Amoco Oil Company v. Jones

467 N.W.2d 357 (1991)

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Nature of the Case

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Facts

D operated a gas station which he had leased from P. The lease terms prohibited D from committing waste to the property, and further required that D keep the property in good repair, perform necessary upkeep and maintenance and surrender the property at the end of the lease in substantially as good condition as when received, ordinary wear and tear excepted. The lease did not indicate which party was responsible for obtaining fire insurance. P could terminate or choose not to renew the lease upon the occurrence of a variety of events, including Destruction of all or a substantial part of the Premises. In the event the Premises had to be subsequently rebuilt or replaced by P and operated under a lessee franchise relationship, P granted to D a thirty (30) day right of first refusal of the new franchise. A fire caused substantial damage and destruction to the station. Neither party was negligent or otherwise at fault in causing the fire. P terminated the lease because of 'destruction of all or a substantial part' of the property. P sued D for breach of the lease; alleging D failed to return the station to P in as good condition as when he received it. At the close of P's evidence, the trial court directed a verdict in D's favor. The trial court found the lease terms did not contain a covenant to restore the property to its original state in the event of such severe destruction or damage, that D did not breach the lease, and entered judgment in favor of D. P appeals.