Court Opinion

ID: 6961762
Source: CourtListenerOpinion
Date Created: 2022-07-24 01:46:48.735338+00
Date Added: 2024-06-11T16:08:27.861442
License: Public Domain

Mr. Justice Scholeield delivered the opinion of the Court: The clause in the lease providing that the premises shall not be assigned without the written assent of the lessors, is clearly for the benefit of the lessors only. It does not render the assignment, when otherwise made, absolutely void, but voidable only, at the option of the lessors or their representatives. But even if the lessors, instead of here attempting, as they now are, to enforce rights under an assignment otherwise made, were attempting to have such an assignment declared void, they could not succeed. They have knowingly accepted rent from Abiah G. Webster since she has been in possession as purchaser from Gage, and this concludes them, for it is well settled that “any act done by a landlord knowing of a cause of forfeiture by his tenant, affirming the existence of the lease, and recognizing the lessee as.his tenant, is a waiver of such forfeiture. (1 Williams’ Saunders, 287; 2 Platt on Leases, 471; 1 Washburn on Real Property, 454.) The receipt of rent subsequently accruing from the tenant by the landlord is such an act, and the forfeiture thereby waived. (Bleeker v. Smith, 13 Wend. 530; Jackson v. Allen, 3 Cow. 220, and authorities cited by Sutherland, J. 230.) ” Ireland v. Nichols, 46 N. Y. 416. See, also, Shattuck v. Lovejoy, 8 Gray, 204; Fisher v. Deering, 60 Ill. 114. The answer expressly asserts that Abiah G. Webster, by her husband, Christopher C,. Webster, purchased the houses, and immediately «entered into possession, and leased them, etc. The proof clearly shows that the houses and the unexpired term were sold at the same time, and as a part of the same transaction, and not separately and distinctly. Although Christopher C. Webster in his testimony denies that he had any agreement with Gage as to leasing the ground for any certain term, he nevertheless admits that when he purchased he did so with the understanding that the houses stood on leased ground which had seven years to run, with the privilege of renewal. His purchase, he says, was for his wife, Abiah, and with her money. He makes no claim to having purchased the lease for himself. He shows the payment of rent by his wife, pursuant to the terms of the lease, to the lessors, and the acceptance by them of the rent. She “claims through and is in of the same estate” as Gage, whom she succeeds, and is, therefore, assignee. Taylor’s Landlord and Tenant, see. 429; Bedford v. Therber, 30 N. Y. 453; Provost v. Caller, 2 Wend. 517; Fisher v. Deering, supra. It is unimportant whether Abiah G. Webster is to be regarded as a party to the renewal of the lease, (as, under all the evidence, we think clearly she should be,) for inasmuch as it is proven that she continued to occupy the premises, the law binds her, in the absence of a new agreement, to the same terms by which she was bound by the old. Clinton Wire Cloth Co. v. Gardner, 99 Ill. 151; Griffin v. Knisely, 75 id. 411; McKinney v. Peck, 28 id. 174. Since the answer sets up no claim to the term in Christopher C. Webster, but virtually concedes its sale to and purchase by Abiah G. Webster, we think the fact that Gage subsequently executed a written assignment to Christopher C. Webster of no consequence. Title passed from Gage, and to Abiah G. Webster, by the purchase and sale. He knew, Webster says, that the purchase was with her money and for her use, and so when he subsequently executed a bill of sale and assignment to Christopher C. Webster, he had nothing to sell or assign, and necessarily, therefore, nothing passed thereby. In a case of doubt the writing would probably be sufficient to settle the controversy and establish the title in the party whoffi. it designates as purchaser. But here there is no doubt. The answer settles the question to whom the sale was made, and it does not lie in the mouths of the Websters to now say that it was not made to Abiah G. Webster; and we repeat, there is no pretense that the houses were sold to one person and the lease to another, but the entire tendency of the proof, on the contrary, is, that there was but a single transaction, in which the unexpired term passed with the sale of the houses. Abiah G. Webster took possession, remained in possession during the remainder and after the expiration of the term, and paid rent for a time, and, so far as rent was paid at all, in accordance with the terms of the lease to Gage, Christopher C. Webster meanwhile claiming no