Court Opinion

ID: 5388102
Source: CourtListenerOpinion
Date Created: 2022-01-08 09:35:47.152203+00
Date Added: 2024-06-11T08:30:15.650818
License: Public Domain

Van Voorhis, J.
(concurring). The result in favor of the tenant would appear to be correct, inasmuch as the rental of $10,000 per annum under the new lease with the new tenant for a term of ten years appears to have been made as part of an oral agreement that the new tenant would also have basement space in the same building without extra charge. The new tenant was therefore given a better offer than was available to the existing statutory tenant, thus rendering the situation outside of the scope of subdivision (k) of section 8 of the Business Bent Law.
My vote for affirmance is based exclusively upon that ground. The clause in the new lease that it shall be subject to cancellation u if Tenant shall make default with respect to any other *316lease between Landlord and Tenant ”, is not in violation of the provision in subdivision (k) of section 8 that the new lease shall be “ non-cancellable except for violation of any term or obligation of such lease ”, in view of the circumstance that no other lease existed between this landlord and tenant at the time in question. The provision concerning defaults under another lease is said to have been inserted in the standard form of lease of the Real Estate Board of New York in 1935, to cover the situation where a new lease is made of the same premises between the same parties for a term to take effect upon the expiration of an existing lease at a future date. If a tenant in such case were to break a condition of the existing lease, the intention' of the Real Estate Board was evidently to leave the landlord free to cancel the future lease before the commencement of its term. No such situation could exist here, inasmuch as the prior lease between the landlord and the tenant in possession had expired. We are dealing with a statutory tenancy. In the nature of the situation, there is no prior lease between these parties to which the Real Estate Board’s form clause could apply. The proposed new ten-year lease would follow immediately upon the termination of a statutory tenancy. Consequently there is nothing upon which the cancellation clause in the new lease could operate.
The only situations which have been suggested to which the clause in question could apply are irrelevant. It would hardly extend, in any event, to other real property than the demised premises which might have been or might become subject to lease between the same landlord and tenant. Only a strained construction could likewise render the clause applicable to some future lease respecting the same premises which the landlord and the new tenant might make for a term commencing at the end of the prospective ten-year lease, or which might shorten or otherwise alter the prospective lease. In any instance where a ten-year lease is entered into between a landlord and a new tenant pursuant to subdivision (k) of section 8, the possibility is latent that the landlord and new tenant máy in good faith alter or cancel the new lease by later mutual agreement before its termination. The test of its validity is not whether that may happen, but whether some secret understanding to change or end it exists between them at the time when the statutory tenant in possession is given the first refusal. Subdivision (k) of section 8 contemplates that the statutory tenant be given the right to enter into the new relationship upon the same basis in priority to the new tenant, and if, as in this case, there *317be some collateral understanding that the new tenant is to have an advantage, such as free use of an area in the basement which the statutory tenant did not or could not enjoy, the requirements of subdivision (k) of section 8 have not been fulfilled. For this reason the determination of the Appellate Term in favor of the tenant should be affirmed.
Peck, P. J., Dore, Cohn and McCurn, JJ., concur in Per Curiam opinion; Van Voorhis, J., concurs in result, in opinion.
Determination unanimously affirmed, with costs to the respondent. [See post, p. 927.]