2015 NY Slip Op 50089

Citation: 2015 NY Slip Op 50089
Jurisdiction: New York (state)
Source: Official source
Original Source: https://www.nycourts.gov/reporter/3dseries/2015/2015_50089.htm ↗

Related Parts of This Source

Full Text

1,724 chars

Respondent-corporation, the Court finds that this commercial lease agreement dated
2004 is an arms length transaction between family members and definitely contains
provisions that are not customary in commercial transactions.

There are several terms that the Court deems not the usual and customary
terms and conditions in commercial leases. The first provision is the "automatic
extension". Under New York law, the law abhors automatic extensions particularly in
contractual agreements that deal with services (citations omitted). Rarely does
any commercial lease self-execute with automatic one year extensions. Based on the fact
that this transaction was between family members, the terms were obviously negotiated
by this family to keep the property in their family. The parties were flexible enough that
either party could terminate the commercial lease agreement with 90 days notice as
defined in the automatic extension. If such termination provisions are indeed included in
commercial leases, they are usually in the form of what is commonly referred to as "good
guy clauses" that are beyond the scope of this proceeding.

Therefore, this first significant article of the lease demonstrates an arms
length transaction between these parties notwithstanding their familiar relationship.

More importantly, the "Buy Sell" provisions in article 15 are certainly not
customary in commercial transactions and is a defining factor in this closely-held family
lease. The lease gives the tenant, its successor and assigns, an irrevocable exclusive
option to purchase the property. The only obligatory act is to serve written notice to the
landlord. If the tenant does, in fact, exercise the option, the landlord shall, not