Irving Trust Co v. Perry v. 8212 1934

Decision Date03 December 1934
Docket NumberNo. 22,22
Citation293 U.S. 307,79 L.Ed. 379,55 S.Ct. 150
PartiesIRVING TRUST CO. v. A. W. PERRY, Inc. Argued Nov. 5—6, 1934
CourtU.S. Supreme Court

[Syllabus from pages 307-308 intentionally omitted] Messrs. Edward K. Hanlon and Charles K. Beekman, both of New York City, for petitioner.

[Argument of Counsel from pages 308-309 intentionally omitted] Messrs. Thomas F. Dougherty and John M. Perry, both of New York City, for respondent.

Mr. Justice ROBERTS delivered the opinion of the Court.

The respondent was lessor in a lease having a number of years to run at the date of the tenant's bankruptcy. The writing stipulated:

'* * * For the more effectual securing to the Lessor of the rent and other payments herein provided, it is agreed as a further condition of this lease that the filing of any petition in bankruptcy or insolvency by or against the Lessee shall be deemed to constitute a breach of this lease, and thereupon, ipso facto and without entry or other action by the Lessor, this lease shall become and be terminated; and, notwithstanding any other provisions of this lease, the Lessor shall forthwith upon such termination be entitled to recover damages for such breach in an amount equal to the amount of the rent reserved in this lease for the residue of the term hereof less the fair rental value of the premises for the residue of said term.'

Respondent filed a proof of claim, based upon this clause, which the referee expunged. The District Court affirmed the order. The Circuit Court of Appeals, reversing the decree of the District Court, directed that the claim should be allowed.1 The case is here upon writ of certiorari.

Decision is to be made under sections 1(11) and 63(a) and (b) of the Act of July 1, 1898, as they stood prior to the filing of the petition on September 30, 1932, and the presentation of respondent's proof of claim on March 29, 1933.2 The subsequent amendments of June 7 and 18, 1934,3 are by their terms inapplicable.

In Manhattan Properties, Inc., v. Irving Trust Company, 291 U.S. 320, 54 S.Ct. 385, 78 L.Ed. 824, we reserved the question of the provability of a claim for liquidated damages arising upon such a covenant. The petitioner's contention is that, inasmuch as claims for future rent, or for damages for the breach of the covenant to pay rent, or claims upon contracts of indemnity conditioned upon reentry by the landlord subsequent to bankruptcy, were there held not provable, it logically follows that a claim for stipulated damages for breach of the lease may not be proved. We hold otherwise.

By the terms of the contract, the filing of the petition in bankruptcy was, of itself, and irrespective of the election of lessor or lessee, a breach of the lease. The claim of the landlord, consequent upon the breach, arose and matured at the moment of the filing of...

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33 cases
  • Oldden v. Tonto Realty Corporation, 282.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • May 17, 1944
    ...the substantially identical case of In re Outfitters' Operating Realty Co., 2 Cir., 69 F.2d 90, affirmed Irving Trust Co. v. A. W. Perry, Inc., 293 U.S. 307, 55 S.Ct. 150, 79 L.Ed. 379, an express provision that bankruptcy is a breach, for which damages are provided, is concededly valid; bu......
  • In re Sturgis Iron & Metal Co., Inc., HK 08-02966.
    • United States
    • United States Bankruptcy Courts. Sixth Circuit. U.S. Bankruptcy Court — Western District of Michigan
    • September 30, 2009
    ...modifications, to also permit claims by landlords for future rents under an unexpired lease. Irving Trust Co. v. A.W. Perry, Inc., 293 U.S. 307, 311, 55 S.Ct. 150, 151, 79 L.Ed. 379 (1934). 59. The trustee shall assume or reject an executory contract, including an unexpired lease of real pr......
  • Jersey Boulevard Corp. v. Lerner Stores Corp.
    • United States
    • Court of Appeals of Maryland
    • April 26, 1935
    ...... Compare Irving Trust Co. v. A. W. Perry, Inc., 293. U.S. 307, 55 S.Ct. ... prior to the adoption in 1934 of the amendment to the. Bankruptcy Act already referred ......
  • Comm'r of Ins. v. Massachusetts Acc. Co.
    • United States
    • United States State Supreme Judicial Court of Massachusetts
    • January 30, 1942
    ...the filing of the petition. William Filene's Sons Co. v. Weed, 245 U.S. 597, 38 S.Ct. 211, 62 L.Ed. 497;Irving Trust Co. v. A. W. Perry, Inc., 293 U.S. 307, 55 S.Ct. 150, 79 L.Ed. 379. The cases last cited are instances where landlords secured relief by virtue of special clauses which provi......
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