127 Misc. 611 | N.Y. App. Term. | 1926
The landlord brought this proceeding against the tenant, as the parties are therein nominated, for non-payment of rent for December, 1925, and January, 1926. Upon the trial it appeared that the petitioner in January, 1925, obtained a deed to the property from C. Pianisani, Inc., a corporation controlled by the tenant; that the latter occupied the premises in question at the time of the conveyance and was still in possession at the time of the trial. No evidence appears to indicate that the tenant ever paid any rent to the corporation or that the landlord endeavored to collect it prior to December, 1925. The latter testified, however, that he had made an agreement with the tenant for the payment of seventy-five dollars per month for the occupancy of the premises, beginning with the last named month. Such a contract is denied by the tenant, who, while orally pleading a general denial, endeavored to prove at the trial that the deed under which the landlord
The proceeding was brought under the authority of section 1410, subdivision 2, of the Civil Practice Act by one claimed to be a landlord, against a tenant, as a holdover after default in nonpayment of rent. To authorize such a proceeding under this section, it was necessary for the petitioner to establish that the conventional relation of landlord and tenant existed between the parties. (People ex rel. Mitchell v. Simpson, 28 N. Y. 55.) In Black’s Law Dictionary the term conventional is defined as “ Depending on, or arising from, the mutual agreement of parties; as distinguished from legal, which means created by, or arising from, the act of the law.” As is said in People ex rel. Mitchell v. Simpson (supra, 57): “ The relation of landlord and tenant is created by a lease, or demise, to which the landlord and tenant are parties, and this constitutes the conventional relation between them.” This agreement may be express or implied, or it may even be created by estoppel, but in the latter case the creation is likewise not by'operation of law, but by acts of the parties, which estop the tenant from denying the existence of the relation; and “ unless this relation exists by agreement, and not by operation of law, the magistrate has no jurisdiction in such cases.” (Burkhart v. Tucker, 27 Misc. 724, 725.)
The statute has also authorized the remedy in certain cases in which the conventional relation does not exist, such as in favor of a purchaser after perfected title against a former owner, whose property has been sold by virtue of an execution or under foreclosure by advertisement; also by an owner against a squatter. (Civ. Prac. Act, § 1411.) ' It is also available to one forcibly put out or kept out of lawful possession (Civ. Prac. Act, §§ 1412, 1414), notwithstanding the fact that there is not the slightest element of relation of landlord and tenant. (Markun v. Weckstein, 100 Misc. G68.) But it cannot be invoked by a mortgagee, or even a purchaser in the ordinary form of foreclosure of mortgage. The remedy in such a case, after appropriate judgment in foreclosure, is by an application for an order in the nature of a writ of assistance (Greene v. Geiger, 46 App. Div. 210), unless the tenant was not a party to the foreclosure action, in which event summary proceedings may be maintained. (Commonwealth Mortgage Co. v. De Waltoff, 135 App. Div. 33.) A mortgagee, whether before or after breach of
It would seem, therefore, that if the tenant were able to show that the alleged landlord was really a mortgagee, he would not only defeat the proceedings under section 1410, but would also successfully bar the petitioner from bringing such proceedings under any other provision. The tenant was not permitted to introduce any such evidence, upon the theory that it called for the exercise of equity jurisdiction, which confessedly, the court did not possess. Clearly, this ruling was error, for all that was attempted was to-challenge the claim of the petitioner that he was the landlord in the premises. The oral answer, in form a general denial, did not present any equitable defense; nevertheless, the tenant was well entitled to offer the proof. But if such a defense were actually tendered, it seems to us the situation would have been no different. This subject has been attended by much discussion and no less confusion, and our experience has demonstrated the need for higher clarity. In an effort in this direction let us examine into the nature and limits of the equitable defenses which may be interposed. The solution would appear to be bound up with the interpretation of section 1425 of the Civil Practice Act (added by Laws of 1921, chap. 199, as amd. by Laws of 1924, chap. 514), and to intelligently arrive at this requires a retrospect of the historical development of the section which, in part, provides as follows: “At the time the precept is returnable * * * the person to whom it is directed * * * may answer, orally or in writing, denying generally the allegations, or specifically any material allegation of the petition, or setting forth a statement of any new matter constituting a legal or equitable defense, or counterclaim. Such defense or counterclaim may be set up and established in like manner as though the claim for rent in such proceeding was the subject of an action.”
