Kamioner v. Balkind

La Fetra, J. Plaintiff seeks to recover upon a written contract, by the terms of which defendant, Joseph I. Balkind, guaranteed the payment of the rent reserved in a lease executed by the plaintiff as landlord and Adolph W. Balkind as tenant for the term commencing July 1, 1912, and ending December 31, 1918, at the annual rental of $6,200, payable in equal monthly payments in advance, and the performance by said Adolph W. Balkind of the covenants contained therein. The complaint involves two causes of action. The first is for the recovery of the arrears of rent for the months of June, July, August and September, 1913. The second is to recover for damages or, more strictly speaking, for any deficiency between the rent reserved in said" lease and' the net collections by way of rent after re-entry and possession by the landlord as agent of the tenant under the terms of the lease. The landlord had an option either to cancel the obligations under the same and to assume possession as of his former estate, or to re-enter and to take possession and as agent of the tenant to relet the same for the account of the tenant. In' the latter contingency the landlord was to collect the rents from the new tenants, applying the same to the expenses incurred and then towards the rents reserved in the old lease. The defendant claims a discharge of his [460] obligations under the contract of guarantee by virtue of a subsequent decree in bankruptcy against him and a re-entry by the landlord and surrender by tenant, the principal obligor, because of assignments of the lease and payment of certain rents to the landlord before October 1, 1913. In other words, acts by or on behalf of the landlord which he claims show a cancellation of all obligations of the tenant under the clause of the lease before mentioned and that negative the claim of the plaintiff of a re-entry as agent of the tenant. These defenses are untenable. Bents accruing after the commencement of bankruptcy proceedings are not provable against the estate of either the tenant or his surety. Matter of Roth & Appel, 24 Am. Bank. Rep. 588; Codding v. Hooper, Lewis & Co., 35 id. 23; Zabele v. Reeves, 227 U. S. 625; 29 Am. Bank. Rep. 493. The assignments in question growing out of the lease did not discharge the tenant, but operated as a conveyance of his interest. It gave the landlord an additional claim against the privies in estate of the tenant. Neither did it relieve the surety from his contract. Ettlinger v. Kruger, 146 App. Div. 824, 825; Baker v. Devilin, 88 Misc. Rep. 586; Dagett v. Champney, 122 App. Div. 254; Morgan v. Smith, 70 N. Y. 541; Flank v. Kuhlmann, 63 Misc. Rep. 334; Verschleiser v. Newman, 76 id. 544; Kunzweiler v. Lehman, 34 id. 466; Sachs v. American Surety Co., 72 App. Div. 60; affd., 77 N. Y. 551; Berg v. Kaiser, 137 App. Div. 1; Heidecker v. Hoffman, 133 N. Y. Supp. 436; McNulty v. Duffy, 28 Misc. Rep. 779; Folger v. Racer, 167 App. Div. 167; McCready v. Lindenborn, 172 N. Y. 400; Wilkesbarre Realty Co. v. Powell, 86 Misc. Rep. 321. The plaintiff elected to rent the premises as agent for the tenant as of October 1, 1913. The sole remaining obligation of said tenant and his surety is to answer for any deficiency. The second cause of action [461] is prematurely brought, for a deficiency may never arise under the lease in question. If it does it can only be determined upon the expiration of that lease. Matter of Hevenor, 144 N. Y. 271; McCready v. Lindenborn, supra; Harding v. Austin, 93 App. Div. 564; Vogel v. Piper, 89 N. Y. Supp. 431; Wilkesbarre Realty Co. v. Powell, supra. In the McCready case (supra) it is to be noted the deficiency clause provided for rests, i. e., periods before the expiration of the lease, when the amount of the deficiency was to be ascertained. The plaintiff is entitled to recover the rents for June, July, August and September, after deducting the net collections from those in possession before October 1,1913. Farren v. McDonnell, 74 Hun, 176; Bank of California v. Webb, 94 N. Y. 467. I accordingly direct judgment in favor of the plaintiff against the defendant for the sum of $518.27, with interest from September 1, 1913, on the first cause of action, and judgment in favor of the defendant dismissing the second cause of action (but not upon the merits) to the extent indicated. Judgment accordingly.