Where a lease at $3,000 a year, payable in
monthly
installments, stipulated that if the tenant underlet or attempted
to remove any of the goods on the premises without the landlord's
consent, then, at the sole option and election of the landlord,
the term should cease, AND MOREOVER, in either of said
cases, "one whole year's
rent, to-wit, the
rent
of $3,000 over and above all such rents" as have already accrued,
shall be and is hereby reserved and shall immediately accrue and
become due and owing, and shall and may be levied on by distress
and sale of all such goods as may be found on the premises,
Held, in a case where a removal and consequent levy had been
made while the lease had yet more than a year to run, that
although the clause in the lease was obscure, the $3,000 was
"rent," intended to be secured in advance and in a gross sum
instead of in the monthly shape, and was not a penalty above and
independent of the other and usual rents.
Mrs. Dermott leased to Dexter a hotel for three years from 1st
October, 1855, to be extended to five, at the option of the tenant.
The rent was $3,000 a year, payable in monthly sums of $250. It was
expressly stipulated between the parties and made a condition that
if the tenant should assign or underlet the premises without the
written consent of the landlord or should
remove or attempt to
remove any of his goods or chattels (except the same be
replaced of equal value) from the premises without a like consent,
then and in either case and event, at the
"sole option and
election" of the landlord,
the term should cease and
the landlord might immediately reenter upon the premises and expel
the tenant, AND MOREOVER, in either of said cases, or the happening
of the events,
"
one whole year's rent, to-wit, the rent of $3,000 over and
above all such rents (that is to say, all such of the rents
hereinbefore reserved to be paid on the first day of each month
during the said term . . . as shall have then already accrued)
shall be and by these presents is reserved to be paid by
the said Dexter to the said Dermott, and shall immediately
thereupon accrue and become due and owing from him to her,
and
shall and may be levied by distress and sale of all such goods and
chattels as may be found on the premises."
Dexter the tenant took possession, and afterwards executed
Page 68 U. S. 62
two deeds of trust of the goods and chattels in the hotel to the
defendant, Wallach, to secure certain promissory notes. One of the
notes not being paid at maturity, Wallach advertised the goods and
chattels for sale, and was proceeding with the sale when Mrs.
Dermott levied a distress upon them for $3,000. This was on the
18th of May, 1857,
about a year and five months before the
lease would expire. The ordinary rent had been all punctually paid
to the 1st of May, the month in which the distress was made,
so that no rent of the ordinary kind was due at the time of the
distress. Wallach having replevied the goods seized, the defendant
avowed, setting up, by way of justification for the taking, the
attempt to remove them from the premises, and alleging that by such
removal one year's rent had accrued. There were two pleas to the
avowry. I. No rent in arrear. II. No demand for the rent.
The substantial question was whether this $3,000 was "rent," or
was a penalty, that is to say, whether the clause meant that in the
event of a removal, or attempted removal, Mrs. Dermott might get a
year's rent
in advance, or whether it meant that she
should have a sum of money equivalent to a year's rent "over and
above" all rents, by way of penalty.
The Circuit Court for the District of Columbia, in which the
case arose, gave judgment for the plaintiff. On error here, the
question was the same as below and as already stated.
Page 68 U. S. 64
MR. JUSTICE NELSON delivered the opinion of the Court:
The case turns mainly upon the question whether the $3,000
mentioned in the lease, accruing on the happening of this event, is
rent or a penalty.
The argument on behalf of the tenant is that by the true
construction of the lease, the landlord, on the happening of the
event, may at his option consider the term as ended and re-enter,
and in addition distrain for the $3,000, and hence the term having
ended, or it being in the power of the landlord to end it, the sum
reserved cannot be regarded as rent, but as a penalty, as the
relation of landlord and tenant has ceased.
We do not agree to this construction. Although the wording of
the clause occasions some obscurity and hesitation, yet, regarding
the sense and substance of it, there can be little doubt about its
meaning. It will be observed that if the tenant assigns or
underlets, the term ceases at the option of the landlord. So in the
event of the removal or attempt to remove the goods. Now the words,
"at the sole option
Page 68 U. S. 65
and election" of the landlord are superfluous if intended to be
limited to this breach of the covenant. All that was necessary was
the inhibition to assign, underlet, or remove the goods and the
right of reentry in case of breach. Without giving the option or
election, the landlord had the right to waive the forfeiture.
Receiving rent with knowledge of the breach is a waiver. So levying
a distress for the rent, or in any other way consenting to a
continuance of the term. These words, we are of opinion, are
entitled to an influence in the construction of this part of the
lease beyond these covenants of forfeiture, and may aid in the
construction and meaning of the clause which provides for the
payment of the year's rent in advance. And the true meaning, we
think, is that the landlord may at his option consider the term at
an end and reenter in the events mentioned, or may at his option
(understood), have the year's rent in advance.
We do not think the word "moreover," in the connection found,
necessarily means the rent in advance, in addition to the previous
remedies mentioned, but rather an alternative remedy.
These covenants are inserted in a lease for the better security
of the rent. The one in question simply makes the rent payable in
advance, instead of by installments, on the happening of the event
stated. It would have been not only strange but unreasonable to
have made this stipulation as contended for on the part of the
plaintiff, to take effect at the moment the term ceased, or might
be put an end to by the landlord. The words should be very clear
and controlling to lead to such an interpretation.
It is argued that the reservation of this $3,000 rent in advance
should be regarded as a penalty, for the reason that the event
would happen on the removal of a single article of goods, and that
the remedy is out of reasonable proportion to the injury. But the
answer is the covenant against removal necessarily embraced all the
goods on the premises that furnished security for the rent, and it
is not for the tenant to set up as a defense to its enforcement,
that the breach is not as great as it might have been. The removal
of a single
Page 68 U. S. 66
article is a wrong which he is not permitted to take advantage
of, and besides, there is no hardship in the case, for if he
desired to remove any particular article, the covenant permits it
on replacing goods of equal value.
The removal of the goods took place on the 18th of May, 1857,
some year and five months before the expiration of the lease, so
that practically the reservation of the rent in advance, on the
event in the lease happening, works but simple justice to all
parties. It became the substitute for the rent reserved payable
monthly. If the tenant had brought about the event by the removal
of the goods within a year of the termination of the lease, whether
or not he might have had a remedy to abate the excess, we need not
discuss.
Judgment reversed and cause remanded for a venire de
novo.
