Case Name: Mills v. Connor et al., Trustees
Court: Supreme Court of Ohio
Jurisdiction: Ohio
Decision Date: 1922-03-28
Citations: 104 Ohio St. 409
Docket Number: No. 17108
Parties: Mills v. Connor et al., Trustees.
Judges: Marshall, C. J., Johnson, Hough, Wanamaker, Robinson and Jones, JJ., concur.
Reporter: Ohio State Reports, New Service
Volume: 104
Pages: 409–421

Head Matter:
Mills v. Connor et al., Trustees.
Landlord and tenant — Lease a chattel interest — Title of personal representatives of deceased lessee — Testamentary trustees— Powers limited hy will, when — Operation of moving picture theater — Exercise of option to renew lease — Specific performance — Trustees cannot compel renewal, when.
1. A lease for years, being a chattel interest, passes at the death of the lessee to the personal representative, who becomes, by virtue of his office, assignee of the term.
2. Equity implies such powers in a trustee as are reasonably necessary to the discharge of the duties assigned by the instrument creating the trust; but when the powers and duties of a testamentary trustee are defined and limited by clear and express language of the will, he has no authority beyond that expressly conferred, and no power to act in other matters connected with the estate of the testator.
3. Where the testator was the owner of a moving picture theater located on the first floor of a five-story building, all of which, with the exception of certain designated rooms, the testator held under lease for a term of ten years, with the option of a further lease of five years at a stipulated rental, and his will directed that such moving picture business “shall be conducted during the life of the lease on said building” by two persons named, they are not thereby authorized to execute such renewal lease.
4. Under such circumstances an action for specific performance cannot be maintained by the persons named as such trustees to compel the lessor to execute to them a lease on said premises for an additional term of five years.
(No. 17108
Decided March 28, 1922.)
Error to the Court of Appeals of Franklin county.
This is an action for specific performance brought in the court of common pleas of Franklin county against the plaintiff in error, James O. Mills, who will hereinafter be referred to as the defendant, by John A. Connor and William Petrakas, as trustees under the last will and testament of Mike Bouzon, who will hereinafter he designated as the plaintiffs.
The claim of the plaintiffs set up in their petition and amendment thereto is in substance as follows: On August 31, 1911, Mike Bouzon and John Pekras procured a lease which was duly executed to them upon certain business property on High street in the city of Columbus, consisting of a firs* floor store-room and basement thereunder at No. 21 North High street; and also the second, third, fourth and fifth floors over the store-rooms at Numbers 19, 21 and 23 North High street, excepting therefrom certain designated rooms on the upper floors thereof. The lease was for a period of ten years at a stipulated rental, payable monthly. It contained a clause providing that the lessees could not without the written consent of the lessor endorsed thereon sublet any part of the first floor or basement of the premises, or assign the lease; and that unless the written consent of the lessor was procured the lessees could use the first floor and basement for no purpose other than that of maintaining a first class theater for the production of pictures, vaudeville, opera, or drama. A further provision authorized the removal of equipment upon the expiration of the term. It was also provided that all the conditions, covenants, etc., of the lease should bind the heirs, executors, administrators, successor and assigns of the parties. The lessees had the right to re-lease the premises for a further period of five years from the expiration of the ten-year term on the same terms and conditions except an increased rental therein stated of $666.67 instead of $658.34 monthly, provided that prior to September 1, 1921, the lessees shall have submitted to and filed with the lessor a lease duly executed, satisfactory to the lessor, for such premises for the new term. The lease was duly filed and recorded in the lease records of Franklin county, and the lessees entered into possession of the premises and therein installed a moving picture theater. Thereafter, in accordance with the terms of the lease. Mike Bouzon acquired the interest of John Pekras in said lease and also in the moving picture theater, and performed all the covenants and conditions of the lease. Thereafter on January 5,1918, the defendant James O. Mills duly acquired said premises under a ninety-nine year lease, renewable forever, subject to the lease held by Bouzon, and subject to his right to release the premises for an additional term of five years as in said lease provided. Bouzon paid the rentals and otherwise complied with the terms of the lease until his death, which occurred April 14, 1919. He left a will, which was duly probated in the probate court of the county, which contained the following provisions:
“Item NXTT. I am the sole owner of a moving picture theater, known as the ‘Dreamland Theater,’ located at No. 21 North High street, in the city of Columbus, Ohio. It is my will that, as soon after my decease as may be practicable, said business be sold, either at public or private sale, as my executor in his judgment deems best, and from the proceeds of such sale he shall pay over to my cousin and faithful friend, William Petrakis, an equal one-sixth (1-6) portion of the proceeds of said sale, he, the said William Petrakis, to have and to hold the same to himself and his heirs forever. The remaining five-sixths (5-6) portion of said, sale shall be divided into five (5) equal parts, and one equal one-fifth (1-5) part of said five-sixth (5-6) shall be paid by my executor, hereinafter mentioned, to each of my five sisters, Stathula, Stamota, Jonula, Chevi and Theofine, hereinbefore mentioned in various items of this will, they to have and to hold the same for themselves and their heirs forever.
