Mayor of New York v. Mabie — 9 N.Y. Super. Ct. 401

Majority

p. 401

The Mayor, &c., of the City of New York v. Philip Mabie and others.

(Before Duer, Bosworth, and Emmet, J.J,)

October 26;

November 19.

Headnote

' Jn an action for the recovery of rent, reserved in a lease in writing, damages resulting from a subsequent tortious act of the lessor, not amounting to an eviction, nor constituting a breach of any covenant in the lease, could not, before the amendment of the Code, in April, 1852, be recouped or set off by the defendant.

Whether in actions" commenced since April, 1862, damages thus sustained can be made the subject of a counter claim under § 150 of the Code—Quere? Judgment for plaintiffs upon verdict,

Cabe on a verdict for the plaintiff, taken subject to the opi-' nion of the court at general term.

As the questions of law, which the case involves, arose upon the pleadings, it is necessary to state the complaint and answer <m externo,

The complaint of the above-named plaintiffs, the Mayor, Aldermen, and Commonalty of the city of New York, shows that they were, at and before the time next hereinafter mentioned, possessed of certain issues and profits arising and accruing from certain wharves in the city of New York, hereinafter mentioned, viz. the right to collect wharfage from such vessels as should lie against or touch at the said wharves; and being so possessed, they, the said plaintiffs, on the twenty-ninth day of April, in the year one thousand eight hundred and fifty, by a certain instrument in writing, bearing date the day and year last aforesaid, one part whereof was duly executed under the common seal of the city of New York, and the other part whereof was duly executed under the hand and seal of the said Philip Mabie, demised and leased to the above-mentioned Philip Mabie, in Consideration of certain rents and covenants • therein reserved and contained, the right to levy and collect to his, the said Philip Mabie’s own use, all the wharfage which should or might arise, accrue, or become due

p. 402

between the 1st day of May, A,D. 1850, and the 1st day of May, A.D. 1851, from the use or occupation by vessels of more than five tons burden, of any of the wharves belonging to the said parties of the first part, the said the Mayor, Aider-men, and Commonalty of the city of New York, from and including the easterly side and end of the middle pier at Coenties Slip, or Pier Ho. 7, to and including the westerly half of Pier Ho. 8, or the pier on the easterly side of Coenties Slip, together with the bulk-head between said piers, and which were known as district Ho, 3 of public docks and slips, except certain docks, slips, wharves, piers, and places therein mentioned and excepted.

And the said plaintifls, the Mayor, Aldermen, and Commonalty of the city of New York, further thereby authorized the said Philip Mabie to demand and receive all lawful suma of money due for wharfage thereon.

And the said Philip Mabie on his part covenanted to pay to the said the Mayor, Aldermen, and Commonalty of the city of New York, the sum of five thousand five hundred dollars, in four equal quarterly payments, on the first days of August, Hovember, February, and May next thereafter.

That the said Philip Mabie, on the said day, in order to secure the payment of the said rent, in and by the said lease, agreed to he paid, duly executed, together with the said Simeon Fitch, and William Fitch, under their respective hands and seals, a joint and several bond, in the penalty of eleven thousand dollars, conditioned for the payment of the rents in said lease, reserved unto the said, the Mayor, Aider-men, and Commonalty of the city of New York, at the times at which they should respectively fall due.

That the said Philip Mabie entered upon the said.premises and collected and retained for his own use and benefit and be-hoof, of the wharfage thereof, under and in pursuance of the said lease for the full term theieof, but has neglected and failed to pay the full amount due to the said the Mayor, Aldermen, and Commonalty of the city of New York, under the said lease, but that there is still due and unpaid for rent .thereon, from the said Philip Mabie, the sum of four thousand four hundred and twenty-five dollars, with interest, upon the sum

p. 403

of three hundred dollars, from the first day of August, A.D, "1850, upon the sum of thirteen hundred and seventy-five dollars, from the first day of November, A,D. 1850, upon the sum of thirteen hundred and seventy-five dollars, from the first day of February, A.D. 1851, and upon the sum of thirteen hundred and seventy-five dollars, from the first day of May, A.D. 1851.