possession or right of possession of either houses or ground during all that time, save as the agent of Abiah G. Webster. Surely it can need no demonstration that A, having passed his title to B, .can not, by any subsequent act, whether formal or informal, pass the same title to 0. It is, of course, understood, and to be borne in mind, that there is nothing, as regards the rights, of’the parties here contending, to prevent the passing of title or right of possession to the remainder of the term, as well as of the houses, by a parol agreement, accompanied, as the evidence here shows was the fact, by actual possession, delivered and accepted in accordance with the terms of such agreement. Walters v. Northern Goal Mining Co. 5 De Gex, MacN. & Gord. 629, Cox v. Bishop, 8 id. 815, and Robinson v. Rosher, 1 Y. &. C. 7, cited by counsel for plaintiffs in error, are unlike the present case. In the first, a bill in equity was filed for specific performance, and the recovery of rent from a cestui que trust. In the next case, the question, as stated by Lord Justice Knight Bruce, was, “whether an equitable assignee of a legal term of years granted in mines, or mines and other hereditaments, under a reserved rent and certain covenants, is liable to be sued in equity by the lessor for rent which became due, and damages in respect of some of the covenants committed during the time that the assignee was in the possession and enjoyment of the demised property as the equitable assignee of it, which he had then ceased to be. ” In the'other case the question was,-whether, when an equitable interest has been acquired in leasehold property by a contract in the nature of an assignment, the landlord had the right to proceed in a court of equity against the assignee as if he were his tenant. As we have before seen, in the present case Abiah G. Webster is not merely an equitable assignee,—she is a legal assignee; and if the object were simply to obtain a decree against her for the rent due, a court of equity would have no jurisdiction, for the remedy at law would be complete. But the bill here is to enforce payment of rent by the sale of specific property, upon the ground that a lien for that, purpose is reserved upon the property,—in other words, to enforce that lien,—and it is this alone which is claimed to give a court of equity jurisdiction. But the point is made that the covenant sought to be enforced does not run with the land, or otherwise bind the assignee. The covenant is as follows: “That he will pay, or 'cause to be paid, all water rates, and all taxes and assessments, except special assessments for permanent improvements, that may be laid, charged or assessed on said demised premises pending the existence of this lease, or if, at any time after any tax, assessment or water rate shall have become due or payable, the party of the second part, or his legal representatives, shall neglect to pay such water rates, tax or assessment, it may be lawful for the party of the first part to pay the same at any time thereafter; and the amount of any and all such payments so made by the party of the first part shall be deemed and taken, and are hereby declared to be, so much additional and further rent for the' above demised premises due from and payable by the party of the second part, and may be collected in the same manner, by distress or otherwise, as is hereinafter provided for the collection of other rents to grow thereon. And it is expressly understood and agreed by the said party of the second part hereto, for himself, his heirs, executors, administrators and assigns, that the whole amount of rent reserved and agreed to be paid for said above demised premises, and each and every installment thereof, shall be, and is hereby declared to be, a valid and first lien upon any and all buildings and improvements on said premises, or that may at any time be erected, placed or put on said premises by the said party of the second part, his heirs, executors, administrators or assigns, and upon his or their interest in this lease and the premises hereby demised; and that whenever and as often as any installment of rent or any other amount above declared to be deemed and taken as rent shall become due and remain unpaid for one day after the same becomes due and payable, said party of the first part, her heirs, executors, administrators, agents, attorneys or assigns, may sell at public auction," to the highest bidder for cash, after having first given ten days’ notice of the time and place of such sale in some newspaper published in the city of Chicago, all the buildings