William Usborne Moore.

The Commercial year book online

. (page 115 of 125)
Online LibraryWilliam Usborne MooreThe Commercial year book → online text (page 115 of 125)
Font size
QR-code for this ebook


let differ from one another as widely as other
contracts between landlord and tenant, and each
must be interpreted according to its terms. If
a tenant hires a flat, or other premises, from
month to month, no notice at all is necessary in
order to terminate his tenancy at the end of any
month. His hiring is only for a month, and at
the close of the month the contract is at an end
unless a new contract, express or implied, Is en-
tered into for the following month.



Sals of Leased Premises— To Whom Rent
Should be Paid.

A bought of B a dwelling which at the time was
under lease to C, rent payable on the first of the



month in advance. B introduces A as the new
landlord on the 3d of the month. The payment
of rent has been delayed subject to repairs neces-
sary in the house, and at the time of introduction
of the new landlord it has not been paid for the
current month. To whom has C to pay the rent ?
Reply.— When a rented building has been sold,
and the tenant has been notified to pay rent to
the purchaser, he should pay to him such rent as
becomes due after the notification. Rent which
has fallen due previously is to be paid to the
original landlord, though actual payment is not
made until after the tenant has notice of the
sale.

Life Tenant's Power to Convey.

I have an estate in which I hold only a life
interest. 1 have no children, and two Bisters are
my immediate relations. Now, can I give a lease
of the property for a term of years and can the
lessee hold possession of the property until the
expiration of his lease though I should die in the
meantime? If I can make a lease, is there any
limit to the time for it to run ?

Reply.— No one can convey a larger interest in
real estate than he owns himself. Anyone who
has a life interest may grant the use of the estate
to another for the term of the grantor's life, but
no longer. If he makes a lease for a term of
years the lease will be good if the grantor lives
throughout the term ; but if he dies during the
term the lease comes to an end at the same mo-
ment, because a grantee cannot take more than
his grantor has power to give. It is expressly
provided by statute in this State that a "convey-
ance made by a tenant for life or years, of a
greater estate than he possesses, or can lawfully
convey, does not work a forfeiture of his estate,
but passes to the grantee all the title, estate, or
interest which such tenant can lawfully convey.'*
Whether the life tenant's surviving relatives are
near or remote has no bearing upon the matter.

Liability for Repairs.

Under a lease of a dwelling containing no
reference to repairs except the usual closing
clause providing that the tenant shall leave the
property in as good condition as when he entered
it, reasonable use and wear and tear and damage
by the elements excepted, can the landlord be
compelled to make repairs?

Reply.— A landlord is under no obligation to
make repairs of any nature upon premises leased
to another unless the obligation is Imposed upon
him by some stipulation to be found in the lease
itself. Where the lease is silent upon the subject
of repairs, or where, as In the present case, it
binds the lessee " to leave the property in as good
condition as when he entered it, reasonable use
and wear and tear and damage by the elements
excepted,*' the lessee cannot compel the lessor to
make any repairs, but the lessor can compel the
lessee to make such as may be necessary to meet
the requirements of the covenant.

A Tenant's Covenant to Repair.



A leases the first floor of his building to B. The
lease provides that the tenant is to keep the
premises in a good state of repair at his own cort
and expense Boys playing ball in front of the
building threw the ball through a window, break-
ing the glass. The tenant claims that A is liable
for this damage. Is this so ?

Reply.— If a tenant covenants to keep the
building In repair he cannot refuse to make re-
pairs upon the ground that their necessity was
caused by some person other than himself. It is not



Digitized by



Google



670



THB COMMERCIAL TEAR BOOK.



merely the damage be does himself which be Is
bound to make good ; this it would be his duty to
<lo even if he bad not entered into a covenant or
was not a tenant ; but under his covenant he is to
return the premises in as good condition as they
were in when he took them, damages from any
and all causes having been repaired. If boys have
broken the windows the tenant must put them
in, and look to the boys or their parents for reim-
bursement.

Construction op a Covenant to Repair.

Please give your opinion upon the enclosed copy
of a lease which I made upon certain premises in
the State of New York. The factory building
•described in the lease has recently been destroyed
by fire. Under the terms of the lease, 1 would
like to know whether the lessee is obliged to
rebuild or not.

