133 N.Y.S. 876 | N.Y. App. Div. | 1912
The defendant is the owner in fee and landlord of certain premises known as 1618 and 1620 Broadway, in the borough of Manhattan, and the plaintiffs are tenants thereof under a lease entered into in 1906 between the then owner of the property and plaintiffs’ assignor. The said lease was for a term of ten years,
The said lease further provided: “Ninth. In case of default by said tenant in any of the covenants herein contained or in case the whole or any part of said premises shall become vacant, the landlord may at his option terminate this lease at any time by giving thirty days previous notice to the tenant,. said notice to be left on the premises with any person in charge thereof, or to be affixed upon a conspicuous part of the premises, if they are vacant; or the landlord may at his option re-enter the said premises and resume possession thereof, either by force or otherwise, without being liable for any prosecution therefor, and re-let the same during the remainder of the term, at the best rent that he can obtain for account of the tenant who shall make good any deficiency. ”
The Special Term has found as a fact that said 9th clause of the lease herein, so far as same was applicable to the covenant to pay rent, was inserted as a security merely for such payment, and was so regarded by the parties.
The building which it was contemplated would be erected upon the premises was completed and the tenants entered into occupation of the same under the terms and provisions of the said lease on the 18th day of January, 1908, and on that day paid the first quarterly installment of rent in advance. Quarterly installments of rent in advance were thereafter paid as follows:
Due according to lease. Paid by check dated.
April 18, 1908. April 18, 1908.
July 18, 1908. July 18, 1908.
Oct. 18, 1908. Oct. 19, 1908.
Jan. 18, 1909. Feb. 18, 1909.
April 18, 1909. April 20, 1909.
July 18, 1909. July 21, 1909.
Oct. 18, 1909. Nov. 3, 1909.
The court has found that payment of rent on the first day of each quarter had not been insisted upon; that only the first three quarterly installments out of eight were paid at the beginning of the quarter; that a custom had grown up between the landlord and the tenants of accepting and paying the rent on a
The vice-president of the defendant company testified that after he wrote the letter of January twenty-ninth he had a telephone conversation with the president of the plaintiff companies, whom he had called up on the first, second or third of February: “The substance of it was that I would like a check. Mr. Singer said it would be sent. That is all there was said. There was not anything said about cancelling the lease. It was not referred to at all. Nothing was said to indicate that because the rent had not been paid two or three weeks before that we would not take the rent. We were willing to take the rent at that time. I asked him for it. I have said I didn’t say anything to him when I asked him for that rent, that if he didn’t send it down we would cancel the lease.”
On February 9, 1910, the rent still being unpaid, the landlord served upon the plaintiffs the following notice: “You and each of you are hereby notified that Barney Estate Company, Landlord * * * in consequence of the default of the tenant under said lease to pay the rental therein covenanted to be paid hereby elects to terminate the said indenture of lease upon the 12th day of March, 1910, in accordance with the provision thereunto provided. Thirty days previous notice of such termination is hereby given in accordance with the terms of said lease and you are hereby notified to deliver up and vacate the .said premises on or before said 12th day of March, 1910.”
Thereafter the defendant brought dispossess proceedings against the plaintiffs as holdovers after the termination of their lease, but the tenants had a decision in their favor which, on appeal to the Appellate Term, was reversed and a new trial ordered. (Barney Estate Co. v. Palmer & Singer Mfg. Co., 68 Misc. Rep. 501.) Before the coming on of the new trial this equitable action was instituted and a preliminary injunction was granted by the Special Term which was affirmed unanimously on appeal to this court, without opinion. (143 App. Div. 906.)
In the agreed statement of facts submitted to the Special Term it is conceded that the rental value of the premises since January 1, 1910, is substantially more than the amount of rent reserved in the lease.
As conclusions of law the Special Term found that the defendant waived the payment of rent for the quarter beginning January 18, 1910, on the particular day specified in the lease, and that plaintiffs aré entitled to judgment as asked for excusing plaintiffs for not paying the rent upon the rent day mentioned, and that the said lease is in full force and effect and binding upon the parties hereto in all respects, and plaintiffs were entitled to the injunction prayed for, and from the judgment entered in accordance therewith defendant appeals.
It is apparent from the record that there is and has not been the slightest chance that defendant would fail to receive the full amount of rent due. It has been tendered repeatedly and is thoroughly secured by bond and deposit, and the question is whether a court of equity is required to declare a forfeiture of a long term lease for a twenty-one days’ delay in the payment of the quarterly rent payable in advance under, the circumstances disclosed by this record. The plaintiffs are engaged in
A significant fact is that in the conversation over the telephone between the vice-president of the defendant and the president of the plaintiff companies, held on the first, second or third of February, as Mr. Brundage testified, when he said that he would like a check Mr. Singer said it would be sent and he further testified that nothing was said about canceling the lease or “ to indicate that because the rent had not been paid two or three weeks before that we would not take the rent. We were willing to take the rent at that time.” Yet six days later the notice was served canceling the lease for default in payment on January eighteenth. Can it be doubted for a moment that if Mr. Brundage had said to Mr. Singer, if you don’t send the check at once we will be obliged to exercise the option given to us by the lease and cancel it, he would have received it, it appearing that immediately upon receipt of the notice of February ninth the full amount due with interest was tendered ?
In view of the previous relations of the parties and their mutual conduct, it was not fair without notice to attempt to exercise the right to cancel. Forfeitures are not favored in equity. This provision was inserted by way of security but is being made use of, not to enforce payment of an amount due, but to regain possession of a valuable piece of property of which the rental value has substantially increased since the making of the lease above the amount of the rent reserved.
In Horton v. N. Y. C. & H. R. R. R. Co. (12 Abb. N. C. 30; affd. without opinion, 102 N. Y. 697), where a similar action was brought to secure relief to the plaintiffs from the forfeiture of a term, Mr. Justice Daniels said: “ Under the well-settled principles observed and enforced in courts of equity where such a forfeiture has been provided for as a security to the lessors for the payment of the rent reserved, as it was by this lease, the tenants have usually been relieved from the
In Giles v. Austin (62 N. Y. 486) there was a covenant in the lease that the lessee should pay the taxes and assessments as the same should become due and payable. After notice the lessor brought an action of ejectment alleging that the lessee had neglected and refused to pay the taxes for a number of years. After the action in ejectment had been instituted plaintiff brought an action to be relieved from his forfeiture. Judge Bapallo said: “That covenants to pay taxes and assessments are in the nature of covenants to pay money, and that forfeitures incurred by their breach may be relieved against upon the same principles. By the payment of the amount due at any time before sale or the expiration of the right to redeem, the landlord is placed in precisely the same position as if no default had occurred; and where there is no bad faith on the part of the tenant, mere delay in making the stipulated payments should not bar him from relief.”
In Noyes v. Anderson (124 N. Y. 175) Bradley, J., said: “The power of a court of equity in cases properly requiring it, will be exercised to reheve a party against forfeitures and from penalties. And this is upon the principle of equity jurisprudence that a party having a legal right shall not be permitted to avail himself of it for the purposes of injustice or oppression. * * * It is also not only available
The judgment appealed from should be affirmed, with costs.
Ingraham, P. J., McLaughlin, Laughlin and Scott, JJ., concurred.
Judgment affirmed, with costs.