Landlord & Tenant

Owner Entitled to Use and Occupancy After Expiration of Lease

Liberty Equity Restoration Corp. v. Park

NYLJ 6/12/15, p. 27, col. 3

AppDiv, Second Dept.

(memorandum opinion)

In a consolidated action for breach of contract by occupant of a home, and summary holdover proceeding by owner of the home, owner appealed from Supreme Court's denial of his summary judgment motion. The Appellate Division modified to grant the motion to the extend owner sought possession and to establish liability for use and occupancy, but concluded that questions of fact remained about the value of use and occupancy.

Owner entered into a contract to sell the property to Liberty Equity. At the same time, owner leased the home to Liberty Equity. Allegedly, the latter then subleased the premises. Liberty Equity then brought this action for breach of the contract of sale, leading owner to bring a summary possession proceeding because the lease had expired. The two proceedings were consolidated, and owner sought summary judgment on its claim for possession and use and occupancy. Supreme Court denied the motion.

In modifying, the Appellate Division held that owner had made out a prima facie case for use and occupancy by establishing that the lease had expired and Liberty Equity had remained in possession, while Liberty Equity had raised no questions of fact in response. As a result, the court granted summary judgment on the issues of possession and use and occupancy, but held that issues of fact remained on the appropriate amount to be awarded.

Guaranty Remains in Effect Even After Modification of the Lease

250 West 78th LLC v. Pildes of 83rd St, Inc.

NYLJ 6/4/15, p. 19, col. 5

AppDiv, First Dept.

(memorandum opinion)

In an action by landlord against tenant and tenant's guarantor for rent due, landlord appealed from Supreme Court's grant of summary judgment to the guarantor and from dismissal of its complaint against tenant, while tenant cross-appealed from Supreme Court's dismissal of its counterclaim for return of its security deposit. The Appellate Division reversed, holding that the guaranty remained in effect even after a lease extension with increased rent.

In 1996, tenant leased the premises from landlord's predecessor for a 10-year term. Tenant's principal guaranteed payment of the rent and additional rent obligations under the lease, and provided that the rent obligations included the obligation to pay rent that might come due during any extension of the lease term. The guaranty provided that landlord could modify or amend any provisions of the lease without releasing or impairing the obligations of the guarantor. In 2006, tenant extended the lease term (at increased rent) through 2009. In 2008, tenant extended the lease through 2014. Landlord subsequently brought this action for rent against both tenant and guarantor.

In reversing Supreme Court's award of summary judgment to guarantor, the Appellate Division held that the increases in rent during the lease renewal periods did not release guarantor of his obligation under the guaranty. The court also held that Supreme Court had improperly dismissed the claim against tenant, since tenant had never moved to dismiss the complaint against it, focusing only on the guaranty. Finally, the court concluded that summary judgment was not appropriate in favor of either party on the claim for return of the security deposit.

Lease Unenforceable Because Amendment Not Signed By County Executive

County of Nassau v. Grand Baldwin Associates, L.P.

NYLJ 5/29/15, AppDiv, Second Dept.

(memorandum opinion)

In an action by the county to establish that a lease it entered as a tenant is invalid and unenforceable, landlord appealed from Supreme Court's grant of summary judgment to the county. The Appellate Division affirmed, holding that the lease was invalid because the county executive had failed to sign an amendment to the lease.

Landlord agreed to lease the subject property to the county for use as a police station. The landlord was to build the station, but the county was to bear all of the construction expenses. Landlord signed the lease on Sept. 30, 2009. In a separate document titled “Amendment to Lease,” landlord agreed to enter into a project labor agreement with the Nassau/Suffolk Building Trades Council. Landlord signed the amendment on Dec. 7, 2009. The county legislature approved the lease and the amendment on Dec. 16, and the County Executive signed the lease on Dec. 24. The County Executive never signed the amendment. In this action, the county sought a declaration that the lease was invalid, and Supreme Court awarded summary judgment declaring the lease invalid. Landlord appealed.

In affirming, the Appellate Division concluded that the Nassau County charter made the county executive's signature on the lease amendment an essential element of a binding contract. The signature, therefore, could not be treated as a mere ministerial act. Because the amendment was integral to the lease agreement, the invalidity of the amendment rendered the entire lease unenforceable.

