Case Name: George K. Collins, Respondent, v. Cyrus L. Hasbrouck, Appellant
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1874-03-24
Citations: 56 N.Y. 157
Docket Number: 
Parties: George K. Collins, Respondent, v. Cyrus L. Hasbrouck, Appellant.
Judges: 
Reporter: New York Reports
Volume: 56
Pages: 157–167

Head Matter:
George K. Collins, Respondent, v. Cyrus L. Hasbrouck, Appellant.
Where a lessee executes an instrument conveying the whole of his unexpired term, but reserving rent at a different rate and time of payment from the original lease, and a right of re-entry on non-payment and on breach of other conditions, also providing for a surrender of the premises to him on the expiration of the term, the instrument is a sub-lease not an assignment.
Where a lease contains a condition of forfeiture, at the option of the lessor, upon breach of a covenant on the part of the lessee, the acceptance by the former of rent which became due and payable after an act of forfeiture, with notice thereof, is a waiver of the forfeiture.
A lease contained a condition forfeiting it, at the option of the lessor, on breach by the lessees of a covenant not to sub-let without the written consent of the former; such consent was given to a sub-lease for a specified term. The lessee executed a sub-lease for tbe term specified, with a privilege, also, to the sub-tenant of an extended term, upon his giving two months’ notice of Ms desire therefor. The landlord accepted rent after notice of the extended term and up to the end of the authorized term. Held (Andrews, J., dissenting), that the sub-lease was a breach of the covenant and an act of forfeiture; that the forfeiture was incurred by the creation of the extended term, not by the act of the sub-tenant in taking possession under it; that the assent to the sub-letting for the specified term, did not bar a re-entry until the expiration thereof, and so authorize the landlord to receive rent until then, without waiver; but that the right of re-entry arose upon the forfeiture, and the acceptance of rent, with notice, thereafter, was a waiver thereof.
(Argued February 23, 1874;
decided March 24, 1874.)
Appeal from judgment of the General Term of the Supreme Court in the fourth judicial department, affirming a judgment in favor of plaintiff entered upon a verdict. (Reported below, 1 S. C. R. [T. & 0.], 36.)
This was an action of ejectment brought by the plaintiff to recover possession of a store and basement in the city of Syracuse. The plaintiff, on the 30th of December, 1863, leased the store Ro. 49, in the Collins block in the city of Syracuse, to Leopold Schwartz, Leopold Bronner and Bern-hard Bronner, for the term of ten years, from the 1st of April, 1864, at an annual rent specified in the lease. The lease provided, amongst other things, that the lessees should not, during such term, sub-let or relet said premises nor any part thereof, without the written consent of said lessor, and in case of a violation of said covenant, said lease should terminate at the option of the lessor, and the lessee should be deemed and considered in fact and in law a tenant holding over after his term had expired, without the permission of the landlord. On the 1st of April, 1865, plaintiff leased the basement room under the store Ro. 49 to the same parties, for the term of nine years from that date, and the lease contained the same conditions against sub-letting or reletting as is contained in the lease of said store. On the 9th of August, 1867, the plaintiff gave his consent in writing that the lessees above named might lease a part of the basement under Ro. 49, to Joseph Brower, for the term of two years and seven months from September 1,1867. On the same day the lessees, Schwartz and others, leased the part of the basement referred to in the consent, signed by the plaintiff, to said Brower for said term of two years and seven months, with the privilege to Brower to extend the tenn four years longer by giving two months’ notice of his desire to have it so extended. Brower assigned his lease to Hawley, Pierce & Co.,, and they assigned the same to the defendant, who entered and occupied under said lease, and was in possession when the plaintiff demanded