidence was insufficient to warrant the instructions. Based on our review of the record we agree with the trial court\u2019s ruling as a matter of law that the language in the lease regarding repairs is ambiguous. Our affirmative resolution of the question concerning the legal sufficiency of the evidence to take the case to the jury on the remaining issues makes it unnecessary for us to address this assignment further.\nDefendants next assert that the trial court erred in refusing to instruct the jury on the issues of abandonment and surrender. We note first of all that the record clearly reflects that the trial court instructed the jury on the issue of abandonment of the premises by plaintiff. As to the court\u2019s refusal to give an instruction on the issue of surrender as it applies to the law of landlord and tenant, we find no error. Although often treated similarly by courts, the terms abandonment and surrender have essentially different meanings. 1 C.J.S. Abandonment \u00a7 2 (1985). Abandoning a right or thing, without regard to who, if anyone, may thereafter appropriate or possess it, is essentially different from the surrender of such right or thing to an ascertained and designated person. Id. The surrender of a lease requires the lessor and lessee to mutually agree to the termination of the term or cancellation of the lease; however, the surrender may be accomplished by act and operation of law as well as by express agreement. 51C C.J.S. Landlord and Tenant \u00a7 120 (1968) (emphasis added). Obviously, there was no express agreement to surrender the lease in this case. Nor do we find a surrender by operation of law as defendant contends. A surrender by operation of law is based to some extent on principles of estoppel and occurs where the parties do some act or acts from which it is necessarily implied that they have both agreed to consider the surrender as made. Id. at \u00a7 124. Whether surrender by operation of law will be implied must depend on the facts of each particular case. Id. On the facts of this case, it is clear that plaintiff intended no surrender, but rather repeatedly expressed the intent to reopen the restaurant. Being forced to abandon premises due to a constructive eviction does not automatically give rise to a surrender of the premises as that term is used in the law of landlord and tenant. Refusal to submit a requested instruction is not error when instructions given fully and fairly present issues in controversy. Tan v. Tan, 49 N.C. App. 516, 272 S.E.2d 11 (1980), disc. rev. denied, 302 N.C. 402, 279 S.E.2d 356 (1981). The facts of this case do not imply a surrender by operation of law and the trial court did not err in refusing to give the instruction. This assignment of error is overruled.\nFor the reasons given above, we find no error in the trial, but remand for further proceedings to determine the appropriate extent of liability of each individual defendant.\nNo error in the trial; remanded for modification of judgment.\nJudges Parker and Duncan concur.", "type": "majority", "author": "WELLS, Judge." } ], "attorneys": [ "Carr, Swails, Huffine & Crouch, hy Auley M. Crouch, III; and Marshall, Williams, Gorham & Brawley, by Lonnie B. Williams, Jr., for plaintiff-appellee.", "Burney, Burney, Barefoot & Bain, by Roy C. Bain and Mary Elizabeth Wertz, for defendant-appellants." ], "corrections": "", "head_matter": "MARINA FOOD ASSOCIATES, INC., and S. N. McKENZIE, Plaintiffs v. MARINA RESTAURANT, INC., CONVA P. KERSEY, ENRIQUE PAULA and ROBERT P. CORBETT, JR., and BENSON MARINE GROUP, INC., Defendants\nNo. 895SC1181\n(Filed 21 August 1990)\n1. Compromise and Settlement \u00a7 6 (NCI3d)\u2014 breach of lease \u2014 offer to buy out lease \u2014 admissible\nThere was no error in an action for breach of a lease agreement in admitting evidence of defendant\u2019s offer of $150,000 in January of 1986 to terminate the lease where there was no dispute concerning the repair or replacement of the roof in late January 1986 and the buy-out offer was therefore not an offer to settle or compromise a disputed claim. Moreover, the offer was evidence of the value of the lease and therefore relevant to the issue of damages. N.C.G.S. \u00a7 8C-1, Rule 402; N.C.G.S. \u00a7 8C-1, Rule 408.\nAm Jur 2d, Compromise and Settlement \u00a7\u00a7 14, 15, 48.\n2. Evidence \u00a7 13 (NCI3d)\u2014 breach of lease \u2014letter from attorney to defendants and accountants \u2014not privileged\nThe court did not err in an action for breach of a lease by admitting into evidence a letter from an attorney to the individual defendants and their accountant. The letter in question was communicated to a third party and was therefore not a confidential communication protected by the attorney-client privilege.\nAm Jur 2d, Witnesses \u00a7 203.