Court Opinion

ID: 3583165
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:33:52.12251+00
Date Added: 2024-06-11T07:41:36.841591
License: Public Domain

By written instrument under seal, Jacob Wall and John L. Wall leased to the defendant certain premises situated in the southeasterly corner of *Page 477 
Sixth avenue and Twenty-first street in the city of New York, known as No. 338 Sixth avenue.
The term of the lease was fifteen years and eight months, commencing on the first day of September, 1901, and ending on the thirtieth day of April, 1917, at twelve o'clock midnight of that day. The rental was $10,500 a year, payable the first day of each and every month. Said lease contained the following clause:
"First. That the said party of the second part shall and will pay and discharge when due and payable or within sixty days thereafter, all and every tax and taxes, Croton water or other water rates, charges for placing, replacing or repairing water meters upon said premises, rents, charges, assessments, duties and other impositions whatsoever, as well ordinary as extraordinary, which shall be assessed, levied or imposed upon the said premises, or any part thereof, by any government, power or authority whatsoever during the said term, except that the parties of the first part covenant and agree to pay all taxes, assessments or other charges which may become a lien and charge on said premises in the year 1901; but the party of the second part covenants and agrees to pay the water rates or rents chargeable against or to said premises or any part thereof after September 1st, 1901."
The interest of Jacob Wall was assigned to John L. Wall and the latter having died, the plaintiff, his duly appointed executrix, brings this action for moneys claimed to be due under the lease.
The only question is whether the tenant is liable for the taxes becoming due and payable on May 1st, 1917, the day after the expiration of the lease. The Trial Term held that the defendant was not liable to pay these taxes, but this conclusion has been reversed by the Appellate Division, two of the justices dissenting.
By the Greater New York Charter in force and effect in 1901, the assessment roll of each borough of the city was to be delivered to the receiver of taxes on or before the 15th *Page 478 
day of September (Sec. 911), and the taxes became due and payable on the first Monday of October. (Sec. 914.) This evidently explains the provision in the above clause of the lease that the party of the first part covenants and agrees to pay all taxes and assessments which may become a lien and charge on the premises in the year 1901. The lease commencing September 1st, the taxes under the charter would become due and payable October 1st, and it was agreed that the owner should, therefore, pay the taxes for the year 1901. Section 911 was amended by chapter 455 of the Laws of 1911 by changing the date when the assessment rolls should be finally completed and delivered to the receiver of taxes, to the 28th day of March. The date for payment of taxes was changed so as to make one-half of the taxes upon real estate due and payable on the first day of May and the remaining and final half payable on the first day of November. All taxes, it was provided, should be and become liens on the real estate affected on the respective days when they became due and payable and should remain liens until paid.
The lease was for a long term, fifteen years and eight months, and it seems reasonable to suppose that the parties contracted with a view to those things which would happen during the term of the lease. In my opinion, the wording of the clause does not warrant a construction which would require the tenant to do something which did not happen to the premises until after his term had expired and he had ceased to have anything to do with the property. This clause, above quoted, states that the lessee shall and will pay and discharge when due and payable all and every tax upon said premises which shall be assessed. The taxes in this case under the amendment of the charter, as above stated, did not become due and payable until May 1st, 1917. At that time the lease had expired. The defendant had ceased to have any interest in the property. During his term which was up to midnight of April 30, 1917, he *Page 479 
could not pay the taxes assessed even if he desired to do so. They were not payable. The provision of the lease regarding the payment of taxes must have been written with a view to each one of the years that the lease had to run; each one of the fifteen years. It was not made, having in mind solely the date of expiration. In fact the changes in the law shifting the date of payment and of lien did not occur until after the making and execution of the instrument. Had the law remained as it was when the parties made the lease, the lessee's term would have expired many months before the taxes became due on October 1st. It cannot be said, therefore, that the parties contemplated that the taxes would be assessed before and become due and payable after the expiration of the lease and made their provisions accordingly. It is for this reason that I am of the opinion that the parties used these words, intending them to apply to the things which would happen during the term of the lease, i.e., that the lessee was to pay the taxes which became due and payable while his lease was in force and effect, not those which became due and a lien upon the property after the expiration of his term. In effect this is what the clause means. If more than that had been intended specific provision would have been made for it. This construction of the lease seems to be in harmony with our decision in Ward
v. Union Trust Company of N.Y. (224 N.Y. 73). The lease in that case contained the covenant as follows: "Provided always and the lessee hereby covenants to pay said rent punctually, and to pay and discharge all annual taxes as shall during said term be imposed on said premises hereby demised, as soon as they become due and payable, and to pay the Croton and all other water charges as soon as the same shall become due, and to keep said demised premises free, clear, discharged and unincumbered from all such taxes and Croton and other water charges during said term, and to put and keep the said premises in good order and *Page 480 
repair, and in all respects promptly comply with and execute all the laws, orders and regulations of the State and municipal authorities applicable to said premises; except as hereinafter provided with respect to the widening of Fifth avenue." One-half of the amount of taxes in that case became due and payable on the day on which the term of the defendant's lease expired. It was properly held that he should pay this half because the taxes became due and payable while he was in possession. As Judge CHASE said: "Reading the covenant as a whole, the promise of the tenant includes the general taxes imposed and becoming due and payable within the term. The demised premises became incumbered with one-half of the tax of 1914 on May 1, 1914. The lessee could not leave the demised premises free, clear, discharged and unincumbered from taxes during said term if the taxes so actually due and payable on the date of the expiration of the lease were left unpaid. The payment of the tax comes precisely within the terms of the contract made by the lessee and we can only consider and enforce it." (pp. 75, 78.) So in this case, reading the covenant as a whole, the promise of the tenant included merely the payment of the general taxes imposed and becoming due and payable within the term. The fact that in the Ward case the covenant also was to keep the demised premises unincumbered was not the determining feature and is not a distinguishing element between that case and this. The effect is the same in this case. By the charter provision, above referred to, the taxes became a lien on the day when they became due and payable. It is the due date, the time when the parties must act, not the city officials, which was in the minds of the lessor and lessee. When the taxes were assessed was a matter of no importance. It could be weeks or months prior to the time of payment. This was a mere matter of detail, of bookkeeping, of administrative work on the part of the city government. What the landlord and tenant had in mind was the thing *Page 481 
which affected them; it was the date when payment had to be made by one or the other; when the real property became charged with a lien. The assessment did not affect either of them until by operation of law it touched the property and became a payable tax. Therefore, emphasis in both these cases by reason of the phraseology used, comes upon the words "due and payable," and indicates that the tenant was to pay all such charges which matured during the term of his lease.
For this reason I am of the opinion that the judgment of the Appellate Division should be modified by deducting therefrom the amount of taxes due and payable on May 1, 1917, to wit, the sum of $1,313 and interest, and as so modified affirmed, without costs.
HISCOCK, Ch. J., CARDOZO and McLAUGHLIN, JJ., concur with POUND, J.; CRANE, J., reads dissenting opinion, with whom HOGAN and ANDREWS, JJ., concur.
Judgment affirmed.