BBG News

Great Decision Against Commercial Tenant and Lease Guarantor

Aug 5, 2022

In a decision and order docketed, the Supreme Court from the New York County awarded our client a summary judgment against the tenant and the lease guarantor for more than $144k, plus interest back to April 1, 2021, and attorneys’ fees.

The Court rejected all of the tenant’s COVID-related defenses of the impossibility of performance, the frustration of purpose, and force majeure, and MOST SIGNIFICANTLY, rejected the defendants’ defense that the lease guarantor was protected from liability under the recently enacted Guaranty Law – N.Y.C. Administrative Code § 202-1005. Defendants argued that the tenant is a restaurant, which is clearly protected under the Guaranty Law.

The Firm argued that the restaurant had removed several tables in the small retail location years before the COVID pandemic to accommodate more customers, and therefore did not have in-premises consumption of food or drinks during the period in which it had defaulted in paying rent. Without in-premises consumption, the facility did not technically qualify for protection under the Guaranty Law as a restaurant.

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