and improvements on said premises, and all the right, title and interest acquired by said party of the second part under this lease to the premises herein described, and as the attorney of the said party of the second part, hereby irrevocably constituted, may make to the purchaser or purchasers thereof a suitable and proper transfer, bill of sale or deed of the same, and out of the proceeds arising from such sale, after first paying all costs and expenses of such sale, including commissions and attorney’s fees, retain to himself the whole amount due on said lease up to the date of said sale, rendering the surplus, if any, to said party of the second part, his heirs, executors, administrators, agent, attorney or assigns, which sale shall be a perpetual bar to and against all rights and equities of said party of the second part, his heirs and assigns, in and to the property sold. ” The general doctrine is thus stated in Taylor on Landlord and Tenant, sec. 260: “Covenants in a deed that extend to a thing in esse, parcel of the demise, and benefit the estate, run with the land, and bind not only the covenantor and his personal representatives by privity of contract, but also the assignee, though not named, and every other person who is in of any estate created by or' growing out of the original demise, by privity of estate. ” And so the same author says, in section 372, the covenant to pay rent “is a covenant running with the land, binding on the assignee, without his being specially named. ” And upon this principle it has been held that a covenant to become surety for the payment of rent runs with the land. (Allen v. Culver, 3 Denio, 284.) The covenant that the rent, etc., shall be a valid and first lien upon the buildings and improvements, etc., is in the nature of security for the performance of the covenant for the payment of rent, and is, therefore, governed by Allen v. Culver. It is hut an incident or accessory to that covenant,—not a debt or right of property, but a remedy for a debt. It stands or falls with the covenant to pay rent. That covenant runs with the land, and. this covenant is necessarily carried with it as the remedy stipulated by the parties for its enforcement. All talk, therefore, about this covenant, except as an inseparable incident or accessory to the covenant to pay rent, is out of place, because it has-and can have no existence as a separate and independent covenant. But counsel for plaintiffs in error again contend that this lien can not be enforced, because the lease was not executed, acknowledged and recorded in conformity with the requirements of the statute relating to chattel mortgages. The question here does not affect third parties,—it is only between the lessors and the assignee of the lessees. No creditors or purchasers without notice are concerned. We have, held in Gregg et al. v. Sanford, 24 Ill. 17, Titus et al. v. Mabee et al. 25 id. 257, and Gittings v. Nelson, 86 id. 591, that a chattel mortgage or deed of trust of chattels does not create a lien on personal property acquired or brought into existence after its execution, as against creditors or purchasers. But this does not apply to cases where only the parties to the instrument, or,them representatives, are concerned. As between them we have held a chattel mortgage is good, though not executed, acknowledged or recorded as required by the statute. Davis v. Ransom et al. 26 Ill. 100; Fuller v. Paige, id. 358; Badger v. Batavia Paper Manf. Co. 70 id. 302; Sumner v. McKee, 89 id. 127; Forest et al. v. Tinkham et al. 29 id. 141. And in Cruikshank v. Cogswell, 26 Ill. 366, in speaking of the sale of a house there in controversy, we said: "As between the parties to it, delivery was not essential to the completion of the sale of the house. It was competent for the parties to agree at the time of the sale that the seller might retain possession of the house as long as he pleased, and upon any consideration which suited him, and no one but a creditor of, or purchaser from, the seller could take advantage of the non-delivery to the purchaser. ” See, also, to like effect, Corgan v. Frew, 39 Ill. 31. It was said by Story, J., in Mitchell v. Winslow, 2 Story, 630: “It seems to be the clear result of all the authorities, that whenever the parties, by their contract, intend to create a positive lien or charge, either upon real or personal property, whether it is then in esse or not, it attaches in equity as a lien or charge upon the particular property as soon as the assignor or contractor acquires a title thereto, against the latter, and all persons asserting a