Opinion
14425
February 1, 1937.
Before SEASE, J., Spartanburg, July, 1936. Affirmed.
Statutory receivership proceeding by Ella B. Wofford and another against John A. Law, Jr., as Receiver of the Merchants Farmers Bank of Spartanburg. From an order overruling exceptions to a Master's report allowing the claim as a preferred claim, and affirming the report of the Master, the Receiver appeals.
The decree of Judge Sease is as follows:
On exceptions to a Master's report dated May 9, 1936, allowing a preferred claim for $1,050.00 rent, I have heard the issues involved.
The matter was presented on behalf of the Receiver by W.A. Crow, of the firm of Nicholls, Wyche Russell, attorneys for the Receiver, and on behalf of the owners of the property, Ella B. Wofford and Jesse W. Boyd, as Receiver, by their attorney, Jesse W. Boyd.
The issues involved grow out of the following facts: The bank occupied as its place of business property, one-half of which was owned by the bank and one-half by Ella B. Wofford and H.B. Carlisle. For the space owned by Mrs. Wofford and Carlisle, the bank had for a period of years paid $150.00 a month under a written lease. This lease, by its terms, would have expired December 31, 1932. The bank went into liquidation in January, 1932, and the First National Bank, of Spartanburg, S.C. was appointed Receiver. The Receiver handled the affairs of the closed bank for the most part in its own place of business, but retained possession of the rented property and kept all of the bank's equipment there. From time to time, it was necessary to go in and out for purposes of attending to the business of the closed bank. There seems to have been no negotiations about the continued use of the property, but the Receiver paid the owners $150.00 a month until its tenure as Receiver was terminated by its own liquidation in June, 1932.
Upon that event, John A. Law, Jr., was appointed Receiver, successor to the First National Bank. He continued the same occupancy and use of the property occupied by the bank. There appears to have been no negotiations about the rental other than the Receiver's statement to the property owners that he was unable to pay the rent, as all of the cash of the bank was deposited in the then closed First National Bank. This occupancy continued until January, 1933, when the property of the closed bank was removed and the keys to the building turned over to the property owners.
The principal contention of the Receiver is that the lease terminated upon the closing of the bank, and that the Receiver should pay a reasonable compensation for the use made of the property, and that the facts do not justify a rental of $150.00 a month. This contention as to the termination of the lease is correct. It terminated as a matter of law. While the Master does appear to have taken the view that the lease was still in effect, since neither of the Receivers elected to cancel it, at the same time the Master based his recommendation also on the fact that the keys to the building were retained by the Receiver during the entire period, and he was in sole possession of the building. However, the matter of this bank's liquidation is in equity, and, independent of the Master's reasoning, the testimony supports a finding that $150.00 a month is a reasonable amount for the Receiver to pay for the use made of this property, H.M. Cleveland was president of the First National Bank while it was Receiver, and he paid that amount regularly until the closing of his bank. He would not have done so if he had not regarded it as reasonable. The succeeding Receiver continued to occupy the premises in the same way and for the same purposes until he gave it up at the end of the year when he surrendered possession.
There is also testimony as to the subsequent rental of the property. No rent was paid during the period of the present Receiver's occupancy from June until December, inclusive. I find that $1,050.00 is reasonable and proper allowance for that use, and that the same shall be allowed as costs of administering the closed bank, and the Receiver is authorized and directed to pay that amount out of any assets in their hands to Mrs. Ella B. Wofford and Jesse W. Boyd, as Receiver of H.B. Carlisle, or to their attorney, Jesse W. Boyd.
The exceptions to the Master's report are overruled, and the conclusion of the Master affirmed.
It is so ordered.
Mr. Donald Russell, for appellant, cites: As to reasonable rent for premises occupied by Receiver: 185 S.E., 619.
Mr. Jesse W. Boyd, for respondents, cite: Reasonable rent: 174 S.C. 69; 76 S.C. 355; 168 S.C. 395; 167 S.E., 659; 158 S.C. 510; 167 S.E., 830; 43 A.L.R., 272; 180 S.C. 317; 185 S.E., 619.
February 1, 1937. The opinion of the Court was delivered by
This case comes to this Court on appeal from an order of his Honor, Judge T.S. Sease, Circuit Judge, issued in the Court of Common Pleas for Spartanburg County, affirming the Master's report in the cause.
In order that the case may be better understood, we quote herewith the following agreed statement appearing in the record:
"This is a statutory receivership proceeding against The Merchants and Farmers Bank of Spartanburg, S.C. filed December — , 1931. The appeal is from a decree for payment by the receiver of rent in the sum of $1,050.00 for seven months, June to December, 1932, inclusive. The property was occupied by the bank and retained by the successive receivers. The bank's rent was under a lease, and was paid up to the time the bank closed in December, 1931. The leased premises consisted of one half the building occupied by the bank. The first receiver was the First National Bank of Spartanburg, S.C. which retained occupancy of the premises and paid therefor $150.00 a month for the five months (January to May, 1932, inclusive) while it was receiver. On account of its closing in June, 1932, John A. Law, Jr., was appointed receiver in its stead. He continued occupancy of the premises until December 31st, 1932. No rent has been paid for this period, and the owners filed petition in the original proceeding seeking direction of the Court for payment of the same by receiver. The petition was referred to the Master, who took testimony and filed a report recommending payment of rent, $1,050.00. The receiver excepted to the Master's Report, and the matter was heard and a decree rendered on July — , 1936, directing payment of rent.
"Timely notice of intention to appeal from that decree was served."
We are satisfied that the Circuit Judge reached the proper conclusion in the case and for the reasons appearing in the decree issued by his Honor, it is the order of this Court that the judgment of the lower Court be, and is hereby, affirmed.
NOTE: Let the decree of his Honor, Judge T.S. Sease, be incorporated in the report of the case.
MR. CHIEF JUSTICE STABLER and MESSRS. JUSTICES BONHAM, BAKER and FISHBURNE concur.