1 Hilt. 447 | New York Court of Common Pleas | 1857
The law, in respect to the liability of the assignee of a lessee for rent reserved by tbe lease, is well settled. Where
But there is a distinction between an express or specific assignment by a lessee of all his interest in a lease, and a general assignment made by him of all his property for the benefit of creditors. In the first case, the assignee, by accepting the lease, ■creates a privity of estate between himself and the lessor, and having established that relation, it is immaterial whether he enters and enjoys the land or not; but in a general assignment for the benefit of creditors, the assignees may accept the assign ■ment, and.enter upon the execution of the trust, but whether ■they will become assignees of a lease, held by the insolvent at thedime of the assignment, is altogether at their election, and ■that election must be signified by some unequivocal act. It must be an act denoting an intention on their part to avail and .possess themselves of the beneficial interest which the insolvent ■lessee had in the lease. Where a lease is expressly or specific-' ally assigned, the assignee, by accepting the assignment, indi•cates his intention to accept the leasehold estate, with all the conditions to which it is subject. But in an assignment for the -benefit of creditors, nothing more is indicated but the acceptance vef a trust, to execute which, it may or may not be necessary ■for the assignee to possess himself of a leasehold interest exist
This distinction, between the liability of a specific assignee of a lease and an assignee for the benefit of creditors, appears to-have been first pointed out by Lord Kenyon, in Bourdillon v. Dalton, 1 Espin. 234. “ The assignees,” he says, “ certainly take this term under the assignment, but if it be what the civil law calls ‘ damnosa hereditas,’ an interest producing nothing to the bankrupt’s estate, they may abandon it.” Afterwards, Lord Ellenborough, in Turner v. Richardson (7 East, 335), referred to this decision of Lord Kenyon, and said, that “the assignees of a bankrupt are not bound to take property of the bankrupt, -which, so far from being valuable, would be a charge to the creditors, but they may make their election ; if, however, they do elect to take the property, they cannot afterwards renounce it.” But the point came up for more mature consideration in Copeland v. Stephens (1 Barn. & Ald. 594), and it was distinctly determined, that the general assignment of a bankrupt’s personal estate, un
The same principle, in effect, has been recognized in the case of executors. Where they have no assets, they are not liable to the lessor, though the}^ have taken possession of leasehold premises for the purpose of letting them, if the possession has been productive of no profit, and they have, after keeping it a reasonable time for that purpose, offered to surrender it to the
In Carter v. Warne, supra, and Lindsey v. Limbert, supra, it was held, that the assignees have a reasonable time to ascertain if the; lease can be made available for the benefit of creditors or not, and during that time may take such steps as they may think necessary for the purpose of trying to make the property productive. They may offer the premises for sale (Hasting v. Wilson, and Turner v. Richardson, supra), or put an agent in possession for the purpose of letting them (Lindsey v. Limbert, 12 Moore, 209), or they may go themselves, or place persons temporarily upon the premises to take charge of the goods of the insolvent, and dispose of them there (How v. Kennett, 3 Adol. & Ellis, 659), and may even release an under-tenant, if, within a reasonable time, they notify the lessor that they do not intend to accept (Hill v. Dobie, supra), without assuming the character of assignees, or charging themselves or the assigned estate with the payment of rent.
But, assuming the management of a farm (Thomas v. Pemberton, supra), or selling the leasehold interest at auction and receiving a deposit on the sale, and then neglecting to enforce the contract against the purchaser (Hastings v. Wilson, supra), or executing an assignment of the lease to another (Page v. Godden, supra), or entering for the purpose of disposing of the.insolvent’s effects, and so using or occupying the premises as to diminish their value, and dealing with the premises as if they were their own (Carter v. Warne, supra), or carrying on the trade of the insolvent the same as before, for the benefit of creditors (Clark v. Hume), have been held to be acts showing an election to take the term and assume the legal relation of assignees of the lease.
