Court Opinion

ID: 3602561
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:48:38.704517+00
Date Added: 2024-06-11T13:58:12.378770
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 586 
A lessee, who enters into possession of demised premises under a lease for a fixed term with the privilege of extending it by giving written notice to the lessor, and continues in possession after the fixed term has expired, paying the rent thereafter as it becomes due, thereby elects to exercise the option for an extension of the term, although no express notice of such election is given. (Long v. Stafford, 103 N.Y. 274, 283.) In such a lease the requirement of a written notice may be waived by the parties and a waiver will be implied when the lessee remains in possession and pays the rent to the lessor. (Id.)
The assignment of the lease in question by the lessee to the defendant conferred upon it all his rights, including the privilege of exercising the option to extend the term. "The benefit running with the land is transmitted by assignment." (McAdam's Landlord  Tenant [3rd ed.], 377; Piggot v. Mason,
1 Paige, 412.) The assignee thereupon became liable for the rent by privity of estate so long as it remained in possession, *Page 588 
but it could have terminated the liability at any time during the first year by assigning the lease and leaving the premises. (Frank v. N.Y., L.E.  W.R.R. Co., 122 N.Y. 197.) It was the duty of the assignee upon the expiration of the original term to surrender possession to the lessor, or exercise the option given by the lease. Among the covenants on the part of the lessee running with the land, was one requiring surrender of possession to the lessor upon the expiration of the defined term, unless the option was exercised. The assignee gave no written notice of an intention to extend the lease, but continued in possession after the expiration of the first year and paid the rent every week as it fell due for the period of four months. The lessor by accepting the rent from the assignee waived his right to require written notice of election as required by the lease. The assignee claimed no right to hold over or to continue in possession except as authorized by the lease. No such circumstances existed as were held in two recent cases to rebut the presumption of a renewal or extension by implication. (Herter v. Mullen, 159 N.Y. 28;Zorkowski v. Astor, 156 N.Y. 393.) The case is barren of any excuse, real or pretended, for continuing in possession and paying rent without exercising the option. The assignee at the expiration of the first year stood in the shoes of the lessee with all the privileges and duties which would have devolved upon him had he then owned the lease. Any act which, if done by the lessee, would have raised a conclusive presumption that he intended to exercise the option, would if done by the assignee in possession have the same effect. Due effect can be given to the lease and the assignment thereof in no other way. A lessee by remaining in possession and continuing to pay rent would ipsofacto have extended the lease and the assignee by the same acts brought about the same result. The privity of estate which existed between the assignee and the lessor when the first year expired, gave to the acts of the former the same legal effect as if such acts had been done by the lessee in the absence of an assignment. The act of continuing in possession *Page 589 
and paying rent, operating through the option in the lease which then belonged to the assignee, resulted in an implied contract to extend the lease, and thenceforward there was privity of contract between the parties as well as privity of estate. The lessor by accepting the rent accruing after the expiration of the fixed term impliedly waived the notice required by the lease, and the assignee by remaining in possession and continuing to pay rent impliedly exercised the option to extend the term for the further period of two years. The result was not the creation of a new lease, but the continuance of an existing lease pursuant to the terms thereof. The subsequent assignment by the defendant to one of its employees and the abandonment of possession by it had no effect upon the contract, and the defendant continued liable for the rent by virtue of its implied covenant.
We think that from the mutual action of the parties, the one remaining in possession and paying the rent and the other consenting thereto by accepting the rent, a contract arose by implication of law binding upon both, which extended the lease for the period named in the option. The judgment should, therefore, be affirmed, with costs.
PARKER, Ch. J., GRAY, O'BRIEN, BARTLETT, MARTIN and CULLEN, JJ., concur.
Judgment affirmed.