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Colonial Cases

Glover, Dow and Co. v. Torckler, 1870


Glover, Dow and Co. v. Torckler

Supreme Court of China and Japan
24 February 1870
Source: The North-China Herald, 8 March 1870




Shanghai, 24th Feb., 1870.

Before C. W. GOODWIN, Esq.

Messrs. GLOVER, DOW & Co. v. F. TORCKLER.

Action of Ejectment.

Mr. Rennie appeared for the Plaintiff.

Mr. Harwood for the Defendant.

Mr. Rennie said the plaintiff's claim either possession of the premises or to restrain defendant from certain breaches of agreement.  It was alleged that plaintiff had violated the term of the lease in sub-letting the houses to Chinese; and also that he prevented the plaintiff from having access to a godown.  Defendant admits having done as plaintiff charges him but denies the unlawfulness of his doings.  Defendant had put a wall obstructing the entrance to godown without the consent of the plaintiffs, but he contends he had perfect a right to do so.  (Plan of premises handed in.)  There were two points; have Plaintiff a right to have access to the godown through that passage; and can they prevent defendant from sub-letting the premises to Chinese?

[Several letters were read to prove that Messrs. Glover and Co. let the premises for Tls. 900 per annum to the end of the year with privilege to renew the lease for two years; that Torckler wrote to have repairs done to the house three days after, and requested that the godown might be closed.]

The Godown was a large one and it is not likely that plaintiffs would have given it up.  Mr. Rennie quite admitted that a tenant has a right to sub-let any portion of his house, unless it is stipulated that he shall not do so.  But in re-letting to Chinese, the case is different, as it vitiates the Insurance.  It was for the Court to decide whether it was not implied in the agreement that he should not do this.  The lease gave him no such privilege.  He would produce a letter for a French landlord, expressing surprise that such a privilege should be allowed to defendant; showing that it was implied, that such a right was not allowed.He [Mr. R.] thought that these facts sufficed to prove that defendant had no right to sublet to Chinese without permission.  He would get Mr. Groom to explain about the Wall, and Mr. Cheverton to prove the view of the Insurance Company in subletting to Chinese.

F. A. Groom. - I am partner in Glover Dow & Co.  I had conversations with Mr. Tickler, about closing the door of the Godown, after the letter of the agreement was signed.  I told him I could not shut it up.  His first reference to shutting it up was made in a subsequent letter.  The closing of the door would prevent us from using the godown.  It is of great importance to us.  We pay Tls. 3,000 for the whole premises and defendant merely pays Tls. 900 of this.  I was first informed of this on the 14th July.  He asked that Chinese might be prevented from having access to the godown.  I said it was quite impossible to shut the door; the godown would be practically useless.  The passage on the other side is a very narrow one.  The object of putting up fences was to keep Chinese from passing Mr. Tockler's house.

Cross-examined. - I remember receiving the letter of the 8th July speaking of a parting wall to be erected, and one door to be closed so that he might have the place private.  I refused those terms.  I gave him notice several times.  I received rent to the end of 1869; the rent was paid monthly.  I don't know that Maynard & Co. have premises on the other side.  I don't know of Ta-Zang being inhabited by Chinese; it was once.  It belongs to Maynard Cousin and Co.  I have not used the godown since letting it to Torckler.  I told Mt. Torckler that we could not shut the door under any condition.  The agreement was made in a hurry.  I agreed to put the premises in repair but refused to close the door.  It was contemplated to make a lease in writing, I was anxious to have everything explained in the lease before using the godown.  I believe Mr. Torckler accepted the terms of our letter of the 9th December, and went into the premises.  My idea was to wait till the end of the year, to make definite arrangements.

Mr. Cheverton. (Hongkong Fire Insurance Company):- The ordinary rate of Insurance on foreign house is ¾ per cent on Shanghai; on Chinese, 4 to 5 per cent; on European houses inhabited by Chinese, classed as semi-European. 1 ½ per cent.  Mr. Torckler's premises were examined by our Surveyor.  The rate which we would charge the house would be 1 ½ per cent, it being inhabited by Chinese and having part of it used as a kitchen.  The rate is raised, to 1 ½ per cent on account of it being a semi-European house.  If a first class risk was burned down, and if it was found that it had been inhabited by Chinese, without due notice being given, it would damage the Insurance risk.

Cross-examined. - The stove on the premises increases the risk.  I don't know in whose room it was.  I should only charge a European risk if Mr. Torckler lived there by himself.  If he had any Chinese there I should be guided by the circumstances in determining the rate.  If a policy is granted on a building and it is subsequently inhabited by Chinese without notice being given, it would come under the clause in our policies, relating to such cases.  Chinese servants living in the house do not increase the risk.  I know that Mr. Torckler applied for Insurance.  My surveyor examined the premises and gave me a report of their condition.  I took them as a semi-European risk.

To Mr. Rennie. - The house insured as a semi-European risk increases the danger of all the houses surrounding it.

