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Kel Kim Corp. v. Central Markets, Inc.

Court of Appeals of New York
519 N.E.2d 295 (1987)


Kel Kim (plaintiff) leased a building from Central Markets (defendant) for a period of 10 years. Kel Kim was going to use the building as a skating rink and the lease required that Kel Kim buy a public liability insurance policy. Kel Kim bought a policy that was in effect for the first six years of the lease. However, thereafter, the insurance company did not renew the policy because of financial uncertainty with its reinsurer. When the policy ran out, Central Markets sent a notice of default to Kel Kim and ordered it to obtain replacement insurance or vacate the premises. Kel Kim tried to obtain a replacement insurance policy but was unable to do so. Kel Kim then brought this suit for a declaratory judgment, claiming that it should be excused from complying with the insurance provision in the lease due to either (1) impossibility or (2) a force majeure clause in the lease that excused performance for specific, unforeseen events related one of the parties’ ability to conduct day-to-day business. The trial court granted Central Markets’s motion for summary judgment, ordering Kel Kim to vacate the presmises. The appellate court affirmed. Kel Kim appealed.

Rule of Law


Holding and Reasoning (Memorandum)

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