“For the purpose of consummating said sale of said theater under this item of my said will, I hereby empower my executor hereinafter mentioned to execute any and all instruments necessary to effectually transfer the title to my said theater the same as I might do if living and personally present, and it shall not be necessary for him to procure the consent or approval of the Probate Court to such sale, and the purchaser or purchasers thereof shall not be required to see to the application of the purchase money.
“Item XÑIII. In the event there is any legal impediment in the lease or otherwise, which will prevent a sale of said moving picture theater under the foregoing item of this will, then it is my will, and I hereby direct that said moving picture business and said ‘Dreamland Theater’ shall be conducted during the life of the lease on said building by my cousin and faithful friend, William Petrakis, and John A. Connor, and one-sixth (1-6) of . the net profits thereof shall be turned over to the said William Petrakis, to be his absolutely, and the remaining five-sixths (5-6) shall be divided into five (5) equal portions and the same turned over in equal portions to my said five (5) sisters, hereinbefore mentioned, their heirs and assigns, to have and to hold the same absolutely. For this purpose, I direct that said profits' shall be ascertained and paid to them quarterly.”
Plaintiffs averred that the defendant objected to the salé of the theater and threatened to forfeit the lease if the executor sold the lease or the motion picture theater; that on February 6,1920, the plaintiffs were appointed' by the probate court of Franklin county as trustees to operate' and conduct the theater under the lease, and since that date have been operating the same and paying the defendant the rental therefor and otherwise performing the conditions of the lease; that they prepared a renewal lease- in duplicate for the five-year term, beginning September 1, 1921, and ending August 31, 1926, which contained the terms and provisions of the original lease except as to the monthly rental of $666.67 and the lack of provision for a renewal as contained in the original lease; and that the defendant refused to execute the lease and demanded that plaintiffs surrender possession of the premises August 31, 1921, and threatened to oust the plaintiffs therefrom. Plaintiffs further averred that Bouzon made no other or further disposition of the business or of the lease than as contained in Items 22 and 23 of the will, and that when the will was executed the chattel property of said Bouzon in said theater was in excess of $25,000. Plaintiffs prayed for an injunction restraining the defendant from interfering with their possession of the premises and for a decree requiring the defendant to specifically perform his contract by executing a renewal lease to the plaintiffs.
A general demurrer having been overruled the defendant filed an answer which set up three de fenses. The first, after admitting many averments of the petition and amendment thereto, contained a general denial. In the second the defendant averred that plaintiffs have no authority other than that conferred by Item 23 of Bouzon’s will and that they were authorized by it to conduct a moving picture theater only until the expiration of the term of the lease, August 31, 1921, and that any interest of Bouzon in the lease passed to his executor; that the theater was turned over by the executor to the plaintiffs, pursuant to the order of the probate court, upon an application of the executor, the same to be operated and managed by plaintiffs as provided by Item 23 of the will, and that by the same order the executor and his bondsmen were released and discharged therein from any and all further liability as to the management and control of the theater. The third defense alleged that the plaintiffs were not authorized or empowered to execute the renewal lease. A demurrer to the answer was sustained, and the defendant not desiring to plead further judgment was rendered for the plaintiffs as prayed in the petition.
The case was appealed to the court of appeals, where it was heard upon evidence, and judgment was there likewise entered for plaintiffs and against the defendant, who was ordered to sign and execute the lease mentioned and described in the petition of plaintiffs, and enjoined from interfering with the plaintiffs in the possession and enjoyment of the premises during a term of five years. Error is now prosecuted in this court to procure a reversal of that judgment and decree.