a surrender of the premises, and when this action was brought. The plaintiff claims the leases were forfeited by reason of the sub-letting by Schwartz and the lessees Bronner, for the term of four years after the expiration of the term of two years and seven months to which sub-letting he had consented. The facts relating to the question of consent by the plaintiff, are as follows, viz.: On the day Brower assigned his lease one of the Bronners took it to plaintiff, and, as he testified, showed to him and asked him to indorse his consent. The plaintiff testified he did not read the lease, and did not know there was in it a provision that the term might be extended at the election of Brower. Plaintiff indorsed his consent to the assignment by Brower, to Hawley, Pierce & Co. This consent was on the lease when Hawley, Pierce & Co. assigned it to the defendant. The court submitted four questions to the jury to be answered by them on the rendition of the verdict, as follows: 1st. Did Brower insert in the lease from Bronners to Brower the clause giving Brower the right to extend the lease for four years after he exhibited to and it was examined by the plaintiff ? The answer was, “ He did.” 2d. Did Collins, when he signed the consent dated October 14th, 1867, to the assignment by Brower to Hawley and others, of the lease of Bronners to Brower, know the clause was in the lease giving the lessee the option to extend the terms of the lease for four years ? The answer was, “ He did not.” 3d. Did the plaintiff ever consent in writing to the lease executed by Bronners to Brower, dated August 19th, 1867, read in evidence in this ease ? The answer was, “ He did not.” 4th. When was the plaintiff first informed of the provisional clause in the lease of Bronners to Brower ? The answer was, “ The fore part of January, 1870.” The jury rendered a verdict in favor of the plaintiff.
Wm. C. Ruger for the appellant.
The court should have directed a verdict for the defendant. (1 N. Y., 600; 9 id., 465.) The sub-lease from Bronners to Brower was not a breach of the conditions of the original lease- from Collins to Bronners. (7 Hill, 253; 4 Seld., 305; Bedford, v. Terhune, 30 N. Y., 453; 17 J. R., 66; Siefke v. Koch, 31 How., 383; Roosevelt v. Hopkins, 33 N. Y., 81; Lynde v. Hough, 27 Barb., 415, 422; Jackson v. Silvernail, 15 J. R., 279.) Plaintiff is estopped from alleging that the contract, under seal, made by him and indorsed on the back of the lease from Bronners to Brower is invalid. (Jackson v. Stevens, 16 J. R., 110; Jackson v. Bull, 1 J. Ch., 81; Sweet v. Green, 1 Paige, 473 ; Barker v. Harris, 15 Wend., 615 ; Jackson v. Foster, 12 J. R., 488; Bush v. Cole, 4 Sandf., 79.) An agreement to renew a lease is an incumbrance. (5 Abb., 28.) Plaintiff’s acceptance of the rent was a waiver of the forfeiture. (13 Wend., 530; 26 Barb., 41.)
Isaac D. Garfield for the respondent.
An action of ejectment will lie for a breach of a covenant against under-letting. (Taylor’s L. and T., 698; Jaekson v. Brownson, 7 J. R., 227; Doe v. Bliss, 4 Taunt., 735.) The consent by the lessor to one under-letting of the demised premises, is not a waiver of a further and different under-letting, (Doe v. Bliss, 4 Taunt., 735; 1 Saund., note y to Duppa v. Mayo ; Keeler v. Davis, 5 Duer, 507; Hazzard v. Franklin Ins. Co., 7 R. I., 49 ; Taylor’s L. and T., 497.) The rent so received must have been received as rent accruing after the forfeiture. (Jackson v. Allen, 3 Cow., 220, 230; Coke Litt., 211 [5] ; Woodfall L. and T., 203, .204; Jenkins v. Church, id., 482 ; Penants case, 3 Coke, 64; 1 Saund., 287; C. N., 16; Taylor’s L. and T., 497.) Plaintiff is not estopped by his consent to the assignment of the sub-lease- from proving the truth of the transaction. (Holden v. Put. F. Ins. Co., 46 N. Y., 1; Wilcox v. Howell, 44 id., 398; Shapley v. Abbott, 47 id., 443; Mechanics' Bk. of N. Y. v. N. Y. and N. H. R. R. Co., 13 id, 538; Griffith v. Pritchard, 5 B. & A., 781; McKildors v. Darracott, 13 Grat., 278, 285, 286 ; Dumpor's case, 1 S. L. C., 101, note Taylor’s L. and T., 501; Doe v. Woodbridge, 9 B. & C., 376; Doe v; Peck, 1 B. & A., 428; Doe v. Goldwin, 6 Q. B., 498, 553 ; Doe v. Jones, 5 Exch., 498 ; Bennett v. Herring, 