Gray v. Kaufman Dairy & Ice-Cream Co.

• Decision Date: 06 April 1900
• Citation: 56 N.E. 903,162 N.Y. 388
• Court: New York Court of Appeals Court of Appeals
• Parties: GRAY v. KAUFMAN DAIRY & ICE-CREAM CO.

162 N.Y. 388

56 N.E. 903

GRAY

v.KAUFMAN DAIRY & ICE-CREAM CO.

Court of Appeals of New York.

April 6, 1900.

Appeal from supreme court, appellate division, Second department.

Action by John Gray against the Kaufman Dairy & Ice-Cream Company for rent. From a judgment of the appellate division (45 N.Y. Supp. 1141) affirming a judgment of the trial term in favor of plaintiff, defendant appeals. Reversed.

This action was brought to recover two months' rent of the premises known as ‘No. 787 Eighth Avenue,’ in the city of New York. In July, 1893, the plaintiff let the said premises to the defendant for ten years from August 1, 1893, at the yearly rental of $2,400, payable monthly in advance, and also the extra water rent charged against the defendant for its business. The defendant took possession about July, 1893, and paid rent to November 1, 1893, but refused to pay for the months of November and December of that year, the rent of which became due and payable on the 1st days of those months respectively. The answer, in effect, admits the making of the lease, but denies any indebtedness under it, and sets up the eviction of the defendant, a surrender and rescission of the lease, and claims credit for the rent received from the undertenant. On or about the 28th or 29th of October, 1893, the plaintiff had a conversation with Mr. Kaufman, the president of the defendant, upon the demised premises. The plaintiff's version of this conversation is as follows: ‘They were pulling up the store and the things, and were going to move out. They had not said anything to me about moving out prior to that time. I asked Mr. Kaufman what he was doing,-pulling up the store. He said he was going to move out, and I asked him why, and he said because he couldn't make any money; and I told him that he had a lease on it, and that I would hold him responsible for the rent if he went out. ‘Well,’ he says, ‘I am moving out. I don't want to stay where I don't make my rent.’' The defendant moved out, and sent the keys of the store to the plaintiff by mail. Plaintiff received them about the 2d of November, 1893. On the 3d of November, 1893, plaintiff served upon the defendant a notice, of which the following is a copy: ‘New York, November 3rd, 1893. To the Kaufman Dairy & Ice-Cream Co.: Yesterday I received the keys of 787 Eighth avenue by mail. I hereby notify you that I do not accept a surrender of the premises, and that I intend to hold you responsible for the rent under the lease. I shall let the premises on your account, and hold you for any loss which may be sustained. Yours, etc. John Gray.’ The defendant made no answer to this notice. On the 17th of November, 1893, the plaintiff went to Kingston and saw Mr. Kaufman, the president of the defendant, Mr. Spore, the secretary, and a Mr. Bruin. The plaintiff asked Mr. Kaufman for the November rent, and the latter replied that no rent was due; that he had not made a lease; that there was nothing due, and he would not pay; that he had given up the store, and plaintiff could do what he liked with it. Thereupon the plaintiff started for home. The president and secretary of the defendant went to the railway station, and there had a conversation with the plaintiff about compromising the matter by taking the cellar of said premises for $50 a month for the term of the lease if the plaintiff would cancel the same as to the rest of the premises. The plaintiff said he would think over the matter, and see what he could do with the remainder of the property, and let them know. The plaintiff testifies that thereafter, and on the 27th of November, 1893, he wrote to the defendant as follows: ‘Kaufman Dairy & Ice-Cream Co.-Gentlemen: I have an offer for the store you leased from me, 787 Eighth Ave. The parties will pay $1,500 to the first of May, and $1,600 for three years from May. I think this is about as good an offer as can be expected, considering the times. Please let me know if you will keep the cellar, and pay the difference between the $1,500 and $2,400 to May, and $1,600-$2,400 after. An early reply will much oblige. Yours, respect., J. Gray, 323 Washington Ave.’ The plaintiff further testifies that he inclosed this letter in an envelope directed to the defendant at Kingston, N. Y., deposited it prepaid in the post office at Brooklyn, and received no reply thereto. The defendant had tenants in the cellar when it left the premises. These tenants attorned to the plaintiff. On or about the 1st of December, 1893, plaintiff let the premises which had been previously demised to the defendant to one Mary Ann Keogh for the term of three years and five months at an annual rental of $1,500 per year for the first five months, and $1,600 per year for the remaining three years, to be paid in equal monthly installments in advance. The defendant pleaded eviction, but gave no evidence upon that subject, and upon the trial admitted that it had no excuse for leaving the premises. Kaufman admitted having a conversation with the plaintiff before the defendant left the premises, in which the plaintiff stated that he would hold the defendant for the rent, but denied that he (Kaufman) had stated that the defendant would not stay where it did not make any money. Daufman also admitted the receipt of the lettef dated November 3d, but both he and Spore denied receiving the one dated November 24th. Both admitted the conversation testified to by the plaintiff as having taken place at Kingston, and Spore testified that on that occasion Kaufman stated distinctly that the defendant did not owe any rent; that it had given up and surrendered the premises; that there was some talk at the railroad station about renting the cellar from the plaintiff at $50 per month during the term of the lease, but there was nothing said in that conversation about plaintiff's reletting the premises on defendant's account. Abraham L. Gray, a son of the plaintiff, testified on the latter's behalf that he went to Kingston with his father to see Kaufman, and was present at the conversation at the railroad station. He testified that Mr. Spore offered the plaintiff $50 a month for the basement if he would let the defendant off on the store, and the plaintiff replied that he would think it over and let them know. The lease to the defendant contained no provision against subletting, except for ‘any saloon or liquor business,’ and contained no provision for a reletting of the premises by the plaintiff in case the defendant vacated the same during the term of the lease. After the evidence was all in, the parties waived the jury, and submitted the facts to the court for decision. The defendant admitted its liability for the November rent, but claimed that it was released as to the December rent by the reletting of the premises to said Mary Ann Keogh on the 1st of December. Upon these facts the court found that the plaintiff was entitled to recover rent for the months of November and December, less the amount received from the undertenants; that the plaintiff refused to accept a surrender of the premises; that the premises were at no time surrendered to the plaintiff; and that the reletting of the premises was done with the assent of the defendant.

David B. Hill, for appellant.

Jacob F. Miller, for respondent.

WERNER, J. (after stating the facts).

This controversy arises out of the conventional relation of landlord and tenant, under circumstances governed by fixed principles of law. The first and most important question in the case is whether the plaintiff's reletting of the premises described in the lease, after the defendant's attempted surrender of the same, changed or affected the legal status of the parties under the original lease. It is so well settled as to be almost axiomatic that a surrender of premises is created by operation of law when the parties to a lease do some act so inconsistent with the subsisting relation of landlord and tenant as to imply that they have both agreed to consider the surrender as made. It has been held in this state that ‘a surrender is implied, and so effected by operation of law within the statute, when another estate is created by the reversioner or remainder-man, with the assent of the termor, incompatible with the existing state or term.’ Coe v. Hobby, 72 N. Y. 145. The existence of this rule has been recognized in this state in Bedford v. Terhune, 30 N. Y. 463;Smith v. Kerr, 108 N. Y. 36, 15 N. E. 70;Underhill v. Collins, 132 N. Y. 271, 30 N. E. 576,-and in other jurisdictions in Beall v. White, 94 U. S. 389, 24 L. Ed....