J.N.A. Realty Corp. v. Cross Bay Chelsea, Inc.

366 N.E.2d 1313 (1977)

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J.N.A. Realty Corp. v. Cross Bay Chelsea, Inc.

New York Court of Appeals
366 N.E.2d 1313 (1977)

J.N.A. Realty Corp. v. Cross Bay Chelsea, Inc.

Facts

J.N.A. Realty Corp. (JNA) (plaintiff) leased commercial property to a restaurant for a 10-year term, with an option to renew for another 10-year term. The lease required the restaurant to inform JNA at least six months prior to the end of the lease term if it wished to exercise the option. Cross Bay Chelsea, Inc. (Chelsea) (defendant) offered to buy the lease, under the condition that the option be modified to be a 24-year term. JNA agreed to modify the option term as requested. All other terms of the lease remained unchanged, including the six-month-notice requirement. Chelsea purchased the lease, as well as some fixtures and chattels then existing on the property. Chelsea occupied the premises and made improvements to the property. Chelsea did not give notice before the deadline, later claiming it was unaware there was a deadline. After the deadline passed, JNA informed Chelsea that Chelsea needed to vacate the premises at the end of the lease term. Chelsea then provided notice of its intention to renew the lease, but JNA refused to renew the lease. After the lease expired, JNA brought a holdover action to recover the premises from Chelsea. The trial court held that Chelsea was entitled to equitable relief in the form of a lease renewal, and the appellate term affirmed. The appellate division reversed the judgment for Chelsea. Chelsea appealed to the New York Court of Appeals.

Rule of Law

Issue

Holding and Reasoning (Wachtler, J.)

Dissent (Breitel, C.J.)

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