The original statute which authorized the remedy in summary
By chapter 193 of the Laws of 1849 the provision for the defenses available to the tenant was amended by requiring “ an affidavit * * * denying the facts upon which the said summons was issued, or any of those facts; * * This became a part of section 2244 of the Code of Civil Procedure on September 1, 1880 (Laws of 1880, chap. 178), except that the affidavit was denominated answer to make it accord with the forms of pleading in actions generally. Under the amendment of Í849 the tenant in People ex rel. Ainslee v. Howlett (76 N. Y. 574) was held entitled to prove that a lease under authority of a deed was in fact a cover for a usurious loan, and that this deed was actually a mortgage. According to the notes of the Commissioners of Revision (2 Throop's Code Civ. Proc. [1880] 362, anno, to § 2244), the changes made by the Code of 1880 did not preclude a tenant from proving that the tenancy was void or voidable in accordance with the rule in the case last cited. (See, also, Reich v. Cochran, 151 N. Y. 122.)
With the development of Code pleading our legal tribunals evinced a tendency, in summary proceedings, to bar affirmative defenses constituting new matter, limiting the defense to such as might be proved under general or partial denials. (Bloom v. Huyck, 71 Hun, 252; Durant Land Imp. Co. v. East River El. Light Co., 15 Daly, 337.) In adopting this construction they seem-» ingly followed the strict language of the statute. So, therefore, while in the ordinary action the Code had made provision for pleading new matter constituting defenses or counterclaims,' the absence
In 1893 the Legislature put an end to this equivocal situation and placed the answer in summary proceedings upon substantially the same basis as an answer in an action. By chapter 705 of the Laws of 1893 it permitted, in addition to the general and specific denials, a “ statement of any new matter constituting a legal or equitable defense, or counterclaim. Such defense or counterclaim may be set up and established in like manner as though the claim for rent in such proceeding was the subject of an action.” The right granted the tenant to avail himself of equitable defenses under this amendment gave rise to a possible construction that the Legislature might have conferred upon inferior courts equity jurisdiction in contravention of article 6, section 18, of the Constitution of the State. That no such intention was manifest is fully indicated by a reading of section 2244 of the Code (now section 1425 of the Civil Practice Act). The comma following the words “ legal or equitable defense ” and preceding the words “ or counterclaim,” makes perfectly clear that the group of words containing the adjectives was not intended to qualify thé word “ counterclaim; ” in any event, the adjective “ equitable ” was certainly not intended as a word of qualification upon the word “ counterclaim,” and the latter in its scope is confined to one only of legal nature. Furthermore, if additional support for this proposition were necessary, the provisions embodied in this section by chapter 132 of the Laws of 1920 giving the court power to grant affirmative judgment for the amount found to be due on the counterclaim, point unequivocally to the legislative intent to authorize only affirmative legal and not equitable relief. The right to a money judgment on the counterclaim was an extension of the one previously limited to a setoff against the amount of the landlord’s demand, but could not serve the tenant in his endeavor to recover upon his excess claim, if any, as was held in Wulff v. diento (28 Misc. 551).
Some of the difficulties of equitable defenses in summary proceedings resulting from the interpretation of the amendment of 1893 are noted in Constant v. Barrett (13 Misc. 249), where the court recognizes the availability of such defenses in proceedings of this character, so far as they may go to defeat the landlord’s claim. The problems suggested there, without any attempt at their solu
Indeed, there was a time when equitable defenses were practically unknown in common-law courts. By statute or judicial innovation, however, their jurisdiction in this direction has been greatly extended. In many cases where, formerly, a defendant was compelled to invoke.equity for relief against an unconscionable adversary, the former may now defeat the latter at law. For, by peremptorily barring the action, the same result upon precisely the same grounds is reached by the common law as could be effected in chancery by permanent injunctive measures. Therefore, the distinction between equitable defenses which are urged to defeat the proceedings and equitable counterclaims which require the granting of affirmative relief, as to which only a court of equity has jurisdiction, becomes of consequence and may be illustrated by the following cases. In Simon v. Schmitt (137 App. Div. 625) the' tenant whose term had expired, defended in the summary proceeding brought against him, upon the ground that he was entitled to a renewal of the lease under his agreement. But the renewal clause left the question of the rent for the new term to be determined
