Central Railroad Garage Corp. v. Eastern Transportation Co.

Dye, J.

The plaintiff, hereinafter called Central ”, as owner of premises 899 East 149th Street, Bronx, New York City, sued the defendant, hereinafter called Eastern ”, for three months’ rent allegedly due under a written lease. The lease was executed September 7, 1951, for a term expiring September 30, 1972, a period of over twenty-one years. In making the lease the parties took into consideration that the premises were then occupied by a statutory tenant under a lease dated November 4, 1944, which, by its terms, had expired in 1947. Because of this the parties mutually agreed in a separate writing of even date that Eastern was to forthwith commence summary proceedings against the statutory tenant to obtain possession of the premises and if Eastern was “ unsuccessful in obtaining possession of the premises * * * either one of us may cancel the lease by giving at least fifteen days’ registered written notice of cancellation to the other prior to September 1,1952, and in'the event that such registered written notice is given, neither party shall have any rights against the other of any kind and the lease shall be considered terminated, null and void.” (Emphasis supplied.)

Thereafter, Eastern promptly commenced summary proceedings against the statutory tenant and obtained a final order of eviction which was duly entered January 11, 1952. Its execution was initially stayed until June 13, 1952, the maximum allowable period (Commercial Bent Law, § 8, subd. [k], par. [1], as amd. by L. 1951, ch. 431). Nonetheless, the statutory tenant in a series of legal maneuvers, which need not be detailed here, succeeded in extending the stay to August 25,1952. Faced with this situation and being mindful that the deadline date for cancellation was August 17th, Eastern gave registered written *123notice of cancellation to Central under date of August 8, 1952, certifying that we have been unsuccessful in obtaining possession of said premises Central, some time later, rejected the notice of cancellation and demanded payment of the rent reserved in the lease.

At the time the cancellation notice was given, Central, Eastern and the statutory tenant did not know that the Municipal Court, to which the show cause order with interim stay to August 25th had been assigned for hearing on the oral argument, on its own initiative and without notice to any interested party, had denied the motion and vacated the stay. Its order was dated July 19th and entered in the clerk’s office July 22d. When, later and on or about August 21st, the statutory tenant in possession learned of this inadvertent disposition, it applied for and was granted a further order to show cause containing a temporary stay which was made returnable August 29, 1952, and thereafter denied September 4th.

The notice of cancellation on its face at the very least was valid and effective. The burden of establishing the contrary rested with Central and in this it failed. It has not shown, for indeed it cannot, that the defendant Eastern who, concededly, had no knowledge of the vacatur, was dilatory in not obtaining a warrant of eviction between July 19th and the deadline date of August 17th. It is idle speculation to assume that had Eastern done so it would have been successful in obtaining possession by September 1st. According to this record, the statutory tenant was actually in possession, and was avoiding eviction by every means available, first by resorting to the protection of the Commercial Bent Law and then by means outside the statute. As late as August 21st, four days after the deadline, the holdover tenant was before a court of competent jurisdiction pleading for an extension of time and had been successful in obtaining a stay of execution which was not set aside until September 4th, four days after the agreed expiration date. As we read the cancellation clause it seems clear that the posses sion mentioned contemplated actual physical possession as distinguished from a bare legal or constructive possession. Quite obviously, Eastern needed the premises for its immediate and personal use, hence the option to cancel was conditioned *124on obtaining possession of the prémises. It is reasonable to assume that in making this ordinary business contract the possession the parties contemplated was actual and physical possession and, unless such possession was obtained on or prior to September 1, 1952, the lease was to be “ considered terminated, null and void ”.

The judgment appealed from should be reversed and the complaint dismissed, with costs in all courts.