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Adam Leitman Bailey, P.C. Wins Trial for Commercial Overtenant, Obtains Monetary Judgment for Unpaid Rent from Subtenant through the Date of Eviction and Balance of Sublease Term

By Christopher Halligan


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After a four day trial, Adam Leitman Bailey, P.C., recently prevailed in a plenary breach of contract action and obtained a monetary judgment with interest for a commercial Overtenant.

In 2013, an accountant subleased two portions of her Manhattan office space to an attorney and beauty salon. After making an initial payment and submitting a security deposit, the owner of the beauty salon stopped paying rent.

The Overtenant initially turned to a different law firm, whose first non-payment proceeding was dismissed. The accountant finally regained possession of the subleased space in August 2014 on default when the beauty salon failed to answer the second non-payment proceeding. However, by this time the Overtenant had not received any rent in months. And, there was still time remaining on the sublease and the Overtenant was not being paid.

She then came to Adam Leitman Bailey, P.C. for help.  Adam Leitman Bailey, P.C. analyzed the overlease and sublease and commenced a breach of contract action. In the case, Adam Leitman Bailey, P.C. demanded unpaid rent and late fees through the date of the subtenant’s eviction. In addition, relying on the seminal New York case of Holy Props. v. Cole Prods., 87 N.Y.2d 130, 661 N.E.2d 694, 637 N.Y.S.2d 964 (1995), in which the Court held that a commercial landlord in New York has no duty to mitigate damages, Adam Leitman Bailey, P.C. also demanded a judgment for unpaid rent through the date of the expiration of the sublease.

The subtenant retained counsel and opposed the action. She asserted that our client was not entitled to any rent after the eviction date and that our client was not entitled to a portion of the rent before the eviction. She claimed that our client illegally locked her out of the subleased space during her tenancy.

Adam Leitman Bailey, P.C. obtained smoking-gun correspondence between the parties that demonstrated that the subtenant had not been illegally locked out.

The matter proceeded to a five day trial. At trial Adam Leitman Bailey, P.C. demonstrated that the rent had not been paid and discredited the subtenant’s claims of illegal lockout. At the conclusion of trial Adam Leitman Bailey, P.C. submitted a legal brief arguing that our client is entitled to all unpaid rent through the date of the eviction and through the balance of the sublease term.

In a recent Decision and Order, the Court credited our client’s testimony and found that the subtenant’s claims were not credible and meritless. The Court awarded damages to our client for unpaid rent and late fees through the date that the subtenant was evicted. Moreover, relying on Holy Prop., and it’s progeny, the Court awarded a judgment for the rent that our client would have been entitled to, through the balance of the sublease term, if the subtenant remained in possession. Finally, the Court awarded interest.

Christopher Halligan and Vladimir Mironenko of Adam Leitman Bailey, P. C. represented the commercial Overtenant.

Adam Leitman Bailey, P.C.

NEW YORK REAL ESTATE ATTORNEYS