Opinion
Argued September 18, 1872
Decided January term, 1873
John D. Kernan for the appellant.
S.C. Huntington for the respondent.
It cannot well be claimed that the covenant not to engage in the tailoring business does not extend to the whole term of five years. It was to be in force during the continuance of the lease. There was but one lease, which, if the notice was given, was to continue to December 15, 1867, and the whole term of five years is spoken of in the lease as the term of the lease, and all the other covenants in the lease clearly apply to this whole term. Not only the language used, but the circumstances surrounding the parties, show quite clearly that they intended that the lessees should have the protection of this covenant during the entire term of five years.
But the defendant claims that Place, one of the lessees, having died, the plaintiff, the other lessee, had no right to give the notice extending the term or to sue for the breach of the covenant, and whether he had such right is the only question to be considered.
Upon the death of one of two partners, the survivor takes the partnership property for the purpose of holding and administering it until it can be converted into money and the partnership debts paid. This right is said to be given to the surviving partner, because he is chargeable with the whole of the partnership debts. He does not take the title to the property, in any sense, as assignee, but as survivor, for the purpose above mentioned, and he has all the right to and control over the property for such purposes which both partners had before the death of one. (Colyer on Partnership, § 129; Tremper v. Conklin, 44 N.Y., 58.)
This lease was partnership property. The right to renew a lease is frequently a very valuable property, and as such, when it belongs to a firm, is part of the partnership assets. It has frequently been held that if one partner takes a renewed lease in his own name when the right to the renewal belonged to the firm, he can be compelled to account for its value to his copartner; so, if after the death of his copartner he should seek to appropriate to his own benefit the value of a renewed lease, he could be compelled to account for it to the creditors of the firm, and the representatives of the deceased partner, for whom, in a certain sense, he acts as trustee. ( Holdridge v. Gillespie, 2 John Ch. R., 33.)
In this case, it was the duty of the plaintiff, if he believed the extension of the term from three years to five would be of advantage to the partnership estate, to extend it by giving the notice. It may be that the extension was needed for the purpose of closing out the stock of goods on hand at the time of the death of Place. If not needed for any purpose connected with the partnership estate, and if the lease, as extended, had any value, it was the duty of the plaintiff to dispose of it in some way and realize such value. If he failed to do so, and occupied the store for his own private purposes, there can be no doubt that he could be compelled to account for the value of the lease.
It is claimed, however, that the plaintiff could not give the notice, because, by doing so, he would create an obligation for rent binding the partnership estate. It is true that the partnership was dissolved by the death of Place, and, thereafter, the plaintiff had no power to incur any new liabilities on account thereof. After the death of his partner he could bind no one but himself; and all the liabilities of the firm fell upon him individually. He took this lease as survivor, with all the covenants pertaining to it. He had the same power and control over it, and the same right to enforce the covenants contained in it, as he would have had if he had been the sole lessee named in it. He had the power and the right to give the notice, and thus extend the lease. By so doing he undoubtedly made himself liable for the rent. Whether, in case of loss, he could reimburse himself out of the partnership estate is a matter of no concern to the defendant. That would depend upon considerations not involved here. The administratrix of the deceased partner certainly could not object, as she consented to and took part in giving the notice.
It follows, if I am right thus far, that this lease was properly extended, and that it was in force at the time of the alleged breach of the covenant by the defendant. The plaintiff was the only person who could enforce this covenant or sue for its breach. By operation of law he became the sole lessee, and the only person legally interested in this covenant.
I therefore reach the conclusion that the General Term was right, without considering some of the abstruse questions discussed by counsel upon the argument before us. In the view I have taken of this case, it depends upon plain and simple principles of law, which must control our decision.
The order of the General Term must be affirmed, and judgment absolute rendered against the defendant, with costs.
All concur.
Order affirmed, and judgment accordingly.