Reply.— The lease under which our correspond-
ent's question arises binds the lessee to maintain
the premises in good repair and ** to restore said
premises at the expiration of this lease in good
running order, wear and tear of elements alone
excepted. 11 At common law the tenant under
this lease would have been bound to restore the
buildings destroyed by fire during his tenancy.
But this rule is changed by a statute of this
State, which provides that "where any build-
ing, which is leased or occupied, is destroyed
or bo injured by the elements or any other



cause as to be untenantable and unfit for occu-
pancy, and no ex press agreement to the contrary
has been made in writing, the lessee or occupant
may, if the destruction or injury occurred with-
out his fault or neglect, quit and surrender
possession of the leasehold premises, and of the
land so leased or occupied ; and he is not liable to
pay to the lessor or owner rent for the time sub-
sequent to the surrender.'' The covenant to
repair in the lease under consideration is the
ordinary covenant, and that, under the decision
of our courts, is not sufficient to deprive the
lessee of the benefit of the statute. In a case
reported in 87 N. Y„ 98, the Court of Appeals
speaks as follows : "The benefit of the statute is
not lost by a general covenant of the lessee to
repair. Such a covenant, in the absence of any-
thing in the lease explaining or extending it,
would not, we think, prevent the lessee from
availing himself of the statute. We think the
words 4 unless otherwise expressly provided by
written agreement or covenant, 1 while they do
not require an agreement, in totidem vcrbfa, that
the rent shall continue notwithstanding the
destruction of the premises, or their becoming
untenantable, are nevertheless not satisfied unless
it appears from the lease or other writing that
the parties had in mind the contingency men-
tioned in the statute, and inserted provisions or
covenants inconsistent with the right of surren-
der thereunder. 11



Mortgages.



Lessee op Mortgaged Premises.

A house is rented with rent payable at the end
of the month. There are two mortgages on the

Elace, the second of which matured on April 1 last,
ut has not yet been foreclosed. Am I safe in
paying the rent to the owner, taking the receipt
in such form as will hold me free from liability ?
If so, what would be proper legal form ? The
property is located in Pennsylvania.

Reply.— A lessee of property subject to a mort-
gage may safely pay rent to the mortgagor until
he has notice from the mortgagee demanding that
it be paid to him. No special form of receipt is
necessary; any receipt showing payment of rent
to the mortgagor is sufficient.



Authority to Collect a Mortgage Debt.

Some time since we purchased real estate on
which there was a bond and mortgage ; the inter-
est on the mortgage is collected by the attorneys
of the mortgagee, who sign the receipts for same,
and on being requested to show their authorit>
for collecting same are insulted, and refuse to give
any information as to the matter. If we refuse to
pay interest to them under these circumstances,
would they be able to make trouble for us ?

Reply.— Whenever a debtor makes payment
upon a mortgage debt, either of principal or in-
terest, he may always properly demand the pro-
duction of the note or bond secured bv the mort-
gage. Otherwise he may learn, after making
the payment, that the note or bond had previous-
ly been transferred, in which case the actual
holder will be able to collect again not withstand



ing the payment thus incautiously made to



i



former holder. Any man who demands money
of another should be ready and willing to show
his right to receive it. In the case our correspond-
ent puts, if the attorney is requested to show
the bond as an evidence of his right to collect the
money, he must either show the bond or go into
court and sue for the amount. If he adopts the
latter plan it will be a sufficient answer to his suit
to say that the debtor was at all times willing to
pay the money to any one who could show a right
to receive it. The attorney will be compelled to
exhibit the bond in court, as he had been asked
to do before ; he cannot recover any more money
than he could have had without the suit, and he
will be compelled to pay the costs of the pro-
ceeding.

Mortgagee's Claim for Deficiency.

A sold a piece of real estate to B, and took a
mortgage and bond, and B has not paid the inter-
est. A has commenced proceedings in foreclosure
and sale. Now, if B disposes of his other real es-
tate before the sale of the property on which the
mortgage is taken, can A follow the other prop-
erty to make up any deficiency in case the sale of
the mortgaged property does not satisly the
claim ?

