Kennedy v. ERKMANKennedy v. ERKMAN
Opinion by
There are two appeals in this case. One is the appeal of John C. Huss, one of the defendants in the court below. The other is the appeal of Cities Service Oil Company, an intervenor defendant in the court below. Both appeals are from the order of the trial court which discharged rules to shoAv cause why a judgment in an amicable action of ejectment should not be stricken or opened.
The ease arises from the following facts: Appellees, Samuel A. Kennedy and Margaret J. Kennedy, his Avife, owned a gasoline service station in Versailles Borough, Allegheny County. On April 9, 1951 appellees entered into a Avritten lease to rent the premises containing the service station to Michael Erkman and John C. Huss. Erkman and Huss were both defendants in the court beloAV, but Erkman is not an appellant in this court. The lease Avas for a period of one year, expiring on March 16, 1952, and from year to year thereafter, but, nevertheless, each party could terminate the lease at any time upon sixty days’ written notice. The lease
The issues presented by the facts in this case are very narrow. They may be stated as follows:
1. Did the assignment executed by the Kenn'edys convey their power to terminate the lease; and
2. Where a husband and wife are the lessors, is it necessary that a termination notice be signed by the wife as well as the husband?
In order to resolve the first issue, it is necessary to determine the intent of the parties in using the words “all rights, privileges and obligations” to describe what was to pass to the assignee at the time the assignment was executed.
The primary rule of construction of an agreement is that the intent of the parties is controlling. Where the words used are clear and unambiguous the intention must be determined from the agreement alone:
Atlantic Refining Company v. Wyoming National Bank of Wilkes-Barre et al.,
Appellants contend that when a lessor assigns a lease he no longer has the power to terminate it. In support of this contention, appellants cite
Landberg et al. v. Equitable Investment Co. et al.,
Further examination of the assignment involved in the instant appeals sheds additional light upon the intent of the parties. The assignors specifically reserved the rentals and all rights incidental thereto. The right to receive rents is usually the most essential element in any lease from the standpoint of the lessor, and here that important right of the lessor was completely unaffected by the assignment.
The consideration passing to the assignor for the assignment is also significant in determining intent. The assignment recites a consideration of One Dollar and there is no evidence that the actual consideration was anything more than that. It seems almost inconceivable that for a nominal consideration a lessor would agree to place beyond his power indefinitely the ability to increase rental income by terminating a lease and entering into a more favorable one should the opportunity present itself. It is likewise inconceivable that the lessor-owners would, by relinquishing for an indefinite period their power to terminate (while the lessees retained their power to terminate at will) a lease calling for a restricted single use and a fixed rental, create a condition which would make it impossible as a practical matter for them to sell their land at the value it would possess without such limitation. These are particularly important considerations to a lessor in a pe
The words of art which are usually employed where parties intend that all of an assignor’s valuable property attributes should pass to the assignee are “all of the right, title and interest” rather than “rights, privileges and obligations”. The ability to terminate a lease is more properly designated a power rather than a right, and would clearly be intended to pass to an assignee where all of the interest of a lessor in the lease is conveyed by an assignment. The use of the terms employed in this part of the assignment here involved, as well as its other provisions previously referred to, result in an ambiguity or doubt as to the intent of the parties.
When the surrounding circumstances are considered, the intent of the parties to the assignment clearly emerges. Appellee Samuel A. Kennedy testified on deposition that the lessee service station operators had refused to enter into agreements with appellant Cities Service Oil Company for equipment rental and sales contracts — under the lease, the lessors had the right to prescribe the brand of products which were to be sold on the premises — and that the purpose of the assignment was to give Cities Service Oil Company the right to supply its products to the lessee. This testimony was uncontradicted. The right to furnish its products, which is undoubtedly of value to appellant Cities Service Oil Company, passed to it by the assignment and was enjoyed by it for a period of more than three years.
We come now to the question of whether lessors gave notice of termination in accordance with the provisions of the lease. The lease provided “. . . either party may terminate same at any time without regard to the term stated by written notice delivered to the other party sixty days prior to the date upon which such termination is to become effective.” Husband and wife appellees were both parties to the lease as lessors, but only the husband appellee signed the notice of termination. Appellants contend that the lease provisions required both lessors to sign the notice. This issue was raised in the court below by the motion to strike the judgment from the record.
The Kennedys held title to the leased premises as tenants by the entireties. Where real estate is so held, neither spouse, acting independently, may create or terminate any legal interest in the land to the prejudice of the other spouse:
Schweitzer v. Evans,
The order of the court below refusing to strike or open the judgment entered in ejectment is affirmed, costs to be paid by appellants.