Wit v. Commercial Hotel Co.

Decision Date24 November 1925
Citation149 N.E. 609,253 Mass. 564
CourtUnited States State Supreme Judicial Court of Massachusetts Supreme Court


Exceptions from Superior Court, Worcester County; W. A. Burns, Judge.

Action of contract by Ignatz Wit against the Commercial Hotel Company to recover a portion of the taxes on real estate. Judgment was ordered for the plaintiff in the named sum, and defendant excepts. Exceptions sustained.A. S. Houghton, of Worcester, for plaintiff.

E. H. Vaughan, of Worcester (E. T. Esty and P. H. Breen, both of Worcester, on the brief), for defendant.


This is an action of contract to recover a portion of the taxes upon real estate, as provided in a lease entered into between the plaintiff, as lessor, and the defendant, as lessee, for a period of three years beginning May 1, 1914, with the right, on the part of the lessee, to renew it for two successive terms of three years each. The answer is a general denial, payment, and a relinquishment and discharge of all rights to any shares of the taxes based upon a valuation greater than that of 1916. The writ is dated September 13, 1921. The case was heard by an auditor whose findings of fact by agreement of parties are final. The court, upon motion, ordered judgment for the plaintiff in the sum of $7,002.59, with interest from the date of the writ.

The property leased is described as a portion of a building at 68 Front street, Worcester, heretofore used as a hotel, including the entire three upper floors and all of the first floor except portions occupied by stores and a part of the cellar, with rights to light in an open area and a right to use a passageway in the rear. The auditor's report states that the right was granted to the lessee to make the renewals upon certain conditions, and that the lessee seasonably and properly exercised this right and occupied the premises from May 1, 1914, to May 1, 1923. A copy of the renewal provision of the lease is not contained in the bill of exceptions. But it appears therein that the instruments relating to the six years following the first rent period were two letters, one dated December 28, 1916, and the other December 30, 1919, in each of which the defendant notified the plaintiff of its desire to renew the lease for a further term of three years in accordance with the conditions stated therein, and in each case asked him to prepare a new lease. It is assumed that no instrument renewing or extending the lease was executed. The clause relating to the payment of a portion of the taxes is in the following terms:

‘It was also understood and agreed that in case the taxes levied by the city of Worcester upon the real estate upon which the leased premises stands shall be increased any year during said term over the amount levied for the year 1911 that the lessee shall pay each year one-third of said increase for said year to the lessor at the time said taxes are due each year.’

From the beginning of the lease through the year 1916 the land on which the hotel building was located together with a parcel of substantially vacant land in the rear, containing in all 13,011 square feet, was assessed to the lessor as one tract. In 1917, for purposes of taxation, the city of Worcester divided the tract into two parts and assessed each part separately, a theatre having been erected in the meantime, on the rear portion. As thus divided, the front lot contained 5,617 square feet, and comprised the land upon which the hotel building and the stores described in the defendant's lease stood, together with the land on Front street. This change in assessment threw a heavier burden on the front part of the lessor's land and was a disadvantage to both plaintiff and defendant. For several years before 1917 the defendant had employed as its legal adviser a certain practicing attorney in Worcester. In 1917, after the division of the assessment, the plaintiff sought the services of this attorney to represent him in an attempt to bring about a reassessment of the land as one parcel. The attorney, believing that a conflict of interests might develop between the plaintiff and defendant over the assessment, declined to represent or assist the plaintiff until the plaintiff had received the assent of the defendant. The defendant, through its authorized agent, then came into the conference and made an agreement giving its consent to the establishment of professional relations between the attorney and the plaintiff, as desired by the latter, in return for an agreement then made by the plaintiff, that the obligation in the lease above referred to, providing for payment on the part of the lessee of a portion of the increase in taxes, would be thereafter based upon a valuation not in excess of the valuation assessed for the year 1916. As a result of this conference the attorney represented the plaintiff in proceedings for procuring a reassessment of the whole as one parcel. This attempt, however, was unsuccessful, and the assessors continued to assess the land as two parcels.

The exceptions of the defendant present three principal questions: (1) Was the original lease renewed so as to be in force down to the date of the writ? (2) What is meant by the phrase ‘real estate upon which the leased premises stands,’ as it appears in the clause relating to payment of increased taxes? and (3) Did the alleged oral agreement between the plaintiff and defendant, which was made in 1917, constitute a contract between the parties?

[1] 1. The contention of the defendant, which we assume to be open to it, is, that the lease has not been legally extended or renewed. The provision in the lease gave the lessee the right to have renewals for the additional terms; but without a formal renewal or something equivalent to it, the term was not extended through the additional period. Cunningham v. Pattee, 99 Mass. 248, 252;Leavitt v. Maykel, 203 Mass. 506, 509, 89 N. E. 1056,133 Am. St. Rep. 323;Gardella v. Greenburg, 242 Mass. 405, 136 N. E. 106, 26 A. L. R. 1411;Hanna v. County of Hampden, 250 Mass. 107, 145 N. E. 258.

[2][3][4] But, the tenant having continued to occupy and pay rent for each monthly period beyond the term, under an agreement for and with a right to a renewal, became a tenant at will of the same premises ‘with all the rights and privileges that had been annexed to them, and upon the terms and conditions specified in the written lease, except so far as modified by mutual arrangement.’ Walker Ice Co. v. American Steel & Wire Co., 185 Mass. 463, 467, 70 N. E. 937, 939;Benton v. Williams, 202 Mass. 189, 88 N. E. 843; Leavitt v. Maykel, supra; Boudreau v. Johnson, 241 Mass. 12, 16, 134 N. E. 359. The terms of an oral agreement creating a tenancy at will are binding on both parties, and upon the same reasoning any oral contract modifying the original agreement is legal and enforceable. Flanagan v. Welch, 220 Mass. 186, 107 N. E. 979;Crowe v. Bixby, 237 Mass. 249, 254, 129 N. E. 433. Even the provisions of a written lease may be modified by a subsequent oral agreement. Hastings v. Lovejoy, 140 Mass. 261, 2 N. E. 776,54 Am. Rep. 462.

[5] 2. It is contended by the plaintiff that ‘the real estate upon which the leased premises stands' for the purposes of determining the amount of the increased tax for which the defendant is liable, means the building itself and 5,617 feet of land; while the defendant's contention is, that if it is liable at all, the words should be construed to mean an area of 4,886 square feet. The smaller of these figures represents the land covered by the building, of which the leased premises are a part; the larger, the area of the lot assessed with the building, by the ...

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