Landlord & Tenant

AppDiv, Second Dept

(memorandum opinion)

In an action for personal injuries, the City of New York, as landlord, appealed from Supreme Court's denial of its motion for summary judgment. The Appellate Division reversed and granted the city's motion, holding that as an out-of-possession landlord, the city was not liable for injuries suffered on the premises as a result of the foreseeable criminal acts of third parties.

Plaintiff alleges injury as a result of criminal activity in a municipal hospital. In 1970, the city leased its municipal hospitals to the Health and Hospitals Corporation (HHC). The lease required HHC to assume all maintenance responsibilities, and the city retained no right as landlord to re-enter for any reason. The lease did not require the city to furnish security for the premises, but it did require the city to provide funding for HHC. When plaintiff brought this action against HHC and the city, the city sought summary judgment, but Supreme Court denied the motion, concluding that the city's obligation to fund HHC raised questions of fact about the city's liability for providing inadequate security at an HHC hospital. The city appealed.

In reversing, the Appellate Division emphasized that the city was an out-of-possession landlord with no day-to-day control over operations of the HHC. As a result, the city had no liability for injuries suffered as a result of criminal acts of third parties.

Bankruptcy Protection Does Not Extent to Subtenant

Integral Development Corp. v. Vista Financial Holdings Corp.

NYLJ 10/23/03, p. 19, col. 1

Civil Ct., N.Y. Cty

(Nadelson, J.)

In a summary nonpayment proceeding brought by tenant against commercial subtenant, tenant sought to provide the city marshal with judicial instructions. The court ordered the marshal to proceed with eviction, holding that because tenant had obtained a warrant of eviction before subtenant filed for bankruptcy protection, subtenant was not protected by an automatic stay.

Tenant brought the summary proceeding in 2002, and the parties entered into a consent judgment, which subtenant breached. In June, 2003, tenant served a 5-day notice of eviction pursuant to the settlement stipulation, and subtenant was evicted on July 14. Subtenant then obtained an order to show cause that temporarily restored subtenant to the premises. After subtenant's restoration application was denied on September 5, a city marshal served another 5-day notice of eviction on September 11, with eviction scheduled for September 22. On September 19, subtenant notified the marshal that it had filed for bankruptcy petition, and the marshal notified tenant that he would not proceed with the eviction until he received further judicial direction. Tenant then filed an order to show cause to provide the marshal with instructions.

In instructing the marshal to proceed with the eviction, the court noted that a landlord need not move in bankruptcy court to vacate an automatic stay when a non-residential lease has terminated before the filing of the bankruptcy proceeding. Whether the lease has terminated is a question of state law, and in New York, issuance of a warrant of eviction annuls the landlord-tenant relationship. As a result, in this case, the lease had terminated before initiation of the bankruptcy proceedings. Subtenant was left with a naked possessory interest that was of minimal value to the estate. As a result, the court directed the marshal to proceed with the eviction.

Out-of-Possession Landlord Not Liable for Criminal Acts

DeJesus v. New York City Health and Hospitals Corp.

NYLJ 10/14/03, p. 32, col. 4

AppDiv, Second Dept

(memorandum opinion)

In an action for personal injuries, the City of New York, as landlord, appealed from Supreme Court's denial of its motion for summary judgment. The Appellate Division reversed and granted the city's motion, holding that as an out-of-possession landlord, the city was not liable for injuries suffered on the premises as a result of the foreseeable criminal acts of third parties.

Plaintiff alleges injury as a result of criminal activity in a municipal hospital. In 1970, the city leased its municipal hospitals to the Health and Hospitals Corporation (HHC). The lease required HHC to assume all maintenance responsibilities, and the city retained no right as landlord to re-enter for any reason. The lease did not require the city to furnish security for the premises, but it did require the city to provide funding for HHC. When plaintiff brought this action against HHC and the city, the city sought summary judgment, but Supreme Court denied the motion, concluding that the city's obligation to fund HHC raised questions of fact about the city's liability for providing inadequate security at an HHC hospital. The city appealed.

In reversing, the Appellate Division emphasized that the city was an out-of-possession landlord with no day-to-day control over operations of the HHC. As a result, the city had no liability for injuries suffered as a result of criminal acts of third parties.

Bankruptcy Protection Does Not Extent to Subtenant

Integral Development Corp. v. Vista Financial Holdings Corp.

NYLJ 10/23/03, p. 19, col. 1

Civil Ct., N.Y. Cty

(Nadelson, J.)

In a summary nonpayment proceeding brought by tenant against commercial subtenant, tenant sought to provide the city marshal with judicial instructions. The court ordered the marshal to proceed with eviction, holding that because tenant had obtained a warrant of eviction before subtenant filed for bankruptcy protection, subtenant was not protected by an automatic stay.

Tenant brought the summary proceeding in 2002, and the parties entered into a consent judgment, which subtenant breached. In June, 2003, tenant served a 5-day notice of eviction pursuant to the settlement stipulation, and subtenant was evicted on July 14. Subtenant then obtained an order to show cause that temporarily restored subtenant to the premises. After subtenant's restoration application was denied on September 5, a city marshal served another 5-day notice of eviction on September 11, with eviction scheduled for September 22. On September 19, subtenant notified the marshal that it had filed for bankruptcy petition, and the marshal notified tenant that he would not proceed with the eviction until he received further judicial direction. Tenant then filed an order to show cause to provide the marshal with instructions.

In instructing the marshal to proceed with the eviction, the court noted that a landlord need not move in bankruptcy court to vacate an automatic stay when a non-residential lease has terminated before the filing of the bankruptcy proceeding. Whether the lease has terminated is a question of state law, and in New York, issuance of a warrant of eviction annuls the landlord-tenant relationship. As a result, in this case, the lease had terminated before initiation of the bankruptcy proceedings. Subtenant was left with a naked possessory interest that was of minimal value to the estate. As a result, the court directed the marshal to proceed with the eviction.