Propst v. McNeill

James F. PROPST v. Dan McNEILL, in His
Official Capacity as Airport Commission
Chairman, Walnut Ridge Airport, and City of
Walnut Ridge, d/b/a Bertco, Inc.

95-1290                                            ___ S.W.2d ___

                    Supreme Court of Arkansas
               Opinion delivered November 18, 1996


1.   Landlord & tenant -- caveat lessee doctrine discussed. -- The
     caveat lessee doctrine states that unless a landlord agrees
     with his tenant to repair leased premises, he cannot, in the
     absence of statute, be compelled to do so or be held liable
     for repairs.  

2.   Landlord & tenant -- legislature must make changes to law --
     caveat lessee rule still adhered to. -- Because of the policy
     considerations and possible impact that would ensue in
     enlarging a landlord's liability, it is the legislature's
     province to change the state's landlord-tenant law; the
     supreme court has steadfastly adhered to the caveat lessee
     rule for one hundred years without a hint that it might
     consider abandoning it; it is a matter of public policy to
     uphold prior decisions unless great injury or injustice would
     result. 

3.   Landlord & tenant -- appellant could appreciate risk of
     storing his plane in old hangar -- facts did not warrant
     departure from caveat lessee rule. -- Although the supreme
     court did not foreclose its possible review of the caveat
     lessee rule and the efficacy in abandoning that rule in the
     future, where the appellant was a businessman who owned a
     plane and was not shown to be someone who could not appreciate
     the risk of storing his plane in an old hangar, the facts did
     not warrant departure from the well-established law of this
     state; the caveat lessee doctrine remains applicable.

4.   Landlord & tenant -- latent-defect exception inapplicable --
     appellant's proof lacking. -- Even if the latent-defect
     exception to the caveat lessee rule had been recognized by
     Arkansas courts, appellant's proof was insufficient to prove
     that a defect existed; he offered no proof that his leased
     hangar was defective or caused his damages, and the undisputed
     proof showed many other structures had been damaged by the
     windstorm. 

5.   Landlord & tenant -- retention-of-control exception not
     recognized -- Commission not shown to have any duty to repair
     or maintain the hangar. -- Where appellant failed to cite any
     Arkansas law where the retention-of-control exception had been
     recognized, his argument failed; only an express agreement or
     assumption of duty by conduct can remove a landlord from the
     general rule of nonliability; the appellee was not shown to
     have agreed or to have undertaken any duty to repair or
     maintain the leased hangar in question; the trial court's
     decision that no issue of material fact existed to be tried on
     this issue was correct.


     Appeal from Lawrence Circuit Court; Harold S. Erwin, Judge;
affirmed.
     Banks, Dodson, & Spades, by:  Mark S. Carter, for appellant.
     Robert H. Crank and Barrett & Deacon, by:  Paul D. Waddell,
D.P. Marshall, Jr., and Kevin W. Cole, for appellees.

