Neal v. Jefferson

• Court: Supreme Judicial Court of Massachusetts
• Writing for the Court: SHELDON, J.
• Citation: Neal v. Jefferson, 212 Mass. 517, 99 N.E. 334 (Mass. 1912)
• Decision Date: 12 September 1912
• Parties: NEAL v. JEFFERSON.

212 Mass. 517

99 N.E. 334

NEAL v. JEFFERSON.

Supreme Judicial Court of Massachusetts, Plymouth.

September 12, 1912

This was an action on contract to recover damages for alleged breach of a covenant in a lease made May 22, 1909, by one Paine, acting as agent of defendant. The lease included a hotel and cottage in Florida, and was to run one year from November 1, 1909, at a rental of $1,000 per year, and the lease contained a covenant giving plaintiff the privilege to renew the lease for two years by notice on or before June 1 1910.

On March 10, 1910, defendant sold the estate to certain persons named Anthony, who were given notice of plaintiff's lease. April 16, 1910, the Anthonys offered to renew the lease at a higher rate than $1,000 per year. The plaintiff refused to renew the lease, claiming that the defendant was bound to renew under her covenant. On April 25th, plaintiff wrote to one Colett, who had succeeded Paine, asking for a renewal of the lease, but was informed that the premises had been conveyed to the Anthonys.

The defendant asked the court to rule:

'1. That plaintiff could not recover.'

'6. That after the transfer of the property to the Anthonys with notice of the lease and covenant for renewal, defendant was not liable for failure of the Anthonys to respect plaintiff's right of renewal.

'7. That after such transfer and notice defendant was not liable on the covenant for renewal.'

'21. That in determining the rental value of the premises for the years November 1, 1910, to November 1, 1912, if prospective profits of the plaintiff were to be considered, then the jury must consider in reduction of such profits, any opportunity the plaintiff may have had to obtain the hotel for these years from the Anthonys.'

The court refused these requests.

The court gave the plaintiff's first and second requests. The first was:

'1. It being admitted that the lease contained a covenant of renewal executed in behalf of defendant and under authority from her and that plaintiff had performed all covenants to be performed by him, and duly demanded a renewal and the defendant failed to procure such renewal for plaintiff, on these admitted facts plaintiff could recover unless defendant had established a defense.

'2. With respect to the first ground of defense in defendant's amended answer [that defendant had transferred the premises to the Anthonys with notice of lease] that this constituted no defense. That the covenant of renewal was a personal obligation by defendant and her obligation were not discharged by any dealings with third parties. That if the covenant was broken plaintiff was not bound to obtain redress from such third parties. That the law has been stated by the Supreme Judicial Court to be that 'lessors cannot get rid of the burden of their contracts by conveying their land.”

In the superior court there was a verdict for plaintiff for $4,116, and defendant excepted.

COUNSEL

Edwd. H. Warren and Chas. G. Lewis, both of Boston, for plaintiff.

Malcolm Donald and Phillips Ketchum, both of Boston, for defendant.

OPINION

SHELDON J.

It is not material to determine whether the plaintiff could have enforced specifically against the defendant's grantees her agreement to give him a new lease. However this might be, the defendant was personally liable upon her covenant, and her conveyance of the leased premises did not relieve her from that liability. Riley v. Hale, 158 Mass. 240, 33 N.E. 491; Jones v. Parker, 163 Mass. 564, 568, 40 N.E. 1044, 47 Am. St. Rep. 485; Carpenter v. Pocasset Mfg. Co., 180 Mass. 130, 133, 61 N.E. 816. See Manning v. Fitch, 138 Mass. 275; Tufts v. Atlantic Telegraph Co., 151 Mass. 269, 23 N.E. 844. The cases of Hickey v. Railroad Co., 51 Ohio St. 40, 36 N.E. 672, 23 L. R. A. 396, 46 Am. St. Rep. 545, and Sexauer v. Wilson, 136 Iowa, 357, 113 N.W. 941, 14 L. R. A. (N. S.) 185, 15 Ann. Cas. 54, relied on by the defendant, turned on what was regarded in those cases as the intention of the parties. We need not consider whether, upon similar facts, we should follow those decisions. No such intention appears in this case as was found there. It follows that the judge acted rightly in refusing the defendant's first, sixth and seventh requests for instructions, and in giving the plaintiff's first and second requests. And we find no error in the way in which the other requests bearing upon the issue of liability were dealt with.

Where a lessor has prevented the lessee from entering and occupying the leased premises, or where an owner of property has broken his agreement to give a lease thereof to a prospective tenant, the measure of damages in an action for this breach of contract, if no rent has been paid and if nothing further appears, is the difference between the actual value of the leasehold estate that should have been enjoyed and the agreed rental that was to have been paid therefor. Jewett v. Brooks, 134 Mass. 505; Riley v. Hale, 158 Mass. 240, 33 N.E. 491; Dodds v. Hakes, 114 N.Y. 260, 21 N.E. 398; Giles v. O'Toole, 4 Barb. (N. Y.) 261; Denison v. Ford, 10 Daly (N. Y.) 412; Cilley v. Hawkins, 48 Ill. 308. This value, as in all cases in which the value of real estate or an interest therein is concerned, means the value for any and all uses to which the property is adapted and can readily be applied. If it is capable of being used in some particular way and has an enhanced value by reason of its availability for such use, the fact may be shown, and the value to be ascertained is the value thus enhanced; not because this is any other or greater value than the real market value of the property, but because it is the real value which is the subject of inquiry, and that value must depend much upon the nature of the property and its availability or adaptability for advantageous or profitable use. This rule generally has been applied where the value of property taken for a public use is to be determined, but it is not limited to such cases. Providence & Worcester R. R. v. Worcester, 155 Mass. 35, 29 N.E. 56; Maynard v. Northampton, 157 Mass. 218, 31 N.E. 1062; Blaney v. Salem, 160 Mass. 303, 35 N.E. 858; Sargent v. Merrimac, 196 Mass. 171, 178, 81 N.E. 970, 11 L. R. A. (N. S.) 996, 124 Am. St. Rep. 528. The value of a leasehold estate, like that of any interest, is to be determined with reference to the use to which it can be most advantageously put. Manning v. Fitch, 138 Mass. 275; Tufts v. Atlantic Telegraph Co., 151 Mass. 269, 23 N.E. 844.

In this case both parties agreed that the property could best be used as a hotel for winter visitors, and that it was intended to be so used; and if that was so, the measure of damages was prima facie the value of the properrty for this use during the two years after June 1, 1910, over and above the rent which was to be paid therefor. That there might be some difficulty in fixing this value, or that its determination must be partly the result of an estimate rather than of an exact computation, does not affect the application of the rule. Magnolia Metal Co. v. Gale, 189 Mass. 124, 133, 75 N.E. 219; Hunt v. Boston Elevated Ry., 199 Mass. 220, 225, 85 N.E. 446; Page v. Johnston, 205 Mass. 274, 278, 91 N.E. 214. Putting the case in another way, the plaintiff has been prevented from making that use of the property which it was contemplated that he should make, and he is entitled to the damages which thus have been caused to him. Townsend v. Nickerson Wharf Co., 117 Mass. 501, 503; Kostopolos v. Pezzetti, 207 Mass. 277, 93 N.E. 571, Ann. Cas. 1912A, 859; Snow v. Pulitzer, 142 N.Y. 263, 36 N.E. 1059; Stewart v. Lanier House Co., 75 Ga. 582.

Moreover according to the evidence,...