Our clients, young entrepreneurs and proprietors of an artisanal bakery, entered into a long-term lease for approximately 3,500 square feet of warehouse space in the Williamsburg neighborhood of Brooklyn with dreams of opening a bar and upscale eatery in the space. After spending considerable resources and sweat equity building out the premises, they had their dreams shattered when the landlord served them a notice of eviction claiming various lease violations. These purported lease violations included: the client’s (i) alleged failure to close out an ALT-1 Department of Buildings permit and obtain a change to the building certificate of occupancy from warehouse use to an eating and drinking establishment; (ii) alleged failure to timely and diligently complete construction at the premises; and (iii) failure to carry the requisite insurance as required under the lease.
Facing eviction, the clients turned to Adam Leitman Bailey, P.C. (“ALBPC”) to help save their business. With only days until the lease termination date, ALBPC attorneys quickly sprang into action and prepared a motion by way of order to show cause for a Yellowstone injunction to obtain a special Court order to prevent the landlord from immediately terminating the lease. In support of the motion, ALBPC argued that it was the negligence and misfeasance of a neighboring tenant located in the same building that caused the delays to the construction work. ALBPC demonstrated through written correspondence that the landlord joined forces with the neighboring tenant to force the clients out of the building. Additionally, ALBPC detailed to the Court through Department of Buildings filings and other evidence how the neighboring tenant’s misfeasance directly triggered a OSHA investigation and eventually the New York City Department of Buildings issued a stop work order that prevented the clients from closing its Alt-1 and obtaining appropriate changes to the certificate of occupancy for the premises.
Simultaneously with filing the order to show cause, ALBPC filed a complaint against both the landlord and the neighboring tenant. The Court initially granted the injunction, conditioned upon the clients procuring proof of valid property insurance. When the clients could not procure valid insurance, it seemed like the fight was over and the clients would be evicted. To make matters worse, given their mounting legal fees, the clients could no longer afford to pay rent and were several months in arrears and were likely on the hook personally for the landlord’s legal fees.
Despite this, ALBPC attorneys did not give up and worked tirelessly to defend the clients’ lawsuit against the neighboring tenant in the hopes of leveraging a global settlement out of the landlord and neighboring tenant, who where obviously in lockstep.
Ultimately, ALBPC prevailed against the neighboring tenant’s motion to dismiss the complaint. Facing the potential for real liability, the neighboring tenant and landlord capitulated and agreed to enter into a global settlement agreement. In exchange for the clients dropping the lawsuit against the neighboring tenant and surrendering the space, the landlord agreed to waive all its rights to legal fees and rent arrears. This gave the clients the breathing room they needed to open a new establishment elsewhere, riding on the substantial savings ALBPC won for them in their old location.
The clients, now relieved from the prospect of total destruction of their business, are back to doing what they do best: serving-up and selling their delicious breads and pastries from their new location.
ALBPC attorneys Dov Treiman and Israel Katz drew the court papers and negotiated the settlement on behalf of the clients.