Magdalena Doscher, Executrix, et al., Respondents, v. John J. Shaw et al., Appellants

Magdalena Doscher, Executrix, et al., Respondents, v. John J. Shaw et al., Appellants. (Argued April 7, 1873; decided May 6, 1873.) Plaintiff leased certain premises to B. &E.,witli a restrictive proviso that the lessees should not sublet them for storage after the first year of the term. The lessees sublet to S. for five years, and thereupon plaintiffs gave S. a written license to usé the premises for storage for five years, in consideration of the sum of $1,500 per annum, agreed to be paid by S.; also an agreement on his part to keep the buildings insured. Defendants guaranteed the performance of the contract. S. subsequently surrendered his lease and declined to pay the sums thereafter falling due on his contract with plaintiffs. In an action upon the guaranty,—held, that the surrender of the lease did not, without the consent of plaintiffs, terminate or affect the liability of S. to them, but that he was bound to" perform his contract for the whole period of five years, although he ceased to avail himself of the privilege. Appeal from judgment of the General Term of the Superior Court of the city of New York, affirming a judgment in favor of plaintiffs, entered upon a verdict. This action was brought upon a guaranty of an agreement made and executed by plaintiffs and one James Shaw. On March 8, 1864, the plaintiffs leased to Wm. H. Boggs and Peter EL Edmonston, Nos. 384 Greenwich street and 369 Washington street, in the city of New York, with the restrictive proviso that the lessees might rent the premises for storage for the first year of the term, but not longer. James Shaw obtained an underlease of the premises for five years from May 1,1867, and thereupon on his application the plaintiffs entered into a contract with him by which plaintiffs gave to him a “ license and permission ” to use the premises “ for and during the said period of five years, but no longer, for storage, etc.,” and Shaw in consideration of the premises agreed to pay the plaintiffs “ the yearly rent or sum of $1,500, payable quarter-yearly, on the usual quarter days; also, that he and his executors, administrators or assigns, during all the said term of five years, will at his or their own proper cost keep the said stores insured against loss or damage by fire,” to the amount of $20,000. The defendants guaranteed the agreement for Shaw. On or about October 1, 1869, Shaw surrendered his under-lease to his landlord, and ceased to occupy the premises. Plaintiffs were not parties to the surrender. The plaintiffs’ suit was to recover $750 of rent, which became thereafter due under the agreement "and $140 premium of insurance, which Shaw had failed to pay. D. T. Walden for the appellants. Plaintiffs’ agreement with S. did not create or convey any estate or interest in the realty. (Jamieson v. Milleman, 3 Duer, 258; Mumford v. Whiting, 15 Wend., 387, 390; 3 Kent’s Com., 452; Thomas v. Sorrell, Vaugh., 330-351; 1 Wash, on R. P. [3d ed.], 542; Wash, on Easements, etc., 623;) This license terminated when the tenant’s term was extinguished. (1 Wash, on R. P. [3d ed.], 545 ; Carlton v. Redington, 21 N. H., 291; Emerson v. Fish, 6 Glf., 200; Rerick v. Kern, 14 Serg. & R., 272.) To determine whether the covenant to pay the consideration survives the license for use, the intention of the parties as manifested by the instrument must be ascertained. (French v. Carhart, 1 N. Y., 102, and cases cited; Whallen v. Kauffman, 19 J. R., 109; Phelps v. Bostwick, 22 Barb., 314, 317, 318 ; 2 Pars. on Contr., 13-15; Moon v. Magrath, Cowp., 9; Sawyer v. Hammatt, 15 Me., 40; Doe v. Burt, 1 T. R., 701; Stockwell v. Hunter, 11 Metc., 428 ; Kerr v. Mer. Ex. Co., 3 Edw. Ch., 315, 322.) When the term ended and use ceased, the compensation therefor also ceased. (7 Abb. [N. S.], 34; Graves v. Burdan, 26 N. Y., 498; S. C., 29 Barb., 100; Stockwell v. Hunter, 52 Mass., 448; Kerr v. Mer. Ex. Co., 3 Edw. Ch., 315; Winton v. Cornish, 5 Ohio, 477; Ainsworth v. Ritt, 38 Cal., 89.) This principle is not altered, by reason of the surrender being the voluntary act of the tenant. (Home Ins. Co. v. Sherman, 46 N. Y., 370, 374.) Jno. E. Parsons for the respondents. [MAJORITY — Bapallo, J.] Bapallo, J. The right of the plaintiffs to recover in this action depends upon the construction to be given to the agreement sued upon. This agreement was not a lease, but a special contract, whereby the plaintiffs, in consideration of payments stipulated to be made by James Shaw, consented and agreed that he might use the stores in question during a period of five years, for purposes which were prohibited by the lease from the plaintiffs to Boggs & Edmonston, of whom Shaw was the under-tenant. For this privilege, or waiver of their rights, it was competent for Shaw to agree to pay to the plaintiffs such sum as might be determined upon between 1 them, either in gross or in annual payments. He agreed to pay $1,500 a year, and the insurance. The only question is whether, by his contract, he bound himself absolutely to make these payments during the whole period of five years, or only so long as he should continue in the tenancy of the premises. There is no rule of law by which the surrender of his lease by Shaw to Mr. Boggs necessarily, had the effect of terminating his liability under his agreement with the plaintiffs, who were not parties to such surrender. The duration of his liability depended upon the terms of the contract itself; and we think that the true construction of the contract is that Shaw, in consideration of receiving the privilege for five years, bound himself to make the payments and keep up the insurance during the five years. The plaintiffs bound themselves absolutely for the five years, and Shaw reserved no right to terminate his obligations by ceasing to avail himself of the privilege, or by surrendering his term. The surrender was his voluntary act, to which the plaintiffs were strangers, and did not relieve him from his agreement with them. Their consent, or some default on their part, was necessary to terminate that agreement. The judgment should be affirmed. All concur. Judgment affirmed.