Reply.— If B owes money to A, and A holds a
mortgage on part of B's real estate as security
for payment, A's lien does not extend beyond
the property specifically covered by the mort-
gage. The land may be sold under foreclosure
if the debt is not paid, and for any deficiency the
mortgagee has the same claim against the mort-
gagor that any unsecured creditor would have.



Digitized by



Google



LEGAL DECISIONS.



671



Having secured a judgment for the deficiency, he
has the same right as any other creditor to satisfy
the judgment out of any property belonging to
the mortgagor. In the meanwhile, however, the
mortgagor has the same right to sell his unen-
cumbered property, in good faith, as he would
have if there was no mortgage on any part of his
real estate. If the sale is not made in good faith
and for a valuable consideration, but is a mere
device to hinder or delay his creditors, then any
of his creditors, including the mortgagee, may
have the sale set aside as fraudulent and the
property made subject to his claim as creditor.

Mortgage of a Building— What it Includes.

In 1888, A buys two lots of ground in New Jer-
sey. After building a house on same he finds it
is four feet on his neighbor's lot. To protect him-
self he purchases this lot in 1891. He gives B a
mortgage in 1892 on the house and lots, as de-
scribed in his first purchase of the two lots, say-
In* nothing regarding the house being four feet
over the line. B buys In the property under fore-
closure of the mortgage. A, retaining the lot he
last purchases, seeks to have B move the house
back the four feet. Knowing the description
given in the mortgage was false, can he do so ?

Reply. -If A executes a mortgage upon certain
lots therein described, and also upon a building,
the mortgage of the building covers the land
upon which the building stands, whether that land
is included within that specifically described or
not. A building is so connected with the land
covered by it that a mortgage of the building in-
cludes the land also unless an intention that it
shall not do so is clearly expressed. In the case
our correspondent puts, B was mortgagee of the
land covered by the house, and afterwards was
purchxser of it, and he now owns the house and
the ground under it, in addition to the land
specifically described in his mortgage.



Chattel Mortgage on After-Acquired
Property.

I have secured judgment against a barber for
advanced premiums on his plate-glass insurance



covering eight mirrors, on which he gave a chat-
tel mortgage prior to the issuance of the policy.
Subsequently a breakage occurred, and the broken
mirror was replaced by the company. Can I levy
on this one mirror, which the company put in,
as personal property of the assurei, or would the
law hold that it was covered by said chattel mort-
gage?

Reply.— If a mortgage is given covering cer-
tain specified chattels, and containing a proviso
that it shall cover any other chattels purchased
to replace those damaged or destroyed, that pro-
viso is valid and enforceable as between the
mortgagor and mortgagee. But it is of no va-
lidity as against a judgment creditor of the mort-
gagor. In the case our correspondent puts, the
new mirror may be levied upon, whether the
chattel mortgage purports to cover it or not.
See 142 N. Y., 570.



Registry or Mortgages.

A mortgages his property to B, but B does not
get the mortgage recorded. C, knowing that
there is a first mortgage not recorded, takes a
second mortgage on the same property and gets
it recorded. Which mortgage will receive the
first consideration ?

Reply.— If C takes a second mortgage on real
estate, when he knows that there is a first
mortgage upon it, he cannot by recording his
mortgage before the other is recorded gain
priority for it. His knowledge of the existence
of the first mortgage at the time his was executed
is sufficient to prevent this result; and actual
knowledge is at least as effective to this e d as
presumptive knowledge to be inferred from the
fact of registry. If the holder of the second
mortgage, however, should assign it to some one
who had no knowledge of the existence of the
first mortgage, and if the assignee should record
his assignment before the first mortgage was re-
corded, he would then hold a first lien upon the
property. The fact that he took the second
mortgage with no notice, actual or presumptive,
of the existence of the first, and that he recorded
his assignment before the first mortgage was re-
corded, is all that is required to give this priority
to his lien.



Partnership.



Fictitious Partnership Name.

