Holmes v. Harris

• Decision Date: 31 December 1954
• Docket Number: No. A--46,A--46
• Citation: 33 N.J.Super. 395,110 A.2d 329
• Parties: Frank D. HOLMES and Elizabeth M. Holmes, Individually and trading as Huber's Mens Wear, plaintiffs-respondents, v. Malcolm E. HARRIS, Ainslie N. Harris, Marian A. Harris, Olga E. Harris, defendant-respondents on appeal and on cross-claim, and Monmouth Service Company, a corporation of New Jersey, defendant and cross-claimant-appellant.
• Court: New Jersey Superior Court — Appellate Division

Page 395

33 N.J.Super. 395

110 A.2d 329

Frank D. HOLMES and Elizabeth M. Holmes, Individually and trading as Huber's Mens Wear, plaintiffs-respondents, v. Malcolm E. HARRIS, Ainslie N. Harris, Marian A. Harris, Olga E. Harris, defendant-respondents on appeal and on cross-claim, and Monmouth Service Company, a corporation of New Jersey defendant and cross-claimant-appellant.

No. A--46.

Superior Court of New Jersey, Appellate Division.

Argued Dec. 20, 1954.

Decided Dec. 31, 1954.

Maurice A. Potter, Long Branch, argued the cause for defendant and cross-claimant-appellant (Potter & Fisher, Long Branch, attorneys).

Isadore H. Colton, Newark, argued the cause for plaintiffs-respondents.

Before Judges CLAPP, JAYNE and FRANCIS.

The opinion of the court was delivered by

JAYNE, J.A.D.

In this action the essentially significant facts are not in dispute. It will be serviceable to marshal them in chronological sequence.

On February 11, 1946 Rose M. Harris let the ground floor of premises designated No. 185 Broadway, Long Branch, New Jersey, to Huber's, Inc., a corporation of this State, for a term expiring on March 31, 1956. The transaction was evidenced by a written lease duly executed by the parties which enveloped the two following paragraphs of special relevancy to the present alleged cause of action.

'5. It is agreed that the Lessee shall not assign this lease without the written consent of the Lessor. The Lessee may, however, sub-let the whole, or any part of the premises, in which event, however, the Lessee shall remain liable to make the rent payments provided for herein, and for the fulfillment of all the other covenants and conditions hereof.

'22. It is agreed that in the event the Lessor shall decide to sell the land and building of which the leased premises are a part, the Lessee shall have the first right of refusal to purchase the same on terms and conditions acceptable to Lessor. The Lessee shall have a period of 10 days after the receipt of written notice directed to the leased premises of terms and conditions acceptable to Lessor in which to determine whether to meet said terms and conditions and to give the Lessor written notice of the acceptance thereof. Said Notice to Lessor to be directed to her in care of Malcolm Harris, 1001 Main Street, Asbury Park, New Jersey.'

The lessor died on December 6, 1951 and by her last will and testament devised the demised premises to her sons, Malcolm and Ainslie Harris, who are identified as defendants in this action.

On September 15, 1952, in consequence of the refusal of the sons of the deceased lessor to consent to an assignment of the lease, the lessee, Huber's, Inc., sublet the demised premises to the plaintiff Frank D. Holmes for a period commencing on September 15, 1952 and expiring on March 24, 1956 at the same rental the lessee, Huber's, Inc., was obligated to pay by the terms of the lease of February 11, 1946. Cf. Firth v. Rowe, 53 N.J.Eq. 520, 32 A. 1064 (Ch. 1895); Wilson v. Cornbrooks, 104 N.J.L. 418, 140 A. 292 (E. & A.1928); Dries v. Trenton Oil Co., Inc., 17 N.J.Super. 591, 86 A.2d 427 (App.Div.1952). Noticeably here the term of the sublease expired seven days before that of the basic lease. Legal wizardry? However, if the subletting was violative in effect of the provision against the assignment of the lease, an objection thereto is not available to the appellant.

In recognition of paragraphs 5 and 22 of the basic lease, the sublease to the plaintiff Holmes comprised the following related provisions:

'5. It is agreed that the Tenant shall not assign this lease without the written consent of the Landlord. The Tenant may, however, sub-let the whole or any part of the premises, in which event, however, the Tenant shall remain liable to make the rent payments provided for herein, and for the fulfillment of all the other covenants and conditions hereof.

