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In a case of first impression, the Appellate Division, First Department of New York recently addressed a split in the decisions of the lower courts as to the scope of the New York City Guaranty Law, Administrative Code §22–1005 (Guaranty Law). In Tamar Equities Corp. v. Signature Barbershop 33 Inc., No. 1153, 2024 WL 39739 (App. Div. 1st Dept. Jan. 4, 2024), the Appellate Division analyzed whether the Guaranty Law bars recovery from a guarantor where a commercial tenant’s default initially arose during the Guaranty Law’s Window Period of March 7, 2020 to June 30, 2021 (the Window Period), but persisted after the expiration of the Window Period. Holding that landlords may pursue claims for periods outside the Window Period regardless of the date of initial default, the court unanimously reversed the trial court’s dismissal of the landlord’s action against a guarantor of a barbershop lease. Until this decision, some trial courts held that post-Window Period obligations were recoverable, while others held that the guaranty was rendered a nullity.
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Sui Generis: Negotiate Like You Mean It
By Lydia Pilch
As further follow-up regarding tracking of the lifecycle of a commercial lease, Part Two of this series addresses various negotiation events, strategies, desired outcomes and potentially low key disasters.
New York’s Guaranty Law Continues to Divide Opinion
By Matthew J. Schenker and Joshua Kopelowitz
This article discusses the recent developments surrounding the constitutionality of New York's Guaranty Law. In particular, we address the Southern District’s view that the statute is unconstitutional and the splintered view of the statute’s constitutionality expressed by New York State courts.
Don’t Get Caught Holding a Conditional Loan Approval at Closing
By Matthew Kramer
With rising interest rates and more stringent lending standards for both residential and commercial properties, security deposit disputes caused by buyers’ inability to satisfy pre-closing purchase-financing conditions are also increasing.
New York’s Seldom Used Expedited Money Judgment Mechanism: CPLR 3213
By Massimo F. D’Angelo and Gregory Wong
In New York state and local court cases, there is a seldom-used procedural mechanism for obtaining an expedited money judgment against a guarantor. This article provides an overview of CPLR 3213 motions, an update on the resolution of the split that previously existed between the New York State Supreme Court, Appellate Division, First and Second Departments, and practical guidance for transactional counsel drafting commercial leases and guaranties.
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