Court Opinion

ID: 7184665
Source: CourtListenerOpinion
Date Created: 2022-07-24 16:51:23.144894+00
Date Added: 2024-06-11T16:16:02.027366
License: Public Domain

Lea, J.,
(with whom concurred Spoefobd, J.) dissenting. I concur in the opinion of the majority of the court, as delivered by Mr. Justice Voobhies, except so far as it relates to the construction of the obligation assumed by S. F. Slatter, in the purchase of the lease at the Sheriff’s sale.
In the opinion of the court, “ the contract of lease was extinguished by the sale of it to the lessor,” on the ground, “that having become the purchaser of the lease he, the lessor, united in himself the qualities of lessor and lessee.”
The facts of the case, so far they are essential to the illustration of the question presented, are as follows: On the 2d of May, 1855, an order of court was granted for the sale of all the property belonging to the insolvents. By virtue of the order, the Sheriff offered for sale, on the 15th of May, the unexpired term of the lease made by Slatter to the insolvents, having then seven and a half months to run ; at which sale, Slatter himself became the purchaser for the sum of $3000. The question is, whether at this sale, Slatter assumed the payment of a monthly rent of $1,250, in addition to a premium of $3,000-; or whether the $3,000 was a bid made for the right of occupation of the hotel for the unexpired term of the lease. The test suggested in the opinion of the court, by which this question should be solved, is certainly a fair one. What would have been the obligation of any other purchaser but the lessor, at such a sale ? Eor it would be contrary to all rules of equitable construction to impose upon Slatter a different obligation from that which would have been assumed by any other bidder. Now the order of sale does not say that the purchaser shall assume the payment of the rent; the lease does not appear to have been sold subject to any such condition, and it is not so stated in the adjudication. No such construction is warranted by implication of law. Neither the forced nor the voluntary assignment of a lessee’s right of occupation, carries with it any such obligation.
*437It is not necessary to embarrass the inquiry with speculations as to the probable rights of a lessor in a case where his contract was infringed by such an arrangement. In the case at bar, no such question is presented ; the lessor having acquiesced in the sale by becoming himself the purchaser. There are two ways of selling the unexpired 'term of a lease; one by selling it for a premium, subject to the payment of the rent to the landlord, the other by selling or assigning the right of occupation without the assumption of the rent. The latter is the more frequent way of selling or assigning it, since it rarely happens that the unexpired term of’ a lease is worth a premium. The case of a sub-lease is a familiar illustration of one form of this latter mode of assignment. The sub-tenant has nothing to do with -the original contract of lease. He is bound only for the payment of the rent which he stipulates to pay as sub-lessee; and whatever may be the rights of the landlord to cause the lease to be cancelled for the non-payment of. the rent by his tenant, he can in no case hold the sub-tenant liable for the payment of the rent under a contract to which he is not privy. Even the lessor’s privilege would not extend to the effects of the under-lessee, except so far as the latter might be indebted to the principal tenant. C. C. 2676. 6 Rob. 294. .
Now, it must be conceded, that where a lease is offered for sale upon the condition that the purchaser shall assume the payment of th.e rent, confusion would take place should the lessor himself become the purchaser, for the reason that the relation of debtor and creditor would be united in the same person ; and this would be in accordance with the decision lately rendered in the case of Young v. Cambot; and for the like reason, where the payment of the rent is not to be assumed by the terms of the sale, the rights of the lessor, who purchases under such circumstances, are not extinguished. He has not, by the purchase, acquired any obligation due to himself; the price of the purchase in such case is due not to the lessor, but the principal lessee or his representatives. This doctrine was fully recognized in the case of Bach & Co. v. Cottingham, recently decided.
In that case, as in the case at bar, a judicial sale was made of the unexpired term of a lease, the purchaser paying a fixed sum therefor. Before the expiration of the lease, the property was destroyed by fire. The lessor, who had received the whole of his rent up to .the expiration of his lease, was sued both by the purchaser of the lease-and the seizing creditors of the principal lessee, for the reimbursement of the overpaid rent; the former contending, that by the terms of his purchase, he had acquired all the rights of the original lessee. But the court held, that the right to reimbursement had not passed to the purchaser of the unexpired term of the lease, but remained vested in the original lessee and, as such, was liable to seizure by his creditors. It is olear, therefore, that the purchaser of the unexpired term of the lease, was not subrogated to the contract of lease with its rights and corresponding obligations. He became not the assignee of 'filie contract, but he acquired the right of occupation under the contract. There is nothing in the nature of the proceedings for a sale, nor in the presumptions arising from the facts of this case, which would indicate the intention or the expectation that the purchaser was to pay a premium on the lease. Had such been the intention of the syndic at the time the order of sale was applied for, it should have been clearly expressed.
*438But the facts of the case absolutely repel any such presumption. It appears to me manifest, that no person could be expected to pay a premium for the unexpired lease of a hotel, after the business season had nearly expired, and at a time when the season was approaching at which many of the large hotels of the city are closed from inability to pay expenses, and when those which are not closed, are kept open at a charge to the proprietors; and yet it is contended, that a purchaser would, under the circumstances, not only have assumed to pay a monthly rent of $1,250, but would be liable for a premium of $3,000 more for the privilege of so doing. As respects Slatter himself, such a conclusion is not less improbable, for having his accruing rent to the extent of $9,375 secured to him, by his privilege of lessor, we are to conclude that he offered a premium of $3,000 more for the purpose of extinguishing his claim, thereby making a voluntary sacrifice of the whole of it. A rule of interpretation which leads to such a conclusion, cannot, in my opinion, correctly illustrate the intentions of the parties.
I think that Slatter, after being charged with the amount of his bid, should be placed on the tableau, as a creditor for the rent accruing until the expiration of the lease.