116 Misc. 440 | City of New York Municipal Court | 1921
This is a summary proceeding to recover possession of premises situated at the northeast corner of Broadway and Ninety-fourth street, borough of Manhattan, on account of non-payment of rent. The tenant admitted upon the trial that the rent remained unpaid and set up a counterclaim for damages sustained through the landlord’s breach of one or more covenants of the lease. The jury rendered a verdict in favor of the tenant in the sum of $7,045.19. On the coming in of the verdict the landlord moved for a new trial and to set aside the verdict. Decision having been reserved, this motion is now before the court.
Upon the trial the rent due to the landlord was conceded to be the sum of $7,583.31, together with accrued interest of $113.33. The lease also provided that the water rates and the plate glass insurance premium should be borne by the tenant and added to the rent. These two items, which by agreement of the parties were adjusted at $1,200 and $58.70, respectively, added
Before passing upon the objections raised by the landlord, two preliminary questions, although not particularly referred to upon the briefs of counsel, should be disposed of. The one deals with the jurisdiction of this court to receive a verdict for the tenant in excess of $1,000 and to enter judgment thereon. Section 2244 of the Code of Civil Procedure permits a defense or a counterclaim in a summary proceeding to “be set up and established in like manner as though the claim for rent in such proceeding was the subject of an action.” Chapter 132 of the Laws of 1920 amends the section by adding:
“ If the court finds that a defense or counterclaim has been established in whole or in part, it shall, upon rendering a final order, determine the amount of rent due to the petitioner or make such other proper disposition as shall determine the rights of the parties and may give affirmative judgment for the amount found to be due on the counterclaim.”
The statute does not limit the amount of the counterclaim to be rendered. There is no constitutional prohibition to prevent the legislature from conferring upon a court of inferior jurisdiction power to render judgment upon a counterclaim in excess of $2,000. Section 18 of article 6 of the Constitution prohibits the legislature from conferring any greater jurisdiction upon inferior local courts than is conferred upon County Courts, and section 14- of article 6 provides that the jurisdiction of County Courts shall not be so extended as to authorize an action for the recovery of money in which the sum demanded exceeds $2,000.
The other preliminary point to be disposed of deals with the motion made by the landlord for leave to discontinue the proceeding. Upon the conclusion of the testimony, after a three days’ trial, the landlord moved for a final order in its favor. Argument was had and the motion was denied. Thereupon the landlord moved to discontinue the proceeding. The court, in the exercise of its discretion, denied the motion on the ground that the discontinuance would injuriously affect the rights of the tenant. The claim of the landlord had been eliminated as an issue. The entire controversy turned upon the tenant’s counterclaim. In Palmedo v. Walton Reporter Co., 112 Misc. Rep. 729, affirmed by the Appellate Division on the opinion below, the rule was reiterated that “ The court, in its discretion, should deny a motion to discontinue an action when the rights of the defendant will be materially affected and injured.” As stated in Winans v. Winans, 124 N. Y. 140, 145, the authorities “ * * * support the right to refuse. leave whenever circumstances exist which afford a basis for the exercise. of legal discretion-, * * Where a counterclaim has been interposed a discontinuance should ordinarily not be granted (Jermyn v. Searing, 139 App. Div. 116), especially not where, after a lengthy trial, the sole issue left in the case was that raised by the counterclaim. Cases such. as Nichols v. Williams, 42 Misc. Rep. 527, and Engel & Co. v. Davis, 81 id. 202, which hold that the plaintiff in the Municipal Court has the right to discontinue before final submission, even though a counterclaim has been interposed, have no application. They were decided under subdivision 1 of section 248 of the former Municipal Court Act, which made it mandatory upon the court to permit a discontinuance by the plain
The premises in question were leased by the landlord to the tenant by two instruments, one dated October 1, 1917, which was the principal lease, and the other June 1, 1918. Both leases were to expire October 1, 1927. The total rental was $13,000 a year. Under the principal lease the tenant agreed to fit up the premises and conduct the same as a high grade and first class restaurant in a reasonably satisfactory manner. This
“ * * * except that the tenant is hereby permitted, after having fully and completely fitted up, decorated and completed the furnishings of a first class restaurant as herein provided, to assign this lease to reputable white persons financially responsible and of good repute for the express purposes herein limited, provided such proposed assignees first assume and undertake to carry out and perform well and faithfully all of the terms and covenants of this agreement on the part of the tenant to be performed, and also, at the same time and as a condition precedent to taking such assignment, pay unto the landlord the equivalent of two months’ rent in cash as security for the full, and faithful performance by the tenant of the terms of this agreement.”
