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WALNUT-JUNIPER COMPANY v. MCKEE (09/22/75)

decided: September 22, 1975.

WALNUT-JUNIPER COMPANY
v.
MCKEE, BERGER & MANSUETO, INC., APPELLANT



Appeal from order of Court of Common Pleas, Trial Division, of Philadelphia, July T., 1974, No. 148, in case of Walnut-Juniper Company v. McKee, Berger & Mansueto, Inc.

COUNSEL

Robert I. Tuteur, and Eilberg, Corson, Getson & Abramson, for appellant.

L. Gerald Rigby and Richard J. Braemer, for appellee.

Watkins, P. J., Jacobs, Hoffman, Cercone, Price, Van der Voort, and Spaeth, JJ. Opinion by Hoffman, J.

Author: Hoffman

[ 236 Pa. Super. Page 2]

Appellant contends that the court below improperly denied its petition to open judgment entered by confession pursuant to a written lease with an agent of appellee.

Appellant is a New York corporation; appellee is a limited partnership. Appellant leased from appellee certain

[ 236 Pa. Super. Page 3]

    office space in a building located at 1315 Walnut Street, Philadelphia. The term of this lease ("Old Lease") extended from October 1, 1972, to September 30, 1977. When the appellant vacated the premises sometime in August, 1973, it notified appellee and requested that appellee find a subtenant. Appellant defaulted on the August and September, 1973 rental payments, and appellee took judgment by confession pursuant to the terms of the Old Lease. Appellee, however, agreed to the satisfaction of this judgment in return for appellant's payment of rental arrearages and execution of a second lease ("New Lease"). The terms of the New Lease were substantially the same as those of the Old Lease, and were effective October 1, 1973.

Although not entirely clear from the record, sometime prior to November 1, 1973, appellee found a subtenant. The prospective subtenant, however, would not agree to payment of certain costs contained in the New Lease as additional rent, specifically those contained in paragraph 42 providing for payment of tax increases during the term and payment of a proportionate share of costs incurred in operation and maintenance of the building. The subtenant also refused to pay the costs of remodeling the premises to meet its specifications. Appellant maintains that it rejected the subtenant and enlisted the services of an agent to find a subtenant who would either take the premises as is or assume the costs of remodeling. Despite appellant's objection to this subtenant, appellee entered into a sublease agreement and commenced remodeling. Upon discovery of the fact that appellee had taken possession of the premises and had already undertaken substantial remodeling, appellant refused to pay the November rent.

On July 1, 1974, appellee filed its complaint seeking judgment by confession. Judgment was entered in the amount of $25,446.15 of which $2,166.67 was attributed to the November, 1973 rent, $16,054.95 was attributed

[ 236 Pa. Super. Page 4]

    to estimated building maintenance costs and estimated tax increases for the balance of the term which the subtenant refused to assume, $6,012.81 was attributed to remodeling costs incurred in preparing the premises for the subtenant, and attorney's fees computed at five per cent. On August 8, 1974, appellant filed a petition to open judgment, asserting that appellee's entry into the sublease agreement with a subtenant it had rejected and the commencement of remodeling amounted to an eviction, and excused further obligation under the New Lease. In its answer, appellee asserted that appellant was in breach of the lease for failure to occupy the premises and for ...


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