Eagle Tube Co. v. McDonald ( 1909 )

FORD, J.

This is an appeal from a final order in summary proceedings to recover possession of real estate,' dismissing the proceedings. Lendrum, undertenant, did not appear.

On May 4, 1908, appellant, as landlord, and respondent, as tenant, executed two leases. One covered property, known as the “Anchor Hotel property,” on the southeast corner of Thirteenth avenue and Twenty-Fourth street; and the other covered five adjacent lots. This proceeding is concerned with the hotel property only. The parties had also at the same time, executed written consents giving the respondent the right to sublet or assign the said leases. On the same day the parties also executed an escrow agreement by which they agreed that said leases and consents should be deposited in escrow with a certain lawyer, to be “delivered to the party of the second part [the respondent] immediately upon the termination of the tenancy and possession of the said Henry Holsten, who was then in possession of said hotel, to said Anchor Hotel, and the insurance of the title to said lease hold under said leases in the party of the second part by the Title Guarantee & Trust Company.” Such delivery was to be made by leaving duplicate originals of said leases at the office of the attorneys for the respondent. On May 18th an order of the Municipal Court was made dispossessing the said Holsten from said premises. On May 22d the attorneys for the respondent wrote the attorneys for the appellant that they understood that Holsten. had vacated the premises occupied by him and that he had actually moved out. On May 23d one of the attorneys for the appellant delivered to the attorneys for the respondent, at their office, the said leases and consents, and a copy of a certificate of the Title Guarantee & Trust Company. He stated that rent would begin on May 24th, and asked for a check for the three months’ rent in advance, as provided by the Anchor Hotel lease. This rent has not been paid, and its nonpayment is the basis of this proceeding. On May 25th the respondent’s attorneys made certain objections to the tender of the leases, consents, and certificate, claiming that the appellant had not complied with the escrow agreement. These objections and others were raised on the trial. The learned justice below dismissed the proceeding on the ground that it did not sufficiently appear that the relation of landlord and tenant existed between the parties.

The objections were with one exception all overruled by the said justice for sufficient reasons, as set forth in his opinion. The objection which, however, he held to be fatal to the appellant, was that the certificate of the title company, delivered with the leases and consents to respondent’s attorneys on May 23d, is not sufficient to require the title company to insure title in the Eagle Tube Company of Delaware. It appears that a lease had originally been made to the Eagle Tube Company of New York, and that thereafter, on December 27, 1907, the trustees in liquidation of said New York corporation, had made a sublease to the Eagle Tube Company of Delaware, the appellant here. The certificate of the title company on the first page certifies that the title to said premises is vested in, and can be sublet by, Eagle Tube Company, the lessee therein (referring to the lessee in the original lease to the New York corporation); and it was on this ground that the learned justice below held that the title company could not on that certificate be compelled to insure title in the Delaware company, thus robbing the tender of May 23d of all effect.

But the learned justice below seems to have overlooked the first typewritten page of said certificate, wherein the title company states:

“The above title having been closed by sublease to Eagle Tube Company, this is to certify: That the Eagle Tube Company can sublet said premises or any part thereof to John McDonald,” etc.

The lease to the Eagle Tube Company of New York was not a sublease, and the only sublease that can be referred to is the one from the trustees of the New York company to the Delaware company. In my opinion the title company could have been compelled to insure under said certificate the title of the Eagle Tube Company of Delaware to the respondent herein. In that one respect the learned justice below erred. He correctly held that:

“If, therefore, the landlord presented a certificate showing the readiness of the title company to insure the title to the tenant upon the recording of his lease, this should be taken as a reasonable compliance with the agreement of May 4th, and such as would be presumed to be contemplated thereby.”

In my opinion the appellant showed a full compliance on May 23, 1908, with the requirements of the escrow agreement.

It may be added that the objection as to the advertising signs was never raised until the trial, and should not prevail. Higgins v. Eagleton, 155 N. Y. 466, 50 N. E. 287. As to water charges, Zorn v. McFarland, 11 Misc. Rep. 555, 32 N. Y. Supp. 770, cited by respondent, is not in point.

The order should be reversed, and a new trial granted, with costs to appellant to abide the event. All concur.