KMWB Partner James Schwartz Secures Win in Guaranty Dispute

KMWB Partner, James Schwartz, secured a significant victory at the Appellate Division, First Department in a commercial guaranty action. The firm’s client, the owner of an office building, sued a lease guarantor for unpaid rent. The guarantor sought dismissal, claiming that the landlord and tenant had modified the lease. The guarantor then asserted that because, under principles of guaranty law, any modification of the guaranteed obligation frees the guarantor, it was no longer liable. The trial court agreed.

However, the Appellate Division reversed, holding that the guaranty itself said that modifications would not free the guarantor. The Court further noted that, in any event, the alleged modification was not a true modification at all, but rather an instance of the landlord’s lenience with the tenant.

Read decision ​here​.

If you have any questions about guaranty enforcement or commercial lease matters, please contact James Schwartz or your KMWB trusted advisor.