3 C. B. [N. S.], 370; Baylis v. Gross, 4 id., 536; Bleecker v. Smith, 13 Wend., 533; Jackson v. Allen, 3 Cow., 220.) The instrument, under which the Bronners transferred possession of the premises to Brower, was a lease and not an assignment of the term. (Post v. Kearney, 2 Corns., 394; Martin v. O' Oonner, 43 Barb., 514; People ex rel. Elston v. Robertson, 39 id., 9; Piggot v. Mason, 1 Paige, 412; Linden v. Hepburn, 3 Sandf., 668 ; Freeman v. Bateman, 2 B. & A., 168; Williams v. Haywood, 5. Jur. [U. S.], 1859, p. 1417; Clark v. Coughlan, 3 Irish L. R., 427; Taylor’s L. & T., § 16, p. 3-4, § 340; Collamer v. Kelly, 12 Iowa, 318 ; Poultney v. Holmes, 1 Strange, 405 ; 2 Greenl. Cruise, tit. 32, chap. 7, §§ 4—7, pp. 121-122; House v. Burr, 24 Barb., 525; Tracy v. Albany Ex. Co., 7 N. Y., 472, 474.) To constitute a waiver by the receipt of rent,, the landlord must have been aware of the existence of the forfeiture. (Penant's case, 3 Coke, 64; Jackson v. Brownson, 7 J. R., 227; Jackson v. Shuts, 18 id., 174.)

Opinion:
Folger, J.
This is an action of ejectment, brought by a landlord against an under-tenant. When the action was commenced', the-term created by the original lease, had not expired by the- lapse of time. It is claimed however, that there had been a forfeiture- of the lease, by a breach by the lessees, of their covenant not to sub-let. That covenant is, that they will not sub-let, without the written consent of the lessor. It is followed by the condition, that in case of a violation or breach thereof) the lease- shall terminate, at the option of the lessor.
The first question isj did- the lessees sub-let the premises, without the written consent of the lessor. They executed an instrument to Brower, by which they gave him a right in the premises, for two years and seven months, and a privilege for four years longer by his giving two months' notice. The defendant contends, that this is not a sub-lease, but that it is an assignment of the lease to them, or of their term. It is said, that when a lessee conveys his whole estate to an alienee, the conveyance amounts to, and is called, an assignment ; and that the distinction between an assignment and a lease, depends solely upon the quantity of interest which passes, and not upon the extent of the premises transferred. .An assignment creates no new estate; but transfers an existing estate into new hands; an under-lease, creates a perfectly new estate. (Comyn on Land, and Ten., 51, 52.) In this case, these general principles will not entirely satisfy; and we must learn how they have been applied in particular instances. We find: that though a lessee make an instrument, which by its terms conveys the whole of his interest in the premises ; if he reserve to himself a reversion of some portion of the term, it is an under-lease, and not an assignment. (Archbold on Land, and Ten., 10.) It has accordingly been held; that though the instrument dispose of the whole unexpired term, if it contain a covenant to surrender the premises on the last day of the term it is an under-lease and not an assignment. (Post v. Kearney, 2 N. Y., 394.) And again, if there be a right reserved to the lessor to re-enter on breach of conditions, this makes a sub-lease. (Doe ex dem. v. Bateman, 2 Barn. & Aid., 168.) So it has been held, that a reservation of a new rent makes the instrument a sub-lease. (Piggot v. Mason, 1 Paige, 412.) Undoubtedly, the chief of these is the reversion of some portion of the term. (See Platt on Lease, 1 vol., p. 10, et seq.) Therefore, though the instrument executed to Brower does, in the term of two years and seven months demised, and in the privilege for the further term of four years, cover the whole unexpired term demised by the plaintiff to the Bronners; yet it is a sub-lease and not an assignment. It is in the form of a lease; it reserves to the Bronners rent at a new rate and at a new time of payment; it stipulates for a right of re-entry on non-payment of rent, and on the breach of certain conditions contained in it; it provides for a surrender of the premises to them on the expiration of the term. Thus the Bronners did not part with their whole interest in the premises and in the lease thereof to them.
