When a tenant under an unexpired lease of nonresidential real property files a case under chapter 11 of the Bankruptcy Code, both tenant and landlord acquire rights and obligations that may contravene the terms of the lease...more
Many commercial landlords require that a guarantor secure the obligations and liabilities of a tenant as a prerequisite for entering into a lease. A lease guaranty is a contract between an individual or entity (guarantor)...more
Last summer, we wrote about New York City Administrative Code Section 22-1005, known as the Guaranty Law. This was a pandemic-era prohibition on enforcement of personal guaranties supporting commercial leases for defaults...more
Third-Party Releases are common in English law schemes of arrangement and restructuring plans, and US courts have so far indulged that approach in granting recognition. If Prospero’s plea to the audience at the...more
Recently, two important court decisions ruled that a New York City local law known as the Guaranty Law, which rendered unenforceable certain guaranties of commercial lease obligations, was unconstitutional. One month later,...more
The saga continues now that a federal district court judge has ruled that N.Y.C. Local L. No. 55 of 2020 (also known as the Guaranty Law) is unconstitutional. The Guaranty Law, which sought to provide immediate monetary...more
Two recent cases from New York state court came out on opposite ends of the landlord-tenant and landlord-guarantor divides over COVID-19-related commercial lease disputes. On the pro-landlord end of the spectrum, in Mept 757...more
On May 26, 2020, New York City Mayor Bill de Blasio signed into law Int. No. 1932-A, amending the New York City Administrative Code to prohibit enforcement of personal liability against natural persons for certain commercial...more
As the COVID-19 (Coronavirus) pandemic continues to have devastating effects on our nation’s economy, particularly for small businesses and restaurants struggling to make ends meet and stay afloat, relief has become available...more
Certain guarantors of restaurant, retail, and other commercial leases in New York City may soon be off the hook for tenant defaults occurring during the COVID-19 pandemic, thanks to a bill recently passed by the New York City...more
Sister blog The LLC Jungle recently posted about an opinion from California’s Sixth District Court of Appeal — Orozco v. WPV San Jose, LLC — describing the legal difference between an LLC tenant, and the LLC’s owner who...more
A lease guaranty is a valuable tool that provides commercial landlords with additional security. This is especially true in the case of leasing to a corporate tenant without sizable assets or an established operating history....more
A common theme of the cases and issues discussed in this blog is that document drafting is at the root of many commercial real estate disputes....more
In reviewing notable guaranty cases from 2017 while preparing this year’s updates and edits for CEB’s top-notch treatise, California Mortgages, Deeds of Trust, and Foreclosure Litigation, we came across an opinion that...more
In Cedar-Fieldstone Marketplace, LP v. T.S. Fitness, Inc., the Massachusetts Appeals Court considered whether a release of a landlord’s claims against a tenant for unpaid rent precluded the landlord from bringing a collection...more
One might expect that a sheriff’s sale of stock pursuant to a writ of execution could not result in a viable claim for conversion by a judgment debtor. A California Court of Appeal, however, has ruled that it could....more
Is a personal guaranty a separate agreement from the underlying contract it guarantees? The North Carolina Court of Appeals recently considered this issue in Friday Investments, LLC v. Bally Total Fitness of the...more
Social media is everywhere, and while it gives businesses an unprecedented opportunity to reach a record number of consumers at a minimal cost, it can prove to be a double edged sword when disgruntled employees or customers,...more
If you can’t locate a party and personally serve him, you can follow the less-known method of service, called substitute service. Once you have filed your complaint seeking damages for breach of a lease or guaranty, you are...more
As we now find ourselves in the midst of Q4 with the holiday season rapidly approaching, it is safe to say that 2015 was a rather dynamic year across the board. The real estate market being no exception, we expect great...more