
    Samuel Frank et al., Appellants, v. Meyer Auerbach, Respondent.
    (Supreme Court, Appellate Term,
    June, 1908.)
    Landlord and tenant — Eights, duties and liabilities in regard to premises— Eepairs, insurance and improvements — Covenants as to insurance— Interpretation and construction.
    A covenant by the sub-tenant of an entire building to pay any and all increase of insurance on said premises above the premium charged on the premises on a certain previous date is applicable to increased premiums due to an increase in the amount of insurance, arising from improvements made to the premises after such date and previous to the execution of the sub-lease bontaining the covenant, taken out for the benefit of the owners, whei^ the intermediate lessee is under a like covenant to the owners ;\and such covenant is not limited to insurance in favor of the subtenant’s immediate landlord; and it contemplated an increase in the amount, or a change in the character of the insurance, rather than a^i increase in the rate of premiums. ^ In such a case, in an action against the sub-tenant by his landlord to recover the amount of such increase of premiums, iti^a error to exclude proof of the covenant in the lease from the owners to the plaintiffs and the improvements made to the premises and issuance of a larger amount and different kind of insurance in consequence thereof.
    Appeal from a judgment of the Municipal Court of the city of Mew York, twelfth district, borough of Manhattan, in favor of the plaintiffs.
    Lewis S. Goebel (William Porter Allen, of counsel), for appellants.
    Meyer Auerbach (Benjamin F. Spellman, of counsel), for respondent.
   Giegerich, J.

The plaintiffs appeal from a judgment rendered in their own favor by the court below after a trial without a jury, the ground of such appeal being that the judgment is inadequate.

The action was brought to recover the sum of $326.47, made up of various items of water rates and other and more important items of payments for insurance.

The defendant’s liability is predicated upon the provisions of a lease made by the plaintiffs, as landlords, to the defendant’s assignor, as tenant, by which the tenant agreed to pay “ any and all increase of insurance on said premises above the premium charged on the 21st day of March, 1900.”

A few days subsequent to -the execution of this lease, the defendant took an assignment of the same from the original tenant and assumed the performance of all its covenants, conditions and agreements.

The trial justice rendered judgment in favor of the plaintiffs for the sum of three dollars and thirty cents, being an unpaid balance of water tax which the defendant conceded was due; but the residue of the plaintiffs’ claim, made up of payments made for fire and plate-glass insurance, was disallowed.

It further appears from the lease that it covered the entire building and not merely a part thereof, and that it specified that the premises were to be occupied for the sale of fancy leather goods, trunks, bags and cutlery on the store floor and some light, similar business above the store floor.

The tenant also undertook by the terms of the lease, in addition to the rent reserved, to pay all taxes, assessments and charges that might be assessed or imposed upon the premises by the city authorities and all charges for Croton water consumed on the premises. The lease was dated May 26, 1902, and was assigned to and its obligations assumed by the defendant three days later.

On the 21st day of March, 1900, there was a policy of fire insurance in the amount of $5,000 upon the premises, payable to Bradish J. Smith and Edwin P. Smith, executors; as owners, bearing a premium of fourteen dollars, the term of the policy being three years from May 1, 1899, to May 1, 1902. The insurance just named was the only insurance existing upon the premises on the 21st day of March, 1900.

The plaintiffs’ counsel further attempted to show upon the trial that between the 21st day of March, 1900, and the 1st day of May, 1902, extensive additions and improvements were made to the premises in question, including a new store front with plate-glass windows, and that when the fire insurance policy above named expired on the 1st day of May, 1902, a new policy in an increased amount was taken out, also in the name of the Smiths. The policy so sought to be introduced was objected to by the defendant’s counsel and was excluded, apparently on the ground that, as it was issued to the Smiths and not to the plaintiffs, it was not covered by the agreement in the lease. Some efforts were also made to show the issuance of plate-glass insurance on or about the 1st day of May, 190*2, no such insurance having been carried on the 21st day of March, 1900. Such other evidence was also excluded by the trial judge, apparently on the same ground, namely, that it ran to the Smiths and not to the plaintiffs. Evidence was also excluded showing that the plaintiffs were under obligation to the Smiths, from whom the plaintiffs rented, to pay such additional cost of insurance as they were seeking in this action to impose upon the defendant.

