Opinion
2007-921 K C.
Decided July 10, 2008.
Appeal from a final judgment of the Civil Court of the City of New York, Kings County (Jack M. Battaglia, J.), entered May 18, 2006. The final judgment, after a nonjury trial, awarded possession to landlord (12 Misc 3d 1155[A], 2006 NY Slip Op 50904[U] [2006]).
Final judgment affirmed without costs.
PRESENT: PESCE, P.J., RIOS and STEINHARDT, JJ.
This case concerns a building in the Bush Terminal Industrial Complex in Brooklyn (the Bush Complex), which complex is owned by the City of New York (the City). In 1989, the City leased the Bush Complex to a predecessor of Harborside Management Corporation (Harborside Management) for a 10-year term ending in February 1999. On or about June 30, 1999, Harborside Management and tenant Harborside Mini Storage, Inc.'s predecessor, U.S. Movers Inc., executed a sublease for building 56, unit G, of the Bush Complex for a term commencing on July 1, 1999 and ending on December 31, 2008.
Toward the end of its lease period, Harborside Management entered into negotiations with the City for a renewal lease. The proposed renewal lease was approved by the Brooklyn Community Board, the President of the Borough of Brooklyn, and the City Planning Commission, but the City never executed the lease. In 2001, Harborside Management brought an action against the City to declare the proposed renewal lease valid. In November 2002, that litigation was settled by an agreement in which Harborside Management surrendered its interest in the Bush Complex to the City. Upon Harborside Management's surrender in December 2002, the City leased the complex, including the premises in question, to the New York City Economic Development Corporation, landlord herein, and tenant paid rent to said corporation.
In July 2005, landlord commenced this commercial holdover proceeding seeking possession of the subject premises. Throughout this proceeding, and on appeal, the essential dispute between the parties has been whether, as tenant contends, tenant occupies the subject premises pursuant to a valid unexpired sublease or, as landlord contends, as a month-to-month tenant whose tenancy has expired pursuant to a notice of termination.
Tenant argues, in essence, that it is not a month-to-month tenant and that it has a valid sublease because Harborside Management had a valid lease allowing it to enter into the sublease and/or because landlord, through its conduct, validated the sublease by "accepting tenant's attornment" under the sublease. Landlord contends that the sublease is invalid because Harborside Management's renewal lease was never executed, and thus Harborside Management was only a month-to-month tenant when it executed the sublease with tenant. Landlord further contends, in effect, that it never validated the sublease.
Following a trial, the Civil Court found that Harborside Management's renewal lease never became effective, and so, after February 28, 1999, Harborside Management became a month-to-month tenant of the City. The court also found that the record did not support a finding that landlord was estopped from denying the full effectiveness and enforceability of the sublease for its stated duration. Accordingly, it awarded landlord a final judgment of possession (12 Misc 3d 1155[A], 2006 NY Slip Op 50904[U] [2006]). For the reasons that follow, we affirm the final judgment.
Despite tenant's attempts to argue that Harborside Management's renewal lease may have been validated by the City, it is undisputed that the City ultimately decided not to execute the renewal lease. In support of its claim, tenant points only to the self-serving statements of Dominick Massa, president of Harborside Management, who died before this proceeding was commenced, as set forth in an affidavit which was prepared in connection with Harborside Management's litigation against the City, and which was never admitted into evidence in this proceeding. At trial, Diane Nieves, an employee of Massa, testified only that it was her understanding that Massa had been in negotiations with the City about the renewal lease, but that they did not finalize that lease. On this record, even if the Massa affidavit were admissible, the evidence is insufficient to establish that the City, by its conduct, is bound by the renewal lease that was never signed. Accordingly, based on the record in this proceeding, the lower court properly found that Harborside Management was a month-to-month tenant when it entered into the sublease with tenant.
Tenant argues, in the alternative, that its sublease is valid by virtue of landlord's acceptance thereof. Where a lease was originally invalid for want of title in the lessor, a subsequent purchaser may validate the lease by accepting attornment from the lessee under the invalid lease, with knowledge of the terms and conditions of the lease ( see e.g. Holm v C.M.P. Sheet Metal, 89 AD2d 229). "The acceptance of an attornment, however, is not proven by the mere payment and receipt of rent' . . . The proof viewed in its totality must evince clear and unequivocal tokens of an intention to accept an attornment'" ( Holm, 89 AD2d at 234, citing Matter of O'Donnell, 240 NY 99, 106, 107). In this case, the proof, viewed in its totality, does not clearly and unequivocally demonstrate that landlord ever validated the sublease.
Tenant also argues that landlord ratified the sublease. Ratification is the express or implied adoption of the acts of another by one for whom the other assumes to be acting, but without authority ( Holm, 89 AD2d at 232). Tenant never alleged that Harborside Management purported to act on landlord's behalf; therefore, the doctrine of ratification is not applicable here.
When it took over the Bush Complex in December 2002, landlord became responsible for about 40 to 50 subtenants. Landlord began billing tenant, as well as the other subtenants, for monthly rent and electricity charges using the same rental amounts and electricity billing procedure that had previously been used by Harborside Management. However, while certain notices sent to tenant by landlord's billing and insurance agents referred to a "lease" and/or to the sublease, landlord never stated that tenant's sublease was in effect and, in fact, sent tenant a notice characterizing tenant's payments as "use and occupancy," not as rent. In addition, an employee of landlord testified that landlord used the same billing amounts and procedure as Harborside Management had used for reasons of administrative convenience.
About a year after it took over the subject premises, landlord brought a nonpayment proceeding against tenant. Throughout that proceeding, landlord explicitly characterized tenant as a monthly tenant. Both parties were represented by counsel, and after extensive negotiations, that proceeding was settled by a stipulation dated June 29, 2004. In that stipulation, tenant is repeatedly referred to as a monthly tenant, including the following:
"WHEREAS, Respondent HARBORSIDE MINI STORAGE, INC., is the Monthly Tenant of Building 56, Unit G, located at the Bush Terminal Industrial Complex, at the Foot of 48th Street and First Avenue, Brooklyn, New York (the Subject Premises') . . . Respondent Harborside Mini Storage, Inc. is a monthly tenant of the Subject Premises. This Stipulation does not give it greater rights to the monthly tenancy. The Landlord reserves the right to terminate the monthly tenancy in accordance with applicable law."
The 2004 stipulation in the nonpayment proceeding contradicts tenant's principal's testimony that, prior to the instant proceeding, he was never informed by landlord that landlord did not consider the sublease valid and in effect. Moreover, tenant's sublease provided that, in July 2004, tenant's rent was to increase from $41,666.66 per month to $63,400 per month. According to tenant's principal's testimony, landlord never attempted to collect this increased amount, and tenant never paid the increased amount ( cf. 30 Carmine LLC v Depierro , 7 Misc 3d 836 [Civ Ct, NY County 2005]). Thus, viewing the evidence as a whole, we agree with the Civil Court that the record does not support a finding that landlord validated the sublease.
Accordingly, we affirm the final judgment awarding possession to landlord.
Pesce, P.J., Rios and Steinhardt, JJ., concur.