Service Oil Co. v. White

542 P.2d 652 (1975)

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Nature of the Case

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Facts

P needed a new location for a service station and Arnold, a real estate firm. Arnold's salesman, Jack Pearce, knew of a station location which had been built and was owned by D. Arnold prepared a listing agreement: 'Lot 1 Block G, Maplewood Addition to City of Wichita, Sedgwick Co. Kans. Texaco Station, 150.95 on Pawnee (what is paved) approximately 100' Deep.' The reference to 'Texaco Station' was made in the description because Texaco was the previous lessee. The terms upon which a lease would be granted by D were inserted in the listing agreement. D signed, and P inspected the location, measured the paved area from the sidewalk to the rear of the station premises, and found it to be a hundred feet. It viewed the two pump islands which were fifteen feet back from the sidewalk. P noted certain repairs were necessary before the station would be ready for occupancy. P entered into a lease with D. P quickly discovered that D had deeded the front of the property to the city and hence the current pump locations did not meet code and had to be moved. P tried to get a variance, and the city refused. P spent $3,335.73 moving the pumps and demanded reimbursement from D. P sued D. The court held that the term in the lease restricting use to a gas station was an implied warranty from D to P that the land was fit for such a use. The court found that D knew or should have known that P could not operate the station in its current condition and that the pumps had to be relocated. It held that D’s reckless misrepresentations caused P damages of $3,957.35 and $1,500 in punitive damages. D appealed.