Swan v. Kemp

Jones, J., delivered the opinion of the Court. The material facts of this case are that Isabel A. Swan, one of the appellants, was the owner in fee-simple of a lot of ground on Baltimore street, in the city of Baltimore, upon which there was a valuable improvement in the way of a building which had long been used for business purposes. On the 5th of April, 1886, she with her husband executed to Alonzo Lilly a lease of these premises for ninety-nine years renewable forever, in the usual form and with the usual covenants and conditions of that familiar mode of conveyance, subject to an annual rent, for the first two years, of twenty-four hundred dollars, and thereafter, during the continuance of the lease, of three thousand dollars payable in monthly instalments. On the 17th day of August, 1897, Alonzo Lilly and his wife executed to the appellees, Lawrence B. Kemp and Christian Devries, a deed of the premises, so leased to the said ⁶⁸⁸ Lilly, in trust for the uses and purposes set out in said deed which authorized and involved a sale thereof by the said trustees.

In execution of their trust these trustees sold the premises in question to the appellee, Henry Kirk, for sixty-five thousand dollars. This purchase price was for the property in question as a fee-simple property and it was agreed between the vendor trustees and the purchaser, that fifty thousand dollars of the purchase-money—that amount being the capitalization at six per cent of the rent reserved by the lease of the 5th of April, 1886—should be applied to the extinguishment of the rent so reserved. There was no provision in the lease for redeeming the same; but the sale, which has been referred to, having been made in 1902, fifteen years had expired between the date' of the lease and the time of the sale, and the trustees, who made the sale, and the purchaser claimed the right to redeem the lease under the provisions of the Act of 1884, ch. 485. The sale of the property, made as has been stated, was reported by the trustees to the Circuit Court of Baltimore City which had jurisdiction of the trust they were executing and was ratified by that Court on the nth day of August, 1902.

The trustees, thereupon, to consummate the sale as made, reported, and ratified, tendered to the appellants, the then owners of the fee-simple interest and reversion in the property in question, fifty thousand dollars together with all arrears of rent and the current rent to the date of the tender and requested from said owners (appellants here) a conveyance of said fee-simple interest and reversion. The appellants refused to make the conveyance requested and.based their refusal upon the claim that the Act of 1884, ch. 485, did not apply in such a case as this where a lease was made of property already imT proved; and that the said Act had been repealed and made inoperative, as affecting this case, by the later Act of 1888, ch. 395. To procure from the appellants the conveyance thus requested and refused the appellees instituted in the Court below the proceedings in the case at bar. These proceedings, as they appear in the record, consist of the bill of complaint ⁶⁸⁹ of the appellees with certain exhibits, and the answer of the appellants.

From the allegations and admissions appearing upon the face of the pleadings the facts which have been set out are shown. The Court below decreed adversely to the contention of the appellants and they have brought this appeal. The inquiries now to be made are suggested by the grounds set up by the appellants for their refusal to convey the reversion in the property in question upon the demand made upon them. First then does the statute in question—Act 1884, ch. 485— apply in the state of the case we have here ?

That statute provides as follows: “That all' leases or sub-leases of land hereafter made in this State, for a longer period than fifteen years, shall b'e redeemable after the expiration of fifteen years at the option of the tenant, for a sum of money equal to the capitalization of the rent reserved at the rate of six per centum in gold coin of the United States, or its equivalent, unless some other sum not exceeding four per cent capitalization of said rent in said coin shall be specified in said lease, in which event said rent shall be redeemable for the sum fixed in said lease or sub-lease.” A mere reading of the statute is sufficient to show that the lease we are dealing with here is within-its letter. No attempt at argument or illustration could1 make that plainer. Now is it not within the mischief the statute-was intended to remedy ? within the object it was intended to accomplish ? within the policy it was intended to establish ? In the case of Stewart v. Gorter, 70 Md. 242 , the legislation we have now under consideration was before this Court for construction as to its purport, object and effect and it was there declared that it “ was the result of a well-grounded belief that these long leases, with their covenants of renewal' were injurious to the prosperity of the city of Baltimore, and-that sound public policy demanded that all leases hereafter made, if for more than fifteen years, might be ended at the option of the tenant or lessee upon paying the capitalization of his ground rent at six per centum.

It was the system of these long leases, irredeemable until the end of the term, that ⁶⁹⁰ the