Gardiner v. Parsons

• Decision Date: 26 May 1916
• Citation: 224 Mass. 347,112 N.E. 958
• Parties: GARDINER v. PARSONS et al.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

224 Mass. 347

112 N.E. 958

GARDINER

v.PARSONS et al.

Supreme Judicial Court of Massachusetts, Suffolk.

May 26, 1916.

Report from Supreme Judicial Court, Suffolk County.

Action by Robert H. Gardiner, trustee, against Birney C. Parsons, assignee, and another. Case reported upon pleadings and agreement. Decree ordered in accordance with opinion.

Plaintiff, trustee of real estate, brought a bill against Birney C. Parsons, assignee for benefit of creditors of Lewis F. Perry & Whitney Company, and against that company, alleging its tenancy under leases; entries by him for the purpose of determining the leases, which entries complainant alleged were an election, under the terms of the leases, to hold the lessee for damages in addition to rent accrued; subsequent oral agreement for partial occupancy by lessee, which complainant claimed to be not a waiver of breaches or release of claims under the leases; the assignment; that assignee has never accounted for nor closed the estate; that complainant has not been paid; that complainant consented to the assignment and filed proof of claim, which was not paid-and asking for establishment of complainant's rights. In the defendant's answers they denied the entries and subsequent oral agreement, and that the entries by complainant operated as an election under the lease to hold lessees for damages, and that the subsequent oral agreement did not waive breaches or release claims under the lease. It was agreed that before the parties presented evidence on any other issue the questions of fact of entries and oral agreement be left to the court to determine, after which determination the case was to be reported to the full bench for determination of rights of parties upon these facts and bill and answers. The court reported the case to the full bench, with a finding that entries were made for the purpose of terminating the leases, and that a subsequent oral agreement for partial occupation was made.

Warren, Garfield, Whiteside & Lamson, of Boston (Alex. Whiteside and Cleveland Bigelow, both of Boston, of counsel), for complainant.

Lee M. Friedman and Swift, Friedman & Atherton, all of Boston, and Clement F. Robinson, of Portland, Me., for defendants.

BRALEY, J.

By the terms of the common law assignment of the defendant lessee made for the benefit of creditors to which the plaintiff lessor seasonably became a party, ‘all claims are to be made up as if due on the date of these presents adding or deducting interest as the case may be, provided, however, that in case the property hereby conveyed shall be sufficient therefor, then and in that case interest will be allowed on all claims to the time of making up the final dividend, at the rate provided in each account or obligation,’ and ‘the individual firms and corporations creditors of the party of the first part who execute these presents accept this conveyance in full payment, satisfaction and discharge of all and singular their debts, claims and demands, actions and causes of action against the party of the first part existing at the date hereof, whether payable now or at some future time, and also all contingent claims against it as indorsers or otherwise, and absolutely release, acquit and discharge the party of the first part of and from all such debts, claims and demands, actions and causes of action.’

[1][2] The assignee is not a receiver and in the allowance of claims and marshaling of assets he is bound by the terms of the assignment. Matter of Hevenor, 144 N. Y. 271, 275,39 N. E. 393;People v. St. Nicholas Bank, 151 N. Y. 592, 594, 595,45 N. E. 1129. It was optional with the plaintiff whether he would become a party, but upon acceptance he agreed to participate in the distribution of the property appropriated for the benefit of creditors upon the conditions designated by the assignor. Andrews v. Tuttle-Smith Co., 191 Mass. 461, 78 N. E. 99, and cases cited. And no provisions are found similar to those contained in the assignment construed in Cotting v. Hooper, Lewis & Co., 220 Mass. 275, 107 N. E. 931, requiring that the net proceeds should be distributed substantially in conformity with the ‘Bankruptcy Acts of the United States,’ and consequently the private debts and liabilities of the assignor were limited strictly to debts and liabilities recognized in bankruptcy proceedings, or in Shaw v. United Shoe Machinery Co., 220 Mass. 486, 108 N. E. 68, where proof of debts due from the assignor were regulated by R. L. c. 163, § 31, relating to insolvent debtors. The single justice decided that shortly before the date of the assignment the plaintiff made an entry upon the demised premises for the purpose of terminating the leases described in the third and fourth paragraphs of the bill. The leases thereupon having been terminated the covenant of the lessee common to both leases ‘that in case of such termination * * * it will indemnify the lessor against all loss of rent and other payments which he may incur by reason of such termination during the residue of the time * * * specified for the duration of the term, or at the election of the lessor, the lessee will upon such termination pay to the lessor as damages such sum as at the time of such termination represents the difference between the rental value of the premises for the remainder of the said term and the rent and other payments heretofore named,’ matured and became enforceable. The plaintiff however could not recover both indemnity and damages, but must elect the ground of liability on which he proposed to hold the lessee. Cotting v. Hooper, Lewis...