Case ID: cai_2/html/0025-01.html
Source: Caselaw Access Project
Author: {"author": "Livingston, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Hendricks against Judah.
    If a house be taken for a year before an act of bankruptcy, and the bankrupt continue in possession afterwards, he is not discharged from the subsequent rent by his certificate.
    
    Action on the case, for the use and occupation of a house. One count was on a parol agreement by the defendant with the plaintiff, to take a house of him, which the defendant afterwards refused to occupy^ or pay the rent for. The other, money paid, laid out, and expended, to the.use of the defendant. A verdict having been rendered for the plaintiff, the question of his right to recover was reserved for the opinion of the court, on a case which was shortly this:
    The defendant applied to a Mrs. Bowne to rent him a house from the first of May, 1800, to the first of May, 1801. This she refused to do, but said that she would let it to the plaintiff, who might underlet it to the defendant. This was accordingly done. In September, 1800, the defendant became a bankrupt, and duly obtained his certificate, but the plaintiff never took the house off his hands, though it was for the most part unoccupied, and had, by the courtesy of the defendant, been in some degree occupied by the plaintiff, who paid to Mrs. Bowne the rent for the three quarters due after the bankruptcy. To recover this the present suit was instituted, and the sole question was, whether the bankruptcy in September, and certificate thereon, was a discharge from the subsequent rent ?
    
      Biggs, for the plaintiff.
    Under the circumstances of tms case, the plaintiff may perhaps be considered as a surety for-the defendant, paying the debt after the bankruptcy of the principal. In this point of view, the very cause of action would be subsequent. But taking it simply as a matter between landlord and tenant, it is a general proposition, that the latter does not become a debtor to the former, in a sense *that would make bankruptcy a discharge, until after the rent falls due. If it be quarterly, then at the expiration of each quarter ; if annually, then at the end of the year. This principle will be found in Cullen’s Bankrupt Law, 126, in Mills v. Auriol, 1 H. Black. 433, and Naish v. Tatloclc, 2 H. Black. 319. The tendency of the cases is to settle this point, as between landlord and tenant, because a demand for rent, which was not payable antecedent to a bankruptcy, cannot be proved under the commission. If, therefore, it cannot be proved, it cannot be barred, and the bankrupt continues liable notwithstanding his certificate, which has only a retrospective and not a prospective view. But there is a special count on a parol agreement to use, occupy, and pay, alleging damages by a breach in refusing; surely, a previous bankruptcy is not a bar to a recovery in an action sounding in damages to be subsequently assessed.
    
      Troitj?, contra.
    As the defendant rented from the plaintiff, it is a question merely between landlord and tenant. An underletting can never change the mesne tenant into a surety. It is settled, that to an action of debt on a lease, brought after a bankruptcy, for rent subsequently accrued, the certificate is a bar, nay, even if it be on the implied covenant in the reddendum.
      
       A distinction, however, has in the English books been taken, where the suit is on an express covenent to pay, in which case it is said the bankruptcy is not a discharge. 1 Saund. 241; 4 D. & EL 94; 1 H. Black. 483. The reasoning,'however, on which the fule is established in the first cases, would equally apply to the last, for the bankrupt is as much devested of the possession in this as in the others. The effect of the statute is compulsory upon him, and he is disabled by the act of the law: his immediate inability, therefore, ought alone to be looked at, and not the remote consequence of an agreement, made concerning land, of which he is devested. “ It were infinite,” says the quaint language of Lord Bacon. (Bac. Law Tracts, 35,) “ for the law to judge the causes of causes, and their impulses one of another, therefore it con-tenteth itself with the immediate causes, and judgeth of acts by that, without looking to any farther degree. If any annuity be granted, pro concilio impendendd, and the grantee commit treason, whereby he is imprisoned, so that the grantor *cannot have access to him for his counsel, nevertheless the annuity is not determined by this nonfeasance, yet it was the grantee’s own default to omit the treason, whereby the imprisonment grew; but the law looketh not so far, but excuseth him, because the not giving counsel was compulsory, and not voluntary, in regard to the imprisonment.” So here, the law has, against the consent and will of the defendant, deprived him of the means of performing his promise; and shall he be held to it, when the very consideration is taken out -of his hands ? In Mayor v. Stewart, Yates, J., says, “ As the act devests him of his whole estate, and renders him absolutely incapable of performing his' covenant, it would be a hardship upon him, if he should remain still liable to it, when he is disabled by the act of parliament from performance.” By act of law, the very consideration is taken away, and, therefore, for want of one, the action is not maintainable. As to its sounding in damages, so does a suit on a promissory note, and yet it is discharged by a certificate: for the debt upon it might be proved, and why not this; as it was a demand growing before the commission, a plain debitum in presentí solvendum in futuro.
    
    
      Higgs, in reply.
    The continued use and occupation, after the bankruptcy, creates the consideration for the rent demanded. The cases cited proceed on this ground; if the assignees take possession under a lease, the bankrupt is exonerated, because.they are liable; but if they do not, then he continues responsible; and even if they do, he is not discharged from an express covenant, because bankruptcy does not dissolve tide contract. But here the contract exists,
      
       and the defendant has had a full consideration by enjoying under it.
    