I should not have felt it necessary to have gone so minutely into the examination of this question upon the authorities, but for a recent decision of the Superior Court (Muir v. Glinsman, Jan. General Term, 1856), in which an assignee for the benefit
In the case before us, the assignment to the defendants was made on the 18th of Aug., 1854, and on the evening of that day the keys of the store occupied by the insolvent were delivered to the assignees. Immediately after they took an inventory ; the goods were got ready for auction ; they dismissed the salesman., but continued to sell goods as customer came in, and a notice was posted up on the outside of the building, “ Selling off by order of the assignees.” On the 8th of September a portion of the goods wore sent to auction.- On the 9th of September an injunction was served upon the defendants, restraining them from selling the goods, which was dissolved on the 19th, and the day following, the residue of goods were sent to auction ; and on the 23d, before the quarter’s rent was due by the lease, the defendants vacated the premises. Soon after the assignment, and before the injunction, one of the defendants told one of the plaintiffs that they did not intend to take the building, and would have nothing to do with the lease; that they “ would occupy the building no longer than they could help; would get the goods right out, and close the business as soon as possibleand, before the quarter fell due, one of the plaintiffs told one of the under-tenants not to pay rent to Thompson & Roesler, the insolvent assignors; and the plaintiffs collected the quarter’s rent when it fell due, on the 1st of Nov., from two of the under-tenants, and entered intoan agreement, in writing, with each of them,to keep them in peaceable occupation until the first of May following, upon their paying their rent to the plaintiffs, and also to save them harmless against any one claiming rent from them.
There is nothins: in this state of facts to show an election, on
Pratt v. Leaven (1 Miles [Penn.], 358) was a case more nearly resembling the one under consideration. There the assignees, under a voluntary assignment for the benefit of creditors, containing no notice of the lease, took possession of the goods in a store, which, as in this case, was part of the demised premises, the key of which they took. They took an inventory of the goods, and, eleven days after the assignment, when the quarter’s rent was more than half expired, they made a public sale of the goods
Upon these authorities, I think it is very clear that the defendants did nothing to show that it was their intention to become assignees of the lease. Their entry upon the premises was for the temporary purpose of disposing of the insolvent’s effects, and they did so in an expeditious and summary manner. They notified the plaintiffs, within twenty days after the assignment, that they would have nothing to do with the lease, and informed them for what purpose they had gone upon the premises; and that the. plaintiffs did not regard or treat them as assignees of the lease, or as having succeeded to the rights and interests of the lessees, is evident from their notifying the under-tenants not to pay rent to the lessees, collecting rent from the under-tenants, and entering into the agreement to save them harmless. I can see nothing in the defendants’ acts to charge them as assignees of the lease, or to make them responsible for the performance of the covenants contained in it. It has been held that where one, not the lessee, is in possession of leasehold premises, it will be presumed that he is in as assignee of the original tenant. Du-
the present case, the judgment was given for the time that the defendants were adjudged to be in actual occupation, that is, from the 18th of Aug. to the 23d of September, at the rate of the rent reserved by the lease ; and it remains but to consider whether, if the defendants were not assignees of the lease, they were liable to the plaintiffs for use and occupation for the time they were adjudged to be in possession of the store.
I confess I do not see how it is possible for the plaintiffs to sustain an action against the defendants for use and occupation. If they were not assignees of the lease, then, according to the ruling (Copeland v. Stephens, 1 Barn. & Ald., supra), the leasehold estate remained in Thompson & Roesler, the insolvent lessees. The privity of estate had never been changed. Thompson & Roesler were in legal possession, under a valid subsisting lease, whether they were in actual occupancy or not being immaterial ; though, in my judgment, they were quite as much so as the defendants. If the defendants occupied, they could only do so rightfully by the permission and authority of the lessees. The lessors could give them no such authority ; they had reserved the right, by the lease, to enter and relet as the agents of the lessees, if the premises should become vacant during the term; but they did not become vacant until the 23d of September, when both the lessees and the defendants left the store. The action
The general term of the court below, therefore, were right in holding .that this judgment could not bo sustained; but they erred in giving j uclgment for the defendants. They should have •reversed the judgment and ordered a new trial; for the plaintiff might show, upon a new trial, acts of the defendants amounting ■to an acceptance of the lease. On the trial, he was not required to go any further, as the court gave him judgment upon the case ¡he made out. The case, therefore, must go back to the general :tcrm, that they may give the proper j udgment.
Ordered accordingly.