'22. It is agreed that in the event that the owner of the land and building of which the lease premises are a part, the said owner being the lessor of the Landlord herein, shall decide to sell the premises, then in that event the first right of refusal to purchase the same on terms and conditions acceptable to the said Rose M. Harris, Lessor, shall be and become the right and privilege of the Tenant herein, the Landlord herein hereby assigning, setting over and transferring the same unto the Tenant herein, subject only to the conditions set forth in Paragraph 22 of the Lease between Rose M. Harris, Lessor, and Huber's, Inc., Lessee, dated February 11, 1946. And the Landlord undertakes and agrees to execute any and all instruments required in such an event.'

At this point in the narrative of facts it is significant to notice that the original lessee, Huber's, Inc., not only sublet the demised premises to the plaintiff Holmes, but by the sublease also assigned to the latter the option to purchase the property accorded by the terms of paragraph 22 of the lease of February 11, 1946.

In its pragmatical effect as between Huber's, Inc., and Holmes, Inter sese, the latter, although nominally a subtenant, acquired the use and occupation of the demised premises in substitution for and under essentially the same terms as Huber's, Inc., except that Huber's, Inc., continued to be responsible for and in practice currently paid the rent to the landlords. It is noted that the landlords were aware of this transplantation and condoned the impropriety of it, if any, during the ensuing years. Cf. North v. Jersey Knitting Mills, 98 N.J.L. 157, 118 A. 840 (E. & A.1922); Garbarine v. Reade, 95 N.J.Eq. 495, 123 A. 164 (Ch.1924); Plassmeyer v. Brenta, 24 N.J.Super. 322, 94 A.2d 508 (App.Div.1953).

Next in the progression of occurrences is the notice bearing date March 5, 1954 addressed by Malcolm and Ainslie Harris, the owners of the property, to Huber's, Inc., and to its subtenants or assigns, of which the following is a reproduction:

'March 5, 1954.

'Huber's Inc., and or its Sub-Tenants or Assigns,

'185 Broadway

'Long Branch, N.J.

'To Whom It May Concern:

'Pursuant to Clause 22 of a certain lease, dated February 11, 1946, made by Rose M. Harris, as Lessor, and Huber's Inc. as Lessee, and covering premises known as #185 Broadway, Long Branch, N.J., you are hereby notified that said Lessor, now deceased, by Ainslee Harris and Malcolm E. Harris, lessor's successors in title, have decided to sell the lands and buildings of which the above-mentioned leased premises is a part and by reason of your 'right of refusal' to purchase the property of which the leased premises is a part, on such terms and conditions as may be acceptable to the Lessor, please be advised that the terms and conditions acceptable to said owners for the purchase of said property is the payment of the sum of $30,000.00 in cash, payable 10% Or $3,000.00, upon the signing of the contract of sale and $27,000.00 cash on the closing of title and delivery of Bargain and Sale Deed with covenant against grantor on or before May 1, 1954 with adjustments to be made as of the date of the closing of title, and with said premises to be sold subject to the rights of the lessee, or its assigns, under above mentioned lease, also subject to such state of facts as an accurate survey and inspection of the premises may reveal, and also subject to the burden or easement of a common or party wall running along the west side of the property being sold and to the use of said party wall by the owners of property lying to the west of said leased premises in common with the owners of the leased premises.

'Also, in accordance with the provisions of said Clause 22 of the aforesaid lease, will you kindly advise Ainslee Harris and Malcolm E. Harris, by written notice directed to Malcolm E. Harris, at 1001 Main Street, Asbury Park, New Jersey, whether you wish to purchase said property under the aforesaid terms and conditions and for the aforesaid price, said notice to be given within 10 days after the delivery of this written notice to the leased premises.

'Rose M. Harris, Lessor (now deceased.)

'By: Ainslee Harris and Malcolm E. Harris

'By: s/ Anthony T. Wolley

'Their Attorney

'180 Broadway

'Long Branch, N.J.'

It should be observed that the notice was addressed to 'Huber's Inc., and or its Sub-Tenants or Assigns.'

However, on the following day, March 6, 1954, the owners of the property, Malcolm and Ainslie Harris, and their respective wives executed and delivered a contract by the covenants of which they obligated themselves conditionally to convey the property to the defendant Monmouth Service Company.

The terms and contingent conditions of the contract are vivid. Those of particular pertinency are here quoted:

'The within described premises is also being sold subject to the rights of Hubers, Inc., a New Jersey corporation, or any sub-tenant or assignee thereof, in and under a certain lease dated Feb. 11, 1946, made by and between Rose M. Harris as lessor and said Hubers, Inc., as lessee, which said lease expires on March 31, 1956, and which said lease calls for a monthly...