City Garage & Sales Co. v. Ballenger

• Decision Date: 01 April 1926
• Docket Number: 6 Div. 569
• Citation: 214 Ala. 516,108 So. 257
• Parties: CITY GARAGE & SALES CO. v. BALLENGER.
• Court: Alabama Supreme Court

108 So. 257

214 Ala. 516

CITY GARAGE & SALES CO. v. BALLENGER.

6 Div. 569

Supreme Court of Alabama

April 1, 1926

Rehearing Denied May 6, 1926

Appeal from Circuit Court, Walker County; R.L. Blanton, Judge.

Bill in equity by the City Garage & Sales Company against J.A Ballenger, to enjoin prosecution of a suit in unlawful detainer and to enforce an option to renew a lease. From a decree dismissing the bill, complainant appeals. Reversed and remanded.

Coleman D. Shepherd, of Jasper, for appellant.

D.A McGregor, Ray & Cooner and Gray & Powell, all of Jasper, for appellee.

BOULDIN J.

The lease of real estate for a term of years, reduced to writing and signed by the parties, passes an interest or estate in lands. In the absence of restrictions in the lease, the lessee may assign his right and title under the lease. Failure to state in terms that the grant is to the lessee "his successors or assigns," does not cut off the right of assignment. The right exists in the absence of stipulations to the contrary. Maddox v. Westcott, 156 Ala. 492, 47 So. 170, 16 Ann.Cas. 604. A stipulation that the premises should not be relet, or the lease should not be assigned, without the consent of the lessor, is usually a lawful condition enforceable by the lessor. Consent to the assignment need not be in writing. If the lessor, knowing of the assignment, accepts the assignee as substituted lessee by receiving the rents without objection, this is sufficient evidence of consent.

In this cause, there is evidence that the lessor was consulted and gave his approval of the assignment beforehand, and there is no dispute that for some 5 years of the 6-year term of the lease the assignee was recognized and rent received from him without objection. Under these facts the assignee succeeded to all the rights of the original lessee. In this state of case, it is immaterial to inquire whether the assignee was bound by stipulations requiring consent incorporated in the duplicate copy held by the lessor, and not in the lessee's copy of the lease.

An option to renew for a like term, on same rental basis embodied in the lease, is, in equity, a part of the estate granted, and passes to the assignee of the lease. Underhill on Landlord and Tenant, § 815, p. 1391; 35 C.J. p. 1013, § 134.

This feature of the lease is executory in character. The tender by the lessee of a renewal lease conforming to the terms of the option, with request for its execution, all the obligations of the lessee having been met, was an exercise of the option, entitling him to specific performance in equity Upon refusal of the lessor to execute the renewal lease. As incident to this relief the lessee was entitled to enjoin a suit by the lessor in unlawful detainer. Equity, treating that as done which ought to be done, regards the lessee as rightfully holding the possession, and, acquiring jurisdiction for specific performance, proceeds to do complete justice.

The stipulation in a lease that, upon failure to pay the monthly rental within 30 days after it falls due, the lessor is "authorized to terminate" the contract, is a valid provision for the protection of the lessor.

The general rule is that payment after forfeiture declared of rents which accrued before forfeiture, and receipt of the same, without more, does not waive an existing forfeiture. On the other hand, receipt of rents accruing after cause of forfeiture, without notice to the contrary, is a recognition of the continued existence of the lease, and a waiver of such forfeiture. Dahm v. Barlow, 93 Ala. 120, 9 So. 598; Zirkle v. Ball, 171 Ala. 568, 54 So. 1000.

Where the lease is not forfeited ipso facto by nonpayment of rents, but the lessor reserves the authority or option so to do, the full payment and acceptance of accrued rents before a forfeiture is declared removes the ground of forfeiture. 36 G.J. 599; Brock v. Desmond & Co., 154 Ala. 634, 45 So. 665, 129 Am.St.Rep. 71; Princess Amusement Co. v. Smith, 174 Ala. 342, 56 So. 979.

The basis of the right of forfeiture is the nonpayment of rent. The time limit fixes the date when this option to forfeit arises. If there are no rents in arrears, there is no basis for the exercise of the option. The case is not strictly one of waiver, which turns upon the question of the intent of the lessor as gathered from the circumstances, but is one wherein the condition named...