Tenant Couldn't Exercise Renewal Option After Lease Expired

December 1, 2004

An owner told a tenant that the deadline to exercise its second renewal option was drawing near. The tenant didn't exercise the option before the deadline. After the lease expired, the tenant assigned the lease and tried to exercise the renewal option. The owner refused to accept the renewal. The tenant sued the owner to let it renew the lease. The owner asked the court to dismiss the tenant's lawsuit.

An owner told a tenant that the deadline to exercise its second renewal option was drawing near. The tenant didn't exercise the option before the deadline. After the lease expired, the tenant assigned the lease and tried to exercise the renewal option. The owner refused to accept the renewal. The tenant sued the owner to let it renew the lease. The owner asked the court to dismiss the tenant's lawsuit.

A New York appeals court dismissed the tenant's lawsuit. The court said the tenant and assignee had offered no good reason that they should get to renew the lease after it expired. The court had no sympathy for the assignee, which had agreed to the assignment knowing that there was a question as to whether or not the lease had expired. The court ordered the tenant and assignee to pay holdover damages to the owner for failing to kick out a subtenant who was occupying the space when the lease expired [Chock Full O'Nuts Corp. v. NRP LLC I].

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