During the year 1861 J. S. and F. R. formed a
partnership under the name of 8. & Co., for the
transaction of a mercantile business in this city
and with foreign countries. After three years
they dissolved partnership and J. S. continued
the'business in the name of S. & Co. A year or so
ago he became embarrassed, and his notes for
about 81,500 were unpaid. S. had had them dis-
counted at his bank. When the cashier of the
bank threatened suit it developed that S. had no
partner; he was informed by the cashier of the
bank that his doing business as S. & Co. was il-
legal. Now, was it illegal? If S. sold a bill of
goods to a foreign house and had to sue abroad
for his money, could he stipulate in his complaint
** J. S., doing business as S. & Co."? Can he bring
an action in one of our own courts against a
debtor, and have any standing in court ?

Reply.— Under the provisions of a law which
was in force in this State in 1861, and which is still



in force with some modifications, an individual
succeeding a partnership in business was allowed
to continue the use of the partnership name if
the firm had had business relations with foreign "
countries, or if it had boon in business in this
State for five years or upwards. But in order to
be entitled to the continued use of the name it
was necessary that the person so using it should
file a certificate in the County Clerk's office set-
ting forth the facts, and should also have the
certificate published. Any individual who con-
ducted his business under a firm name, except in
accordance with the provisions of this law, was
guilty of a misdemeanor. The statute declaring
such Act a misdemeanor, however, was passed in
the interests of those who might give credit to
the individual in reliance upon his false repre-
sentation. His debtors are not harmed by his
unlawful use of a partnership name, and they



^



Digitized by



Google



672



THE COMMERCIAL YEAR BOOK.



are not protected by the law. In the case put by
our correspondent, S. is entitled to sue for and
recover the money due to him, notwithstanding
he may be guilty of the breach of a law of the
State. He may sue either in a foreign or domestic
court.

Right of a Firm to Opbrate Under a Cor-
porate Name.

Is there a law against a firm using the word or
style of *• co." or * company.** For Instance, A, B
& Co. are a manufacturing and packing concern,
and some of the goods they manufacture and pack
are styled " Excelsior Refining Co.," "Excelsior
Packing Co.," or *' Excelsior Manufacturing Co."
Is there a law prohibiting any or all of the above,
unless the so-styled company is incorporated?
If so, what is the penalty, if any ?

Reply.- A firm may carry on its business in
this State under a name appropriate to a corpora-
tion, unless it is a limited partnership. As to such
a partnership, the law requires that it ** must be
conducted under a firm name, which must con-
sist of the name of the general partner, or if there
t>e two or more general partners, of the names of
one or more of such partners, with or without the
addition of the words *and company' or *and
co.'" For ordinary partnerships in which each
partner's liability is unlimited there is no such
restriction.

Death or a Partner-Rights of the Admin-
istrator.

1. In the case of a person dying intestate, have
the heirs, some of whom are members of the firm
of which the deceased was half owner, a right to
sell any stock belonging, at the time of the death,
to the firm, or any of the personal property of the
deceased, before an administrator has been ap-
pointed ? I mean where the sales would be in the
usual way and not at auction. In other words,
how far can the heirs go in disposing of any ma-
terial, some of which may be worth more at the
time than after the administrator has been ap-
pointed ? Can the remaining members of the firm
(of whom there are two, each owning equal shares)
go on and buy and sell material as they did before
the death, using the works, etc., and considering
it strictly their own account and taking all the
profit before the estate is settled, especially when
there is objection on the part of some, if not all,
of the heirs? _ , A

2. How far does the power or authority of an
administrator extend under the laws of New York
State?

Reply.— 1. When a member of a firm dies, the
firm is immediately dissolved unless there is a
stipulation to the contrary in the partnership
articles. The heirs of the deceased have no pow-
er, as such, to deal with his personal estate ; only
his executor or administrator has this right. It
is the duty of the surviving partners to wind up
the business with as little delay as possible, and
they may do whatever is necessary to this end.
They may sell the property of the firm, because
that is a necessary part of the process of winding
up. 1 hey may also complete any contracts into
which the firm bad entered before the death of the
partner. They cannot buy any new goods, unless
it is necessary to do so in order to carry out con-
tracts in force before the dissolution ; nor can
they bind the estate by any act not necessary
either for the completion of such contracts or for
the expeditious settling of the firm's affairs.

