Floersheimer v. Cousins

Siebecker, J. The lease in question contains a covenant by the lessee “not to assign or underlet said premises or any part thereof or otherwise part with this indenture . . with [604] out the consent thereto in writing of the said lessor . . ., or assigns.” When the commissioner of banking took possession of the property and the business of the trust company under sec. 2022, Stats., including the premises embraced in this lease, he became vested with the title and right of possession of such property and assets as liquidating agent for the benefit primarily of the trust company’s creditors. Citizens S. & T. Co. v. Rogers, 162 Wis. 216, 155 N. W. 155. The title and interest held by the banking commissioner to the trust company’s property and assets is vested in him by the statutes and he held it in trust for the trust company and its creditors. Such interest in the property held by the commissioner is akin to the title and interest vested in assignees or receivers who take and hold property of' a debtor in legal proceedings for the benefit of creditors. It appears that the commissioner took possession of the leased premises and remained in possession during the liquidation proceedings. As such possessor he was held liable for the rent reserved in the lease during his occupancy. Rogers Case, supra. The trial court correctly held that the transfer of title from the trust company to the commissioner by devolution in the liquidation proceedings and any transfer that the commissioner may make of the lease in the course of liquidation does not constitute a breach of the covenant in the lease against assignment. “A restriction against transfer is not, as a general rule, regarded as broken by an involuntary alienation or transfer by operation of law.” 24 Cyc. 970; 16 Ruling Case Law, p. 834, § 333; Gazlay v. Williams, 210 U. S. 41, 28 Sup. Ct. 687. The Rogers Case in effect held that the commissioner’s election to take possession of the premises vested him with title to “the leasehold interest” and created a privity of estate between the lessor and the commissioner and. made the commissioner liable for the rent while in possession. U. S. T. Co. v. Wabash W. R. Co. 150 U. S. 287, 14 Sup. Ct. 86; 16 Ruling Case Law, p. 859, § 361. [605] The commissioner’s possession, under the circumstances, cannot be held to be an acceptance by him of this burdensome lease, but operated to make him liable for the rent accruing while he held the premises, and he could terminate thfe liability by assigning the term and relinquishing possession. 16 Ruling Case Law, p. 864, § 367; Patten v. Deshon, 1 Gray, 325. The trial court properly held that the commissioner had the legal fight to assign the lease and thereby free himself from further liability for rént. The judgment properly awarded petitioner recovery of the $750, the amount due under the lease for the June and April quarters as specified in the judgment, and properly authorized the commissioner to make an assignment of the lease upon the best terms procurable, and that upon delivery of the premises to such an assignee his liability for the rent reserved in the lease ceased. By the Court. — The judgment is affirmed.