Commonwealth Building Corp. v. Hirschfield

Brief Fact Summary. Defendant rented an apartment from Plaintiff and was intending to vacate the premises at the end of the lease period, but was delayed until the following day in vacating the premises. The Plaintiff “elected,” under an ancient rule, to treat the Defendant as a hold over tenant for another year (the lease period) and to require rent.

Synopsis of Rule of Law. In a hold over tenant case the Plaintiff proceeds upon one of two theories: 1. The voluntary action of the tenant is such to disclose the right of the landlord to assume an intention on the tenant’s part to create a second tenancy, or 2. That the action of the tenant is such that the court will as a matter of law hold the tenant liable for a second lease on a theory of quasi contract. [Williston on Contracts, Vol. 6 Section:1836].

Facts. Defendant and his family were in possession of the premises in question under a lease made with Plaintiff which was set to expire on September 30, 1938. The lease contained a clause that if Defendant held over as a tenant he would become liable for double rent. Defendant made plans to move at the end of lease and hired the Federal Moving and Storage Company to perform the work of packing and moving the Defendant’s possessions. This work began on the 27th of September and was not entirely complete on the 30th of September. The Defendant and his family and servants slept in the apartment on the night of September 30 and moved the remaining possessions from the apartment on October 1, 1938. There had been some delay in the use of the elevators, although there was some dispute as to which party caused the delay. The Court noted that Plaintiff’s agents did aid the Defendants in moving, because the Defendant’s wife tipped one of them for their help. Around 10:00 a.m. on the morning
of October 1, 1938, an attorney for Plaintiff served the Defendant with a notice which stated, “In view of the fact that you did not vacate possession of your apartment within the time provided for in your lease, the undersigned has elected, and does hereby elect, to treat you as a hold-over tenant for another year, and you are accordingly requested to pay October rent immediately.” The Defendant refused and the Plaintiff sued. At the trial court the Plaintiff obtained a verdict for $1,100. Defendants moved for a new trial which was denied, and then Defendants appealed.

Issue. May the landlord elect to treat a hold-over tenant under these circumstances such that the landlord may assume that the lease period should be extended by another year?

Held. No. Reversed with judgment for Defendant.
The Court cites the New York rule, which was adopted by Illinois: “A tenant who holds over after the expiration of his term may, at the election of the landlord, be held to be either a trespasser or tenant for another similar term.” [citing Conway v. Starkweather, 1 Denio 113, 114]. However, a key element has been added to the rule that the holding over by the tenant must be voluntary.
The Court found that the cases involving hold over tenants proceed on one of two theories: 1. The voluntary action of the tenant allows the landlord to assume an intention on the tenant’s part to create a second tenancy, or 2. The action of the tenant is such that the court will hold the tenant liable for a second lease on the principle of quasi contract. [Williston on Contracts, Vol. 6 Section:1836]. The Court held that the Plaintiff here should not be allowed to recover under either theory.
The Defendant was vacating the property in good faith and with reasonable speed. There was no evidence to support a theory that the actions of the Defendant in holding over should give rise to the Plaintiff’s assumption that the Defendant was voluntarily holding over. The Defendant chose to not move in the middle of the night of the 30th of September, but instead chose to wait until morning. Nothing indicated a desire to renew the lease for another year.
The Defendant cannot be held liable on a theory of quasi contract because justice required an absolute presumption of contract for another term. The lease itself provided for such an occurrence as holding over, and under the terms of the lease, the Plaintiff is entitled to collect double rent for the period of hold over. This agreement is reasonable. Thus, the only power that Plaintiff had in case of hold over was to charge the Defendant double rent for whatever time Defendant held over.

Discussion. Whenever there is a conflict between some common law rule and an express provision in a contract which is not in violation of the law, the courts will generally find favor with the expressed agreement of the parties, such as in this case.