Fleck v. Feldman

Gildersleeve, J. In July, 1904, defendant made and executed the following guaranty, viz.: “ I, Joseph Feldman, in consideration of the sum of one dollar, to me in hand paid by Frank Hillman and Joseph Golding, and in further consideration of their accepting Edward Gross as tenant in the within lease, hereby guarantee to Messrs. Hillman and Golding, the payment of rent for a period of three months. In case of non-payment of rent' by the said Edward Gross unto the said Frank Hill-man and Joseph Golding; their heirs and assigns, and without any notice by them of the non-payment of rent, I will pay said three months’ rent, without any defenses, off-sets or counterclaim, upon proof that the said Edward Gross defaulted in the payment of rent. “ Dated New York, July 14, 1904. Joseph Feldman [L. S.].” The said lease from Hillman and Golding to said Gross was for a term of five years, beginning October 1, 1905, and ending October 1, 1909, at an annual rental of $1,500 for the first year and $1,800 for each successive year. It bore date July 14, 1904, the same day upon which the guaranty was made. Subsequently, Hillman and Golding conveyed the premises and assigned their interest in said lease to plaintiff. Part of the rent for the month of October and the month of November, 1905, was not paid, nor was any of the rent paid for December, 1905, and January, 1906. The plaintiff obtained a judgment against said Gross for this unpaid rent, and issued execution upon the same, which was returned unsatisfied, and no part of said judgment has been paid. The plaintiff in the case at bar seeks to recover against .defendant upon the above quoted guaranty. The justice gave judgment for plaintiff. Defendant appeals. The defendant, on the trial, offered to show that said Gross had assigned his interest in the lease, with the consent of the plaintiff’s assignors, to another party, without the knowledge or consent of defendant, which proffered testimony was excluded by the justice, who said that he would exclude all testimony concerning an assignment of the lease made by [230] Gross; which assignment it is claimed was made prior to the time when the plaintiff’s cause of action against this defendant accrued. If there was a substitution of another tenant in place of Gross, under circumstances which amounted to relieving the latter from his obligations under the lease in question, it produced a material alteration in the relations between the parties, and operated, in the absence of any knowledge or consent of the defendant, to discharge the latter from liability upon his guaranty. Smith v. Niver, 2 Barb. 180. If, on the other hand, plaintiff’s assignors, in consenting to the assignment of his interest in the lease by Gross, expressly refrained from relieving Gross from his obligation to pay the rent, in case of default by Gross’ assignee, defendant would still be liable upon Gross’ failure to make good the default of his assignee. In the suit brought by plaintiff against Gross, in which judgment was obtained by plaintiff, as above stated, the answer of said Gross set iip this assignment of lease as a defense to plaintiff’s claim for rent; so that it was, apparently, held in that action that, as a matter of fact, plaintiff’s assignors had not released Gross from his obligations under the lease by their consent to his assignment of his interest in said lease. The learned court below presumaibly regarded this judgment as making the issue of the continued liability of Gross res adjudicaba, and therefore excluded the evidence offered by defendant in support of his claim that he was discharged from liability by reason of the assignment of the lease by Gross without 'defendant’s knowledge and consent. The'defendant, however, was not a party to that action, and a surety, in the absence of any agreement, is not at common law affected by the result of a suit against the tenant for rent, nor is a judgment recovered by the creditor against the principal conclusive against the surety, and the rights of sureties are the same after as well as before the judgment. McAdam’s Land. & Ten., volume 2 (3d ed.), pp. 882, 883, and eases. there cited. The justice below should have allowed defendant to have the benefit of the' testimony offered, which evidence plaintiff could have rebutted by showing affirmatively that there was no release of [231] Gross from his obligations under the lease, if such were the fact. The judgment must be reversed and a new trial ordered, with costs to appellant to abide the event. Seabury and Brady, JJ., concur. Judgment reversed and new trial ordered, with costs to appellant to abide event.