Opinion
Decided April 18, 1927.
Landlord and tenant — Lease of taxicab stand in hotel — Contract by vice-president, removed as president and manager, unenforceable — Agreement to extend lease two years, within statute of frauds — Section 8621, General Code — Memorandum by hotel officer unauthorized to contract, insufficient — Lease extended one year by possession and payment of rental.
1. President of hotel company, after being discharged as managing officer of company and elected vice president without power in actual management of hotel, had no express or implied authority to enter into contract with cab company for lease of cab stand in hotel which would be binding on hotel company.
2. Contract between hotel and cab company for lease of cab stand in hotel, extending previous contract which had two years to run and could not take effect until expiration of old contract, was within Section 8621, General Code, since it could not be performed within one year, and hence was unenforceable unless subsequently memorandum was made, signed by proper party to be charged or his duly authorized agent.
3. Memorandum of contract for lease of cab stand, which was not to take effect for two years, and was therefore within statute of frauds, signed by officer of hotel leasing stand, after he had ceased to be managing officer and was unauthorized to contract for hotel, was insufficient as memorandum to take contract out of statute.
4. Where cab company continued in possession of cab stand in hotel after expiration of 3-year lease under same terms and conditions as lease, and continued to pay rent for 7 1/2 months, which was accepted by hotel, lease was thereby extended for period of one year, during which time taxicab company could not be ousted.
APPEAL: Court of Appeals for Cuyahoga county.
Messrs. Tolles, Hogsett Ginn, for plaintiff.
Mr. Paul Howland, and Mr. John B. Oviatt, for defendant.
This action comes into this court on appeal from the common pleas court of Cuyahoga county. The action was brought by the Yellow Cab Company for an injunction to prevent the Hollenden Hotel Company from ousting it from its stand in the Hollenden Hotel and on the street adjacent thereto.
It seems that in 1923, prior to July 1, 1923, one Herman Mack was president and managing officer of the hotel company, and that he was more or less connected with Mr. Gray of Chicago, who was the controlling officer of the Yellow Cab Company, a branch of which was being operated in Cleveland under the management of a man by the name of Ginsberg. On July 1, 1923, a contract for three years with Ginsberg, as president of the Yellow Cab Company of Cleveland, was entered into, whereby the Yellow Cab Company acquired the right to have a stand for the Yellow Cab in the hotel and occupy the space on the street assigned by the city public safety department for the use of cabs on said street. The consideration for that contract was a lump sum of $5,400, payable in monthly installments of $150 each, and, in accordance with that contract, the Yellow Cab Company went into possession of the stand in the hotel, and of the street adjacent thereto, and occupied it up to and prior to the time of the bringing of this action.
Three years expired on the 30th of June, 1926. Thereafter the cab company still maintained its cab stand and paid to the Hollenden Company the same amount of money, to-wit, $150 a month. In February, 1927, it was sought by the Hollenden Company to have the Yellow Cab Company vacate the premises occupied by it in the hotel and to substitute another company in the cab stand. Thereupon this suit was brought.
The Yellow Cab Company based its right to occupy, upon an alleged contract with the Hollenden Company, which extended the time for which this contract was made two years. This supplemental contract, so-called, was made about a year after the original contract was made and while it was still in force and effect. The copies of this contract that are produced, signed by Mack for the Hollenden Company, and by Ginsberg, as president of the Yellow Cab Company, were signed in October, the 7th or 9th of October, 1924. The singular part of that is that on September 18, 1924, Mack had been discharged as president and managing officer of the Hollenden Company, and W.E. Guerin elected in his stead; Mack being elected vice president, but having nothing to do with the management of the hotel after his expulsion on September 18. And there is nothing in the record to show that Mr. Guerin was not all the while the active manager of the Cleveland hotel.
This so-called contract was signed in Chicago by Mack, a man who had been superseded, and was not in actual management; it was signed by a vice president not in control, in a state other than that where both parties were located. One might question whether the so-called contract was not an afterthought to bolster up the right of the Yellow Cab Company to hold its franchise, if you could call it such, for a longer period. However that may be, it is clear that Mack had no authority, either express or implied, at the place where this contract was made, to make such a contract to bind the Hotel Hollenden Company. But, even if, as claimed in the record, this contract was made in 1924, and with authority, extending this contract period for two years, the contract would be within the statute of frauds (Section 8621, General Code), inasmuch as it could not be performed within one year, because it must be remembered that the old contract had still two years to run, and, this being a new contract, which could not take effect until the expiration of the old contract, it manifestly could not be performed within one year, and therefore the memorandum is no good as a memoran-frauds, unless subsequently a memorandum was properly made, signed by the proper party to be charged, or his duly authorized agent. As I have already shown, the memorandum that is produced was signed by Mack a month after he ceased to be the managing officer, in a place where he had no right to exercise control over the property. Therefore would not be enforceable, under the statute of dum.
It is not necessary to take up the question that the power to make such contracts is confided to the board of directors of a corporation, who might, by the exercise of specific authorization, authorize the manager or some one else to do it, instead of doing it themselves, but nothing like that is shown. But, assuming that Mack acted within the scope of his authority in making the three-year contract, the infirmity of the later contract must be apparent to a thoughtful student upon an examination of the facts in this case. So we have the situation that the contract for the three years was in writing, and, while it may not be deemed a lease, it is treated as though it were in the nature of a lease. Let us regard it then as having all the formalities of a lease, although it is defectively executed and not acknowledged. The Yellow Cab Company went into possession and lived up to its terms, so far as the record shows, and it is too late now for the Hollenden Company to dispute the right of Mack to make this contract. So then we will regard it as a lease or a contract in the nature of a lease for a period of three years, which would end on the 30th of June, 1926. Now, after that lease had expired, the Taxi Cab Company continued in possession, under exactly the same terms and conditions, and paid the rent for a period of seven and a half months, which was accepted by the Hollenden Company. We think, by virtue of this, that the taxicab company had its lease extended for a period of one year from June 30, 1926, or until June 30, 1927, and that period has still two or three months to run.
We are therefore of the opinion that the Hotel Hollenden Company cannot at this time oust the taxicab company from its possession, and the injunction prayed for by the taxicab company should be granted, to remain in force until the 30th of June of this year, after which time the rights of the taxicab company will have ceased. A decree may be entered accordingly.
Decree accordingly.
SULLIVAN, P.J., and LEVINE, J., concur.