Tracy v. . Albany Exchange Co.

This was an action for a breach of covenant on the part of the defendant, in refusing to renew a lease of certain premises situate in the city of Albany. The lease was executed by the parties on the first day of February 1847, granting the premises to the plaintiff for two years and six months from the first day of November 1846, at the rent of $1000 per year payable quarterly, and contained the following covenant: "The said party of the second part to have the refusal of the premises at the expiration of this lease for three years longer." On the first day of February 1849 the plaintiff requested the defendant to execute to him a new lease of the premises for three years from the first day of May following, at the same rent as that reserved in the lease beforementioned, the latter being the day on which the then term would expire. The defendant refused to do so unless the plaintiff would pay $1200 per year rent, instead of $1000, and subsequently gave notice to the plaintiff that unless he would take a new lease for the premises, at a rent of $1200 per annum therefor, the defendant would rent the premises to another. Subsequently and on the tenth day of February 1849, the plaintiff took from the defendant a lease for one year from the first day of May following, at the rent of $1200 per annum, protesting at the same time against the right of defendant to exact an increased rent, and claiming to reserve his right of action and for which this action is brought. It is admitted by the pleadings, that the plaintiff demanded performance of the covenant at the expiration of the first term, and that the defendant refused. This is an averment in the complaint, and there is no denial in the answer. It is admitted that the premises were worth $1200 per year and were rented by the defendant for that sum. It was also admitted that the sum of $57 remained due on account of the rent of the premises from the plaintiff to the defendant, from the first day of February 1849, being part of the quarter rent falling due on that day, and the further sum of $250 from the first day of May 1849, being the quarter's rent due on that day, which sums still remain unpaid, to recover which the defendant had brought a suit against the plaintiff. A jury trial was waived, and upon closing the evidence the counsel for the defendant stated several grounds upon which the defendant was entitled to judgment upon the facts proved; but the judge decided that the plaintiff was entitled to recover the sum of $600, less a rebate of interest on $200 from the day of the trial to the first day of May 1851. The defendant excepted. The decision of the main question arising in this case, must turn upon the true construction of the words of the covenant for a breach of which this action is brought, which are, "The said party of the second part to have the refusal of the premises at the expiration of this lease for three years longer." There are several decisions showing that a covenant in a lease to renew it, without providing in respect to the term to be granted or the amount of rent to be paid, implies a renewal for the same term and rent. But a covenant to renew upon such terms as might be agreed upon is void for uncertainty (Rutgers v. Hunter, 6Johns. Ch. 218; Whitlock v. Duffield, 1 Hoffman Ch. 110; 4 Kent Com. 108; Abeel v. Radcliff, 13 Johns. 297; 1Hilliard Ab., ch. 15, § 78).

Whatever ambiguity there may be in the words of the covenant, the intention of the parties, to be collected from them, considered in connection with the whole instrument, obviously was that the plaintiff at his election should have a renewal of the lease for the premises for the further term of three years, to commence at the expiration of the existing lease for the same annual rent, as the former, payable quarter yearly. Although the intent of the parties be in opposition to the strict letter of the contract, it must prevail when clearly ascertained from it (2 Kent. Com. 555; Parkhurst v. Smith, Willes Rep. 332;Hathaway v. Power, 6 Hill, 453, Hobart Rep. 277).

The plaintiff was not restricted to the time when the term granted by the lease expired, to make his election for a renewal for the further term; and if made and a renewal demanded, the defendant was bound to comply with his covenant in that respect. The plaintiff in February 1849 made his election and demanded a performance; the defendant refused, unless he would consent to take a renewal at an enhanced rent, and gave him notice that unless he would do so, the defendant would rent the premises to another. This I think constituted a breach of the covenant by the defendant. The taking of the lease by the plaintiff for a different term under the circumstances could not operate as a surrender of the first, or as a performance of the covenant by the defendant. The term of this second lease did not commence until the expiration of the first. And besides the evidence shows that it was not intended by the plaintiff to relinquish a surrender, or by the parties that it should be accepted as a performance of the covenant, and that should be regarded as decisive of the question (Gybson v. Searl, Cro. Jac. 176;Van Rensselaer v. Penniman, 6 Wend. 569, 579; Bogart v.Burkhaller, 1 Denio, 125).

As to the objection made by the defendant that there was rent in arrear, and therefore the plaintiff was not entitled to a further lease, the covenant being independent, the liability of the defendant for the breach of the covenant in question remained. The payment of the rent was not a condition precedent to the right of the plaintiff to a renewal of the lease under the covenant, and he might bring his action for a breach of it, although he was guilty of a default in the payment of his rent or performance of his covenant (Dawson v. Dyer, 5 Barn. Ad. 584).

The measure of damages was correct. It was confined to the difference between what the plaintiff was to have paid for the rent for the term and what he was compelled to pay under the new lease (Masterton v. Mayor of Brooklyn, 7 Hill, 61; Driggs v. Dwight, 17 Wend. 71). The judgment should be affirmed.

Judgment affirmed.