Mr. Harwood admitted the facts of the charge made against his client.  But contended that the letter of the 8th July, formed part of the contract.  The letter stipulated, that the place should be put in repair and the door shut.  On the second charge.  His client had a perfect right to sublet the premises, his doing so has not in any way damaged the premises.  He considered that a landlord could not depart from his agreement till its time had expired.  He could get his client to prove that the door referred to was to be closed, and he contended that a tenant had a right to sublet unless there was a stipulation to the contrary.  He denied that there was an implied contract not to sublet to Chinese.  There was no permanent damage done to the premises.  If the Insurance on it was increased that was a concern of the landlords purely.  He contended that the letter of the 8th July formed part of the agreement.

Fred. TORCKLER. - I had several conversations about taking the premises.  I was invited to come over and examine them and make any remarks I might have.  I wrote to Mr. Groom to explain the obstacle which the door would be to me if left open.  He agreed to my terms verbally.  My reason for writing on the 14th of July was, because the door had not been closed.  Their first objection to the closing of the door was made when I received notice to leave.  I offered to pay the extra Insurance.  I live on the premises.  I made a written agreement for one Chinaman to occupy three rooms.  I know the premises next door.  Maynard Cousin & Co. Have property on the same block inhabited by Chinese.  I have two tenants and their servants.  My premises could not affect the Insurance risk on No. 7 godown, any more than the other houses in the neighbourhood, all being at equal distance from it.  Godowns Nos. 8 and 9 contain cargo only.

To Mr. Rennie. - I took possession on the 13th.  I remember getting a letter from Glover Dow & Co. to go round and look at the French lease.  I wrote an answer to this.  I said nothing about the godown door then.  I do swear that Mr. Groom agreed to shut the door.  I don't consider doing so would injure them in the least.  I have about 30 or 40 Chinese in my two houses.  I sublet two to Chinese merchants.  One holds 3 rooms; the other two.  They will sublet again.  Glover & Co.'s compradore occupied the house next door.  I don't know what is stored in the godown at the back or by the side of it.  I remember writing a letter on the 9th July.  It was to induce them to accept the terms I had offered them.Certainly thought my letter of the 8th, had been accepted (Mr. Rennie here remarked, that in his letter of the 9th.  He made use of the following words. "Since you say you cannot accept the terms of my letter of the 8th." Mr. Harwood explained that this had reference to the amount of rent.)

To Mr. Harwood. - By "special terms" in my letter I meant the party wall.  I would not have taken the premises without getting the privilege of putting up the party wall.  They would be of no use to me otherwise.

Mr. Rennie. - The defendant held the premises on certain terms.  He refused to comply with them and therefore he ought to be turned out; or, if the Court did not take this view of the case, the Court would order him to desist violating the terms of their agreement.  Mr. Groom had sworn that he never gave his consent to this agreement about closing the door.  It is very unlikely that he should.  In Mr. Torckler's letter of the 11th July he says, he would be glad if that godown was shut, which proves that Mr. Groom never gave his consent to shut it.  The improbability of the case, as well as his own letter, proves that no such agreement was made.  Then as to sub-letting the premises to Chinese, the Insurance was affected by it.  There was he contended an implied promise not to do it, and he is therefore wrongfully holding the premises.  If his Lordship thought differently, he would ask him to restrain defendant in his unlawful acts.  He quoted from Woodfall's landlord and tenants to prove, that when a man uses the premises of another in a way so as to do him injury, the law can interfere.  The question of Insurance would settle the matter of the implied contract.

March 5th.

Judgment was delivered as follows:-

In this petition, the prayer is alternative; either that the defendant be ordered to quit and deliver up possession of certain premises, which he now holds of the plaintiffs under an agreement for a lease, or else that he be restrained by an injunction from committing certain alleged breaches of agreement, viz: obstructing the plaintiffs from having access to a certain godown situated in the rear of the premises, to Chinese, to the peril and depreciation thereof, and so as to increase the insurable risk.

The defendant entered into possession of the premises in July last, after some correspondence as to the terms. And he contends that one of these terms was that a certain door of a godown to the rear of the premises was to be closed and disused.  I have carefully read the correspondence in question, and looking to the dates of the letters and the language used in them, I come to the conclusion that the plaintiffs never consented to the closing of the door as a part of the terms, and that the defendant, although he may be under a contrary impression, must be held to have accepted the lease without this term and, consequently, that he has no righty now to do any act to impede them in their access to the door.  But his doing so is not a ground of ejectment; nor do I see that this is a case for an injunction, as the damage or impediment occasioned to the plaintiff, if any, is not upon the premises agreed to be demised, and their remedy against the defendant is the same as it would be against any stranger who acted in a similar manner. 

I do not see that the damage done to the plaintiffs, is supported by the evidence, as Mr. Groom says that up to this time they have had no occasion to use the door in question.  The defendant, however, admits in his answer that he has prohibited the plaintiffs from having access to this godown, and maintains that he is justified by agreement in doing so.  It will, perhaps, be enough if I express my opinion that, in any letter which the defendant may receive from the hands of the plaintiffs, he is not entitled to have this stipulation for the closing of the door inserted.

