Gluck v. Mayor of Baltimore

32 A. 515, 81 Md. 315, 1895 Md. LEXIS 88

Opinion

McSherry, J.,

delivered the opinion of the Court.

This is a proceeding by the Mayor and City Council of Baltimore to condem, under the right of eminent domain, part of a lot of ground and part of the building thereon, for the widening of Gay street. The reversionary interest in the property belongs to the estate of Samuel .Hindes, and the leasehold interest is owned by the appellant, Gluck, under a lease executed in 1885, and which expires in 1905. Gluck being dissatisfied with the award of damages made to him, appealed from the return and estimate of the Commissioners for Opening Streets, to the Baltimore City Court, where a trial by jury was had. At the close of the evidence both the city and Gluck asked the Court to instruct the jury as to the measure of damages applicable to the facts before them. The prayers presented by the city were granted, whilst those presented by Gluck were rejected, and from these rulings this appeal was taken. Compensation was made to the estate of Hindes for the fee-simple interest in so much of the lot as is required for widening the street, and the pending controversy relates only to the amount which the lessee is entitled to be paid for his leasehold interest therein. The proposed widening of Gay street will require but a part of the leased lot, and will take a portion of the building standing thereon. This will leave the building not only diminished in size, but without a .front wall, and consequently untenantable. Under the lease, the tenant is bound to pay in monthly instalments the rent reserved, and there is no covenant in the lease binding the landlord to make repairs. ■

The owner of the leasehold, and the owner of the reversion, together hold the fee-simple estate. Each has a distinct estate or property. “The interest of a termor, in the eye of the law, is just as potential as that of the owner of the fee, although in fact it may not practically be so valuable.” B. & O. R. R. v. Thompson, 10 Md. 87. These several interests are both protected by Art. 3, sec. 40 of the State Constitution, from appropriation for public use, unless just compensation, as agreed on between the parties or as awarded by a jury, shall be first paid or tendered to the party entitled to such compensation. Whatever be the method of ascertaining the values of these distinct interests, it is evident that the sum of those values must be the full value of the property taken. N. Y. & B. Bridge v. Clark, 137 N. Y. 95; Burt v. Ins. Co., 115 Mass. 1. As the owner of each separate interest has the constitutional right to be fully compensated before his estate can be lawfully taken for a public use, he is obviously entitled to look, not to some one else for that compensation, but to the agency authorized to make, and which actually does make, the appropriation of his property. He cannot be driven to seek redress from another. Hence, it will be no answer to his demand to say that the value of his interest, or of a part of his interest, has been improvidently awarded to some one else. Mills on Em. Dom., sec. 70. What, then, is the measure or the standard by which the value of so much of the appellant’s leasehold interest, as is needed for widening Gay street, is to be ascertained?

Primarily it would be the fair market value of his interest in the entire lot, less the fair market value of his interest in that portion which would remain after the widening of the street has been completed. Mayor, &c., v. Rice, 73 Md. 311. This, as a general rule, is a priori correct; but the Court in the case last cited was not called on, as it is by the prayers in the case at bar, to designate the particular items which properly go to make up these relative market values. The prayers on both sides in the pending appeal require such an analysis — those of the city by the exclusion, and those of the appellant by the inclusion of alleged constituent factors of damage. The specific inquiry then is, when part of the demised premises is taken, what circumstances affect the relative market values fixed in the rule above quoted as the standards of comparison, if the tenant is bound by an unconditional covenant to pay rent, and the landlord is under no covenant to repair the buildings injured by the appropriation for the public use ? This depends, first, upon whether the tenant still remains liable for the payment of the whole rent, though part of the leased premises has been actually taken by condemnation proceedings ; and, secondly, upon whether he is bound to replace the buildings partially removed or damaged, in the absence of a covenant on the part of the lessor to make repairs. These questions are raised by the prayers.