Wherefore the said plaintiffs demand judgment against the said Philip Mabie as prijrcipal, and Simeon Fitch and William Fitch as sureties on the said bond, for the said sum of four thousand four hundred and twenty-five dollars, together with interest on the sum of three hundred dollars, from the first day of August, A.D. 1850; upon thirteen hundred and seventy-five dollars, from the first day of November, A.D. 1850; upon thirteen hundred and seventy-five dollars, from the first day of February, A.D. 1851; and upon thirteen hundred and seventy-five dollars, from the first day of May, A.D. 1851, besides the costs of this action,

The amended answer of the defendants in this action respectfully shows to this court, that they respectively admit the mating of the lease, and the giving of the bond, as they are respectively set forth in the complaint in this action. But the said defendants for answer thereto allege and declare that immediately after the said defendant, Mabie, entered upon the collection of the wharfage according to and in pursuance of said lease upon the premises described therein and referred to in said complaint, a certain agent or agents of the plaintiffs unlawfully and without any right or authority whatever, came upon the said premises, and then and there entered upon and actually assumed the entire control of all vessels, so far as relates to the berth or location thereof in said slip, or adjacent to said pier or piers, which came up to or into the district so leased to said Mabie, as described in said complaint, and that they, the said agent or agents of the said plaintiffs did, without any authority or right, or consent from said Mabie, and very greatly to his damage, injury, and loss, then and there, and have ever since, and still continue to let out and give the exclusive use to certain vessels, lines, or classes of vessels, or

p. 404

the owners, agents, or consignees thereof, to certain berths or locations in said slips, or contiguous to the pier or piers in said district, thereby prohibiting and preventing all other vessels from occupying and using said berths or locations, whether the same were occupied or not.

That said agent or agents during the period for which rent Is claimed under said lease, as was well known to the plaintiffs, were in the constant habit of letting out and giving the exclusive use of berths and locations within the slip and adjacent tp the pier or piers contained in said district to certain vessels, or the owners, agents, or consignees thereof, and for such exclusive use, either directly or indirectly, receiving a compensa- - tion; and that such agent or agents from time to time would give sitch exclusive use to those who would pay, or directly or indirectly give the most therefor.

That by reason of the unlawful conduct and interference of the agent or agents of the plaintiffs aforesaid, giving such exclusive use, and in preventing other vessels from occupying such berths or locations, even when vacant, and also by reason of the fact, that should such berths or locations happen to he occupied by any vessel or vessels not enjoying such exclusive use or privilege, and whether loaded or partly loaded, or discharged or partly discharged, or convenient or inconvenient to the captains or owners thereof, and of their being without any right or authority whatever, required by said agent or agents forthwith to haul and remove from said berth or location, the exclusive use of which had been given as aforesaid, other vessels not enjoying such exclusive privileges almost entirely abandoned, and left said district of public docks and ships leased as aforesaid, and obtained accommod; lions elsewhere, and thus, through the unjust and unlawful interference of the agents of the plaintiffs aforesaid, was the said defendant, Mabie, deprived of a large amount of wharfage winch would otherwise have been received by him. ’ That by reason of the unlawful, overhearing, and unjust conduct as aforesaid, of the agent or agents of the said plaintiffs, all of which wore well known to them, the said defendant, Mabie, has sustained a very great loss and damage, amounting to more, as he verily believes, than the whole sum claimed in the said complaint..

p. 405

And the said defendant, further answering, alleges, that the Said agent or agents of the said plaintiffs in entering upon, doing and performing all the various acts and matters as hereinbefore mentioned, and each and every of them, acted under the authority, direction, and approval of the said plaintiffs, and that all the doings and conduct of the agents aforesaid, in each and every of the matters aforesaid, were known to, approved of, and ratified by the said plaintiffs.

That the said defendant, Mabie, upon the trial of this action, will seek to have the amount of damages aforesaid sustained as aforesaid, recouped and set off against the amount claimed by the plaintiffs for the excess over and above the amount claimed by them, together with its costs, and that the said complaint, as to the defendants, Eitch, may be discharged With judgment in their favor against the said plaintiffs for their costs.

The reply controverted the allegations in the answer, and denied that the defendants were entitled to recoup or set off the damages which they claimed. -

The action was brought on to be tried on the twenty-fifth day of April, 1853, before the Chief Justice and a jury.

The defendants admitted the allegations of the complaint, whereupon they were allowed by the court to open the case.

The defendants then offered to prove the facts set forth in the answer.

The court excluded the evidence, and directed the jury to find a verdict for the plaintiffs.

Whereupon the jury found a verdict for the plaintiffs for the sum of five thousand one hundred and five dollars and'fifty-six cents, the amount claimed and interest, to which direction of the judge the counsel for the defendants then and there duly excepted. His honor then directed that the entry of judgment upon the verdict should be suspended until the decision of the general term could be had upon the questions of law involved.

