Case ID: nys_61/html/0343-01.html
Source: Caselaw Access Project
Author: {"author": "PATTERSON, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

BACHRACH et al. v. LEVENTRITT.
    (Supreme Court, Appellate Division, First Department.
    December 8, 1899.)
    Assignment for Benefit of Creditors—Contracts for Preferences—Construction—Lease.
    Plaintiffs, to have their claim against defendant’s assignor, for past-due rent, made a preference in his general assignment, agreed that neither the assignor nor his assignee should be chargeable with any rent of the premises to accrue for July, August, and September. After the assignment, plaintiffs’ said claim was paid in full. After providing for the preference above, the agreement, with- respect to what should be done with the unexpired term of the lease, declared that the title to the lease should pass to the assignee, who might sublet the premises, upon condition that the new tenant should be acceptable to plaintiffs, and should procure, before August 1, 1897, ,a person to guaranty the payment of the rent for said ' months of July, August, and September, and that, “upon the failure of said tenant to procure such guaranty, * * * this agreement shall terminate and become void,” the premises to be surrendered to plaintiffs, “and the rent for so much of said term as shall then have expired shall at once become payable”; also that, unless a tenant was procured by September SOth, premises were to be surrendered back to the landlords on that date. ■Held, that the latter declarations of the agreement do not make the assignee liable for the rent of the month of July, since his exemption from liability therefor was a condition precedent to granting the preference to plaintiffs’ past-due claim, but contemplate payment therefor by the tenant to be found.
    Appeal from special term, New York county.
    Action by David Bachracli and another against George M. Leventritt, as assignee, etc. Judgment for defendant, and plaintiffs appeal. Affirmed.
    Argued before VAN BRUNT, P. J., and PATTERSON, O’BRIEN, McLAUGHHN, and INGRAHAM, JJ.
    W. G. Wilson, for appellants.
    S. P. Goldman, for respondent.
   PATTERSON, J.

This appeal is from a judgment entered upon a dismissal of the complaint in an action for rent of certain premises in the city of New York, of which the plaintiffs were lessors, and one S. W. Richards the lessee. The term was' to begin on the 1st day of September, 1893, and end on the 1st day of May, 1903, the rent to be paid in equal monthly payments, in advance, on the 1st day of each and every month during the term. On the 10th of June, 1897, Richards made an assignment for the benefit of creditors to the defendant. At that time there were arrearages of rent due. On the day preceding the assignment, terms of an agreement between the landlords, the lessee, and the intended assignee were agreed upon relating to the rent in arrear and to the unexpired term of the lease. That agreement was reduced to writing, and signed by the parties. It is dated the 9th of June. The action is brought against the assignee to recover rent of the premises fdr the month of July, 1897, upon the theory that, by the terms of the agreement referred to, the assignee has become bound to pay rent for that month, under the covenant of his assignor contained in the lease. The assignee went into possession, and it is conceded would be liable for the rent, unless he is absolved from that liability by the terms of the agreement of June 9th. The only question before the court relates to the construction of the agreement, which is set out in full in the record. Its recital shows that it was entered into, between the parties in anticipation of Richards making the assignment for the benefit of creditors. It states that he owes the plaintiffs the sum of $4,146.66 for arrears of rent of the premises, and that, being desirous of securing that indebtedness to them, he agrees to make them “the second preferred creditors in the said general assignment, subject to a prior preference of not more than twenty-five hundred dollars, for the sum of forty-one hundred forty-six. and 66/ioo, upon the sole condition, however, that the said above-named Mrs. Valentine Gumprecht and David Bachrach, their heirs, executors, successors, and assigns, shall not ask or demand, or be entitled to receive,' any rent from • the said Samuel W. Richards, or from the assignee under the general assignment aforesaid, during or for the months of July, August, and September, 1897.” There then follows ah obscure, and rather blind, provision concerning an entirely ■ different subject, namely, what shall be done with the unexpired term of the lease, and! respecting that the parties agreed that the title to the lease should pass to the assignee under the general assignment; and the lessors consented to the sale,"assignment, and subletting of the premises under the lease by the assignee, to whomsoever he should deem suitable and proper; “provided, however, and this agreement is made upon the express condition, that such new tenant shall be acceptáble to said landlords, and that this agreement shall be of no effect unless and until the same shall have been executed by said assignee, and unless the said tenant, on or before August 1, 1897, shall procure some person, to be acceptable to the landlords, to guaranty in writing the payment of the rent of said premises for said months of July, August, and September, 1897, as the same is reserved in said lease, and at the tipies therein specified; and that, upon the failure of said tenant to procure such guarantor as herein agreed, this agreement shall terminate and become void, and these premises shall be forthwith surrendered to the landlords, and the rent for so much of said term as shall then have expired shall at once become payable. It is also agreed that, unless in the meantime a new lease shall have been executed between the said landlords and the tenant to be procured by said Richards as aforesaid, the said premises shall be surrendered to said landlords on September 30, 1897.” It is claimed by the plaintiffs that, by force of the later stipulations of the agreement, the assignee has become liable to pay the rent for the month of July; but it seems quite apparent that the second branch of this agreement was intended to be entirely independent of the first, and that is the practical construction the parties themselves.have given it. The preference of the indebtedness for past-due rent was made upon the express condition that the assignee should not be chargeable with any rent to accrue for the months of July, August, and September, and on the 29th of July, 1897; and, as the agreed statement of facts in the case shows, the whole amount of that preference was paid to the landlords, and thus that part of the agreement was executed, and the consideration for the assignee's exemption from liability paid.

Construction must be given to the whole agreement, so that all of its parts may become operative, and none of them be destroyed, if that is possible. There is no real irreconcilable repugnancy in its provisions. The assignee was to take the title to the lease, in order that it might be assigned by him to some tenant to be procured, apparently, according to the last sentence of the agreement, by Richards; the landlords’ consent to a sale and assignment of the lease upon the express condition that the tenant to be found shall be acceptable to them and the assignee, and that such tenant, on or before August 1, 1897, shall procure a person to guaranty the rent of the premises for these very three months, showing that it was in the contemplation of the parties that the tenant to be found should be responsible for the rent accruing for those three months. The assignee evidently did not take the lease for the purpose of retaining the premises for his own use. He could have put a tenant in possession at any time, and that tenant was to pay the rent for the very month of July now sued for. That the assignee was not to pay it is evident from the first branch of the agreement. An acceptable tenant to both parties might go into possession at any time after the 10th of June, and have the whole month of July within which to procure the guaranty for rent, and, if he should not procure that guaranty, then the agreement by which he entered into possession would become void, and he (the tenant) become liable for so much of the rent of the term as should then have expired. Then, if a tenant was not procured by the 30th of September, the premises were to be surrendered back to the landlords.

The agreement with respect to the assignee taking the lease and the procurement of a tenant is one, in substance, separate and distinct from the first branch of the instrument, and the provision with respect to the agreement terminating and becoming void applies only to the second branch. Otherwise the whole instrument would have become nullified, and the plaintiffs would not have been entitled to receive the amount of the preference, which was actually paid to them on the 29 th of July.

The contract was properly construed by the court below, and the judgment should be affirmed, with costs. All concur.