      
       Where the cause of action entirely arises after an act of bankruptcy, a certificate is not a bar. Therefore, the certificate of a bankrupt endorser on a bill or note is not a bar to an action by hia endorsee who has taken up the security subsequently to the act on which the commission issued. See Bamford v. Burrell, 2 Bos. & Pull. 1. So the discharge of an insolvent does not exonerate from the demand of his bail, who were fixed previously to its heing obtained, and pay the money afterward. Buel v. Gordon, A Johns, Rep. 126. On the same principles demands by obligees, on bonds conditioned to save harmless, if damnified, may be enforced notwithstanding a certificate posterior to their date, if the contingency of injury do not arise, till after the act of bankruptcy; aliter, when the bond is to pay absolutely on a certain day, or is previously forfeited. Toussaint v. Martinant, 2 D. 4 E. 100; Martin v. Court, ib. 640; Hodgson v. Bell, 7 D. & E. 97. So under our insolvent law, though the forfeiture be merely that of not procuring a conveyance of a certain specific number of acres of land, for which the obligor had received payment. Clinton & Norton v. Hart, 1 Johns. Rep. 376. It has by a late decision been'ruled, that a certificate of a bankrupt does not. discharge from a judgment subsequently entered on a cognovit given before the certificate, the cognovit being, as it is said, a mere acknowledgment of damages. Wyborne v. Ross, 2 Taun. 68. Aliter, where the judgment is before the discharge, though the costs be. taxed afterwards, and arise on a judgment of non pros. Hurst v. Mead, 5 D. & E. 365. The principle of the last decision governs in cases under our insolvent law, a discharge according to which will exonerate from costs subsequently ascertained, on a judgment previously rendered; (Warne v. Constant, 5 Johns. Rep. 135,) though it bo only on a non oros. Thomas v. Striker, ib. 136 n,(a); but see the next noto and eases there.
    
    
      
       This position, though generally laid down, is not strictly correct. It seems that there are circumstances under which a demand will bo barred by a certificate, though the amount cannot be proved. Thus, if there be, a mere canse of action antecedent to the act of bankruptcy, for which a suit- is previously instituted, the verdict subsequently obtained, witli the costs, will be Darred, but the costs themselves cannot be proved. Ex parte Hill, 11 Ves jun. 646. Whether in such a case the verdict which was prior to the bank ruptcy be, by a judgment posteriorly entered up, rendered a provable debt, is, perhaps, rather doubtful. See Ex parte Charles, 14 East, 197, and Willet v. Pringle, 2 N. R. 130, where, as well as in Ex parte Hill, the old cases on this point are examined.
    
    
      
       That is, because it is payable out of the land, and not on account of it The action is founded not merely on the terms of the demise, but on the enjoyment of the tenant. Co. Litt. 142, a. and Lord Mansfield in Wadkam v Marlowe.
      
    
    
      
       Therefore if an annuity be granted by deed in which there is a covenant to pay as it becomes due, and the annuity be also secured by a bond, an action may be maintained on the covenant, for arrears accrued subsequent to the bankruptcy, though the bond was forfeited before. Cotterell v. Hooke, Doug. 97. Dor a statute which vests the estates of debtors in assignees, does not discharge the debtor from an express covenant, which is collateral to the land. Hornby v. Houlditch, And. 40; Lansing v. Pendergrast, 9 Johns. Rep. 127.
    
    
      
      
         Therefore assumpsit will lie against a bankrupt lessee from year to year upon his agreement to pay rent during the tenancy, notwithstanding the occupation by his assignees for part of the time during which the rent accrued. Boot v. Wilson, 8 East, 311. But debt will not He on the redden-dum of a lease for rent accruing after the commissioners’ assignment, the consent of the lessor to it being virtually included in the act of parliament. Wadham v. Marlowe, 8 Bast, 314, n.
    
   Livingston, J.

delivered the opinion of the court. The only ground on which a certificated bankrupt can expect to be exonerated from a demand of this kind, is the hardship of continuing liable after a surrender of all his estate, and among the rest, this very property, to assignees for the benefit of all lfis creditors ; but is this the fact ? It: does not appear by the case. We well know that a house of this kind, on so short a lease, is not worth more than the rent reserved, and (notwithstanding the generality of the assignment) is not taken possession of by the *assignees. It continues in the bankrupt’s occupation, and if so, as we must presume was the case here, such being the usual course of things, and the contrary not being found, upon what pretence can he ask an exemption from this suit ? He, and not his creditors, have derived a benefit from this property since his bankruptcy. Therefore he, and not the estate asssigned, should be burdened with the rent. Qui sentít commodum, sentiré débet el onus.

It may be subjoined that the debt being contingent, for n case of eviction nothing would have been due, proof of it would not have been admitted under the commission, and, therefore, unless there remain a liability in the defendant, the plaintiff will be without remedy. Culllen’s Bank. Law, 84—126, 3 D. & E. 544. We mean, however, to be understood as determining this cause more particularly on the ground of the defendant’s occupying the premises after his discharge, than on any other, and of the tot.al want of proof that the assignees ever took possession of them. Judgment must be entered on the verdict, as found by the jury. See Van Raugh v. Van Arsdaln, 3 Caines’ Rep. 154, n.(a)

Postea to the plaintiff. 
      
       In which case they are not liable for the rent accruing subsequently to the bankruptcy. Bourdillon v. Dalton and others, 1 Esp. Rep. 233.
     
      
       A discharge under the insolvent act is no bar to an action on an express covenant to pay rent, brought to recover rent accruing subsequent to the insolvent’s discharge. 9 J. R. 121. And, generally, if the creditor, at the time of the assignment by the insolvent debtor, has not a certain debt due or owing, (although it may not be then payable,) so as to entitle him to a dividend of the insolvent's effects, he will not be barred by the discharge. Mechanics' and Farmers' Bank v. Capron, 15 J. R. 461; Frost v. Carter, 1 Johns. Cas. 13; Buel v. Gordon, 6 J. R. 126; Andrews v. Waring, 20 id. 153. But now the discharge exonerates from liability- incurred by making or endorsing any promissory note or bill of exchange, or in consequence oi the payment, by any party thereto, of the money secured thereby. Seo 2 Rev. P«at. p. 22, § 31.