123 N.Y.S. 529 | N.Y. App. Div. | 1910
This action was brought to recover damages for the breach of a. contract in writing made between the plaintiff and the defendant’s testator, Meyer ¡R. Bimberg, on the 24th day of July, 1905, as amended on the twenty-sixth day of the same month. By the orig-" inal contract, so far as material to the question presented for decision, the decedent agreed to lease to the plaintiff a theater to be erected by him at the northwesterly corner of Forty-fifth street and Seventh avenue according to plans which were submitted to and approved by the plaintiff before the agreement was made. The agreement provided that the lease was. to be in the same form and of the same force and effect as a lease which the plaintiff then had of the Lyric Theater, except that the rental was to commence when the theater.was completed and accepted by the plaintiff, and was to be $40,000 per annum for the period of fifteen years thereafter, payable quarter-annually in advance.' On the day the decedent made' the original agreement . with the plaintiff an agreement between the decedent and one Tracy, who was the owner of a leasehold from the trustees of Henry Astor of the premises on which the theater was to be built, and one Thomas, was made for the purpose of forming a corporation to be' known as the Long Acre Square Theater Company with a view to having an agreement made
The recovery by the plaintiff has been under 'a liquidated damage clausó in the original agreement between him and the decedent in which the latter was the party of the first part, which is as follows: “ The party of the first part expressly coyenants and agrees that should he fail to carry out the terms and conditions of this agreement on his part to be performed, and should he fail to give the party of the second part hereto a lease of the said premises'or should he fail to secure for the.same party of the second part a lease of said theater in accordance with the terms of this agreement, that then and in that event he agrees to pay unto the party of the second part, the sum of Twenty-five thousand ($25,000) Dollars, which is hereby agreed upon as liquidated damages for the breach of this agreement, it being distinctly understood and agreed that the amount of damage which the party of the second part may secure by reason of the breach hereof cannot be estimated or determined, hence this figure is arrived at, which is not a penalty, but is expressly agreed upon as such liquidated damages.”
On the twenty-seventh day of July, three days after the original agreement between the plaintiff and the decedent was made, negotiations were opened by the architect, who represented the decedent in the construction of the building, for a lease of the theater to the firm of Wagenlials & Kemper, and on the sixteenth day of August thereafter a formal agreement was made by the decedent and Tracy with said firm to lease the theater to it. This agreement Was succeeded by one more definite on the 24tli day of August, 1905, and on the fifth day of September thereafter, by the direction dr consent of the decedént, a formal lease of the theater was made by the theater company, which had been incorporated, to said firm, on which an advance payment of $40,000 was made, and three days later a formal agreement was executed between the lessee and decedent by which the latter became a partner with them in the enterprise and entitled to one-third of any profits made under the lease. This put it beyond the power of the decedent to perform his contract
Two days after the original agreement was made the decedent had an interview with the plaintiff and with one Klein, the attorney for the plaintiff who drew the original agreement, and as a result of this interview the supplemental agreement was made in the form of a letter from the plaintiff to the decedent as follows : “ In addition to the terms contained in our agreement of July 24th, the following shall become part and parcel of said agreement.
“61 am to deposit the sum of $26,400,1 to secure interest thereon, however, in escrow to be turned over to the person or corporation holding the lease of the property in said agreement named on the turning over of the theater proper to me, same to remain at said times as security for the rent.’ ”
It is contended in behalf of the appellant that compliance on the part of the plaintiff with this supplemental agreement was a condition precedent to his right to the lease. It is conceded that the money was not deposited as contemplated. The evidence, however, fairly sustains the claim of the respondent that his omission to
It will be observed that the supplemental agreement of July twenty-sixth does- not designate ,a depositary. Immediately .after the supplemental agreement was signed the plaintiff manifested readiness to make the deposit as soon as they agreed upon a depositary, and; thereupon a/n appointment was made by telephone with President Schlesiriger of the Mechanics and Traders’ Bank, by which the parties and Attorney Klein were to call at the bank that afternoon and arrange to have Sclilesinger of his bank become the depositary and agree upon the- details with respect to depositing and withdrawing the. fund; The imdisputed evidence shows that the plaintiff had more than sufficient funds on deposit in various; banks with, which to make this deposit ip escrow and was ready and willing to perform on his part and that lie and his attorney were ready and willing to meet at the time and place specified; and; that his attorney did keep the appointment, but. that,the decedent postponed it ..arid evidently notified the plaintiff in- advance of the. hour. Within a day or two thereafter at least one, and some of -the evidence indicates that two definite appointments were made between the parties to meet at ■ the same place and for the same purpose. The president- of the bank was willing to receive the money in escrow, but it was contemplated and intended by the parties that a formal agreement, should be made between them arid the depositary with respect to the conditions upon which the money should be held arid withdrawn and" no rate of interest to be paid by the depositary had been agreed upon. The decedent .failed-to keep the second or second and third appointments and assigned as a reason that he had received" a-more favorable proposition for the lease of the premises, and1 subsequently refused to execute- the lease to the plaintiff and authorized its execution to the other firm as herein stated. It will.
The only other question of importance presented by the appeal arises on the appellant’s contention that liquidated damages cannot be recovered. This claim is based upon the theory that the agreement in that regard is in the nature of a penalty or forfeiture. We are of opinion that this was a proper case for an agreement for liquidated damages. It is manifest that the plaintiff might have sustained very large damages which could not be proved with sufficient definiteness to warrant a recovery thereof if he relied, throughout the .period occupied by the construction of the building, on obtaining a lease of this theater, and then did not receive it; Counsel for the appellant attempts to make an argument against the enforcement of this liquidated damage clause based upon tlié fact that it is not reciprocal. It is not essential to the validity of a liquidated damage clause that it should be reciprocal. Moreover, there was no necessity for an agreement with respect to liquidated damages in case of a refusal of.the plaintiff to take the lease. The damages of the decedent could be readily measured. They would have consisted in the difference between the rent which the plaintiff agreed to pay and the amount which the decedent could obtain for the theater. Interest on the liquidated damages was also properly recovered.
It follows, therefore, that the judgment should be affirmed, with costs. •
Ingraham, P. J., McLaughlin, Miller and Dowling, .JJ., concurred, ■ '
Judgment affirmed, with costs.