Today, in a highly anticipated decision, the United States District Court for the Southern District of New York declared that New York City’s Guaranty Bill is unconstitutional and violates the United States Constitution’s Contracts Clause. The Guaranty Bill rendered personal guaranties associated with certain commercial leases unenforceable for the period from March 7, 2020 through June 30, 2021 (the “COVID Period”). Here is a link to the decision: Melendez Decision (Bill Unconstiutional).
As a result of the decision, New York City property owners who have claims against commercial lease guarantors for unpaid rental arrears which are owed from the COVID Period may now be able to seek these previously unenforceable arrears from guarantors.
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If you wish to discuss how any aspect of this decision may apply to your case(s) or if you had any claims previously barred, contact your BBG attorney of record or email us at info@bbgllp.com.