“It is incontrovertible that nothing but a surrender, a release or an eviction can, in whole or in part, absolve the tenant from the obligation of his covenant to pay rent. Fisher v. Milliken, 8 Barr. 111. Thus, if the premises have been wrongfully entered by a disseisor and the tenant dispossessed for the entire term, or even by the military force of a public enemy, or if they have been destroyed or rendered untenantable by earthquake, lightning, floods or fire, and thus all enjoyment by the tenant entirely lost, yet his covenant remains. Workman v. Miffin, 6 Casey 369, and cases there cited. It is also equally settled that a taking by the sovereign under the right of eminent domain is not an eviction. Frost v. Earnest, 4 Whart. 90; Dobbins v. Brown, 2 Jones, 75 ; Ross v. Dysart, 9 Casey, 452; Schuylkill & Dauphin R. R. Co. v. Schmocle, 7 P. F. Smith, 271 Dyer v. Wightman, 66 Pa. St. 427. The case last cited, and from which the above extract is quoted, was a condemnation proceeding in which the fee-simple was taken for the construction of a railroad. To the same effect see Peck v. Jones, 70 Pa. St. 85 ; Ellis v. Welch, 6 Mass. 246; Parks v. Boston, 15 Pick. 198; Folts v. Huntley, 7 Wend. 210; Foote v. City of Cincinnati, 11 Ohio St. 408; Emmes v. Fecley, 132 Mass. 346; Stubbings v. Village of Evanston, 136 Ill. 37; S. C. 11 L. R. A. 839; Corrigan v. City of Chicago, 144 Ill. 537; S. C. 21 L. R. A. 212, and copious notes. In Wash. on Real Property, vol. i, page 342, the author says: “It has sometimes been attempted to apply the principle of eviction from a part of the premises where lands under lease have been appropriated to public use under the exercise of eminent domain. * * * But the better rule, and one believed to be adopted in most of the States,, is that such a taking operates, so far as the lessee is concerned, upon his interest as property, for which the public, are to make him compensation, and does" not affect his: liability to pay rent for the entire estate, according to the terms of the lease ; and this extends to ground rents.” In Parks v. Boston, supra, it was held: “Where part of a lot of land under lease is taken by the Mayor and Aldermen of Boston for the purpose of widening a street, the lease is not thereby extinguished, nor is the lessee discharged from his liability to pay the reserved rent during the residue of the term, but the lessor and lessee are each entitled to recover compensation for the damage so sustained by them respectively.” And in Foote v. City of Cincinnati, supra, where the leased premises had been appropriated for a street, the Supreme Court held that the lessee was not released from the payment of rent, but that he was entitled to recover from the city the damages he sustained. Whilst there are a few_ cases, chiefly in Missouri and Louisiana, which hold a contrary view, the correct doctrine, both upon principle and by the decided weight of authority, seems to be that a condemnation of a part of a leasehold estate for a public use does not at law amount to an eviction ; and whether the fee or a mere easement be taken, the tenant still remains liable under his covenant to pay the rent originally reserved, because nothing short of a surrender, a release or an eviction will discharge him from his covenant in this behalf. If a condemnation of part of the premises will not discharge the tenant’s covenant to pay rent, neither will it operate to apportion the rent so as to relieve the tenant of any portion of his liability to the lessor. Apportionment of the rent does not mean abatement of it • because though rent may be apportioned, the tenant still remains liable to pay the whole of it, but in different parts to different persons, except where he has purchased or acquired the reversion of part ■of the demised premises. So the question recurs, not what will apportion, but what will abate the rent? The total destruction of the premises does not discharge the payment of rent, or any part of the rent, and nothing save a release, a surrender or an eviction will. A condemnation by eminent domain of part of the landlord’s reversion is notin law an eviction or partial eviction, for an eviction is the act of the landlord or of a third party holding under a paramount title. Taylor, Land & Ten., sec. 381. Neither is it a release, which is the descending of the greater estate upon the less ; Taylor, Land & Ten., sec. 507; nor is it a surrender, which is the yielding up of the less estate to him who has the reversion or remainder. Co. Lit. 337 A As a consequence, then, a condemnation proceeding cannot of its own vigor on principle operate to abate any portion of the rent, and it therefore follows that notwithstanding an appropriation under the power of eminent domain of a part of the reversion, the tenant remains liable on his covenant to pay rent, precisely as he does when the entire habitable premises have been destroyed by fire. The appropriation of part of the property for a public use, leaves the tenant in the position of being deprived of a part of his property, whilst he still remains liable to pay rent for the whole of it, and to that extent obviously does him an appreciable injury, which should be considered by the jury in estimating the decreased market value of the remaining portion of the demised premises. The first and third instructions given by the Court below at the instance of the city, in terms excluded this element of damage from consideration by the jury, and informed them that the tenant was entitled to- have his rent reduced in the same proportion that the value of his lease was diminished. These instructions were therefore erron■eous. As the tenant’s estate is entirely distinct from the landlord’s and as both estates are within the protection of the Constitution, each must be awarded in money an amount equivalent to the value of that which is taken from him ; and as parts of the premises are taken from the possession of the tenant without thereby releasing him from his covenant to pay the whole rent, in estimating the decreased value of that portion which is left, allowance must necessarily be made for the rent to be paid for that fragment of the originally demised premises of which he is to be deprived, because the obligation of his contract to pay the entire rent is. not, and under settled constitutional guarantees, cannot be impaired or abridged by condemnation proceedings which award him no compensation, or which ignore that obligation as an element of substantial injury. The appellant’s first prayer which asserts this principle was therefore correct, and ought to have been granted.

It has, however, been contended that if the tenant should be allowed to recover for the full value of the leasehold interest, and the landlord should be required to rely upon the personal obligation of the tenant for the payment of rent, a rule of this character would or might in many instances result in great loss to the landlord. At best this is a mere suggestion of a possible hardship. As said by Rolfe, B., in Winterbottom v. Wright, 10 M. & W. 115, “hard cases, it has been frequently observed, are apt to introduce bad law.” And in Abbott v. Gatch, 13 Md. 314, and in Taylor v. Turley, 33 Md. 500, this Court declined to permit considerations of great hardship to influence the rigid enforcement of established legal principles. Obviously a principle, if sound, ought to be applied wherever it logically leads, without reference to ulterior results. That it may in consequence operate in some instances with apparent or even with real harshness and severity does not indicate that it is inherently erroneous. Its consequences in special cases can never impeach its accuracy.

