Court Opinion

ID: 6987594
Source: CourtListenerOpinion
Date Created: 2022-07-24 03:19:08.125343+00
Date Added: 2024-06-11T16:09:30.849546
License: Public Domain

Bailey, J. The decision of this case must depend upon the proper construction to be placed upon those covenants in the lease, relating to the removal, at the end of the term, of the buildings and fixtures placed upon the demised premises bv the tenant. A strict construction of the lease to Booney, would exclude from the scope of those covenants, all the buildings erected and improvements made by Latcham & Co., since those were already on the premises when the lease was executed, and were not placed there “ during the time of this lease.” Such construction would make all buildings and fixtures existing on the 1st day of May, 1875, the date of the lease, a part of the demised premises which the tenant covenanted to surrender to his landlord at the expiration of the term, and would, in effect, vest in the landlord, without consideration, and that, too, by a title which Booney would be estopped to deny, all the property purchased by Booney from Latcham, and for which he had just paid the sum of §3,600. Such construction should not be adopted, unless the more equitable one is entirely excluded by the terms of the lease. When viewed in the light of the surrounding circumstances, it is plain that the lease to Booney was intended to operate merely as an extension, or continuation of the original lease to Latcham & Co., the name of the lessee only being changed. The purchase of the buildings and fixtures by Booney was only on condition that he could get an extension of the lease for ten years. The interview with Crary was for the purpose of obtaining such extension. The purchase by Booney of .the buildings, etc., was fully explained to Crary, and, as a result, an agreement was indorsed on the original lease, not for a new term to commence May 1, 1875, but for an extension, in the name of Rooney, of the original lease from that date for ten years. The subsequent execution of a lease running from May 1, 1875, must be regarded merely as the mode which the landlord saw fit to adopt to carry out his agreement for an extension of the original term, and the rights of the tenant to the buildings and fixtures must be regarded as relating back to the date of the original lease. Assuming, then, that the buildings and other improvements in controversy are within the terms of the covenants above mentioned, what are the rights of the parties? These covenants are, that said buildings and improvements shall be deemed a part of the realty, and shall not be removed except by the written consent of the landlord, but it is further provided that the landlord shall give such consent when the rent is fully paid, and the covenants of the lease performed. It is clear that this does not vest the landlord with a complete equitable title to these structures on the non-payment of rent or the breach of any of the covenants of the lease, but merely gives him the right to hold them as a part of the realty until rent is paid and the covenants performed. In other words, he is vested with a lien on said structures in the nature of a mortgage, from which the tenant has the right of redemption. We think there was no error in dismissing the cross-bill The tenant had such right to remove the buildings and fixtures and such right only, as was given by the expi’ess terms of the lease. Itwas there agreed, as we have seen,-that those structures should be and remain a part of the realty, except in one event, viz, the payment of the rent, etc. In that way only could the tenant entitle himself to their severance. He had no right to have them sold and the proceeds applied to the rent. Not only would such sale contravene the express terms of the covenant, but in case it should fail to realize the full amount due, the landlord would be compelled to allow the buildings to be removed before receiving what he has expressly stipulated for in his lease — the payment of the renj; in full. -The cross-bill •seeks merely to have the buildings, etc., appraised and sold and the proceeds applied to the rent. The tenant was not entitled to that relief, and it was properly denied. Had the cross-bill been in the nature of a bill to redeem, a different question would have been presented. But such is not its character. It makes no offer to redeem, nor does it pray for permission so to do. But we think the decree under the original bill should not have barred and foreclosed the tenant of all right to the buildings and fixtures, as it practically does, without according him an opportunity to redeem. The amount of the rent in arrears should have been ascertained and a reasonable time given the tenant to pay it, and on failure to make payment within the time limited, the decree might properly foreclose his rights and perpetually enjoin him from interfering with the property. It should be remembered that, so far as the original bill is concerned, the landlord has presented himself before a court of equity, asking to have his rights in the property in question settled and protected. A court of equity will not aid him in taking advantage of, and enforcing the forfeiture of his tenant’s term, except upon equitable conditions. The least that can be required of him is, that he give his tenant an opportunity within a reasonable time, to avail himself of the terms of the covenant, by paying the rent and thus entitling himself to the possession of the buildings and fixtures. If the landlord, since he took possession, has derived any actual benefit from the buildings, etc., by way of an enhanced rent, or otherwise, the tenant should receive credit for the same in the statement of the account for rent; and on the other hand, the landlord should be allowed interest on the rent in arrears from the time the same became due. The decree will be reversed and the cause remanded for further proceedings in accordance with this opinion. Decree reversed.