     Tom Glaze, Justice.
     This case involves an issue concerning landlord-tenant
liability.  Appellant James F. Propst entered into a lease with
appellee Walnut Ridge Airport Commission and that lease set out
the terms under which Propst stored his plane, a 1972 Cessna 182,
in hangar space at the Walnut Ridge Airport.  Afterwards, a wind
storm damaged the hangar and Propst's plane.  Propst subsequently
brought suit against the Commission, alleging the Commission had
negligently failed to (1) secure the hangar to its foundation, (2)
replace defective structural supports, or (3) warn him of the
hangar's defective condition.  The Commission answered, denying the
allegations and raising a number of affirmative defenses. 
     Eventually, the Commission moved for summary judgment,
claiming any obligation it might have as a landlord was a matter of
contract and the parties' lease controlled the litigation.  The
Commission, without admitting its hangar building was in disrepair,
argued that, under Arkansas's landlord-tenant law, it was not
responsible for damages to Propst's plane because of the
Commission's failure to repair the leased building.  The trial
court agreed and granted the Commission's motion.  Propst appeals
from that summary judgment.
     In his first argument, Propst acknowledges that Arkansas has
recognized the caveat lessee doctrine for almost a century,
Haizlip v. Rozenberg, 63 Ark. 430, 39 S.W. 60 (1897), and under
that rule, unless a landlord agrees with his tenant to repair
leased premises, he cannot, in the absence of statute, be compelled
to do so or be held liable for repairs.  Stalter v. Akers, 303 Ark.
603, 798 S.W.2d 428 (1990); see also Majewski v. Cantrell, 293 Ark.
360, 737 S.W.2d 649 (1987); Terry v. Cities of Helena & W. Helena,
256 Ark. 226, 506 S.W.2d 573 (1974); Hurst v. Field, 281 Ark. 106,
661 S.W.2d 393 (1983).  Consistent with this doctrine, the trial
court here determined that, under the parties' lease, the
Commission never agreed to repair or maintain its hangar, so the
Commission was not obligated to pay for any plane damage Propst may
have sustained, resulting from defects found in the hangar
building.  However, Propst, citing Sargent v. Ross, 113 N.H. 388,
308 A.2d 528 (1973), opines the caveat lessee rule of law is
outdated and asserts landlords should be compelled to exercise
reasonable care not to subject others to an unreasonable risk of
harm.  See also Stephens v. Stearns, 678 P.2d 41 (Idaho 1984)
(adopted rule that a landlord is under a duty to exercise
reasonable care in light of all circumstances); Asper v. Heffley,
458 A.2d 1364 (Pa. Super. 1983) (negligence of the landlord is a
matter for determination by the factfinder); Faureau v. Miller, 591 A.2d 68 (Vt. 1991) (landlords may be held liable for exposing their
tenants to unreasonable risks of harm in the leased premises).  To
further support his contention that Arkansas's adherence to the
caveat lessee rule should end, Propst submits that Arkansas has
become less rural, and consequently tenants have become less
informed and too ill-equipped to judge the structural integrity of
buildings with which they are unfamiliar.  See Thomas M. Quinn and
Earl Phillips, The Law of Landlord-Tenant:  A Critical Evaluation
of the Past with Guidelines for the Future, 38 Ford. L. Rev. 225
(1969).  He adds that landlords, on the other hand, are generally
familiar with their properties either through firsthand knowledge
of the condition of the properties or through knowledge imputed to
them by persons hired to manage their properties.
     The Commission acknowledges that a majority of states no
longer apply caveat lessee; nonetheless, it submits Arkansas courts
should continue to follow that doctrine, or at the very least,
leave it up to the General Assembly to decide whether the state's
landlord-tenant law should be changed in this respect.  First, the
Commission cites the case of Dapkunar v. Cagle, 356 N.E.2d 575
(Ill. 1976), where the appellate court rejected a party-tenant's
invitation to depart from the well-established caveat doctrine as
applied to leases.  The Illinois Court reasoned in part as follows:
          In the landlord-tenant law, on the other hand, the
     landlord, although having the benefit of a limited
     immunity through the rule of caveat emptor, is not
     totally insulated from recovery for injuries sustained by
     the tenant or third persons as a result of defects in the
     premises.  As we have already pointed out, there are
     several exceptions which can allow for recovery from the
     landlord; and these exceptions cover many injuries. 
     Additionally, building codes in force in many localities
     today have the effect of protecting tenants, to a certain
     extent, by requiring landlords to keep their buildings
     within applicable standards.  At the time of the early
     product liability law developments away from privity
     notions, purchasers of manufactured products did not have
     the benefit of anything comparable to a building code to
     control manufacturers.  It can hardly be said, therefore,
     that a present-day tenant injured by a defect in the
     leased premises is in the same remediless position with
     respect to the landlord as the injured purchaser once was
     with respect to the product manufacturer.