The next ground of ejectment, or if that be refused, that for an injunction, is the under-letting by the defendant of part of the premises to Chinese.  While the negotiations for the lease were going on, the plaintiffs invited the defendant to look at the terms of the French lease under which they themselves hold, as containing the terms with which he would have to comply, and according to which their lease to him must be drawn up.  The defendant accepted the terms of this lease "subject to certain exceptions agreed to in writing," but which exceptions, it now appears, amount to nothing.  What is material is, that the French lease contains no conditions whatever against under-letting.  It is, therefore, quite certain that the plaintiffs agreed to execute a lease containing no such terms.  It is, indeed, argued in their behalf that this being a French lease, and the property situated in the French concession, it is possible that by French law, the construction of such a lease may imply a condition not to under-let.  No proof is given that such is the French law, but I think it immaterial, even if it were proved to be so.  The plaintiffs offered this French lease to the defendant, as containing the condition by which he would have to be bound, and he could not be bound by anything which he could not see there.  If they have meant to inform him that they intended to require a covenant against under-letting, they should have adopted some other way of explaining themselves.  I think it clear that they are bound to grant him a lease, unfettered by such a covenant; and in the absence of any such covenant, the general right of w lessee to under-let is admitted by the plaintiff's learned counsel.  But it is urged that letting to Chinese is different from letting to foreigners, and that an implied covenant against doing the former must be assumed.  The case appears to me to be analogous to that of sub-letting a house for the purpose of a disagreeable trade, and from the cases and the practice in England, I conclude the law then to be, that in the absence of express covenant, the lessee may apply the demised premises to any use, or employ them in any trade, however objectionable.  In the case of Doe and Wetherell v. Bird, where, in a lease, there was a covenant against many obnoxious trades, specifically named, and generally against any "offensive trade," it was held that the application of the house to the purpose of a lunatic asylum, was no violation of the covenant - the word trade being applicable only to buying and selling.  This shows the tendency of the law to construe covenants of this kind very strictly, and to indicate as much as possible the right of the tenant to the free use of the premises - covenants in restraint of trade in a trading locality are not considered "usual" covenants; - that is, where there has been an agreement for a lease "with the usual covenants," such covenants as the above cannot be forced upon the lessee when the lease comes to be formally granted.

In the present case, there is no agreement for any other covenants besides those in the French lease, and the question of what are the "usual" covenants does not arise.  If the lease be completed, the defendant is entitled to have it without any covenant against under-letting, or applying it to any particular purpose.

In the absence of covenants, a tenant is bound: I, to use the premises in a tenant-like manner, according to the custom of the country, and 3, not to commit or permit waste or spoliation.  But the onus of proving the custom lies upon the party claiming the benefit of it; and in the present case no custom has been proved prohibiting letting to Chinese.  On the contrary, the evidence of Mr. Cheverton, as witness for the plaintiffs, leads me to infer that it is not unusual for foreign houses in Shanghai to be let to Chinese; because, he says that there is a recognised higher scale of risk for fire insurance in such cases.  This leads to the question whether the permission to Chinese to occupy the premises is itself waste. It has been urged that the increase of risk, as shown by the higher rate of insurance required, is in itself a species of waste, against which an injunction should be granted.  The meaning of waste, as described in the books, seems to be, the destruction of any part of the demised premises, or the conversion of them into some other shape.  Thus, converting two chambers into one, or one into two, is waste, and this notwithstanding the alteration is a manifest improvement, and increases the rent of the property.  But I cannot find that any particular application of the premises, provided it do not tend to their destruction, or require any actual alteration of them, is waste. 

With regard to vitiating an insurance or increasing the risk, that is no actual damage to the property.  It is a possibility of damage, which may be guarded against by paying the extra premium.  In the case Hickman v. Isaacs, there was a covenant not to carry bon any noisome or offensive trade, and it was held that the use of the premises for depositing lucifer matches, whereby they were rendered absolutely uninhabitable, was no breach of the covenant, as the word "dangerous" was not user.  Now, dangerous trades must be carried on, and the mere doing this has never been held to be waste; and, if the lessee object, he must guard himself ab initio against such an application of his property when he agrees for the lease.

The evidence given of the increased rate of insurance was the only evidence offered in support of the allegation that a Chinese tenant is, necessarily and universally, a deterioration to a house; and I do not feel justified in assuming that this is the case on mere statement; although, I dare say that such an idea may be current.  If any actual damage had been, or shall hereafter be, done by the Chinese tenants, the plaintiff will have their remedy against the lessee.  In the meantime I do not see that this Court can interfere by injunction to prevent the occupation by the Chinese tenants.

I feel, therefore, bound to dismiss the petition; but as one of the two principal points actually in dispute, viz:, the right of the proposed lessee to have a stipulation for the closing of the godown door included in the lease, has been decided against him, and as he admits interfering with the plaintiff's use of the godown, which I think he had no right to do, I dismiss it without costs.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School