Jesse Newman, Plaintiff, v. Murdo Tolmie, Defendant

Jesse Newman, Plaintiff, v. Murdo Tolmie, Defendant. Sale of a business under an agreement that if an extension of the lease for five years was obtained, the vendee would pay a further sum to the vendor — its construction is one of law for the court—the extension presumably to be at the same rent although not necessarily by a single lease. One Newman, who conducted business in premises of which he held a lease at a rental of seventy-five dollars per month, expiring May 1, 1895, wishing to retire from business, sold certain personal property to one Tolmie in February, 1895, under an agreement providing as follows: “ Possession to be taken Mch. , 1st, 1895, at §75 per month. If lease is obtained for 5 years the party of the 2nd part to pay to the party of the 1st part the sum of §750 additional and another bill of sale drawn up. ” Under such agreement Tolmie entered into possession of the premises. Prior to the making of this agreement Newman and Tolmie called upon the landlord’s agent to ascertain whether a new lease for five years could be obtained, and were informed by the agent that it was not possible at that time to get an extended lease for five years from May 1, 1895, but that he believed that the landlord would extend the lease for one year from May, 1895, and that there would be no trouble in getting a further extension. March 13, 1895, Newman obtained from the landlord an extension of .the lease for one year from May 1, 1895, at seventy-five dollars per month, under which the defendant occupied the premises. On the expiration of that lease the landlord refused to renew the lease at the previous rental, but did execute to Tolmie a' lease for three years for a rental of eighty-five dollars per month. At- the expiration of this lease the landlord renewed it for one year at the same rental. Held, that the construction of the agreement presented a question of law for the . decision of the court; That while it was evident that neither of the parties contemplated that the payment of the additional §750 should depend upon Tolmie’s ability to obtain a single lease of the premises for five years from the expiration of the existing lease, they did contemplate that the additional payment should not be made unless Tolmie obtained the right to occupy the premises for five years from the termination of the existing lease at the' same rental fixed by such existing lease and that the additional payment of $750 never became due. Motion by the plaintiff, Jesse Newman, for a new trial upon a case containing exceptions, ordered to be heard at the Appellate Division in the first instance upon the dismissal of the complaint by direction of the court after a trial at the New York Trial Term. Henry Brill, for the plaintiff. Philip M. Brett, for the defendant. [MAJORITY — Ingraham, J.:] Ingraham, J.: Upon the trial of this action the complaint was dismissed at the end of the plaintiff’s case, to which the plaintiff excepted. The court thereupon"’ ordered the exceptions to be heard in the first instance at the Appellate Division. The plaintiff was in possession, as lessee, of certain premises in the city of New York, wherein he carried on the business of carpenter and builder. He had & lease of the premises, which expired on the 1st day of May, 1895, at a rental of $75 per month. In February, 1895, wishing to retire from business, in consideration of $750 paid by a firm, of which the defendant was the surviving partner, he sold to this firm certain personal property consisting of a horse, wagons, etc. To this agreement there was annexed a note, as follows: “ Possession to be taken Mch. 1st, 1895, at $75 per month. If lease is obtained for 5 years the party of the 2nd part to pay to the party of the 1st part the sum of $750 additional and another bill of sale drawn up.” In pursuance of this agreement the defendant took possession of the personal property and entered into possession of the premises theretofore occupied by plaintiff and paid the $750. Prior to the making of this agreement the plaintiff and the defendant together had called upon the agent of the landlord to ascertain whether a new lease for five years could be obtained. The agent replied to this request that it was not possible to get an extended lease for five years, from May, 1895, at that time, but that he believed the landlord would give a lease for one year from May, 1895, and he also believed that there would be no trouble after that in getting an extended lease, but that he would have to see the owner of the property. Nothing seems to have been said about the rental at that interview. Subsequently, on March 12, 1895, the owner and the plaintiff executed an agreement whereby the lease was extended for' one year, from May 1, 1895, at $75 per month, and under that lease the defendant’s firm occupied the premises until May 1, 1896. Prior to May 1, 1896, it would seem that the defendant entered into negotiations with the owner and secured a verbal agreement for a new lease for three years from May 1,1896, at $85 per month. The owner, however, refused to renew the lease at $75 per month; the rent formerly paid. Before this lease was actually executed the plaintiff went to the agent of the landlord in relation to the new