Schnakenberg v. Gibraltar Sav. & Loan Ass'n, A--480

• Court: New Jersey Superior Court – Appellate Division
• Citation: 37 N.J.Super. 150,117 A.2d 191
• Docket Number: No. A--480,A--480
• Parties: Henry J. SCHNAKENBERG, Plaintiff-Appellant, v. GIBRALTAR SAVINGS AND LOAN ASSOCIATION, etc., and Anton H. Sinnigen, et ux., Defendants-Respondents. . Appellate Division
• Decision Date: 30 September 1955

Page 150

37 N.J.Super. 150 117 A.2d 191 Henry J. SCHNAKENBERG, Plaintiff-Appellant,
v.
GIBRALTAR SAVINGS AND LOAN ASSOCIATION, etc., and Anton H.
Sinnigen, et ux., Defendants-Respondents. No. A--480. Superior Court of New Jersey.
Appellate Division. Argued Sept. 7, 1955.
Decided Sept. 30, 1955.

Page 152

[117 A.2d 192] Ervan F. Kushner, Paterson, for plaintiff-appellant (Robert H. Kleiner, Paterson, on the brief).

Charles B. Clancy, Jr., Newark, for defendant-respondent Gibraltar Savings and Loan Ass'n (Clancy & Clancy, Newark, attorneys).

Edward R. McGlynn, Newark, for defendants-respondents Anton H. Sinnigen and Susanna Sinnigen (McGlynn Weintraub & Stein, Newark, attorneys; Roger H. McGlynn, Newark, on the brief).

Before Judges GOLDMANN, FREUND and CONFORD.

The opinion of the court was delivered by

FREUND, J.A.D.

The plaintiff Henry J. Schnakenberg appeals from a summary judgment in favor [117 A.2d 193] of the defendants Gibraltar Savings and Loan Association, and in favor of the defendants Anton H. Sinnigen and Susanna Sinnigen, his wife, on the first, third and fourth counts of the complaint, entered on defendants' motions for dismissal before answer filed, on the ground that the complaint failed to set forth a cause of action.

The suit involves the construction of a clause in a lease by the defendants Sinnigen to the plaintiff. The property was subsequently conveyed to the defendant Gibraltar, subject to the lease. The gist of the plaintiff's argument is that the cause should have gone to trial so that testimony might have been presented as to the circumstances surrounding the

Page 153

execution of the lease and thus aided the court to ascertain the intention of the parties.

On March 1, 1946 the defendant Anton H. Sinnigen sold to the plaintiff an ice cream, candy and luncheonette business at premises Nos. 1037--1039 South Orange Avenue, in the City of Newark. Simultaneously, pursuant to the contract of sale, the defendants Anton H. Sinnigen and his wife entered into a lease with the plaintiff for the store, the basement, and a second-floor apartment, for a term of ten years commencing March 1, 1946.

The contract of sale provided as follows:

'Party of the first part (Anton H. Sinnigen) agrees to execute a lease to the party of the second part (the plaintiff) covering the store now occupied as the candy store, said lease to include also all the upstairs second floor, at a monthly rental of $275.00 for a term of ten years from the date hereof. Said lease shall contain a provision permitting the party of the second part to meet any reasonable offers at the expiration of the ten year period.'

The lease contains the following provision, which is the subject of the litigation:

'The parties of the first part (Anton and Susanna Sinnigen) hereby agree that at the expiration of this lease the party of the second part shall have the privilege of meeting any reasonable offers for a renewal of the lease.'

It is to be observed that the provision in the contract of sale does not specify whether 'any reasonable offers' to be met by the plaintiff apply to the sale or to the rental of the property. It might have referred to both, but the lease provision limits such offers to 'a renewal of the lease.'

The complaint alleges that the plaintiff entered into open and exclusive possession of the leased premises; that on October 30, 1952 the defendant Gibraltar Savings and Loan Association purchased the premises subject to the plaintiff's lease; that on September 7, 1954 its attorney notified the plaintiff that he must vacate upon termination of the lease on February 29, 1956; and that he had no right to a renewal of the lease.

Page 154

In the first count the plaintiff sought specific performance of the option of renewal or, in the alternative, a money judgment. The second count charged the Sinnigens with fraud in that at the execution of the lease they falsely represented to the plaintiff that he would be assured of a renewal of the lease at its expiration, whereas they were contemplating the sale of the premises to Gibraltar or another, and did not intend to renew. By the third count the plaintiff sought a declaratory judgment as to the interpretation of the renewal clause. The fourth count sought reformation of the renewal clause to conform to the alleged true intent of the parties so that the plaintiff should have an absolute right of renewal.

The trial judge, after argument of the motions, dismissed the first, third and fourth counts of the complaint, but denied the motion to dismiss the second count as to the Sinnigens. The basis of the judgment was that the clause did not constitute an absolute option to, or right of, renewal. He construed the provision to be 'a conditional option and gives the plaintiff only a right of pre-emption or of first refusal if the landlord desires to lease the premises again,' and that in the absence of a claim that the landlord was about to relet the demised premises to another tenant the plaintiff was not entitled to specific performance. [117 A.2d 194] The fourth count for reformation was dismissed because the individual defendants were no longer the owners and Gibraltar was a bona fide purchaser chargeable and 'bound only by what the lease provides and not by what it should have provided.'

The motions of defendant...