GYM-N-I Playgrounds, Inc. v. Snider

Ron Snider (plaintiff) leased a commercial warehouse to GYM-N-I Playgrounds (GYM-N-I) (defendant). GYM-N-I manufactured playground equipment in the warehouse. In Texas, if the lease does not discuss the issue, landlords impliedly warrant that premises are suitable for the intended purpose. However, this lease specifically provided that GYM-N-I accepted the building as is and expressly waived any warranties on behalf of Snider. The lease also contained a holdover provision that stated: “any holding over without written consent of Landlord shall constitute a lease from month-to-month, under the terms and provisions of this Lease to the extent applicable to a tenancy from month-to-month.” The lease expired in September 1996. The parties did not execute a new lease, but GYM-N-I continued to pay and Snider continued to accept monthly rent until a fire destroyed the building in August 2000. Snider’s insurance company sued GYM-N-I, seeking reimbursement for the insurance claim money it had paid to Snider. GYM-N-I filed cross claims and third party claims against Snider alleging that defective electrical wiring and the lack of a sprinkler system caused the fire. Snider argued that the lease’s as-is clause and warranty disclaimer barred GYM-N-I’s claims. GYM-N-I argued that the as-is clause did not survive when the original lease expired. The trial court found for Snider. GYM-N-I appealed. The appeals court affirmed. GYM-N-I appealed again.