August 17, 2016
This is one of those stories where a commercial landlord in a changing New York City neighborhood tried mightily to work with a small tenant to keep it alive. In the end, however, the business just couldn't hang on. In October 2013, a leading Brooklyn landlord approached Itkowitz PLLC with a problem with a commercial tenant. The issue was that the Tenant was continuously in default but would always come up with a check before the Landlord would commence an eviction proceeding. However, notwithstanding sporadic payments, the Tenant never came close to paying a substantial amount of arrears that was owed and that the landlord generously carried.
Shortly thereafter, Itkowitz PLLC commenced a nonpayment proceeding against the Tenant which resulted in a stipulation of settlement, the issuance of a judgment of possession and warrant of eviction, execution stayed pending compliance with the stipulation which spread out the substantial arrears through the balance of the lease term, ending in 2017. We recommended the spreading out of the arrears through the balance of the lease term to assure the timely payment of rent and arrears, the failure of which would inevitably result in an eviction without having to start a new nonpayment case.
The Stipulation was executed in May of 2014 and, thereafter, the Tenant began paying current rent and arrears on more or less a timely basis. When the tenant began missing payments, we would send a default notice and the rent and arrears would usually be paid on the last possible day prior to a scheduled eviction. Almost a year later in April 2015, the Tenant defaulted again, the default triggered a marshal’s notice of eviction followed by an Order to Show Cause. That motion culminated in an amended stipulation which shortened the notice period in the event of a further default to three days, and the stipulation further provided that should the tenant fail to cure any further default such default shall be deemed “material and noncurable.”
After the tenant once again fell into arrears in April of 2016, we served a further notice of default. When the Tenant attempted to pay the rent after the expiration of the default period, we negotiated an early end to the lease term in which the Tenant would continue to pay certain sums and would be obligated to vacate the premises on August 31, 2016. The Tenant’s ability to stay through that period was dependent on his meeting the payment obligations in the stip.
When the Tenant defaulted on a payment under the most recent stipulation, we sought eviction and the Tenant once again brought an order to show cause to stay eviction. This time, however, the Court directed that the Landlord was not obligated to let him stay any further and ordered the eviction to proceed after the close of business on August 12. The court further ordered that no further marshal’s notice needed to be served and that no further orders to show cause from the Tenant would be permitted.
The eviction finally occurred and thus a new chapter begins for the space.