Urban Properties Corporation v. Benson , 116 F.2d 321 ( 1940 )

HEALY, Circuit Judge

(dissenting).

I think the order should be affirmed.

The lessor had the option to terminate only if “a receiver or other officer or agent be appointed to take charge of the demised premises or the business conducted therein”.

No receiver or other officer or agent has been “appointed”. The possession of the lessee was not disturbed and his conduct of the business suffered no interruption. True his continued operation of the business was “authorized” by court order subject to court supervision; and the lessor might with advantage to himself have reserved the option to cancel the lease on that account. But the actual event did not measure up to the contingencies provided against in the contract. To reach the conclusion arrived at by the majority it is necessary, I think, to stretch the language of the forfeiture clause beyond its ordinary sense. Thus the word “authorized” is substituted for the word “appointed”, and the lessee -himself is by analogy translated into “a receiver or other officer or agent appointed to take charge of” the premises or business. This seems to me a perversion of language as it is commonly understood by the man in the street.

The state statute (Civil Code, § 1442) provides, and it is the law generally, that a condition involving a forfeiture must be strictly interpreted against the party for whose benefit it is created. To decree a forfeiture it ought to appear to the court plainly and at once that the right asserted has been reserved, and this without resort to nice distinctions and questionable analogies. Here a clause unambiguous on its face is converted into a trap for the uninitiated and the lessee is surprised into the loss of a valuable property right.