     Expanding further on why this court should refuse to overturn
its earlier case law on the subject, the Commission argues the
caveat lessee rule serves Arkansas's constitutionally declared
public policy of respecting its citizens' right to contract.  It
suggests that eliminating caveat lessee will not result in more
protections, but instead in fewer options for the tenant.  In other
words, the Commission argues the law should not be changed to
eliminate the productive and beneficial use of marginal structures,
absent landlord repair and insurance against possible liability.
     In arguing that it should be the legislature's province to
change this state's landlord-tenant law, the Commission points out
it generally has been that governing body in other states that has
abandoned the doctrine by adopting the Uniform Residential Landlord
and Tenant Act.  See Watson v. Sellers, 385 S.E.2d 369 (S.C. App.
1989).  Because of the policy considerations and possible impact
that would ensue in enlarging a landlord's liability, there is
merit in the argument that such matters might be dealt with better
in the legislative arena.  In any event, this court has steadfastly
adhered to the caveat lessee rule for one hundred years without a
hint it might consider abandoning it.  This court has held that it
is a matter of public policy to uphold prior decisions unless great
injury or injustice would result.  Independence Federal Bank v.
Paine Webber, 302 Ark. 324, 789 S.W.2d 725 (1990).  As the
Commission properly mentions, the present case is one involving a
businessman who owns a plane and was not shown to be someone who
could not appreciate the risk of storing his plane in an old
hangar.  Although this court does not foreclose its possible review
of the the caveat lessee rule and the efficacy in abandoning that
rule in the future, we conclude that this is not the type of
situation or facts that warrant our departure from the well-
established law of this state.  That being so, we reject the
invitation to do so in this case.  
     Propst also argues on appeal that, even if this court declines
to overturn the caveat lessee doctrine, that doctrine still
provides that landlords are liable in tort for injuries and damages
resulting from defective and dangerous conditions if the injury is
attributable to (1) a hidden danger in the premises of which the
landlord, but not the tenant, was aware; (2) premises leased for
public use; (3) premises retained under the landlord's control; or
(4) premises negligently repaired by the landlord.  See Restatement
(Second) of Torts,  358-362 (1965).  In this respect, Propst
first contends a material issue of fact was raised in this cause as
to whether a hidden or latent defect existed concerning the leased
hangar and to what extent the Commission knew about that defect and
possible danger.  The Commission counters by simply stating that
Arkansas has never recognized the latent-defect exception to caveat
lessee and that, even if Arkansas had, Propst's proof was
insufficient to prove defect existed.  
     Propst bases his latent-defect argument on his affidavit
wherein he averred that, after the windstorm tore away the hangar
in question, he observed the two other hangars on the premises and
repairs had previously been undertaken to reattach one of the
buildings to its foundation.  This fact, Propst argues, indicated
the Commission was aware Propst's leased hangar had also been
inadequately attached to its foundation.  Without the need of
discussing whether the latent-defect exception has ever been
recognized by Arkansas courts, we believe that, even if it had,
Propst's evidence on this issue is sorely lacking.  He offered no
proof that his leased hangar was defective or caused his damages,
and the undisputed proof showed many other structures had been
damaged by the windstorm -- this included a third hangar which,
too, was located on the premises.
     In his final argument, Propst suggests a jury question exists
as to whether the Commission had retained sufficient control of the
leased building so as to impose a duty to keep the premises in a
reasonably safe condition.  He points out that, under the parties'
lease, the airport manager had a key and right to enter the hangar
and to make any required improvements.  Propst also states that the
lease prohibited him from making his own repairs.
     We first note that Propst fails to cite any Arkansas law where
the retention-of-control exception has been recognized.  In fact,
this court has repeatedly stated that only an express agreement or
assumption of duty by conduct can remove a landlord from the
general rule of nonliability.  Hall v. Rental Management, Inc., 323
Ark. 43, 913 S.W.2d 293 (1996); Bartley v. Sweetser, 319 Ark. 117,
890 S.W.2d 250 (1994); Barnes, Quinn, Flake & Anderson v. Rankins,
312 Ark. 240, 848 S.W.2d 924 (1993); Glasgow v. Century Property
Fund XIX, 299 Ark. 221, 772 S.W.2d 312 (1989); Hurst v. Feild, 281
Ark. 106, 661 S.W.2d 393 (1983); Kilbury v. McConnell, 246 Ark.
528, 438 S.W.2d 692 (1969); Joseph v. Riffee, 186 Ark. 418, 53 S.W.2d 987 (1932).  Thus, we conclude by holding that the
Commission here was not shown to have agreed or to have undertaken
any duty to repair or maintain the leased hangar in question.  As
a consequence, we agree with the trial court that no issue of
material fact existed to be tried on this issue.
     We affirm.