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Asbestos Fibres, Inc. v. Martin Laboratories Inc.

Decided: April 27, 1953.

ASBESTOS FIBRES, INCORPORATED, A NEW JERSEY CORPORATION, PLAINTIFF-APPELLANT,
v.
MARTIN LABORATORIES, INC., A NEW JERSEY CORPORATION, DEFENDANT-RESPONDENT



On appeal from Superior Court, Law Division.

For affirmance -- Chief Justice Vanderbilt, and Justices Oliphant, Wachenfeld, Burling, Jacobs and Brennan. For reversal -- Justice Heher. The opinion of the court was delivered by Burling, J.

Burling

[12 NJ Page 235] This is an appeal in a civil action instituted in the Superior Court, Law Division, wherein the plaintiff, Asbestos Fibres, Incorporated, a New Jersey corporation, sought reformation of a lease and damages for unlawful eviction from the demised premises. The defendant Martin Laboratories, Inc., a New Jersey corporation, filed a counterclaim.

The trial resulted in judgment of dismissal as to the plaintiff's complaint, of damages of $4,830.82 in favor of the defendant and against the plaintiff on the first count of its counterclaim, and against the defendant on the second count of its counterclaim. The plaintiff appealed to the Superior Court, Appellate Division. Prior to hearing there, certification was allowed upon our own motion.

The plaintiff initiated this action by filing a complaint in the Superior Court, Law Division, on January 5, 1951 alleging therein that on December 18, 1947 it had entered into a five-year lease with the defendant for premises owned by the defendant in the City of Newark, Essex County, New Jersey; that the defendant failed to carry out the terms of the lease and as a result the City of Newark ordered the closing of the building, forcing plaintiff to move to other quarters on September 1, 1949; and that the plaintiff as a result thereof suffered injury in several detailed respects. The plaintiff sought damages from the defendant in the amount of $250,000. The defendant answered denying that it had breached the lease or caused plaintiff's removal from the premises, and by counterclaim sought damages of $3,625 (on the first count) for nonpayment of monthly installments of rent due, and $2,500 (on the second count) for plaintiff's failure to comply with terms of the lease calling upon the lessee to make repairs. This analysis of the action was substantially set forth in a pretrial order entered December 18, 1951, as amended at the first trial in the cause.

The provision of the lease upon which the plaintiff had premised its action read as follows:

"36-A: It is agreed between the parties hereto that sewerage and water are available in the building and are in usable condition up to the building."

During the course of the first trial, the trial court construed paragraph 36-A of the lease, supra, "to be not a covenant on the part of the landlord that sewerage and water are available in the building and are in usable condition up to the building and will be so maintained and kept by the

landlord during the term of the lease," nor a warranty on the part of the landlord. After an extended colloquy between the trial court and counsel, during which the trial court advised counsel that "equity will, upon a proper showing, reform the policy or contract" upon grounds such as mutual mistake, and the plaintiff admitted that its claim was based upon mistake in the wording of paragraph 36-A of the lease, the plaintiff moved to amend the complaint to include a prayer for reformation of paragraph 36-A. The defendant resisted the motion.

During the course of argument on the motion, the defendant admitted that if an equitable count for reformation were permitted and succeeded its counterclaim would be "almost completely eliminated."

After extended discussion the trial court granted the motion, conditioned upon plaintiff paying to the defendant costs in the amount of $100. Upon plaintiff's acceptance of this condition the trial court ordered the withdrawal of a juror and declared a mistrial.

Subsequently, the plaintiff filed an amended complaint and the defendant filed an amended answer and counterclaim. The issues raised thereby were in essence the same basic issues raised in the original pleadings and pretrial order, with the inclusion of pleadings relating to reformation. At the second trial, which began on October 16, 1952, an amended pretrial order stating these issues was filed on October 17, 1952. This amended pretrial order contained the following statement:

"It is agreed by consent of counsel that the pretrial order entered herein on December 18, 1951 be amended to show that the only remaining issue in the case is raised by the second count of the amended complaint filed herein on May 20, 1952, namely, whether a mutual mistake of fact was made to justify reformation of paragraph 36 A of the lease attached to the complaint. The plaintiff contends that a mutual mistake of fact was made. This is denied by the defendant."

During the course of the trial the defendant's evidence as to the amounts alleged to be due as rent under the lease was

introduced by stipulation. Testimony and other evidence was introduced by both parties on the other issues, namely reformation, eviction and incidental damage to the property.

After both parties had rested, the defendant moved for judgment in its favor on the issue of reformation "without submitting the case to the jury." The defendant grounded the motion on the plaintiff's alleged failure to introduce sufficient evidence to "justify submitting this case to the jury ...


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