\n3. Pleadings \u00a7 33.2 (NCI3d); Rules of Civil Procedure \u00a7 15 (NCI3d)\u2014 breach of lease \u2014amendment of pleadings to add breach of covenant of quiet enjoyment and to clarify conversion claim \u2014 allowed\nThe trial court did not err in an action for breach of a lease by allowing plaintiff to amend its pleadings to include breach of the covenant of quiet enjoyment and to clarify the claim of conversion of personal property. Plaintiff offered evidence of constructive eviction which, if found, constitutes a breach of the implied covenant of quiet enjoyment, plaintiff\u2019s claim for conversion was not objected to by defendants at trial, and defendants\u2019 counsel signed and did not contest a pretrial order in which plaintiff stated that one of the issues for trial was conversion of personal property. N.C.G.S. \u00a7 1A-1, Rule 15(b).\nAm Jur 2d, Pleadings \u00a7\u00a7 315, 322, 323, 329, 330.\n4. Corporations \u00a7 28 (NCI3d)\u2014 distribution of assets of corporation \u2014liability of shareholders\nThe trial court did not err in an action for breach of a lease by granting partial summary judgment against individual defendants regarding liability for damages recovered against the corporate defendant where it was undisputed that the individual defendants were the only shareholders of the corporation, the assets of the corporation were assigned to them, the individual defendants were aware of the present action when they received distribution of the restaurant\u2019s assets, no assets or money were set aside for payment of any liability or claims arising from this action, and the distribution completely diminished the assets of the corporation. However, no appropriate factual determination was made to determine the extent of liability of the respective individual defendants and the case was remanded for the trial court to take evidence and make those findings.\nAm Jur 2d, Corporations \u00a7 2870.\n5. Landlord and Tenant \u00a7 8 (NCI3d)\u2014 replacement of roof\u2014 breach of lease \u2014 evidence sufficient\nThe trial court did not err in an action for breach of a lease by failing to replace the roof in a timely manner by denying defendants\u2019 motions for a directed verdict and judgment n.o.v. where plaintiff was the lessee and defendants the lessors; the lease agreement contained a statement to the effect that the lessee would keep the parking area and exterior, including the roof and outside walls, in good repair, normal wear and tear excepted; the lease agreement was prepared by defendant Marina\u2019s attorney; when it became apparent that the roof could not be repaired and had to be replaced, defendant Marina\u2019s attorney wrote to plaintiff requesting that plaintiff replace the roof; plaintiff\u2019s president met with Marina\u2019s and asserted that it was defendant Marina\u2019s obligation to replace the roof; plaintiff offered at one point to replace the roof and deduct the cost from the rent; defendant Marina did not respond and did not raise the issue again; defendant Marina\u2019s attorney assured the president of plaintiff corporation in subsequent discussions that the roof would be replaced and never stated that it was not the landlord\u2019s responsibility to replace the roof; defendant. Marina\u2019s attorney stated in response to repeated requests that the work had not been done due to the unavailability of the roofing company which defendants wanted to do the work; defendant Marina\u2019s attorney wrote to the individual defendants and their accountant advising them that it was his opinion that if the roof damage was normal wear and tear then it was defendants\u2019 problem to correct; the majority shareholder, officer and director of defendant corporation acknowledged in a conversation with the restaurant\u2019s manager that defendant corporation would have to replace the roof; and defendant Marina ultimately had the roof replaced.\nAm Jur 2d, Landlord and Tenant \u00a7\u00a7 774, 777, 828, 832.\n6. Landlord and Tenant \u00a7 6.2 (NCI3d)\u2014 constructive eviction \u2014 breach of implied covenant of quiet enjoyment \u2014evidence sufficient\nThe evidence was sufficient to support claims for constructive eviction and breach of the implied covenant of quiet enjoyment in an action arising from a leaking roof which ultimately had to be replaced. The landlord\u2019s breach of the lease rendered the premises unfit for plaintiff\u2019s purposes; such action constituted constructive eviction which automatically operated as a breach of the implied covenant of quiet enjoyment.\nAm Jur 2d, Landlord and Tenant \u00a7\u00a7 314-316, 333, 336.