During the year 1920 the tenant entered into negotiations with a number of prospective assignees of the lease and purchasers of the restaurant, but the landlord persistently refused to consent to the assignment of the lease or to consider any of the names submitted. Finally, in October, 1920, the tenant assigned the leases and sold its restaurant to Wilder Brothers. In view of the prior refusals of the landlord to recognize any prospective assignees, the arrangement between the tenant and Wilder Brothers was made dependent upon the undisputed and undisturbed possession of Wilder Brothers for the period of three months, and the agreement was to terminate in case the landlord at any time refused to consent to the assignment of the lease. Wilder Brothers went into
“ The law has outgrown its primitive stage of formalism when the precise word was the sovereign talisman, arid every slip was fatal. It takes a broader view to-day. A promise may be lacking, and yet the whole writing may be ‘ instinct with an obligation ’ imperfectly expressed.”
If the wording clearly indicates the intention of the parties their agreement is spelled out of the phrasing adopted by them. Edison Elec. Illum. Co. v. Thacher, 229 N. Y. 172-176. And in Ehrenworth v. Stuhmer & Co., 229 N. Y. 210, the court says at page 219: “ Every detail of a contract need not be specifically expressed. The law takes a broader view of • what must be contained in a contract. ’ ’
Assuming, however, that the landlord in this proceeding was justified in remaining passive, it did not content itself with that. It not only rejected Wilder Brothers, but actively threatened interference with their quiet possession of the premises. Good faith, which must be read into every contract, required the landlord to recognize the assignee offered by the tenant in accordance with the lease.
The landlord makes its principal objection to the verdict upon the assessment of damages. All the disputed facts having been decided in favor of the ten-' ant, it must be accepted that Wilder Brothers repudiated the agreement with the tenant through a reasonable apprehension that the landlord would interfere with their peaceable possession and render the con
In Delafield v. Armsby Co., 131 App. Div. 572; affd., 199 N. Y. 518, on the opinion of Ingraham, J., writing for the Appellate Division, is found an elaborate discussion of the rule that indemnity to the injured party is the basis of the measure of damages in actions for breach of contract. It was there held that, although usually the measure of damages for the breach of a contract to sell merchandise is the difference between the contract price and the market value, where there is no market and the purchaser cannot obtain the property he may recover the loss of profits from a resale which was within the contemplation of the parties at the time of making the contract. Although the case before the court was one of the sale of merchandise, there is no distinction in principle between such a case and this. The tenant was able to dispose of the lease, but through the fault of the landlord lost its profits. These profits are the direct fruits of the contract made between the parties; they are capable of exact ascertainment, and I see no valid reason why they should be withheld from the tenant. But it is asserted that the rule of consequential damages applies only where the facts of the subsidiary contract made by the injured party were known to the party committing the breach. It is not necessary that the contract with Wilder Brothers should have been in existence, or even
In 3 Sutherland on Damages (4th ed., p. 3203) the author says that the profits a tenant might have made by assigning his lease are recoverable from a landlord who unreasonably refused to consent to the assignment in accordance with his obligation. The case cited in support of the text (Underwood Typewriter Co. v. Century Realty Co., 165 Mo. App. 131) has many features in common with the case under consideration. In that case the lease prohibited the assignment thereof without the written consent of the landlord. Upon application of the tenant the landlord promised to give his written consent provided the new tenant proved satisfactory and acceptable. The plaintiff-tenant, relying upon his promise, finally procured an undertenant at an increased rent over that fixed in the lease and in addition the plaintiff was to receive a bonus of $500. The name of the undertenant was submitted to the landlord, who was about to give his consent when he learned of the $500 bonus, whereupon he declined to indorse his consent to the subletting unless he received that bonus. The plaintiff refused to accede to this demand. Through the landlord’s refusal to give the consent the plaintiff failed to sublet the premises. The court held that the damages were properly assessed
The same situation obtains here.
The landlord also calls attention- to variances between the pleadings and the proof, and especially to the fact that the counterclaim in the prayer for relief does not demand affirmative judgment. No objections were raised to these defects during the trial, when they could have been cured. Nor was the attention of the court called to the failure of the tenant to demand affirmative relief, although the case was submitted to the jury with directions to render a verdict in such sum for the tenant as they believed it to have been damaged, provided they found for the tenant in excess of the conceded claim of the landlord. The' silence of the landlord during the trial must be taken as a consent that the issues should be tried as submitted upon the trial. The objection that there was a deviation from the pleadings comes too late. Frear v. Sweet, 118 N. Y. 454. Where counsel fails to present to the court all the points, he cannot be heard after the trial to establish a proposition which was not before the court. Boehm v. Commercial Alliance Life Ins. Co., 9 Misc. Rep. 529; affd., 86 Hun, 617; Smith v. Rentz, 73 id. 195.
However, the jury were permitted to and did include in their verdict the sum of $1,000 paid by the tenant as brokerage commission. This was error. In no aspect of the case was the tenant entitled to recover that amount from the landlord.
The motion to set aside the verdict and for a new
Decreed accordingly.