R. J. Dillon, for the plaintiffs,

moved for judgment on the verdict upon the- following grounds.

p. 406

The evidence offered by the defendants was inadmissible— because;

I. It was in contradiction of the allegations in the Complaint, which the defendants had admitted.

II. The damages claimed by the defendants for the acts of the plaintiffs, are not a subject of set off, as alleged in the answer, Such damages are not a subject of “ recoupment,” 'L “ Recoupment” is allowable only fot the violation of the covenants, agreements, or stipulations on the part of the plaintiffs, contained in the same contract upon which the plaintiffs bring suit. (Ives v. Van Epps, 22 Wend. 155 ; Whitbeck v. Skinner, 7 Hill; 56; Ballerman v. Pierce, 3 Hill, 174 ; Road v. McCul lister, 8 Wend, 109 ; Nichol v. Dusenberry; 2 Comstock, 286.) 2. The faóts alleged in the answer constitute a tort, or trespass ;• having no" reference to the contract sued upon, or any obliga* tion therein, on the part of the plaintiffs, but entirely inde* pendent and extraneous to it. (Cases supra; Cram v. Dresser , 2 Sandford, 125; Ogilvie v. Hall, 5 Hill, 52 .)

IH. The testimony offered does not constitute an eviction, 1. The doctrine of eviction does not apply to an incorporeal hereditament, 2, A tresspass is not an eviction. The facts alleged in the answer, do not show that the defendants were deprived of the use or enjoyment of the premises; they simply allege an interference with the mode of enjoyment. (Cases supra; Hunt v. Cope, 1 Cowp. 242; Bennett v. Bittle, 4 Rawle, 839 .)

W. E. Noyes, for the defendants,

insisting that the verdict ought to be set aside) and. a new trial be granted; argued as follows.

The quéstíons in this casé amé U]ion the following facts,

The plaintiffs being the owners of certain wharves, for & valuable consideration, granted and assigned to these defendants the right to receive and collect such wharfage, as during the continuance of the gránt should accrue; or become due from vessels lying at Of using such, wharves.

That from the timé the grant took effect, and dining the entire continuance thereof, the plaintiffs, without the defend-

p. 407

tot’s consent, assumed the control of all vessels which came up to and used said wharves, permitting some to use certain parts to the entire exclusion of all others, and arbitrarily compelling many to haul, and others to take their places, to the very great inconvenience of the masters and owners thereof—and thereby almost entirely prevented the use of said wharves by all ves» Eels, except those to which the plaintiffs gave siich exclusive privileges. That, in consequence of such interference on the part of the plaintiffs, the defendants have lost wharfage and Sustained damage to an amount equal to the consideration agreed to be paid for the grant.

1st. tinder this state of facts Can the defendants recoup the damages thus sustained? of,

2d. Set them off under the statute by way of a Counter claim ?

I. That the damages thus sustained can be recouped is evident, because the damages arise from the plaintiffs* violation of the spirit of their own contract. They granted to us the right to collect all wharfage, and then from the date of the lease so conducted themselves, that the defendants only got a small portion of what otherwise would have accrued to them, the same as if they had leased us ten rooms in á house and never permitted Us at all to enjoy but five of them, and claimed the whole rent. The consideration of the grant has in a great measure failed from the lessor’s own acts, and is therefore a proper subject for recoup» ineiit. (Reab v. M‘Alister, 8 Wend. 109 ; 4 id. 483; Ballerman v. Pierce, 3 Hill, 171 ; 10 Barb. Sup. Ct. Rep. 55; 4 Sandf. 147 .)

II. There is an implied agreement on thé part of every lessor as a condition of his receiving rent, that the lessee shall quietly enjoy the rights.or privileges granted. (Taylor’s Landlord and Tenant, 144, and cases cited; 2d ed. id. § 304, note ; 1 Sandf. 260 .)

III: If this defence does not cOme within the doctrine of recoupment, it unquestionably is within §§ 149,150, of the code of procedure, and can be sustained as a counter claim. (Sub. 1, § 150, Code of Procedure.)

The judge, who presided

p. 408

at the trial of this action, precluded the defendants from proving the facts alleged in their answer, Was that decision erroneous ? This is the only question presented by the case,

It is alleged that the defendants, by the wrongful acts of the plaintiffs, were deprived of the free and Uninterrupted enjoyment of the demised premises. The free and uninterrupted enjoyment of the premises was the consideration of the defendants’ agreement to pay the stipulated rent, for the recovery of which this action is brought. The plaintiffs, by their unlawful conduct, have produced a partial failure of the consideration of this agreement, Can this partial failure of consideration, thus occasioned, be shown, in an action to recover the whole stipulated consideration, to reduce the amount to be recovered?