It is undoubtedly true that if the mere giving of the notice of renewal had been sufficient ipso facto, under the terms of the lease to work extension, it would have been unnecessary to bring into exercise equitable jurisdiction for affirmative relief, and the tenant would have had a complete defense in proceedings against him as a holdover. (Hausauer v. Dahlman, 72 Hun, 607.) On the other hand, if it were broadly true that one who had a mere equitable right to a lease could defeat summary proceedings, the logical result, in the words of Judge Miller in Simon v. Schmitt (supra), would be a case of “ a tenant without a lease.” In Armstrong v. Shapiro (207 App. Div. 304) Mr. Justice Dowling writing, it was held that an option of renewal separately written and delivered a month after execution of the lease, required an action in specific performance to convert it into a lease, and the existence of such option was, therefore, no competent, equitable defense in summary proceedings. In the case of Capet v. Parker (3 Sandf. 662) the lessee after his tenancy had commenced, contracted to purchase the property. The landlord not only failed to convey but instituted summary proceedings to remove him. The tenant filed a bill for specific performance and enjoined the proceedings on the ground that there were equities involved which the justice entertaining the summary proceeding had no jurisdiction' to determine. The court held that when the tenant became a purchaser from the landlord,
•Of course, the proof by a tenant of the fact that he was the vendee in possession would tend to destroy any claim of the conventional relation; still this might be an equitable defense affirmatively .averred. But as the Municipal Court could not grant equitable .relief, a final determination of the rights between the parties would require an appropriate action in the proper forum. The procedure is pointed out by McAnAM, J., in Rodgers v. Earle (5 Misc. 164, 168): “ It is clear that even the amendment of 1893, in regard to equitable defenses or counterclaims, would not give the tenant in such a case the relief he required. The inferior court could not, under that amendment, decree or enforce specific performance against the landlord. The most it could do would be to find for the tenant on equitable grounds, leaving either party bo seek the necessary substantial relief in a court having equity jurisdiction. Two trials would be made necessary instead of one. Equity abhors a multiplicity of suits, and will enjoin against them when it can.”
While the tenant in the instant case might have brought an action in equity to determine his rights completely and enforce his remedy accordingly, possibly with an injunction to restrain this very proceeding, still he is not barred, as it seems, from setting up the equitable defense in the inferior court.
In Burkhart v. Tucker (supra) the landlord instituted summary proceedings against the tenant in possession who was also the vendee under an agreement to purchase, predicating this upon the contract of sale which gave him the right to rescind for breach of condition and thereupon to take immediate possession. The court held the proceeding improper and declared the remedy of the petitioner to lie in ejectment or foreclosure of the contract. In Roedmann v. Hertel (78 Misc. 55) the landlord brought summary proceedings which were dismissed on the following facts: The day .•after an unsigned lease was given to the tenant by the landlord’s predecessor, he paid a deposit and procured a receipt, which spoke of a five years’ lease. He entered into possession and made permanent improvements. Thereafter, the petitioner, as grantee, obtained a deed which made reference to such lease. This court in the Second Department sustained the final order in favor of the tenant, on the ground that the landlord took title subject to all existing equities, and could not maintain summary proceedings to 'dispossess on the claim that the lease was void under the Statute of Frauds. Thus, the rule that a lease, even if otherwise void under that statute, would be enforced in equity if the lessee had changed
As it is of the utmost importance to avoid any misconstruction of the extent of the Municipal Court jurisdiction to entertain equitable defenses generally, it is not out of place to note cases, both chronologically prior and subsequent to the last one which, while they do not precisely deal with summary proceedings, are nevertheless useful in clarifying the situation. Incidentally these are helpful in showing the bounds of equitable defenses as distinguished from equitable counterclaims. Pelgram v. Ehrenzweig (51 Misc. 31) was an action for rent on a written lease, begun in the Municipal Court. The defense was that the agent of the landlord had fraudulently inserted the wrong apartment number in the lease, and the defendant had, therefore," refused to take possession. Testimony to this effect was rejected below on the ground that “ the law did not give this court jurisdiction to go behind a written instrument.” This court held that to be a mistaken view, saying (at p. 32): “In the Municipal Court, in actions upon written contracts, though fraud may not be proven as the basis for affirmative relief, it is always available as a defense to a claim founded on the contract. Smith v. Hildenbrand, 15 Misc. 129; Richards v. Littell, 16 id. 339; Malkemesius v. Pauly, 17 id. 371.”