In support of the judgment the respondent argues that, in order to charge him with the payment of the premiums in question, it is necessary to read into the lease a provision which does not exist, to wit, that he agreed to pay any and all increase of insurance on said premises that might be placed on the premises in favor of the Smiths.

With this argument I cannot agree. I can see no reason for limiting the insurance to such • as should be issued to the plaintiffs. By the terms of the lease the tenant undertook to pay all taxes, assessments and charges assessed or imposed upon the premises and all charges for Croton water consumed on the premises, but no attempt is made to argue that, unless such taxes were levied in the name of the plaintiffs as owners, or water bills made out in their name, such charges would not be covered by the terms of the agreement. The tenant’s undertaking with respect to the insurance was phrased in broad and emphatic terms, namely, that he will pay any and all increase of insurance on said premises above the premiums charged on the 21st day of March, 1900.” In the light of the evidence offered by the plaintiffs, but excluded, I think the situation and intention of the parties were made entirely clear. Between the date named in the agreement, to wit, March 21, 1900, and the beginning of the leasehold period, extensive additions and improvements had been made upon the building, increasing its value and also changing its character, in the substitution of a plate-glass front in place of the one formerly existing. Such changes manifestly necessitated fire insurance in an increased amount, corresponding to the increased value of the structure, and also plate-glass insurance to cover the new front. The defendant’s undertaking was not to pay the additional cost of insurance taken out in the name of the plaintiffs, hut any and all increase of insurance on said premises;” meaning thereby without respect to the name of the person to whom the insurance should he made out, whether to the Smiths as owners or to some one else as mortgagee, provided only it was insurance on the premises in question.

Both sides rely upon Noel v. Herman Bencke Lithograph Co., 33 N. Y. St. Repr. 759; affd., 134 N. Y. 617, but I cannot see that that case has any hearing on the questions here presented. There it appeared that an agreement was made by the incoming tenant of a part of the building that he would he responsible to the landlord for any increase of insurance over one per cent, premium per annum which might he imposed by various insurance companies on the building or on the stock and fixtures of any other tenants in the building. At the time the lease was executed the rest of the building had been let and the cost of insurance fixed, and the plaintiff was liable to the other tenants for any increase of insurance caused by the uses for which the other parts of the building were leased. Immediately thereafter, the rates of insurance were increased on the other tenants, on account of the extrahazardous character of the defendant’s business, which increase the plaintiff was obliged to pay. It was held that the agreement covered such a case and that the tenant was liable.

Here the situation, as it would have been disclosed by the excluded evidence, shows that there was no question of any contemplated increase in the rate, but only an increase in the amount and character of the insurance. The language selected, namely, “ any and all increase of insurance,” was suitable to express what the situation shows would have been the reasonable intent of the parties in the circumstances. It should be observed, too, that there is nothing in the language selected to suggest any contemplated increase in the rate, such as was implied in the Heel case. On the contrary, the increase mentioned and contemplated was that- in the premium which, of course, would naturally increase with any increase in the amount of the fire insurance carried and with the addition of insurance of any other character.

My conclusion is that the defendant was hound by the agreement under consideration to pay the additional cost of any and all insurance reasonable in amount and taken out in good faith, whether in the name of the owners, or the plaintiffs, and whether fire insurance or plate-glass insurance.

The judgment should be reversed and a new trial ordered, with costs to the appellants to abide the event.

Gildersleeve, J., concurs.

Greenbaum, J. (concurring).

The mere fact that the new policy was issued to the Smiths did not justify its exclusion in evidence. It was insurance on the premises ” in question and came within the provisions of the lease. The judgment should be reversed and a new trial ordered, with costs to appellants to abide the event.

Judgment reversed and new trial ordered, with costs to appellants to abide event.  