2. The administrator of a deceased partner does
not succeed him as a member of the firm. His
only right is to insist that the business shall be
wound up as rapidly as is consistent with the best
interests of all its members; that the property



shall be disposed of to the best advantage, and
that that part of it belonging to the estate shall
be delivered to him lor distribution among the
heirs.

Partnership— Sharing Losses.

A and B form a partnership to conduct a busi-
ness, agreeing to divide the profits and losses
equally. A contributed $3,000 and B $6,000 capi-
tal -to bear no interest-. As the concern lost
money, they decided to liquidate and dissolve
partnership at the end of three years. During
that time each partner crew from the business
$1,700. After disposing of all assets they still owe
the bank $3,200. In otner words, the losses were
$S.800 plus $3,400 drawn by the partners, making
the total losses $12,200. Now, the question arises
between the partners, who owes the $3,2f<0 due
the bank? A claims be only owes $1,600, or half
of it, while B claims that A owes $3,100, and he, B,
only $100, making each partner's loss one-half of
the total loss of $12,200.

Reply.— If A and B have agreed to share profits
and losses equally, and the losses are $12,200, they
should be shared equally. That a part of the loss
consists of capital, which was unequally con-
tributed, is of no consequence. A loss of capital
is like any other loss, and is to be made good in
the same way as any other, unless there is a
stipulation to the contrary in the partnership
agreement. The most obvious danger of loss to
which a firm is liable is a loss of its capital, and if
an agreement to share losses equally does not in-
clude this loss, it is practicably of no value. In
the case under consideration, A is technically
correct in claiming that he owes only half of the
$3,200 due the bank. But he should meet half of
the other losses as well. These aggregate $9,000 ;
A should stand half of this, or $4,500, and he has
only contributed $3,000 to it so far.

Rights op a Special Partner.

A goes with a capital of $3,000 into a special
partnership with B. After a certain time A
wishes to take up a position of some kind with
the firm. Would that deprive him of the advan-
tages of his special partnership ?

Reply.— A special partner, under the law of
this State, may serve the firm in any subordinate
position, but he cannot act as one having au-
thority to bind the firm. The statute upon the
subject is in these words: *' Except as provided
in this section, a special partner may not sign for
the partnership nor bind the same, nor transact
any business on account of the partnership, nor
be employed for that purpose, as agent, attorney,
or otherwise. A special partner may, from time
to time, examine into the state and progress of
the partnership business, and advise as to its
management; may loan money to, and advance
and pay money for, the partnership ; and may
take and hold the notes, drafts, acceptances, and
bonds of or belonging to the partnership as se-
curity for the repayment of such money and in-
terest, and may use and lend his name and credit
as security for the partnership, in any business
thereof, and has the same rights and remedies in
these respects as other creditors might have;
may lease to the general partner or partners any
real or other property for the purposes of the
partnership, at suoh rents and on such terms as
may be agreed on ; and may negotiate sales, pur-
chases, and other business for the partnership;
but no business so negotiated is binding on the
partnership until approved by a general partner.
If a special partner interfere, contrary to these
provisions, he shall be deemed and be liable as a
general partner."



Digitized by



Google



LEGAL DECISIONS.



673



Patents and Copyrights.



Patents for Designs.

Please inform us if we can have patterns or de-
signs of our own creation of fancy hosiery regis-
tered so as to prevent others from copying them.

Reply.— There is no law under which patterns
or designs, such as our correspondent describes,
can be protected by registry. The trade-mark
under which they are sold may be registered, and
all other persons may thus be prevented from
selling them under the same trade-mark ; but the
designs or patterns may still be imitated and sold
under another trade-mark, or without any trade-
mark at all. The only way in which our corre-
spondent can certainly secure protection is by
having his patterns and designs patented. This
may be done under section 4929 of the United
States Revised Statutes, which is as follows:
** Any person who, by his own industry, genius,
efforts, and expense, has invented and produced
aoy new and original design for a manufacture
* * *; any new and original design for the
printing of woolen, silk, cotton, or other fabrics ;



Online LibraryWilliam Usborne MooreThe Commercial year book → online text (page 115 of 125)