The other circumstance which the jury should have been allowed to consider as affecting the market value of that part of the leasehold estate remaining after Gay street has been widened, is that the building will, by reason of the widening of the street, require a new front wall, and it will be necessary to remove the elevator from its present position to some other place on the premises. The lessor is under no covenant to make repairs ; and the lessee is confronted with the alternative of either abandoning the premises for which he must, notwithstanding its untenantable condition, pay full rent during the continuance of the term, or of restoring the front wall and re-constructing the elevator at his own cost and expense to make the premises habitable and available. The appellant’s second and third prayers distinctly raise this question.

Now, the common law has always thrown the burden of repairs upon the tenant, though it imposes no obligation on him to make them unless he covenants to do so. Taylor, Land & Ten., sec. 327, A covenant is never implied that a lessor will make them. Moyer v. Mitchell, 53 Md. 176; Sheets v. Selden, 7 Wall. 423 ; Gott v. Gandy, 2 Ellis & Bl. 845 ; Pomfret v. Ricroft, 1 Wms. Saund. 321, 322, n; Kramer v. Cook, 7 Gray, 550; Doupe v. Genin, 45 N. Y. 123. So unvarying is this doctrine that even a Court of Equity will not compel the landlord to expend in making repairs the money received by him upon fire insurance policies after the destruction of the demised premises; unless he has expressly agreed to so apply the proceeds. Nor will a Court of Equity, when the premises have been burned down and the landlord has collected the insurance, prevent him from suing for the rent, even though he refuses to rebuild, if he be under no covenant to repair. Leeds v. Cheetham, 1 Sim. 146 ; Loft v. Dennis, 1 Ellis & E. 474; Belfour v. Weston, 1 T. R. 310; Holtzapffel v. Baker, 18 Ves. 115. And this is so, because a tenant is obliged to continue the payment of rent during the term, although the premises may become untenantable for want of repair, or from any other cause, or should even have been burned down in the meantime, unless he protects himself by an express covenant against liability in these contingencies. Lamott v. Sterrett, 1 H. & J. 29; Wagner v. White, 4 H. & J. 564; Taylor, Land & Ten., sec. 329; Moffatt v. Smith, 4 N. Y. 126; Fowler v. Bott, 6 Mass. 63; Bussman v. Ganster, 72 Pa. 285 ; Monk v. Cooper, Ld. Raym. 1477. In the lease under which the appellant holds there is no covenant requiring the landlord to make repairs. Under the law none is implied. The removal of the front wall of the building, and the removal of the elevator, will materially lessen the value of the tenant’s estate. The landlord is under no obligation to rebuild the wall or to re-construct the elevator. What is the consequence? If the tenant abandons the premises because they are untenantable, he must still pay the rent. If he repairs them to make them habitable, he must do so at his own cost. In either event he will be directly and seriously injured in his estate by the act of the city in condemning part of his property for a public purpose. It is self-evident that a house without a front wall will be untenantable and practically useless. But the tenant, though he may be unable to occupy the premises because the city removes the front wall, must pay his rent. He cannot compel the landlord to restore the wall, even if. the landlord has been compensated by the city for doing so. "The lessee cannot maintain an action against the landlord to recover from him a certain portion of the sum assessed to him, on the ground that it was intended for the purpose of putting the property in a tenantable condition. The lessee should see to it that that item of damages is allowed to him.” Mills on Em. Dom., sec. 70 ; Turner v. Williams, 10 Wend. 140; Brooks v. Boston, 19 Pick. 174. As then the tenant is bound to repair and must rebuild the front wall to make the house tenantable, and must restore the elevator if he wishes to use it, whatever sum of money may be required for these purposes should have been awarded by the jury to be paid by the city to the tenant; and if the city has paid it to the landlord it cannot on that account escape its obligation to pay it to the tenant before taking possession of his property. It would be a strange concep tion of “just compensation” to the tenant if the money needed to make the house tenantable were awarded to the landlord, and the tenant to whom the injury is in fáct done were left to rebuild at his own expense. Upon the plainest principles of justice, whatever cost the city causes the tenant to incur in making repairs which are rendered necessary by its acts in widening the street is a proper element of the damage he sustains and should be considered and estimated by the jury in measuring the market value of the residue of the leased premises, after the appropriation of a part of those premises for the bed of Gay street. Obviously, then, the second and third prayers of the appellant ought to have been granted, and the second instruction given at the instance of the city should have been refused.

(Decided June 18th, 1895.)

What has been said disposes of all the questions before us, and it follows that there was error in granting the instructions asked by the city, and in refusing the prayers presented by the appellant. The rulings excepted to, will therefore be reversed and a new trial will be awarded.

Rulings reversed with costs above and below, and new trial awarded.