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Owner Entitled to Use and Occupancy After Expiration of Lease

Liberty Equity Restoration Corp. v. Park

NYLJ 6/12/15, p. 27, col. 3

AppDiv, Second Dept.

(memorandum opinion)

In a consolidated action for breach of contract by occupant of a home, and summary holdover proceeding by owner of the home, owner appealed from Supreme Court's denial of his summary judgment motion. The Appellate Division modified to grant the motion to the extend owner sought possession and to establish liability for use and occupancy, but concluded that questions of fact remained about the value of use and occupancy.

Owner entered into a contract to sell the property to Liberty Equity. At the same time, owner leased the home to Liberty Equity. Allegedly, the latter then subleased the premises. Liberty Equity then brought this action for breach of the contract of sale, leading owner to bring a summary possession proceeding because the lease had expired. The two proceedings were consolidated, and owner sought summary judgment on its claim for possession and use and occupancy. Supreme Court denied the motion.

In modifying, the Appellate Division held that owner had made out a prima facie case for use and occupancy by establishing that the lease had expired and Liberty Equity had remained in possession, while Liberty Equity had raised no questions of fact in response. As a result, the court granted summary judgment on the issues of possession and use and occupancy, but held that issues of fact remained on the appropriate amount to be awarded.

Guaranty Remains in Effect Even After Modification of the Lease

250 West 78th LLC v. Pildes of 83rd St, Inc.

NYLJ 6/4/15, p. 19, col. 5

AppDiv, First Dept.

(memorandum opinion)

In an action by landlord against tenant and tenant's guarantor for rent due, landlord appealed from Supreme Court's grant of summary judgment to the guarantor and from dismissal of its complaint against tenant, while tenant cross-appealed from Supreme Court's dismissal of its counterclaim for return of its security deposit. The Appellate Division reversed, holding that the guaranty remained in effect even after a lease extension with increased rent.

In 1996, tenant leased the premises from landlord's predecessor for a 10-year term. Tenant's principal guaranteed payment of the rent and additional rent obligations under the lease, and provided that the rent obligations included the obligation to pay rent that might come due during any extension of the lease term. The guaranty provided that landlord could modify or amend any provisions of the lease without releasing or impairing the obligations of the guarantor. In 2006, tenant extended the lease term (at increased rent) through 2009. In 2008, tenant extended the lease through 2014. Landlord subsequently brought this action for rent against both tenant and guarantor.

In reversing Supreme Court's award of summary judgment to guarantor, the Appellate Division held that the increases in rent during the lease renewal periods did not release guarantor of his obligation under the guaranty. The court also held that Supreme Court had improperly dismissed the claim against tenant, since tenant had never moved to dismiss the complaint against it, focusing only on the guaranty. Finally, the court concluded that summary judgment was not appropriate in favor of either party on the claim for return of the security deposit.

Lease Unenforceable Because Amendment Not Signed By County Executive

County of Nassau v. Grand Baldwin Associates, L.P.

NYLJ 5/29/15, AppDiv, Second Dept.

(memorandum opinion)

In an action by the county to establish that a lease it entered as a tenant is invalid and unenforceable, landlord appealed from Supreme Court's grant of summary judgment to the county. The Appellate Division affirmed, holding that the lease was invalid because the county executive had failed to sign an amendment to the lease.

Landlord agreed to lease the subject property to the county for use as a police station. The landlord was to build the station, but the county was to bear all of the construction expenses. Landlord signed the lease on Sept. 30, 2009. In a separate document titled “Amendment to Lease,” landlord agreed to enter into a project labor agreement with the Nassau/Suffolk Building Trades Council. Landlord signed the amendment on Dec. 7, 2009. The county legislature approved the lease and the amendment on Dec. 16, and the County Executive signed the lease on Dec. 24. The County Executive never signed the amendment. In this action, the county sought a declaration that the lease was invalid, and Supreme Court awarded summary judgment declaring the lease invalid. Landlord appealed.

In affirming, the Appellate Division concluded that the Nassau County charter made the county executive's signature on the lease amendment an essential element of a binding contract. The signature, therefore, could not be treated as a mere ministerial act. Because the amendment was integral to the lease agreement, the invalidity of the amendment rendered the entire lease unenforceable.

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