Messrs. Wilson & Rector, for plaintiff in error.
Messrs. Belcher & Connort for defendants in error.

Opinion:
Matthias, J.
The plaintiffs as trustees under the will of Mike Bouzon seek an order of the court requiring the defendant who is the owner of the five-story business property in question to perform his contract to execute a lease to them on such property for a period of five years. Before a decree may be properly entered requiring the execution of the lease by the defendant it must clearly appear that the plaintiffs have the right to such relief and are entitled to have the conveyance of the premises for such term, and also that they themselves are duly authorized to enter into such contract with the defendant.
The plaintiffs bring this action as trustees under the will of Mike Bouzon, who died April 26, 1919. He was then the owner of a lease, which included not only the first floor store-room and basement at No. 21 North High street in the city of Columbus, but, also, excepting therefrom certain rooms designated in the lease, the second, third, fourth and fifth floors over the rooms at Numbers 19, 21 and 23 North High street. The first floor store-room and basement had for some time been used for the operation of a moving picture theater conducted and managed by Bouzon. The lease was for a term of ten years, which expired August 31, 1921.
The claimed right of the plaintiffs to a lease for the further period of five years is based upon a provision in the original lease wherein it was agreed that the lessee should have the right to re-lease the rooms for a further period of five years beginning on the first day of September, 1921, upon the same terms and conditions as in the original lease, except that the rental therefor should be $8,000 per year, or $666.67 instead of $658.34 per month, and the further provision therein contained that all the conditions, stipulations, provisions and covenants of the lease should bind not only the parties thereto but also their heirs, executors, administrators, successor and assigns. The right of the plaintiffs to demand and receive a. lease on the premises for a further term of five years, as well as the authority upon their part to execute the same, are claimed to arise from the provisions of the lease just cited and the provisions of the will of Mike Bouzon, deceased. It is urged that such right and power are to be found in Item 23 of the will, which is set out in full in the foregoing statement. It is conceded that no disposition of such lease was made by the testator except as shown by the provisions of Items 22 and 23 of the will, and it is also conceded, as of course it must be, that the authority of the plaintiffs is derived from the will, and that they have no power other than that thus conferred.
The testator by Item 22 of his will authorized his executor to sell the Dreamland theater, and further provided in Item 23 of his will that "In the event there is any legal impediment in the lease or otherwise, which will prevent a sale of said moving picture theater under the foregoing item of this will, then it is my will, and I hereby direct that said moving picture business and said 'Dreamland Theater' shall be conducted during the life of the lease on said building by my cousin and faithful friend, William Petrakis, and John A, Connor," etc. It is apparent tbat tbe testator had anticipated a refusal by tbe lessor to give bis consent to tbe subleasing of the first floor and basement of tbe premises.
It should be observed here that the Dreamland theater occupied a comparatively small portion of the premises covered by the ten-year lease. That lease being a chattel, in the absence of any specific provision of the will to the contrary, passed to the executor. That was determined in this state in the case of Becker v. Walworth, 45 Ohio St., 169, where it was held that "A lease for years, being a chattel interest, passes, at tbe death of the lessee, to tbe personal representative, who becomes, by virtue of bis office, assignee of the term." Indeed, the petition in this case avers that subsequent to the death of Bouzon, and after tbe appointment of the executor, tbe executor paid tbe monthly rentals under tbe lease and complied with tbe terms and conditions thereof. Presumably, in tbe discharge of the manifest duties of his office be also collected tbe rentals from tbe subtenants who occupied other portions of tbe leased premises. He was tbe assignee of tbe lease for tbe term.
In defining the duties and powers of the plaintiffs the testator makes no reference whatever to the lease in question, and we look in vain for any word in bis will authorizing them to execute a lease binding upon the testator's estate. He merely delegates to them authority to conduct the moving picture business and tbe Dreamland theater "during the Ufe of the lease on said building." Not only is there no further or additional authority conferred, but no where in the will is there any language which can bo tortured or twisted, into a suggestion of the testator that the plaintiffs shall exercise the option to require the execution of a new lease for the additional term of five years, which would have been his under the terms of the original lease had he survived. At the time of the execution of his will, which was about six months prior to his death, the matter of a new lease was somewhat in the future, and there is not a word in the will anywhere to indicate that such event was then under consideration by the testator. These plaintiffs are given no authority over or delegated any duties in connection with any portion of the property included in the ie¿ise except the room which is designated as the "Dreamland Theater," and as to it authority merely to conduct the moving picture business there located during the life of the lease, the net profits wherefrom are to be divided among the persons designated in the will. The question propounded as to what right these plaintiffs take under the will in any portion of the leased premises, and particularly what authority is conferred upon them by the will over any portion of the leased premises other than the Dreamland theater, or whence is derived their power to execute a lease binding on the estate of Bouzon to the payment of rentals aggregating $40,000, remains unanswered.