The case of Bedford v. Terhune (30 N. Y., 453), cited by defendant, does not conflict with these views. There no agreement to under-let was proven, nor any fact from which an underletting could be fairly inferred. The court recognized the general rule, that a transfer of the whole unexpired term, is an assignment thereof and not an underletting, and it declined to presume from the facts proved, that there was what would have worked a forfeiture; but held, in the absence of evidence of the bargain between the lessees and their assigns, that the presumption was,, that the latter took the whole unexpired term.
Having shown that the Bronners did sub-let the premises, it is plain, that it was without the written consent of the lessor. There is no dispute but that he did consent, in writing, to the sub-lease for the term of' two years and seven months. The jury have in one of their special findings declared, that he did not assent in writing to the lease made by the Bronners to Brower; which means that he did not thus assent to it as it was executed, with the privilege therein of the further term of four years. He did, after it was executed, assent in writing, to an assignment of it from Brower to Hawley and others. This was in ignorance of its provisions, so far as there was contained in them the privilege for the further term. Indeed, in view of the remarks of the court in reply to the exceptions to its charge, and which are to be taken as a further explanatory charge to the jury, we may assume that the jury have found that the lessor's assent to that assignment was obtained fraudulently. So far as the lessees at least are concerned, that assent was therefore void. The conclusion is, that the execution of the instrument to Brower was a sub-lease, without the written consent of the lessor. It was a breach of the covenant not to sub-let. It was an act of forfeiture of the lease. It gave to the lessor a right of re-entry upon the demised premises. It enables the plaintiff, prima facie, to maintain his action.
It is urged, however, that he has waived the forfeiture. The act of waiver is said to consist in the acceptance by him of rent reserved by the lease, which became due and payable after the act of forfeiture, and was accepted by him after he had notice of the act. It was at the option of the plaintiff whether he should avail himself of the act of forfeiture and take his right of re-entry, or whether he should waive it. Though the condition of the lease is, that upon a breach of the covenant, the lease shall thereby become terminated and ended, yet it is also expressed to be at the option of the lessor. In such case the lease is not void, but voidable. (Goodright v. Davids, Cowper, 804; Amsby v. Woodward, 6 B. & C., 519.) The jury have found that he had notice of the act of forfeiture in the forepart of January, 1870. The testimony shows that the plaintiff received payment of rent up to the 1st of April, 1870. As the rent was payable monthly, the presumption is that he received payment of it month by month ; and, hence, some part of it after notice of forfeiture. It would also be, that some portion of the rent received became due and payable after file act of forfeiture, and after notice to him of that act; that would be a waiver of the forfeiture. Notwithstanding the contention of the plaintiff, we see nothing in his testimony which leads to a different conclusion, when taken in connection with the special finding of the jury, just alluded to. An acceptance of rent eo nomine, which accrues after act of forfeiture and is received .after knowledge thereof, cannot ordinarily be made without .a recognition of the continuance of the tenancy. Such recognition is an election between the right to hold the tenant to his lease, and the right to enter and dispossess him. (See cases last cited.)