claim thereto under him, either voluntarily or with notice, or in bankruptcy. ” See, also, Morrill v. Noyes, 56 Me. 458; Silbus v. Lester, 48 Miss. 526; Everman et al. v. Robb, 52 id. 653; Benjamin v. Elmira, etc. R. R. Co. 49 Barb. 441; Seymour v. C. N. F. R. R. Co. 25 id. 286; Page v. Gardner, 20 Mo. 507; Wright v. Birch’s Exr. 72 id. 179; Garner v. Culting, 32 Iowa, 547. Without taking time to examine cases holding, or seeming to hold, a contrary doctrine, we deem it sufficient to say that, as applied to the facts of the present case, the language quoted from Mr. Justice Story is, in our opinion, perfectly accurate. In Butt v. Ellett, 19 Wall. 544, a lease of a plantation was executed for one year. The lessees gave their note for the rent, and to secure the payment of the note a clause was embodied in the lease mortgaging all the crops to be raised on the plantation for the current year. The court said: “The mortgage clause in. the contract of lease of the 15th of January, 1867, executed by Silber and Graham, could not operate as a mortgage, because the crops to which it relates were not then in existence. When the crops grew the lien attached, and bound them effectually from that time. * * * Ellett having bought the premises, became clothed with all the rights of Silber touching the rent stipulated to be paid by Graham. The sheriff’s deed conveyed the reversion, and the rent followed it as an incident. The lease passed by assignment to the grantee, and all its provisions in favor of the lessor inured to the benefit of the assignee. ” The case seems quite analogous to the present case, and well illustrates the controlling principles. It being competent for the parties to covenant for this lien, and the lien being valid as well against the assignee as the lessee, the next inquiry is,, can it be enforced in.a court of equity, or is the remedy solely at law ? And in regard to this there can be no doubt". Story, "in his work on Equity Jurisprudence, vol. 1, sec. 506, says: “Liens also give rise, to matters of account; and although this is not the sole, or, indeed, the necessary, ground of interference of courts, of equity, yet, directly or incidentally, it becomes "a most important ingredient in the remedial justice "administered by them in cases of this sort. * * * A lien is not in strictness either a jus in re or a jus ad rem, but it is simply a right to possess and retain property until some charge attaching to it is paid or discharged.” And after specifying instances in which liens attach, the author proceeds: “Now, it is obvious that most of these cases must give rise to matters of account, and as no suit is maintainable at law for the property, by the owner, until the lien is discharged, and as the nature and amount of the lien often are involved in great uncertainty, a resort to a court of equity, to ascertain and adjust the account, seems in many cases absolutely indispensable for the purposes of justice.” See, also, same authority, sec. 1217; Bispham’s Principles of Equity, (2d ed.) p. 419. Waiving the question whether the lien "here is to be regarded only as an equitable lien, we are of opinion. there was such necessity for the taking of an account as brought the case within that branch of the court’s jurisdiction. Objection is urged that the court erred in applying the money in court to the payment of the indebtedness. We see no error in this. ' The right to control the income,' etc.,- of the premises, follows as a logical sequence from the right to enforce a lien' upon them. If from the income the rent could be paid, no sale should be ordered. We are of opinion, however, that the court below erred in decreeing the payment of the penalty on taxes for two years ($500). The covenant binds the lessee to the payment of no penalty, but of the taxes only. The consequence of failure, in that regard, the covenant declares to be, that it shall be lawful for the party of the: first part to pay the same, and' thereby the amount so paid shall be so much additional and further rent, for the payment whereof the lien just considered is' given. When the lessee did not pay, the lessor should.have paid, both for the protection of his reversionary interest and in order to charge the lessee with the amount, by virtue of the covenant. It was his own neglect and folly that he permitted judgment against the property, and sale for the non-payment of taxes. The- decree below will be reversed, with direction to the court below to strike out so much as is for penalty for nonpayment of taxes, and in all other respects it will be affirmed. Decree modified.