\n7. Trover and Conversion \u00a7 2 (NCI3d)\u2014 breach of lease of real property \u2014conversion of personal property \u2014evidence sufficient\nThere was sufficient evidence of conversion of personal property in an action for breach of a real property lease where the evidence showed that in January 1986 plaintiff vacated the building due to the worsening condition of the interior of the restaurant; restaurant equipment and supplies remained in the building; representatives of plaintiff repeatedly testified that the closing was not meant to be permanent; plaintiff had exercised a five-year renewal option on the lease; plaintiff\u2019s attorney received a letter from defendants stating that they were taking possession of the building after defendants closed on the sale of the building to a third party; and plaintiff\u2019s equipment and other fixtures remained in the building. Defendant Marina\u2019s actions in denying plaintiff access to its property was sufficient to support the verdict as to conversion.\nAm Jur 2d, Conversion \u00a7 28.\n8. Landlord and Tenant \u00a7 13 (NCI3d)\u2014 breach of lease-damages \u2014 evidence sufficient\nThe evidence was sufficient to show damages in an action for breach of a lease for a restaurant where the lessor\u2019s breach resulted in constructive eviction of the tenant. The tenant\u2019s general damages in such a case are the value at the time of the eviction of the unexpired term, less any rent reserved, and recovery may also include compensatory damages for pecuniary losses proximately resulting from the eviction.\nAm Jur 2d, Landlord and Tenant \u00a7\u00a7 183,187, 323, 324, 326.\n9. Trover and Conversion \u00a7 4 (NCI3d)\u2014 breach of lease\u2014 conversion of personal property \u2014 award of damages \u2014 evidence sufficient\nThere was sufficient evidence in an action for breach of a lease for a restaurant to support the jury\u2019s award of damages for conversion of plaintiff\u2019s personal property where the evidence viewed in the light most favorable to plaintiff established that the total value of all of the furniture and equipment owned by plaintiff corporation was $150,000; a videotape was made of the interior of the restaurant showing the equipment and other fixtures owned by plaintiff after defendant Marina took possession of the restaurant building; and the former manager of the restaurant testified that the value of the goods shown in the videotape was over $150,000.\nAm Jur 2d, Conversion \u00a7\u00a7 105, 108, 135.\n10.Landlord and Tenant \u00a7 13 (NCI3d)\u2014 breach of lease for restaurant \u2014instructions on abandonment and surrender \u2014no error\nThere was no error in an action for breach of a lease for a restaurant concerning the court\u2019s alleged failure to instruct the jury on the issues of abandonment and surrender where the record clearly reflects that the trial court in-strueted the jury on the issue of abandonment of the premises by plaintiff and the court correctly refused to instruct on surrender because it is clear that plaintiff repeatedly expressed the intent to reopen the restaurant and intended no surrender. Being forced to abandon premises due to a constructive eviction does not automatically give rise to a surrender of the premises as that term is used in the law of landlord and tenant.\nAm Jur 2d, Landlord and Tenant \u00a7\u00a7 333, 345, 1095, 1096.\nAppeal by defendants from judgment entered 14 June 1989 in New Hanover County Superior Court by Judge Cy A. Grant. Heard in the Court of Appeals 3 May 1990.\nThe original plaintiffs in this case, Marina Food Associates, Inc. and S. N. McKenzie, brought this action to recover damages for breach of a lease agreement against defendant Marina Restaurant, Inc. Plaintiffs subsequently amended their complaint to include the individual defendants, who were the only shareholders of the corporate defendant, and Benson Marine Group, Inc., which had purchased the property in question from defendant Marina Restaurant, Inc. At the conclusion of trial, motions for directed verdicts dismissing claims asserted by plaintiff McKenzie and counterclaims of defendants as to McKenzie were granted. Plaintiffs\u2019 claims against defendant Benson Marine Group and defendant Benson Marine Group\u2019s counterclaims against plaintiffs were also dismissed without prejudice. The motion for directed verdict by defendant Marina Restaurant, Inc. and the individual defendants was denied. The jury returned verdicts in favor of Marina Food Associates (plaintiff) on the issues of breach of the lease agreement, conversion of personal property, and damages. The motion for judgment notwithstanding the verdict by defendant Marina Restaurant, Inc. and the individual defendants (defendants) was denied. Defendants appeal.\nCarr, Swails, Huffine & Crouch, hy Auley M. Crouch, III; and Marshall, Williams, Gorham & Brawley, by Lonnie B. Williams, Jr., for plaintiff-appellee.\nBurney, Burney, Barefoot & Bain, by Roy C. Bain and Mary Elizabeth Wertz, for defendant-appellants." }, "file_name": "0082-01", "first_page_order": 114, "last_page_order": 127 }