The opinion of the court was delivered by: MEANEY
This proceeding is a consequence of the Government's condemnation and occupancy of certain space in the Harborside Warehouse in Jersey City, New Jersey, during World War II. This matter arises upon the Government's motion to strike any claim made on behalf of Schaffer Belts, Inc. except as a holdover tenant.
By stipulation the parties have set forth the material facts as follows:
In 1941 the Harborside Warehouse Company (hereinafter referred to as Harborside) and Schaffer Belts, Inc. (hereinafter referred to as Schaffer) entered into a lease for the premises in question which expired on the last day of January, 1943. During the latter part of 1942 negotiations began for a new lease. On December 15, 1942, Joseph H. Sauter, general manager of Harborside, sent a letter to Schaffer in which he said:
'In reply to yours of December 10th requesting that we renew your lease for a period of one year, increased costs make it impossible to grant your request. However, we are willing to compromise at 70 cents per square foot per year.
'As your tenancy has been most desirable, we hope you can see your way clear to remain.
'The following will confirm your telephone conversation with our Mr.Sauter.
'We will prepare a new lease for the 10,800 sq. ft. of space you now occupy on the 4th floor East of Unite No. 3. It will be for one year from February 1, 1943 at 70 cents per sq. ft per year. There are to be 3-1 year renewal option periods from January 31, 1944.
'As soon as the lease is prepared, we will forward it to you for completion.'
The lease referred to was never executed. Thereafter, until Government occupancy of the premises, Schaffer Belts occupied the premises and paid rent on the basis of 70 cents per square foot. In addition, under date of January 21, 1943, Schaffer sent to Harborside its check in the sum of $ 45 for the purpose of increasing the security deposit from $ 585 to $ 630 as required by Harborside. The check was accepted and cashed by Harborside. Schaffer removed from the premises on September 30, 1943.
The parties also stipulated that Mr. Leo Fisher, General Manager of Harborside would testify if called as a witness that Mr. R. B. M. Burke, Vice-President from June 1940 until his death in March 1945, negotiated for the leasing of space and entered into 'agreements' for the making of leases. The By-laws of Harborside provide: 'Leases for a longer period than one year, or for an annual rental exceeding six hundred dollars shall be approved by the Board and executed on behalf of the Company by the President, or a Vice-President, and the corporate seal shall be affixed thereto and duly attested.'
The practice of the Board of Directors of Harborside was to pass on leases twice each year. Often they were submitted to the Board months after they had been signed by Mr. Burke and rent had been paid. There is no record of disapproval of such a lease.
During its period of occupancy Schaffer had installed electrical taps, risers, switches and other electrical equipment which was rendered ...