lease of the premises, when the agent stated that he had made an agreement for a new lease with the defendant for three years, but that it was not yet signed. After this interview with the agent, the plaintiff went to see the defendant when they discussed the agreement for a lease already made. The plaintiff said to the defendant that he would get him a lease for four years of the same premises; that the agent said that he could have a lease for that period, and the defendant then asked “for $75 a month,” the same that they had been paying. To this the plaintiff said “ no,” and the defendant then said that he would refuse to take a four years’ lease unless it was furnished at the old rent of $75 per month! The new lease ■obtained by the defendant was for three years, from May 1,1896, at the yearly rental of $1,020 ($85 per month), with a provision that should the demised premises he sold previous to the expiration of the term the lessee would, on or before the expiration of sixty days’ notice in writing from the lessor vacate the said premises, and that the lease should cease and determine. At the expiration of this lease in 1899, it was renewed for one year at the same rent, and the defendant, therefore, actually occupied the premises a? lessee for a period of five years from May 1,1895. This action was brought to recover the additional $750 which, by the agreement of February 27, 1895, the defendant was to pay “ if lease is obtained for 5 years.” At the time this agreement was made the parties had applied to the landlord for a new lease for five years, but in reply to this application the agent had said that it was not then possible to get a lease for five years from May 1, 1895, but that he believed the owner would give a lease for one year from May 1, 1895, and that there would be no trouble after that in getting an extended lease. This was the situation when the agreement of February 27, 1895, was made. Considering this situation it is quite evident that neither of the parties contemplated that the payment of this additional $750 should depend upon the defendant’s obtaining one lease of the premises for five years, at the expiration of the existing lease, as such a lease had been expressly refused prior to the making of the contract. The additional payment, however, was conditioned upon the defendant’s obtaining a. right to occupy the'premises for five years; and I think it must have been contemplated that this occupation of the property sub, sequently should be upon the same terms as the present existing lease. The additional payment is conditioned upon the defendant’s obtaining a lease of the premises for five years. The price that the defendant was to pay for the premises during the remainder of the lease under which the plaintiff was occupying the premises was-fixed at $75 per month. The existing lease would expire on the first of May following the making of the contract, and the parties at the time the agreement was made could get no actual assurance that a new lease of the premises would be given. The utmost that they had been able to obtain was an expression of belief by the agent of the landlord that a new lease for one year would be givenj and it is claimed that what was contemplated was a lease at the same terms as were contained in the existing lease. A new lease for one year upon the same terms as the existing lease was given, but at the expiration of that lease the landlord refused to grant a further lease at the same rent and exacted an increased rental, and it is clear that this was the best lease that either the plaintiff or the defendant could obtain. Assuming that the terms of this agreement were ambiguous, thefe was nothing in the negotiation leading up to this agreement or in the practical construction of the agreement put upon it by the parties after it was executed, that throws any light upon the intention of the parties as to the terms of the lease to be obtained which would impose upon the defendant the payment of this additional sum of money. The construction of the agreement, therefore, became a matter of law for the court, and there was nothing to justify the submission of any question as to what 'the parties intended to the jury. It has been held that a covenant of a renewal contained in a lease where the amount of rent is not specified implies a renewal for the same rent. (Tracy v. Albany Exchange Co., 7, N. Y. 472.) The situation here was substantially the same' The plaintiff assigned to the defendant the lease of the premises up to the first of May following the date of the agreement, and the defendant agreed to pay an additional sum of money upon condition that a lease would be obtained for five years. That, we think, clearly implied a lease-upon the same terms as the existing lease, and as this condition was not complied with and no lease upon the existing terms was obtained for a greater period than one year, the defendant never became liable for the additional payment contemplated. It follows that the complaint was properly dismissed. The exceptions are, therefore, overruled and judgment directed dismissing the complaint, with costs. Van Brunt, P. J., O’Brien, McLaughlin and Laughlin, JJ., concurred. Exceptions overruled and judgment directed dismissing conn plaint, with costs.