Pflum v. Spencer — 123 A.D. 742

Majority

p. 742

Annie Pflum, Appellant, v. Laura L. Spencer, Respondent.

Second Department,

January 17, 1908.

Headnote

¡Landlord and tenant—option to renew or purchase — lease construed — when lessee electing to purchase entitled to specific performance.

On the renewal of a lease containing a renewal clause and also an option to purchase, the latter option is again renewed but not the privilege to renew the lease again, for otherwise such right could be made perpetual.

Lease construed and held, to give the tenant an option to purchase at a specific price at any time during the first year, but that the option was modified for-the second year so that, should the lessor or her husband die within sixty days before the expiration of the yearly term, she or her executors might sell on obtaining a bona fide purchaser-after having first given the lessee the opportunity to purchase at the price offered by such purchaser.

When under such lease the tenant prior to the termination of the renewal notifies the lessor of an election to purchase at the price agreed upon in the lease, the lessor having failed to submit an offer from any other purchaser, the tenant’s, complaint asking that the lessor be compelled to specifically perform her contract should not be dismissed.

Appeal by the plaintiff, Annie Bflum, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Kings on the 22d day of April, 1907, upon the decision of the court rendered after a trial at the Kings County Special Term dismissing the complaint upon the merits..

The defendant let certain premises to the plaintiff for one year

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. from November 1st, 1904, by a written lease, which contained the following clauses, viz.:

“ And it is further agreed by the party of the first part that she will grant a further lease of the aforesaid premises for a term of one year commencing at the expiration of the term herein granted at the same yearly rental and containing like agreements and covenants as in these presents contained conditioned upon the party of the second part giving to' the party of the first part .sixty days’ notice in writing of her desire or her intention to avail herself of said option of renewal.

“ And it is further agreed that the party of the. first part hereby agrees to sell the premises herein described to the party of the second part for the sum of ten thousand, five hundred dollars ($10,500), or the house and three lots or sixty feet of the herein let premises for $8,500.00 except that should the party of the second part give the requisite sixty days’ notice in writing to the party of the first part of her intention to avail herself of the option of renewal and should the party of the first part or her husband die during said sixty days before expiration of the term herein granted, then the party of the first part or her executors may, upon obtaining a bona fide purchaser for the said premises, sell the same after having first given party of the second part the opportunity to purchase them at the price offered by such bona fide purchaser.”

The plaintiff gave the sixty days’ notice in writing of option to renew for another year in due time by the following letter, viz,:

“New Yoek, Aug. 25, 1905.

“Dear Mbs. Spenceb: — Owing to the unsettled condition of my business affairs, I have decided not to conclude the matter of purchasing your property at this time, as I may be called West before next year, and I would not care - to have any entanglement which would bind me to the East. However, I desire to renew my lease for another year as provided therein. In this connection, Mr. Washington Smith will call on you at your convenience.

“ Please advise when it will be convenient for him to call, and very much oblige, '

“ Kespectfully yours,

“H. D. PFLUM.”

p. 744

On August 31st, 1906, the plaintiff gave written notice to the defendant of her election to purchase the premises on the terms agreed upon in the said lease, and that she required the defendant to deliver to her a conveyance thereof.

■ The defendant refused, and this suit was brought to Compel her to make such' conveyance.

Samuel M. Richardson, for the appellant.

Claude V. Rallister, for the respondent.

The renewal of the lease embraced all of the covenants and agreements of the lease, except that of- renewal, for otherwise the right óf renewal would be perpetual. The clause in the lease by which the lessor agrees to sell the demised premises to the tenant for $1.0,500 was therefore renewed. But such clause does not provide the same in terms for the renewed year as for the first year, as you perceive on perusing it. It gives the tenant the option to purchase at áuy time during the first year, but this option is restricted and may be- put an end to during the second year. The option of purchase continues during the second year, it is true, but with the modification, that if instead of purchasing during the first year, the tenant gives the required notice ,of sixty days before the expiration of the first year, of a renewal of the lease for another year, and should the lessor or her husband “ die during said sixty days before expiration of the term herein granted”, then she or her executors “ may, upon obtaining a Iona fide purchaser for the said premises, sell the same after having first given party of the second part” {i. e., the tenant) *the opportunity to purchase them at the price offered by such Iona fide purchaser.” The phrase. “ die during said sixty days' before expiration of the term herein granted ”, contemplates that such notice of sixty days shall be or run during the last sixty days, i. e., the sixty days before the expiration of the term, and thus understood becomes entirely plain. It simply means that if the lessor or her husband die during the last sixty days of the term, and' the word ■“ said ” is meaningless.-'

The effect of this is that the tenant may at any time during the renewed year exercise the option of purchase for $10,500, except

p. 745

that if the lessor or her husband has died during the last sixty days of the first year, she or her executors may, at any time before the tenant has exercised such option, sell the property, but .not until the offer therefor has been first submitted to the tenant, and she has been given opportunity to purchase it at that price. In this way the option of purchase given her in the lease may be brought to an end. This being the interpretation of the clause giving the option to purchase, there is no occasion to try to change “ and ”.to “ or ” in the phrase “ and should the party of the first part or her husband die ”, etc. The said purchase clause has a clear meaning as it reads with the word “and”, and would have the'same meaning if we changed “and” to “or”; which is at once perceived if the tenant’s option to purchase continues during the second year until it is ended by the lessor submitting to the tenant an offer from another purchaser and selling to him if the tenant will not take the property and pay the amount of his offer.- If we were to change the reading to be that if the tenant serve the notice of sixty days for a renewal, “ or ” the lessor or her husband die during such sixty days, the lessor or her executors shall have a right to end the tenant’s option by getting a purchaser, and requiring the tenant to take the property at his offer, we would have the same case, i. e., that the tenant — the plaintiff — exercised the option given her by the lease to purchase before the lessor received an offer from any one else.

As the lessor never submitted an offer from any other purchaser to the tenant, she exercised the option to purchase at $10,500 in time.

The judgment should be reversed.

Jenks,. Hookeb, Rich and Millee, JJ., concurred.

Judgment reversed on the law and facts, and new trial granted, costs to abide the final award of costs.