National Bank of South Carolina v. People's Grocery Co.

The opinion of the Court was delivered by Mr. Justice Beease. The statement of facts appearing in the “Transcript of Record” is adopted by the Court and will be reported. *125 Iam unable to concur in the proposed opinion of Mr. Justice Cothran. My reasons in brief, are these: The lease, beginning June 1, 1920, and ending June 1, 1925, was for a term of years. “Estates for years embrace all terms limited for a definite and ascertained period, however short or long this period may be, that is to say, they embrace terms for a fixed number of weeks or months, or for a single year, as well as for any definite number of years, however great.” 35 C. J„ 970. By its express terms, the lease terminated five years from its date, or June 1, 1925, and no notice of of termination was required to be given by either the lessor or lessee. Section 5271, vol. 3, Code 1922. It will be observed that the lease contained no covenants for renewal or extension thereof. It is not pretended by the appellant that there was any express renewal or extension of the lease. Manifestly, the only effect of the memorandum of agreement indors.ed on the lease and signed by the parties was (1) to reduce the monthly rent from $150 to $125 from December 1, 1923, until December 31, 1924, and (2) to give the lessor the option of terminating the lease on December 31, 1924, by giving the lessee notice of such termination on or before September 1, 1924. The lessor not having exercised the option by giving the required notice, the option passed out of the picture. After December 31,. 1924, the lease, for the remaining portion of the term, was in precisely the same position it would have been in if the memorandum of agreement indorsed thereon had never been entered into-. The authorities cited by Mr. Justice Cothran unquestionably show that, in the absence of any agreement to the contrary, where a tenant for a term of years holds over after the expiration of the term, with the consent or acquiescence *126 of the landlord, he becomes a tenant from year to year on the same terms of the expired lease. This, of course, does not mean that the new term is necessarily for the same period as embraced in the expired term. If the expired term was for a year or more, the new term is for another year. If the expired term was for a period less than a year, as for a quarter, or for a month or week, then the new term will be for corresponding term. But this is not the case where there is a new agreement. Robinson v. Barton, 113 S. C., 212, 102 S. E., 16; Telephone Co. v. Bank, 90 S. C., 50; 72 S. E., 878. In the absence of a new agreement, the tenant is liable for further rent upon the principle, not of contract, but of quasi contract. The landlord has the option whether to treat the tenant so holding over after a term of years as wrongfully retaining possession or as rightfully doing so; that is, whether to treat him as a trespasser or as a tenant. The tenant has no option in the matter. Tiff. Real Property, vol. 1, p. 245 et seq.; 35 C. J. pp. 1027 and 1029. Exceptions 1 and 2 impute error to the trial Judge in admitting evidence of an oral agreement alleged to have been entered into by the lessor and lessee at the same time the agreement indorsed upon the lease was made, said alleged oral agreement relating to the character of the tenancy after expiration of the lease, June 1, 1925. If there was such an agreement, it is difficult to see how it could be said to- vary the terms of either the memorandum of agreement indorsed upon the lease, which became a nullity after December 31, 1924, or of the lease itself, which terminated June 1, 1925. The parol agreement, if such there was, in no sense changed or varied the terms of either of said written contracts. Such new contract was to take effect after the expiration of the written lease, and not in derogation thereof, and determined the nature of the tenancy after June 1, 1925. The fact that such oral agreement was entered into at the same time that the written agreement indorsed upon *127 the lease was made is wholly immaterial, since it was a separate and independent agreement. The agreement indorsed upon the lease dealt with the rights of the parties during a part of the term covered by the lease, whereas the oral agreement related to their rights after the expiration of the lease. Surely the parties were at liberty to enter into a contract, either written or verbal, intended to govern their rights after the expiration of the written lease June 1, 1925. The effect of the opinion of Mr. Justice Cothran is to wholly disregard the alleged oral agreement intended to take effect June 1, 1925, and to assume that there was a tenancy from year to year, and that the period of such tenancy became a part of the written lease, and therefore could not be changed by an oral agreement. Whereas, if there was an agreement between the parties determining the character of the tenancy after June 1, 1925, no tenancy from year to year was implied as a matter of law, since such a tenancy is implied only in the absence of an express contract. It is alleged in the answer of respondents that there was an oral agreement entered into between the parties prior to the expiration of the lease, determining their rights after the expiration of the lease. Testimony to establish such an agreement was competent, as there was no allegation that such contract was to continue for more than one year after June 1, 1925, and a parol lease for a period not exceeding one year, commencing at a future date, is not within the Statute of Frauds (C.v. Code 1922 § 5514). Hillhouse v. Jennings, 60 S. C., 392; 38 S. E., 597. It was certainly a question of fact for the jury as to whether respondents retained possession under the alleged oral agreement or held over without any agreement, and with the consent of acquiescence of appellant. If they retained possession under the alleged oral agreement and paid rent to appellant, such part performance would take the contract out of the Statute of Frauds, even if it were applicable. *128 But granting for the moment that there was no agreement between the parties, as is alleged in the answer of respondents, and that there was a tenancy from year to year implied as a matter of law, it is difficult to see how the period of such tenancy could be considered as an incident of the original lease, which expired June 1, 1925, and became wholly inoperative before any such tenancy could be implied as a matter of law. If there was such a tenancy, reference could be had to the lease only for the purpose of ascertaining the terms under which the tenants held. Most assuredly; the parties at any time could have entered into an agreement to change the character of the tenancy. To, adopt the view of Mr. Justice Cothran that the period of such tenancy became an incident of the original lease, and therefore could not be changed by an -oral agreement between the parties, would place it beyond the power of the parties to enter into an oral agreement at any time after June 1, 1925, and prior to June 1, 1926. For these reasons, I think these exceptions should be overruled. Whether or'not there was such an oral agreement as alleged in respondents’ answer was a question of fact. In submitting this question to the jury, the trial Judge committed no error. Exceptions 3 and 3A should be overruled. I see no error on the part of the trial Judge as complained of in the other exceptions, and they should be overruled. Let them be reported. For the foregoing reasons, I think the judgment of the Circuit Court should be affirmed; and a majority of the Court agreeing in this view, it is so ordered and adjudged. Messrs. Justices- Stabeer, Carter, and Mr. Acting Associate Justice Graydon, concur. • Mr. Chief Justice Watts did not participate.