The plaintiff, Harry Ginsberg, on July 22, 1963, for a consideration amounting to $33,000.00, acquired the rights and obligations of prior tenants under the terms of a written lease covering certain storeroom premises, located at 3839 William Penn Highway, Monroeville, Pennsylvania, wherein he conducted a delicatessen and sandwich shop business. Plaintiff continued to comply with the terms of said lease until the month of August 1970. The defendant, George Stern Advertising Agency, Inc., acquired title to said premises on November 18, 1969, by deed from a trustee in bankruptcy, and on November 25, 1969, it also became the assignee of the lessor's interest in the aforesaid lease. By letter of October 12, 1970, plaintiff having failed to pay the monthly rental of $333.33 due for each of the months of August, September, and October 1970, the defendant landlord (Stern), per its attorney, advised the plaintiff (Ginsberg) of its intention to commence in December 1970 legal proceedings for collection of amounts due under the lease unless he cured his delinquency prior to that time.
A similar letter was sent to Ginsberg on November 11, 1970, setting forth a further delinquency. No reply to Stern's attorney having been made, the constable defendant (Schwartz), acting on behalf of defendants, distrained the business property of Ginsberg on the leased premises to satisfy a claim of $4,815.00 on December 10, 1970, and, pursuant to the provisions of the Pennsylvania Landlord and Tenant Act, 68 P.S. § 250.302 et seq., gave notice of sale to be held at 9:30 A.M. on December 22, 1970.
The complaint in the instant action was filed on December 21, 1970, the day before the scheduled sale, challenging the constitutionality of the Landlord and Tenant Act, supra, and seeking, inter alia, a temporary restraining order against the proposed sale. An immediate hearing on the motion for temporary restraining order was held before the district judge to whom the case was assigned. At the hearing, Stern reduced its claim to $2,050.00 and Ginsberg tendered a check for $1400.00 to cover rent admittedly due plus the costs of distraint proceedings. It also appeared that Ginsberg was the owner of substantial assets, including the restaurant equipment under distraint valued at $12,000.00 to $15,000.00, a $13,000.00 equity in his residence building (exclusive of household furnishings, and an automobile not under distraint); that he was maintaining a daughter in college to whom he had given an automobile for trade-in purposes; and that, while he testified (somewhat evasively) to certain encumbrances and bills payable, his net assets clearly represented more than adequate collateral with which to acquire the sum of $700.00, which was sufficient to settle the landlord's claim at that time. The motion was denied on the conclusion that a restraining order was not required to "prevent irreparable harm." The sale scheduled for December 22, 1970, was then postponed to December 29, 1970, at which time Stern's claim was further reduced to the sum of $1,690.00. Ginsberg failed to meet the demand, and the distrained goods were sold by the constable at public sale to Stern for the bid amount of $2,500.00.
The current three-judge court was constituted on December 30, 1970, and a final hearing on the application for a permanent injunction and on the constitutional issues raised by Ginsberg was held on February 8, 1971. The defendant Stern moved at the conclusion of the plaintiff's case for dismissal under Rule 41(b) of the Federal Rules of Civil Procedure.
The commercial lease which gives rise to the controversy between the parties reads, with respect to the amount of rent claimed, as follows:
"* * * the Tenant hereby covenants and agrees: (a) To pay to the landlord as minimum base rent for the demised premises the sum of Four Thousand and no/100 per annum ($4,000.00) dollars, in equal monthly installments of Three Hundred Thirty-Three and 33/100, ($333.33) dollars, in advance, on the first day of each and every month during the term hereof. * * *"
Concerning the landlord's procedural rights, the said lease provides, inter alia:
(b) "The Tenant hereby waives to the Landlord the benefit of all laws now or hereafter in force in this state or elsewhere exempting property from liability for rent, or for debt, expressly waiving the Act of Assembly entitled 'An Act for the Relief of the Poor' approved the 10th day of April, 1828, and its several supplements; also Act No. 20 approved the 6th day of April, 1951, entitled 'The Landlord and Tenant Act of 1951,' as amended."
The conditions of the aforesaid lease were accepted in toto by the terms of the assignment adopted by Ginsberg on July 22, 1963, at which time he was represented by his counsel, whose signature appears as a witness to plaintiff's signature on the lease. Plaintiff testified that his present attorney had represented him at the time of his acquisition of the lease in 1963 and had explained its terms to him.
He was aware that the landlord had remedies under that lease.
Although plaintiff's testimony makes clear that a competitive shopping center near the leased premises opened in 1969, making the 12-month period prior to the fall of 1970 "a very bad year" for him and leaving him without cash to pay his rent,
he conceded that he had a $13,000 equity in his home, as well as ...