It is contended, however, by the plaintiff, that the act of forfeiture did not take place until the 1st day of April, 1870, as that was the- day from which the extended term should begin. This would be to hold that the forfeiture was incurred, not by the creating of the term, but by the beginning of it; by the act of the sub-lessee in taking possession for the extended term, and not by the act of the lessees in creating that term. It was the latter which worked the breach of their covenant. When they executed the sub-lease they had done all that which they need do, to create a sub-letting for a term to which their lessor had not assented. When the defendant, in January, 1870, gave notice that.he exercised the privilege and took the extended term, the sub-letting therefor was complete. It was complete, because before that, and at the time when the sub-lease was executed by the lessees, the right to exercise that privilege was given by them, and they could not retract it. Having, then, done all that which they need to do to create an under-tenancy, they had then done all that which they need to do to work a breach of their covenant not to under-let. The purpose °in taking a covenant against sub-letting is to retain in the lessor a controlling power as to who shall come into the occupation of the premises. The covenant is broken when the lessee gives the right, so far as he can give it, to another to come in. This the lessees did by their sub-lease; and in this they made breach of their covenant not so to do.
It is further said, that the plaintiff having assented to a " sub-letting until the 1st of April, 1870, could not make re-entry until that day, and being debarred from re-entry, might take rent until then without waiver. However this might be, had the sub-letting until that day with his assent, been to one bona fide sub-tenant by one sub-lease; and the privilege of the extended term been given without his assent to another sub-tenant, it is not so here. This sub-lease is all one. It is between the same parties, at the same time. All join in working a breach of the covenant, and thus avoiding the lease which is the basis of the tenancy, and of all and any right to occupation.
In charging the jury, the court said to them: "If the plaintiff had given no consent in writing to the sub-letting of these premises, and they had been sub-let, and he knowing that they had been sub-let, received rent from the tenant, he is then bound by the lease. If Bronner had sub-let these premises to Hasbrouck, without any written consent from the plaintiff, and the plaintiff had received rent from Hasbrouck for the premises after that, he could not say that this was void, because it was optional with him whether he would declare it so or not." From this, and from the general verdict being in his favor, the plaintiff insists, that the jury must have found that he did not receive rent after he knew of the sub-letting. The testimony of the plaintiff was such, that the jury might have so found; but from their special finding, that he had information of the provision for the extended term, in the forepart of January, 1870, it is plain that they relied upon the testimony which was opposed to his in this particular. Besides, the proof was, that the payment of the rent up to 1st April, 1870, was received from Bronner, and not from Hasbrouck; as is the proposition of one of the sentences quoted from the charge. And the other sentence quoted is susceptible of a like application. We cannot suppose that the jury, by their general verdict, meant to contradict their special finding, when they were not strictly held to such conclusion by the charge. We conclude, that though-there was a forfeiture of the lease by the breach of the covenant, that there are facts in the ease as now appearing from which a waiver thereof was necessarily to be inferred. It is true, that a forfeiture may be suspended, and not waived. (Doe ex dem. v. Brindley, 4 Barn. & Adol., 84.) It must appear affirmatively that this is so. When there has been an act of forfeiture; when rent has accrued thereafter; when after knowledge of the forfeiture that rent has been accepted as rent by the landlord; if no other fact is shown, the necessary result is, that there is a waiver of the forfeiture.
The verdict of the jury was generally for the plaintiff; and there were certain special findings. From these, and from the testimony in the case, there appears a- state of facts, without dispute, which presents a legal question, the proper solution of which makes it manifest, that the plaintiff cannot, as the case is now presented, maintain this action. After the verdict was rendered, the circuit judge ordered the case to be reserved for further argument and consideration, as he had power to do, under section 265 of the Code of Procedure. On such further consideration, he ordered judgment for the plaintiff, on the verdict. To this, exception was taken by the defendant. We think that the learned justice erred in the law of the case, for the reasons we have given.
The defendant has raised other questiqns in the case; that the plaintiff is estopped by his assent to the assignment of the sub-lease; and that the defendant is an innocent purchaser, and so to be protected, although the plaintiff was ignorant of the contents of the lease, 'and gave that assent by mistake. The facts of the case as now presented, do not sustain these positions of the defendant. On another trial, a fuller disclosure may make them more or less deserving of attention.
The judgment must be reversed and a new trial ordered,, with costs to abide event.
All concur, except Andrews, J., dissenting.
Judgment reversed.