Fleming v. Fleming Hotel Co. of N.J.

• Decision Date: 23 June 1905
• Citation: 69 N.J.E. 715,61 A. 157
• Parties: FLEMING et ux. v. FLEMING HOTEL CO. OF NEW JERSEY.
• Court: New Jersey Court of Chancery

61 A. 157

69 N.J.E. 715

FLEMING et ux.

v. FLEMING HOTEL CO. OF NEW JERSEY.

Court of Chancery of New Jersey.

June 23, 1905.

Action by John J. Fleming and wife against the Fleming Hotel Company of New Jersey. Petition dismissed.

H. C. Valentine and E. R. Walker, for petitioner. John T. Van Cleef, receiver, pro se. William R. Piper and Edwin O. Long, for creditors.

BERGEN, V. C. The defendant corporation was on the 6th day of April, 1905, decreed to be insolvent, and a receiver duly appointed according to the law applicable to such cases. At the time of the insolvency the corporation was conducting a hotel business in a building owned by Ogden D. Wilkinson, on State street, in Trenton, under a lease between Wilkinson and the defendant, which contained the following covenant: "That if any rent shall be due and unpaid * * * then this lease shall cease and become void, and it shall be lawful for the party of the first part, without notice and without demand for said rent, to re-enter the said premises and remove all persons therefrom." The lease also contained a covenant that the lessee would not assign the lease without the written consent of the owner. At the date of the appointment of the receiver the past-due rent amounted to $2,435.04, which yet remains unpaid. Since his appointment the receiver has continued the business and remained in the occupation of the property, for which use and occupation the owner has been paid at the rate reserved in the lease. The owner files his petition setting forth, in substance, the foregoing, alleging a breach of the covenant for the payment of rent, and prays an order requiring the receiver to surrender the property to him. The receiver resists this application, and claims that, because the owner has accepted rent from him for the period of his occupancy, he has thereby waived his right to a re-entry. This objection, standing alone, would not support the contention of the receiver, for he was bound to pay for the use and occupation of the building during the time he held the property, even if he should determine to abandon the lease and surrender the property. The answer filed by the receiver to the petition shows that the only business of the insolvent corporation was that of keeping a hotel on the leased premises, and that a sale thereof as a going business is necessary to secure the best results for the benefit of the creditors of the corporation; that an Inventory of the property of the defendant shows that the same will be sufficient to meet the claim of the petitioner in full, and that, as soon as a sale thereof can be made in the manner above indicated, he will have on hand funds sufficient to satisfy the defendant's claim for rent in full, and pay a substantial dividend to the general creditors of the company; that, if ousted from the possession of the hotel property, he will be unable to sell the hotel business and...