On the part of the plaintiffs, it is not denied that they are liable for damages, assuming that they have done the acts set tip in the answer, But it is insisted that such damages could hot be recovered in an action ex conbraetM, and that damages resulting from an unauthorized interference of a lessor with his lessee’s enjoyment of the demised premises, not amounting to an eviction, is not a ground for recouping damages, in an action to recover the reserved rent. That damages resulting from acts dui’ing the term cannot in any case be recouped, unless the defendant could recover them in an action ex contraetiu. That the damages suffered in tiffs case could only be recovered in an action ex delicto, and are, therefore, not a proper subject of recoupment.

Cram v. Dresser (2 Sand. S. C. R. 125) is cited by the plaintiff as decisive of this question.

Whether the 150th section of the Code, as amended by the act of April 16th, 1852, would allow such facts to be averred and proved, on the ground that they would constitute a defence falling within its definition of a counter claim, it is not material to inquire, All the pleadings in this action had been interposed some months before the provision in relation to counter claims became apart of tile Code.

This case must, therefore, be determined by the law as it was when the action was commenced, and the issues arising in it Were joined. It seems to be difficult to distinguish this case

p. 409

from that of Cram v. Dresser. Each is an action by a lessor against his lessee, to recover the rent agreed to be paid for the use of the demised premises. In each case the lessee entered upon the premises, and continued in the actual possession and enjoyment of them during the term.

In each case, the damages sought to be recovered resulted from misconduct of the lessor, subsequent to the commencement of the term, "Which disturbed the lessee’s enjoyment of the premises, and rendered stich enjoyment less valuable than it would otherwise have been.

In Cram v. Dresser, the mere entry of the lessor was lawful, because authorized by the terms of the lease. The tortious conduct of the lessor after entry is characterized" by the court as being “ of the same quality as a trespass, although Unaccompanied by any force.”—Id. 126

In this case, the interference Was forcible as well as tortious. There was no covenant in either lease that the lessor would not interfere with, nor disturb the lessee’s enj oyment of the premises. This court held in Cram v. Dresser that as there was no covenant against any such interference, the damages resulting from it could only be recovered by an action of tort, and could not be recouped.

In Cram v. Dresser, the defendant, by a notice annexed to his plea, stated that he would insist on recovering the damages Which he had sustained by the improper conduct of the plaintiff, “ by way of recoupment of the damages at the trial.”

In the case at bar, the defendant, Mabie, in his answer gives notice, that he will insist on having the damages he has sustained recouped, and set off against the damages claimed by the plaintiffs.

In each ease, therefore, the defendant sought to recoup the damages which he claimed he had sustained. In each case the defence was attempted to be interposed, on the principle that the doctrine of recouping damages was applicable to the facts of the case. If the evidence is inadmissible, provided it is not a proper case for recoupment, then the case of Cram v. Dresser is conclusive upon this court, unless it is prepared to reconsider and overrule it.

In this case there was no express covenant for quiet enjoy

p. 410

ment. Hone is implied by law, on which an action will lie. (1 R. S. 738, § 140; Kinney v. Watts, 14 Wend. 38 ; 1 R. S. 750 § 10; id. 762, § 36; Dalston v. Rowe, 1 Ld. Raym. 77.)

In Cram v. Dresser, the court enumerated the cases in which the doctrine had been applied, and said that it had “been applied to the reduction of the price of goods sold, when there was either a Warranty-broken, or fraud in the sale, or a distinct agreement, relative to the subject matter, which was broken, to dimmish the recovery on a contract for labor and materials, Which was not faithfully executed; and, finally, a tenant’s da* mages, by reason of the breach of an agreement to repair, have been admitted in his defence to an action brought by the land" lord to recover the rent of the demised premises.”

In all the cases in which the defendant has been allowed to recoup damages, resulting from the breach of a covenant or promise of the plaintiffs, it wás a covenant or promise cotem* pol-áneous with that made by the defendant, and deemed to be part and parcel of the contract.

If; in this case, there had. been a covenant for quiet enjoy» ment, the acts of the plaintiffs, which the defendant offered to prove, would have been a breach of it, and the damages re= suiting from such breach would have been a proper subject of recoupment. (Ballerman v. Pierce, 3 Hill, 171 ; Ives v. Van Epps, 22 Wench 155.)

In the case supposed, the damage would have resulted from a trespass, which trespass would have been the breach df an express covenant In this ease, the acts done are not a breach of an express covenant for quiet enjoyment, for the lease con* tains none ; but they are the breach of a duty resting on the plaintiffs, which duty required them to abstain from any and all acts that Would diminish the wharfage that would otherwise accrue¡

But that duty or obligation was one existing With equal fores against other persons as against the plaintiffs. It was equally the duty of strangers to not interfere! If the plaintiffs or strangers interfered, an action at law would lié, and the same damages would be recoverable in the one case as in the other. (Kinney v. Watts, 14 Wend. 38 .)

