Andrew Bittens Wins Favorable Decision for Landlords at Appellate Division

Andrew Bittens, Esq. a partner at KMWB, received a favorable decision on appeal in which the Appellate Division, First Department affirmed the lower court’s grant of a motion for summary judgment. The case arose out of a holdover proceeding following expiration of the tenant’s twenty-five year commercial lease. The matter was then consolidated with a related, pending Supreme Court action commenced by the commercial tenant who also resided in and owned a residential apartment in the co-operative building located in Tribeca. The lease for the commercial space expired in June, 2008 and the tenant had the option for three consecutive 25 year lease renewals. Subsequent to the expiration of the lease, a third party lender sought to intervene in the matter claiming that the commercial tenant had assigned the lease to it in 2009 and that it was therefore the successor-in-interest to the commercial lease.

After, the co-operative moved for summary judgment, the lower court determined that the co-operative never received proper notice of the assignment so that it was therefore not an effective assignment and the third-party lender had no rights to the commercial space. The Appellate Division went further in determining that the commercial tenant’s attempt to exercise all three twenty-five year renewal options at the same time in 1992 was ineffective since it failed to comply with the lease term that required the options to be exercised within sixty days of the end of the term. The court further held that the landlord did not waive his right to object to the renewal by accepting rent checks from the tenant. The court reasoned that accepting rent checks from the commercial tenant following the termination of the twenty-five year lease merely resulted in a month to month tenancy, not a reinstatement of the prior lease agreement. The Court ultimately found in favor of the client and affirmed the grant of summary judgment in favor of the cooperative.