Weyerhaeuser Real Estate Co. v. Stoneway Concrete, Inc.
96 Wash.2d 558, 637 P.2d 647 (Wash. 1981)
- Stoneway entered a three-year lease with Weyerhaeuser to strip mine some land.
- It was anticipated that it would take two years to acquire the permits.
- After five years of failing to get the permits, Stoneway gave up and abandoned the property. Weyerhaeuser sued to recover the rentals called for in the contract.
- Stoneway argued that they couldn’t get the permits, so there was no point to leasing the property. Therefore they were allowed to break the contract based on the doctrine of frustration.
- Weyerhaeuser argued that the contract had a term that stated that the rent shall be paid irrespective of whether Stoneway actually does any mining. It also had a clause saying that Stoneway could cancel the lease with 1 year’s notice, which they did not give.
- The Trial Court initially found for Stoneway. Weyerhaeuser appealed.
- The Appellate Court reversed. Stoneway appealed.
- The Appellate Court found that the lease explicitly did not require that Stoneway be allowed to mine, and that there was a clause to let Stoneway out of the lease. Therefore, their defense based on the doctrine of frustration was not valid.
- In addition, the Court found that it was foreseeable that there would be problems getting the permits, and Stoneway should have factored that into their bargaining for the lease.
- The Washington Supreme Court reversed and found for Stoneway.
- The Washington Supreme Court found that while it was foreseeable that the permits would be difficult to obtain, it was not foreseeable that they would be impossible to obtain.