In re the General Assignment for the Benefit of Creditors of Brenner , 9 Misc. 2d 385 ( 1958 )

Nicholas M. Pettb, J.

Motion to settle the account of the assignee for the benefit of creditors.

The only objection interposed is by the landlord of the assignor under a lease which was to run from November 1, 1954 to October 31, 1964, pursuant to which a security deposit was given to the landlord in the sum of $1,200, for the faithful performance and observance by the tenant of the terms, conditions and provisions thereof.

It appears that the rent due on August 1, 1956 was unpaid when on August 20 of that year the assignee took possession under the assignment, remaining in possession until September 12, 1956, a period of 24 days, for which the landlord claims the sum of $275.28 from the assignee for use and occupation. While conceding that the landlord is entitled to apply the security against the rent due for the unexpired portion of the lease commencing August 1, 1956, within the limits provided by section 13 of the Debtor and Creditor Law, the assignee claims that the landlord is not entitled to the sum of $275.28 as an administrative expense.

This court.does not agree with the latter contention. So long as the assignee used and occupied the premises of its assignor, the landlord could neither obtain possession thereof nor recoup its loss by reason of the nonpayment of the rent. Therefore, the value of such use and occupation may not be offset by the security which the assignor had deposited under .the lease. Accordingly, the $275.28 claimed by the landlord for use and occupation is allowed as an administrative expense and its claim as a general creditor, in light of that allowance, is fixed in the sum of $2,882.12 which includes the application of the security deposited under the lease.

As thus modified, the account of the assignee is settled and confirmed. The assignee is allowed commissions in the sum of $278.62 and its attorneys a counsel fee in the sum of $1,000 plus disbursements of $38.98.

Settle order.