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UNITED STATES AIR CONDITIONING CORP. v. FOGEL

April 15, 1959

UNITED STATES AIR CONDITIONING CORPORATION
v.
Frank FOGEL, Shirley Fogel, Rhawn Realty, Inc., Harry Fogel and Beatrice Fogel



The opinion of the court was delivered by: DUSEN

I. History of the Case

On January 27, 1959, a temporary restraining order was entered, restraining Rhawn Realty, Inc. (hereinafter called 'Rhawn'), as landlord, from (a) claiming any acceleration of rent due under a lease dated January 6, 1956, for failure to pay the monthly rent and (b) confessing judgment under said lease on condition that the plaintiff, as lessee by assignment, make all payments when due under the mortgage, pay all taxes and similar charges, and pay the monthly rent when due into the registry of the court. The affidavit filed in support of the motion for this order (Document No. 2) alleged that the above-named defendants (Rhawn, Harry Fogel and Beatrice Fogel) were indebted to plaintiff in the amount of $ 95,377.14, with interest from July 17, 1958, the abovementioned rent was being distributed by Rhawn to the Fogels (sole stockholders of Rhawn) who were distributing it for their own purposes, and ever since October 1958, Rhawn had 'advised plaintiff that the entire amount of rent due under the lease, Exhibit A, would be accelerated and judgment entered on the confession of judgment clause of said lease unless each and every installment of rent was paid to the corporate defendant on the day due,' even though plaintiff took the position that it was entitled to apply the monthly rent against defendants' obligation to pay it the above sum of over $ 95,000. The affidavit also contained this sentence (paragraph 9):

 A hearing on the request for a preliminary injunction was set for February 2, 1959, in the order of January 27. At this hearing, defendants acquiesced in the continuance of the temporary restraining order, which was provided for in an order entered on that date, and requested a continuance of the hearing on the application for the temporary restraining order. After several additional continuances requested by defendants, the hearing on the application for a preliminary injunction and on the above-mentioned motion of defendants was held on March 24, 1959. On the same date, the case was placed on the non-jury trial list, pursuant to order of plaintiff approved by the hearing judge. Counsel filed with the hearing judge Requests for Findings of Fact and Conclusions of Law on April 6, 1959.

 Meanwhile, on April 3, 1959, a conference of counsel was held with the hearing judge in chambers at the request of counsel for plaintiff. At that time, certain procedures (including a non-jury trial of the claim stated in the first count *fn1" of the complaint, to be held May 18 by special listing, provided that the hearing judge denied defendants' demand that this count be tried to a jury) were agreed upon with the understanding that defendants' counsel had to secure approval of his tentative agreement to these procedures (see transcript of 4/3/59, being Document No. 18). By letters of April 6 and 8, attached hereto, counsel for defendants requested that 'this case proceed according to normal legal procedures and as if the meeting of April 3, 1959, had not taken place.'

 Answers to the complaint have been filed by all defendants.

 II. Findings of Fact

 The hearing judge makes the following Findings of Fact:

 1. The following paragraphs of the plaintiff's Requested Findings of Fact (Document No. 19) are adopted as Findings of Fact of the court: 1-4, 5, modified by inserting after the word 'pay' in the fourth line the words 'until 1965,' 6-13, 14, with '$ 115,000' substituted for '$ 125,000', and 15-17.

 2. The following paragraphs of the defendants' Requested Findings of Fact (Document No. 20) are adopted as Findings of Fact of the court: 1-7 and 8, with 'between $ 400,000 and' substituted in line 3 after 'is.' *fn2"

 3. When rent was withheld in October 1958 so that it might be applied against the claim for $ 95,377.14, with interest from July 17, 1958, the defendants' attorney threatened plaintiff on at least two occasions, "If Way doesn't pay that rent, I will have to exercise all the rights under the lease, enter judgment for the rent, proceed for ejectment, and do everything that I have to to protect Harry Fogel's interests." (N.T. 42-3). Under dates of October 16, 1958, and November 4, 1958, defendants' attorney wrote plaintiff as follows:

 '* * * unless this request (for the October rent) is complied with, I shall have no alternative but to take such legal steps, as in my view may be necessary and proper to protect the interests of my clients.' (Plaintiff's Exhibit D.)

 4. Exhibits A, B, and C to the complaint are true and correct copies of the documents, of which they purport to be copies, as signed ...


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