The rule is quite generally established that the representative of a decedent may not carry on the decedent's business after his death unless such authority is expressly granted, and in the absence of clear and express authority an executor may not use the personal assets of his testator to carry on the former trade or business of such testator, and such gen eral assets are not liable for money borrowed or indebtedness incurred by the executor in carrying on such trade or business, though the executor may have acted in good faith. Lucht, Admr., v. Behrens, 28 Ohio St., 231, and 18 Cyc., 241.
It is the rule, also, sustained by the great weight of authority, that the general assets of an estate will be subject to the payment of debts contracted by the legal representative while carrying on the business of the testator pursuant to a testamentary direction only where the will shows clearly that it was the intention of the testator that his general assets should be bound therefor.
The action of the probate court appointing the plaintiffs as trustees and directing them to conduct and operate the theater pursuant to the application of the executor cannot have any effect whatever in the determination of the rights and powers of the plaintiffs. Those rights and powers are derived entirely and solely from the provisions of Item 23 of Bouzon's will, and are measured and limited by the terms of that instrument. (Atkinson v. Beckett, 34 W. Va., 584.) While equity implies such powers in favor of a trustee as are reasonably necessary to the discharge of the duties assigned him by the instrument creating the trust, it is equally well settled that when the powers and duties of a testamentary trustee are defined and limited by clear and express language of the will, and he is there authorized to do only a particular thing, he has no power as to any other matters connected with the estate of the testator. "In trusts of a more particular and active hind, the general power of the trustee is limited to the exact performance of the duty imposed upon Mm. The duty and power given in such trusts must be strictly performed." (2 Perry on Trusts [6 ed.], Section 475.) That is the situation presented in this case. The language used by the testator as to the authority of the trustees and the extent thereof is clear, and it is not such as to warrant any implication whatever of authority to execute a new lease binding upon the estate of Bouzon or do aught beyond the term of the existing ten-year lease. The testator expressly limited the right, power and duties of these trustees to the operation of the theater during the term of the lease, and he conferred upon them no rights, powers or duties with reference to the lease itself which he held on the premises, only a small portion of which was occupied by the moving picture theater. He did not even give them authority to control or make disposition of the equipment of the theater at the expiration of the lease.
The ten-year lease contained the following provision : ' ' Said Lessees, without the written consent of the Lessor first endorsed hereon, shall never sublet, underlet or release any part of the first floor or basement of the premises herein included, or assign this lease." During his life the lessee could not have assigned the lease as a whole, or sublet the portion occupied as a moving picture theater, without first having the written consent of the lessor; no more could he do so by will, and surely these trustees under the very limited power conferred by the lessee's will could not acquire all the rights and benefits of an assignee of the lease in the absence of such consent of the lessor.
It is further urged that the defendant was estopped by reason of his acts and conduct to refuse to exe cute the lease, and particularly estopped to deny the authority of the plaintiffs as trustees. This action was brought January 6, 1921. The original lease did not expire until August 31, 1921. Clearly the acceptance of rents, during the term of the ten-year lease, which the lessor did not question, would not estop him from denying the claim of the trustees that they had a right to demand and authority to execute a new lease for a further term of five years upon property in a small portion of which they were operating a. moving picture theater, under delegated power, and over most of which no authority or right of possession or control was conferred upon or held by them. No action of the lessor, or failure to act, could serve to transfer to the plaintiffs title to the property of the testator. Furthermore, it does not appear that by the delay of the defendant to peremptorily refuse to execute such lease the plaintiffs were induced to change their situation to their detriment, or that their rights were in any wise thereby prejudiced.
For the reasons assigned the judgment of the court of appeals is reversed, and judgment is rendered for plaintiff in error.
Judgment reversed.
Marshall, C. J., Johnson, Hough, Wanamaker, Robinson and Jones, JJ., concur.