Opinion
2018-734 K C
02-08-2020
EIGHTEEN ASSOCIATES, LLC, Appellant, v. COURT STREET PIZZA, INC., Also Known as Court Street Pizzeria, Inc., Doing Business as Antonio's Pizzeria, Also Known as Antonio's Pizza Café, Respondent.
Cornicello, Tendler & Baumel-Cornicello, LLP (David B. Tendler and Jay H. Berg of counsel), for appellant. Law Office of Peter J. Pruzan (Peter J. Pruzan of counsel), for respondent.
Cornicello, Tendler & Baumel-Cornicello, LLP (David B. Tendler and Jay H. Berg of counsel), for appellant.
Law Office of Peter J. Pruzan (Peter J. Pruzan of counsel), for respondent.
PRESENT: MICHELLE WESTON, J.P., THOMAS P. ALIOTTA, BERNICE D. SIEGAL, JJ.
ORDERED that the final judgment is affirmed, without costs.
In this commercial holdover proceeding, the petition alleges that landlord terminated the lease for the premises, a pizzeria, upon tenant's failure to cure four violations of the lease: displaying signs without landlord's permission, sale of items beyond those permitted in a restrictive-use covenant, failure to obtain final sign-off approval from the New York City Department of Buildings for two open permits, and permitting an objectionable odor of pizza to permeate the building. After a nonjury trial, the Civil Court found, in a lengthy decision, among other things, that each of tenant's breaches was immaterial or de minimis and did not warrant a forfeiture of the lease ( 57 Misc 3d 1204[A], 2017 NY Slip Op 51222[U] ).
"It is well settled that absent an express stipulation for a forfeiture, the breach of a covenant in a lease generally does not work a forfeiture of the lease term" ( Lake Anne Realty Corp. v. Sibley , 154 AD2d 349, 351 [1989] ; see Ogden v. Hamer , 268 App Div 751 [1944] ; Fly Hi Music Corp. v. 645 Rest. Corp. , 64 Misc 2d 302 [Civ Ct, NY County 1970], affd 71 Misc 2d 302 [App Term, 1st Dept 1972] ). Rather, when the termination of a lease is sought based on a breach of the lease, absent an express forfeiture provision, the trier of fact must determine whether the lease violation is substantial, material and consequential enough to justify the forfeiture of the lease (see Madison 52nd Corp. v. Ogust , 49 Misc 2d 663 [Civ Ct, NY County 1966], affd 52 Misc 2d 935 [App Term, 1st Dept 1966] ; see also Matter of Park E. Land Corp. v. Finkelstein , 299 NY 70, 74 [1949] [" ‘Substantial’ is a word of general reference which takes on color and precision from its total context. Having little if any meaning when considered in abstract or in vacuum, it must be defined with reference to the peculiar legal and factual setting in which it occurs"] ).
Here, the Civil Court properly found that each of the lease covenants that tenant breached did not contain a forfeiture clause and that each of the breaches was de minimis and immaterial, and did not constitute grounds for forfeiture. Moreover, with respect to all four breaches, as the Civil Court specifically found, landlord failed to present any evidence of prejudice, costs, or injury to landlord as a result of tenant's breaches (see Fly Hi Music Corp. , 64 Misc 2d at 304 ["The law abhors a forfeiture of a lease and where, as here, no substantial injury resulted to the landlord for the failure to comply strictly, the tenant should not be unduly penalized. A forfeiture of the lease herein, particularly after the tenant's expenditure of $7,000 for improvements, would be unduly harsh, especially in light of the fact that the condition complained of was not hazardous"] ).
Landlord's arguments on appeal do not require a different result. Landlord's contention that it did not waive the breaches is of no consequence if the breaches do not rise to the level of warranting a forfeiture. Tenant's failure to obtain a Yellowstone injunction (see First Natl. Stores v. Yellowstone Shopping Ctr. , 21 NY2d 630 [1968] ) also does not require that tenant forfeit the lease, because the breaches were found to have not warranted the termination or forfeiture of the lease. Landlord's argument in its reply brief that, pursuant to the recent opinion of Sag Harbor Pooh, LLC v. Plaza Surf & Sport, Inc. (60 Misc 3d 137[A], 2018 NY Slip Op 51116[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2018] ), a breach of a restrictive use clause constitutes a material breach is also without merit. A review of the opinion in Sag Harbor Pooh, LLC reveals that the restrictive covenant in question required the tenant to sell only "sports and surf equipment, and related apparel, shoes and accessories." There, the tenant admitted that it was not selling any sports or surf equipment, or apparel, shoes, or accessories related to sports and surf equipment. Here, tenant is selling pizza and Italian food, plus a few additional items, which is not comparable to not selling the items in the restrictive covenant at all. Finally, landlord's contention in its reply brief that the Civil Court improperly failed to consider tenant's breaches cumulatively is not properly before this court, as it was raised for the first time in the reply brief, and we decline to consider it (see Matter of Erdey v. City of New York , 129 AD3d 546 [2015] ; U.S. Bank N.A. v. Dellarmo , 128 AD3d 680, 681 [2015] )
Accordingly, the final judgment is affirmed.
WESTON, J.P., ALIOTTA and SIEGAL, JJ., concur.