Wall v. . Hess

Pound, J. This is an action against a tenant to recover unpaid rent of premises in the city of New York and taxes thereon according to the terms of a written lease. On the trial the court directed judgment for the plaintiff, but afterwards set the verdict aside and ordered a new trial because plaintiff refused to stipulate to reduce the recovery by $1,472.53, being the amount of taxes for the year 1917, with interest. The Appellate Division reversed the order and reinstated the verdict. The lease was for a term of fifteen years, eight months from the 1st day of September, 1901, ending on the 30th day of April, 1917, at twelve o’clock midnight. It contained the following clause: “ First. That the said party of the second part (defendant) shall and will pay and discharge when due and payable or within sixty, days thereafter, all and every tax and taxes, Croton water or other water rates, charges for placing, replacing or repairing water meters upon said premises, rents, charges, assessments, duties and other impositions whatsoever, as well ordinary as extraordinary, which shall be assessed, levied or imposed upon the said premises, or any part *474 thereof, by any government, power or authority whatsoever during the said term, except that the parties of the first part [plaintiff’s testator] covenant and agree to pay all taxes, assessments or other charges which may become a lien and charge on said premises in the year 1901; but the party of the second part covenants and agrees to pay the water rates or rents chargeable against or to said premises or any part thereof after September 1st, 1901.” The taxes for the year 1917 were fixed and levied on the 28th day of March, 1917. At the date of the lease, May 6, 1901, and thereafter until January 1, 1912, when chapter 455 of the Laws, of 1911, amending the city charter, took effect, taxes were assessed on the 15th day of September in each year; were payable on the 1st day of October thereafter and became liens on the real estate affected thereby on the days when they became due and payable. It follows that if no change had been made in the charter the tenant would have been under no obligation to pay the taxes in suit for they would have been neither assessed nor payable during the term, but under the change in the charter the taxes were assessed but not payable during the term. The Appellate Division in resolving the question of liability for taxes in favor of the landlord relied upon Ogden v. Getty (100 App. Div. 430) in which it was held: “ Where a lease of premises, located in the city of New York, for a term of twenty-one years, expiring October 1, 1903, provides that the lessee shall pay all taxes, * laid, levied, assessed or imposed,’ on the demised premises during the term, the lessee is required to pay a tax levied by the city of New York upon the demised premises, the amount of which becomes finally and unalterably fixed and imposed on. September 15, 1903, notwithstanding that such tax cannot be paid nor a bill therefor be obtained prior to October 5, 1903.” This court had recently before it Ward v. Union Trust *475 Co. of N. Y. (224 N. Y. 73) in which the provisions of the lease were, with the important exception hereinafter noted, substantially the same as herein. The Ward lease expired at noon on May 1, 1914, and contained a covenant as follows: “ Provided always and the lessee hereby covenants to pay said rent punctually, and to pay and discharge all annual taxes as shall during said term be imposed on said premises hereby demised, as soon as they become due and payable, and to pay the Croton and all other water charges as soon as the same shall become due, and to keep said demised premises free, clear, discharged and unincumbered from all such taxes and Croton and other water charges during said term.” The lessee was held liable, not for the taxes for the year 1914 which had been assessed against the premises during its term, but for the one-half thereof which became due and payable and a lien on the demised premises on May 1, 1914, a few hours before the expiration of the lease. The expression of the intention of the parties that this sum only should be paid was, however, found entirely in the words: “ keep said demised premises free, clear, discharged and unincumbered from all such taxes during said term,” which are not in the lease we are now considering. Chase, J., said: “ Reading the covenant as a whole, the promise of the tenant includes the general taxes imposed and becoming due and payable within the term. The demised premises became incumbered with one-half of the tax of 1914 on May 1, 1914. The lessee could not leave the demised premises free, clear, discharged and unincumbered from taxes during said term if the taxes so actually due and payable on the date of the expiration of the lease were left unpaid.” (P. 78.) The gist of the decision plainly is the clause as to incumbrances, which is treated as evidencing the intention of the parties to the lease and not as making a general rule. The landlord was to receive his rent during the term and was to be subject to no expense on account of the *476 demised premises for taxes which became due and payable and liens during said term. The landlord covenanted to receive the premises unincumbered and the duty of the tenant was discharged when it so delivered them. That is not this case. The obligation of this defendant was to pay all taxes that might be assessed, levied or imposed against the premises during the term. No escape is possible from the conclusion that the taxes for the year 1917 were finally and unalterably fixed and imposed against the demised premises during the term of the lease, although not payable until after the expiration of such term. We should not let the tenant out of his promise because the change in the charter increases his burdens in this regard. Landlords as a class are not lacking in sagacity when it comes to contemplated changes in the tax laws. They properly endeavor to draw their leases with sufficient definiteness to protect themselves from such contingencies. I fail to see what more the landlord could have done to protect himself in this case. We should not add the words “ during the term of this lease ” to the words of the parties in order to give what may seem to us a fairer meaning to the contract than can be found in the words chosen. • The words are not there. That is not the meaning of the lease in legal contemplation. The duty of the tenant to pay the 1917 taxes is absolute. The Ward case states an exception to the general rule, amply recognized and stated by Chase, J. The exception should not be extended beyond the circumstances which moved the court in that case to find for the tenant in part on the terms of the lease before it. The judgment appealed from should be affirmed, with costs.