The Pelgram case was retried, and upon the new trial the court found no fraud, but granted judgment to the defendant for the reason that the lease was executed under mistake. In reversing we held (58 Misc. 195) that the court erred in “ attempting cancellation of a written instrument under seal on the ground of execution under mistake, which is not within the powers conferred upon the Municipal Court * * * and assuming cognizance of a jurisdiction expressly denied (Mun. Ct. Act, § 2, subd. 2) * * *.” Judge Bischoff wrote a concurring opinion, in which he gave expression to the view that “ the Municipal Courts are not authorized to entertain equitable defenses, except in summary proceedings to recover the possession of land; and equity jurisdiction in any case is expressly denied. Mun. Ct. Act, § 2, subd. 2.” The opinion of that jurist would indicate that the defense of “ mistake ” there was of an equitable nature and might be interposed in summary proceedings only, but not in actions at law in that forum.
However, there is no question that the principle has been repeatedly asserted by this court that equitable defenses may be set up in the Municipal Court in all actions. (Geller v. Kings County Mortgage Co., 97 Misc. 707.) This practice has probably been sanctioned by virtue of the spirit of section 69 of the Code of Procedure, later section 3339 of the Code of Civil Procedure, and now section 8 of the Civil Practice Act, by which “ The distinction between actions at law and suits in equity, and the forms of those actions and suits, have been abolished.” Such defenses are not necessarily confined to such as involve the mere question of fraud. Thus, in Queensborough Gas & El. Co. v. Schoncke (76 Misc. 190) the defense of equitable estoppel in an action for the value of electric current furnished was permitted. And in Metropolitan Electric Protective Co. v. Ashlamian (185 N. Y. Supp. 358), in an action for damages for breach of contract, the defendants pleaded both as a defense and counterclaim that the execution of the instrument by them was procured by the fraud of the plaintiff, aided by a mistake on their part. As an equitable defense the plea was held valid, but the judgment of the Municipal Court was deemed erroneous, because affirmative relief by way of damages was awarded to the defendant. The case of Richards v. Littell (16 Misc. 339), while arising in the City Court, is interesting because it deals with the limits of equitable defenses in actions at law. There the plaintiff sued for use and occupation. The defense was that the entry into possession was under a contract of sale, and this was followed by a demand of judgment for specific performance. We held that while the facts alleged were available as a defense, the matter of affirmative relief should be disregarded.
The fact that in the preceding case the subject of the action was. one for rent, does not render the principle less applicable to defenses in proceedings of this kind; for section 1425 of the Civil Practice Act (added by Laws of 1921, chap. 199, as amd. by Laws of 1924, chap. 514), in words that are by no means uncertain, provides that a legal or equitable defense or counterclaim may be set up in such pro
Applying the principles gathered from this discussion to the case before us, the fact that the landlord had the legal title and the tenant had the use and occupation of the premises, was insufficient in itself to create the conventional relation. (Preston v. Hawley, 101 N. Y. 586.) Here, the landlord, evidently realizing the necessity of proving more than mere title in him and use and occupation by the tenant, attempted to establish an actual agreement for the payment of a fixed rental per month. While this was denied, the jury might seem to have passed upon the disputed question of fact in a manner which would not warrant us to disturb the verdict. But the circumstance occurring upon the trial which quite obviously influenced the result, appears to merit reflection. After its retirement and considerable deliberation, the jury returned and made the following request: “ The Foreman: The jury would like to be instructed on whether De Vita is the present owner of the property according to the deed. The Court: He is the legal owner of the property and we must recognize him as such.”
It thus becomes evident that the refusal of the trial judge to permit the jury to consider the question of the nature of the landlord’s title, and his instruction in that regard, tantamount to a complete foreclosure of considering the landlord as other than the legal owner of the property, operated to the grave prejudice of the tenant. True it is, that a tenant is precluded from denying the title of his landlord, but this rule merely estops him from challenging the title as it existed at the time when the lease was made or when the relation arose. (Kibbe v. Crossman, 139 App. Div. 338.) Moreover, the tenant here occupied the premises from January, 1925, without any attempt on the part of the landlord to collect rent until nearly a year thereafter. At no time did he pay rent or recognize any obligation to do so. He may be said to have been in a position, therefore, to deny the andlord’s title, and this
Finally, we may well be committed to the principle that, when charged with the non-payment of rent, a tenant may unquestionably show by any defense that no rent is due; and in that behalf the inferior courts may take cognizance of equitable defenses only to the extent of arresting the procedure and frustrating the claim of the adverse litigant, whether he be plaintiff in an action or the petitioner in a proceeding, to the end that he may not prevail.
The final order is, therefore, reversed and a new trial ordered, with thirty dollars costs to the appellant to abide the event.
All concur; present, Delehanty, Lydon and Levy, JJ.