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In re Mount Holly Paper Co.

March 8, 1940

IN RE MOUNT HOLLY PAPER CO. ;DAVID SCHEIN CO., INC., ET AL.
v.
DAVIES ET UX.



Appeals from the District Court of the United States for the Middle District of Pennsylvania; Albert W. Johnson, Judge.

Author: Jones

Before MARIS, CLARK, and JONES, Circuit Judges.

JONES, Circuit Judge.

Guy H. Davies and Annie H. Davies, his wife, as owners, leased to Mount Holly Paper Company a "paper mill, machinery, equipment and fixtures", located in Mount Holly Borough, Pa., for a term of five years from January 1, 1935, at an annual rental of $3,000, payable in installments of $250 on the first day of each month of the term.

The lessee agreed to be bound, inter alia, by the following covenants and conditions, -

"(a) To pay all taxes of every kind and description on said leased property as they become payable.

"(d) To keep the buildings and water ways in good condition, including paint, and to make all necessary repairs, renewals or replacements thereto."

The lease also provided that, -

"If default shall be made in the payment of any part of the said rent after the same becomes due, or in case of a breach or evasion or any attempt to break or evade any of the covenants or conditions of this agreement, the entire rent reserved for the full term of this lease remaining unpaid shall become due and payable at once, and may forthwith be collected by distress or otherwise", etc.

The lease was thereafter amended so as to provide that the taxes, water rents, power and light bills, costs of repairing and replacing machinery and keeping the buildings and water ways in good repair should be collectible by the lessors as rent in addition to the monthly money payments specified in the lease, and that the lessors should have the right to collect these items or any of them by distress. Both the original lease and the amendment were drawn by Guy H. Davies, one of the joint lessors.

On December 13, 1937, the lessee then being in default in the payment of rent of $250 for the month of December and the property taxes for the year 1937 in the sum of $650, the landlords issued and served a warrant of distress for rent thus itemized:

"Rent for December, 1937, due

Dec. 1, 1937 ...


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