Court Opinion

ID: 5409385
Source: CourtListenerOpinion
Date Created: 2022-01-08 16:06:41.786789+00
Date Added: 2024-06-11T08:30:43.076819
License: Public Domain

Scott, J. (dissenting).
By a lease the defendant demised to plaintiff for a term of years certain real property, and the plaintiff deposited with defendant a sum of money “to be held by the party of the first part, during the continuance of the lease, as security for the faithful payment of the rents, and the performance of the covenants contained in this lease.” The instrument of lease contained a covenant for re-entry by the landlord in case of nonpayment of rent. It also contained ■ a separate covenant to the effect that: “ In ease of default in any of the covenants the landlord may resume possession of the premises and re-let the same for the remainder of the term at the best rent he can obtain for account of the tenant who will make good any deficiency.” After the plaintiff had gone into possession he failed to pay an installment of rent and the landlord instituted summary proceedings under the statute and having obtained a final order resumed possession of the demised premises. Of the amount deposited by the tenant as security *563■all but $600 has been applied by the landlord to the payment of the rent due up to the time of the dispossession. This ■action is to recover the balance of the deposit. Although the lease reserved to the landlord in one covenant the right to “ re-enter ” for nonpayment of rent, under which, as has been held, he could resort only to the common-law action of ejectment, it is not contended, nor can it well be contended that this was his exclusive remedy. Outside of and without regard to the lease he still had a statutory right to resort to summary proceedings. The only question presented is as to the effect of the resumption of possession under statutory summary proceedings upon the defendant’s right to retain the deposit. The effect of a dispossession upon a lease is well settled. It •“ cancels the agreement for the use of the premises,” and “ annuls accordingly the relation of landlord and tenant.” Code Civ. Pro., § 2253. It does not, however, wipe out those covenants and conditions of the lease which by their very terms survived the resumption of possession. Baylies v. Ingraham, 84 App. Div. 360; McCready v. Lindenborn, 172 N. Y. 400; Harding v. Austin, 93 App. Div. 564; Lewis v. Stafford, 24 Misc. Rep. 717; McAdam Landl. & Ten. (3d ed.) 963. As was pointed out in the case first above cited a covenant to pay deficiency arising out of a re-letting after the resumption of possession by the landlord would be meaningless and valueless, if it were to be held to be destroyed by the very act of resuming the possession. The covenant to make good any deficiency, therefore, survived the dispossession proceedings, and since the deposit was made to secure the performance of all the covenants the landlord is entitled to retain what remains of it to secure the performance of the covenant which thus survives. The covenant differs in an essential particular from that considered by the Court of Appeals in Michaels v. Fishel, 169 N. Y. 381. There the covenant to make good any deficiency was conditioned uporf “ re-entry ” by the landlord, and this was held to mean only a resumption of possession by means of an action of ejectment. Here the covenant is to pay any deficiency which may arise after the landlord may have resumed possession, without limiting it to such resumption *564by any particular form of action or proceeding. Anzoleme v. Paskusz, 96 App. Div. 188. The cases cited by respondent are not to the contrary. The distinction between the present case and Michaels v. Fishel, has already been pointed out. In Chaude v. Shepard, 122 N. Y. 397, the covenants covered by the security were to pay rent and Croton water charges and make repairs during the term, p. 400. Obviously these covenants did not survive the curtailment of the term. In Scott v. Montells, 109 N. Y. 1, no such covenant appears as is here considered. In Caesar v. Rubinson, 174 N. Y. 492, the only question involved was whether the deposit should be treated as liquidated damages or as security for actual damages. The result is that the plaintiff has no present cause of action for -the return of his deposit, and cannot have until it shall have been ascertained, at the end of the term for which the lease was made, whether or not there has been an actual deficiency in the rental realized by the landlord upon a reletting.
The judgment should be reversed and a new trial ordered, with costs to the appellant to abide the event.
Judgment affirmed, with costs.