First American National Bank Of Nashville v. Chicken System Of America, Inc.,

616 S.W.2d 156 (1980)

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Nature of the Case

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Facts

First American (P) leased property to Chicken System (D) for 180 months from 1968 with a rental of $1049.08 per month with D paying all insurance and taxes. D took possession and paid all obligations until 1969 when PSI (D1) purchased D. The lease agreement between P-D contained a provision which expressly prohibited any assignment or subletting without the written consent of P. P discovered the purchase and wrote D1 and informed D1 that they could only take over the lease if it had the written consent of P. Despite this, D1 entered the premises and took possession and paid rent to P. On November 1, 1970, D1 defaulted on its payment of rent and vacated the premises. P filed suits seeking rent, insurance, taxes and maintenance under the terms of the lease agreement. D1's defense was that P had withheld consent and that the assignment between D and D1 was invalid and D1 was merely a tenant at suffrage, and when D1 vacated the premises, its obligations and rights under the lease ceased. The trial court ruled that P's lack of consent could be waived and essentially held that D1 was still liable to P. D1 appealed. That court affirmed; there is privity of estate between an original lessor and a subsequent assignee. Following the default of D1, P leased to another party for a term of 60 months at a rental rate of $600 per month. That lease was renewed in 1977 with a rent of $1,000 per month. P sued for the deficiency in the rent and got a judgment of $47,384.27 from D1. D1 appealed.