Contracts Keyed to Dawson
Lloyd v. Murphy
Facts
Before Defendant left, it told Plaintiffs the negative impact the government’s prohibition had on business. Plaintiffs orally waived restrictions in the lease as to use and subleasing, and offered to reduce the rent if it would enable Defendant to operate profitably. However, Defendant vacated anyway, and Plaintiff mitigated its damages by finding a new tenant. Plaintiffs sued for declaratory relief to determine its rights under the lease, and for a judgment for unpaid rent. The trial court found that the war conditions had not terminated Defendant’s obligations under the lease, and awarded Plaintiff unpaid rent plus interest, less the amount it received from re-renting. On appeal, the Defendant urged that its duties were terminated under the lease because its purpose was frustrated by the restrictions placed on the sale of automobiles by the federal government.
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