This duty of the plaintiffs did'not arise otit Of any covenant

p. 411

On their part contained in the lease, hut is One which the laW imposes upon every member of the community.

It cannot therefore be said, that the claim or demand df the defendant springs out of the contract or transaction, which creates the liability on his part, It does not arise out Of any fraud inducing the acceptance of the léase, nor Out Of the breach of any covenant on the part Of the plaintiffs, Contained in it, of of any promise made contemporaneously with it.

It arises from a tort, which might as well have been commit* ted by a stranger as by the plaintiffs, which was subsequent td the execution of the lease, and the entry by the defendant upon the enjoyment of‘the thing demised.

It may be urged, that if a tenant id deprived, by the lessor, of the thing letten in whole or in part, the obligation to pay rent ceases, because such obligation has its force only from its consideration, which is the enjoyment of the thing demised. (Gilbert on Rents, p, 145.)

That an unlawful interference by the lessor, with the lessee’s enjoyment of the premises, rendering their use less valuable, although not amounting to a technical eviction, deprives him, in part, of the consideration of his covenant to pay rent, and therefore presents the case of a partial failure of consideration, which should operate to reduce the plaintiff’s recovery.

To this it may be answered, that all the cases in which the doctrine of recoupment has been applied, are those in which the defendant failed to ultimately receive a full consideration for the sum sought to be recovered of him. When sued for thé price of property which he was induced to buy by reason of fraudulent misrepresentations as to its quality, by showing the ff'aud, he establishes the fact, that he at no time had the whole of that which constituted the consideration of his promise to pay the contract price. ( Van Epps v. Harrison, 5 Hill 63 -66.) He was never put in possession of that which he contracted to buy, •

But if the property had been as represented, and subsequent to its delivery to the defendant, the plaintiffs had tortiously injured it, or interfered with the defendant’s beneficial enjoy* ment of it, although liable in tort for such conduct, no one, I think, will pretend that, in an action for the price, such tort

p. 412

could be proved and tile damages resulting from it be recouped» Yet the tort supposed, would have deprived the defendant, in one sense, of part of the consideration of his promise.

In judgment of law, the, cause of action arising from the tort, in such a case, does not spring from the same contract or transaction, as the action upon the promise to pay the stipulated price, It does not spring from the same contract, for that contains ho stipulation ifi respect to the conduct complained of.

In the case at bar, the liability of the plaintiffs to the defendant, upon the facts offered to be proved, would have been precisely the same, if the lease had been given to the defendant, by some other person. I think no case can be found, which" allows a tenant to show a tort of the lessor, in bar of an action for the rent reserved, or to reduce the amount of the recovery, unless such tort amounts, in law, to an eviction. That a trespass upon, or tortious interference with, the demised premises, during the term, which merely renders the tenant’s enjoyment less valuable, but which cannot he treated as an eviction, and Which violates no Covenant contained in the lease, cannot be set Up as a partial failure of the covenant to pay a fixed rent, or by way of recoupment.

That such conduct on the part of the landlord, is to be redressed in the same way as if it had been the act of a stranger.

That Cram v. Dresser was decided in accordance with adjudged cases, and that no well considered case justifies us in extending the doctrine beyond the limits authorized by the previous decisions. (Reab v. McAllister, 8 Wend. 109 ; Ballerman v. Pierce, 3 Hill, 171 ; Van Epps v. Harrison, 5 Hill, 63 ; King v. Paddock, 18 I. R. 141; Nichols v. Dusenburg, 2 Coms. 286; Harrington v. Snyder, 8 Barb. S. C. 281 , 6 Barb. S. C. R. 386; Willoughby v. Coms., 3 Hill, 392 ; Bushell v. Lech mere, 1 L. Ray., 369.)

In this Case the defendant, Iffabie, received all the wharfage that actually accrued, during the whole term,

The motion for a new trial must be denied, and a judgment entered in favor of the plaintiffs upon the verdict.

The same judgment will be entered in the other action between the same parties.

Cases cited

Ives & M'Carty v. Van Epps & Shattuck 22 Wend. 155 N.Y. Sup. Ct. p. 406
Reab v. McAlister 8 Wend. 109 N.Y. Ct. Err. p. 407, p. 412
Deming v. Kemp 4 Sandf. 147 N.Y. Super. Ct. 1850-09-28 p. 407
Kinney v. Watts 14 Wend. 38 N.Y. Sup. Ct. p. 410