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Landlord & Tenant Law
Occupation of Premises Does Not Establish Assignment By Operation of Law
Innerworkings, Inc. v. Arik Eshel CPA & Assoc. P.C. 2024 WL 781688, AppDiv, First Dept. (memorandum opinion)
In tenant's action against subtenant, subtenant's principal, and alleged assignees of the sublease, all parties appealed from Supreme Court's denial of their respective summary judgment motions. The Appellate Division modified to dismiss all of tenant's claims against the individual defendants and in particular to dismiss the claims against the alleged corporate assignees, holding that the alleged assignment did not satisfy the statute of frauds.
Tenant subleased the premises to BMY in a lease signed by its principal Greenwald. The sublease forbade oral assignments and included a "no waiver" clause, but authorized subtenant to permit occupation by an accounting firm. The accounting firm did occupy the premises by arrangement with subtenant, and subtenant defaulted on payment of rent to tenant. Tenant then brought this action, contending that subtenant had orally assigned its sublease to the accounting firm. Subtenant's principal contended that his signature on the lease was forged, and the accounting firm and its principal asserted that it had never taken an assignment of the sublease. All parties sought summary judgment, but Supreme Court denied their respective motions.
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