176 A.D. 588 | N.Y. App. Div. | 1917
The action is to recover a monthly installment of rent claimed to be due under a written lease of certain premises in the county of New York for a term of twenty-six years from the 4th day of February, 1897. The defendants interposed an amended answer, in which they admitted the making of the lease, and
The.defendants then served a second amended answer, in
‘ ‘ And whereas the said lessees contemplate the organization of a corporation which shall carry on the business which they design to conduct on the premises hereby demised, it is agreed that in the event they organize said corporation, which shall assume all of the assets and liabilities of said lessees, take over and accept an assignment of this lease for the entire unexpired term
The plaintiff served a reply in which he denied the making of such oral agreement and pleaded as a defense thereto: First, the ten years’ Statute of Limitations; second, laches; third estoppel by acquiescence and payment of rent for nineteen years without objection; fourth, ratification. A trial of the equitable issues raised by the counterclaim and reply was ordered in advance of the trial of the common-law issues. At the opening of the trial the plaintiff moved to dismiss the counterclaim because of insufficiency in law, in that there was no allegation of a mutual mistake on the part of the original parties to the lease, nor an allegation of a mistake on the part of the defendants accompanied by fraud or other' inequitable conduct on the part of the lessor. At the close of the case the plaintiff moved to dismiss the counterclaim for failure of proof, and upon the defenses above set forth. These ■ various motions were denied and exceptions duly taken. The court decided the issues in favor of the defendants and directed the lease to be reformed nunc pro tunc as of February Í, 1897, substantially in the language as prayed for in the answer.
In the case at bar we have a lease for a long term of years, carefully prepared, no less than three draft copies having been successively made and submitted to the defendants before it was reduced to its final form. It is complete in its terms, conditions and covenants. In it there are no ambiguities and nothing to suggest omissions or that it is other than it purports to be, the final written agreement embracing the whole engage-
Chancellor Kent, reviewing the early English cases on the question of whether a court of equity - could relieve against a mistake as against fraud and whether parol evidence could be received, said: “ The cases concur in the strictness and difficulty of the proof, but still they all admit it to be competent, and the only question is, does it satisfy the mind of the court ? Lord Hardwicke said it must be proper proof, and the strongest proof possible; and Lord Thürlow that it must be strong, irrefragable proof, and, he said, the difficulty of the proof was so great that there was no instance of its prevailing against a party insisting that there is no mistake.” (Gillespie v. Moon, 2 Johns. Ch. 597.)
Pomeroy in his Equity Jurisprudence says (3d ed. § 859):
To my mind the evidence in the case at bar falls far below the required standard. First, we have the circumstance that no claim that an agreement other than that set forth in the written lease was made or contemplated until after it was suggested by this court on the last appeal that “ It must appear, in addition thereto, that there was an express agreement by which the lessee was released from his covenant to pay the rent, or facts shown from which such agreement can be implied.” (172 App. Div. 189.) Then for the first time it was claimed that an oral agreement had been made, and by mistake omitted in the written lease. A memory refreshed by a necessity pointed out by an appellate court may be convenient, but is not convincing. Second, the testimony of the two principals who negotiated the lease was not available at the trial. Charles Halbe was dead and Samuel Adams was physically and mentally incapacitated ; therefore, the entire proof rests upon the testimony of the attorney who drew the lease as to occurrences and conversations which took place nineteen years ago. And in one of the few instances where the witness purports to give Halbe’s words, the witness stated that the building to be erected would be additional security. Halbe replied: “ Well, the building is all right and I feel satisfied with that, but I also like Flanigan,” and again Halbe said: “Flanigan would have been good enough for me.” Third, the acts and declarations of the parties as evidenced by documents are inconsistent with the existence of an agreement releasing the defendants from liability on the lease upon its assignment to the corporation. In the will of Charles Halbe made March 10, 1911, he provides: “I do hereby give, devise and bequeath unto my son William Alexander Halbe, all my real estate situated on the
Is it reasonable to infer that if he had understood that when the corporation was formed and the lease assigned to it that the corporation had been accepted by him as the tenants under the' lease in place and stead of the defendants, who were the members of the firm of Adams & Co., he would thus have discriminated between the present tenants and the present occupants of the premises ?
The lease was assigned to and accepted by the corporation on July 18, 1900. Thereafter, and on November 15, 1900, the directors of the corporation, two of whom out of the three were the defendants, adopted the following preamble and resolution:
“ Whereas prior to the incorporation of this company the leases covering 339 to 355 Sixth Avenue, 104 and 106 West 22nd Street and 105 to 111 West 21st Street were made out in the names of Samuel Adams and John Flanigan. Whereas, under the terms of the said leases the said Samuel Adams and John Flanigan became personally liable for the rentals of said leases. Whereas said leases have been transferred to the corporation and it is just and proper that said Samuel Adams and John Flanigan be released from personal liability under said leases and that the same be assumed by the company, the president of this company is hereby authorized and empowered to take any steps and to do all things necessary and proper to be done in the premises and deliver on behalf of the company all instruments required in order that said Samuel Adams and John Flanigan be so relieved from liability and that said liability shall fall upon and be and become the liability of this company.”
If it had been already agreed between the various landlords and the defendants (for it was shown that an identical clause as to the organization of a company and the assignment of the lease was contained in the various leases) that on their assignment to and assumption by the corporation the defendants should ipso facto be released from all personal liability, why this preamble and resolution? Why should the president of the corporation be empowered to take steps, do all things
These considerations tend to demonstrate that there was no agreement that upon the assignment of the lease to the corporation the defendants should be relieved from their liability to pay rent.
It is further claimed that the parties understood that the' legal effect of the clause consenting to the assignment was to release the defendants from liability. This rests entirely on the testimony of the attorney that he so understood the legal effect and told all the parties that such was the effect. But as we have seen the will of Halbe and the resolution of the directors of the corporation show that such was not the supposition of the parties. The lease was read by the parties and accepted by them as expressing their agreement. The mere fact that a lawyer gave bad advice to the defendants as to the legal effect of the language used and agreed upon is no ground for reformation or defense. (Garnar v. Bird, 51 Barb. 217, 286; Wilson v. Been, 14 N. Y. 534, 535.)
The language adopted by the parties must be construed according to its legal effect and not in accordance with the misapprehension or ignorance of a lawyer. Upon the evidence produced at the trial, I am of opinion that it was proved that the lease as made expressed the full and complete agreement of the parties, and that no mistake that would authorize a court of equity to reform the contract was established. I have considered the case on the merits, but I am further individually of the opinion that the Statute of Limitations (Code Civ. Proc. §§ 388, 391) is a bar to the maintenance of the counterclaim. A majority of the court, however, do not concur in my view. The justice at Special Term directed a final judgment to be
The judgment should be reversed, with costs, the counterclaim dismissed on the merits and the case remitted to the Trial Term for disposition of the remaining issues of fact.
Clarke, P. J., and Davis, J., concurred; Scott, J., concurred on first ground; Smith, J., dissented.
Judgment reversed, with costs, and counterclaim dismissed on the merits and case remitted to Trial Term as stated in opinion. Order to be settled on notice.