The New York herald., 1921-11-03
TOLANDLORD,
U.S.. JUDGE DECIDES
Says Appellate Terms 10
Per Cent. Decision Is
Not Binding.
EVIDENCE ISN'T BASIS
Learned Hand Ignores Also
Manhattan Ruling on
Investment.
RENT CASES MUDDLED
Only Properties in Hands of
Receivers Are Affected by
Courts Stand.
RENT CASES MUDDLED

Judge Learned Hand in the United
States District Court complicated still
further yesterday the rent situation by
deciding that a landlord was entitled
TO s per cent. net on the value of his
property. In so doing he followed the
decision of the Appellate Term in
Brooklyn that the basis for calculation
must be the total value of the property
and not merely the landlords invest
ment, but held that that courts find
ing that 10 per cent. was reasonable
return was not based on evidence and
nored the decision of the Appellate
Term in Manhattan that the landlord s
investment should be the basis for
calculating his return.
The decision was made in the case
of objecting tenants OF Chester Hall.
Southern Boulevard and Westchester
avenue. The Bronx, against the re-
ceivers of the property. Walter C. Noyes
and Alfred Z. Marling. Samuel Inter
rnyer, who argued the case for the ten
reasonable return, hailed the decision
as victory. and declared that IN effect
ii set aside the Brooklyn ruling, which,
he said. would no longer have to be
followed by the Municipal Courts of that
borough.
Cites Returns on Securities.
Judge Hand, in deciding s per cent.
o reasonable return, said he took judi
cial notice that this rate of return could
be obtained on high grade securities.
There was no proof before him, he said,
that landlords were entitled to any
higher rate. If the contention was that
they were, proof should have been sub
mitted. Speaking of the Brooklyn de-
cision, Judge Hand said:
Nor can / be bound by the dicta in
Hall VS.. Weiner. If the declaration
OF 10 per cent. in that case as proper
.ate was not based on evidence. cannot
feel it authoritative on me. If 1t was
IL depended on the proof offered.
CHASING that portion of the decision
as "dicta"-that Is. a mere statement by
the court on something outside the case
before it-relieves. according TO Mr..
Untermyer. the lower courts from being
bound by it.
Questions Not settIe0 het
The rent puzzle created by these con-
flicting decisions cannot be solved until
the Appellate Division and possibly the
Court of Appeals have passed on the
questions Tho Appellate Term in Man
haitian gave permission on october 1s
TOR an appeal from it's recent decision to
the Appellate Division. but the appeal
has not yet been argued. Judge Hand
decision, it was said. is not binding on
the courts OF New York State In any
way, but will be binding in all cases
where a Federal receivership is in
VOWED. and which consequently come
into the Federal courts.
In this decision also. Judge Hand
fixed the value of the property at 5000
600. which was LEES than the receivers
thought proper, and this caused a fur
ther reduction. The property was sold
lster for sS2o.0oo. Judge Hand said he
found nothing illegal in landlord bar
gaining with tenants and getting more
than he could compel others to pay.
1T must be assumed" he said. "in
view of the relief which these statutes
afford. that rents not contested are
voluntarily paid"