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In Rockwell v. Despart, 2022 WL 1492438, the New York Supreme Court, Third Department recently revisited a recurring question: When may a landowner seek judicial removal of a covenant restricting use of her land? Of course, a burdened landowner may always negotiate removal with the covenant’s beneficiaries, but strategic behavior or the high transactions costs that arise when many parties benefit from the covenant may preclude negotiated removal. RPAPL 1951 addresses the problem. Subsection 1 precludes enforcement of land use restrictions “if, at the time the enforceability of the restriction is brought in question, it appears that the restriction is of no actual and substantial benefit to the persons seeking its enforcement.” Subsection two provides that when a party seeks relief from a restriction, a court may adjudge that the restriction is not enforceable by injunction, and may adjudge that the covenant be extinguished on payment of damages if “the restriction is of no actual and substantial benefit to the persons seeking its enforcement or seeking a declaration of its enforceability, either because the purpose of the restriction has already been accomplished or, by reason of changed conditions or other cause, its purpose is not capable of accomplishment, or for any other reason.”
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Sui Generis: Negotiate Like You Mean It
By Lydia Pilch
As further follow-up regarding tracking of the lifecycle of a commercial lease, Part Two of this series addresses various negotiation events, strategies, desired outcomes and potentially low key disasters.
New York’s Guaranty Law Continues to Divide Opinion
By Matthew J. Schenker and Joshua Kopelowitz
This article discusses the recent developments surrounding the constitutionality of New York's Guaranty Law. In particular, we address the Southern District’s view that the statute is unconstitutional and the splintered view of the statute’s constitutionality expressed by New York State courts.
Don’t Get Caught Holding a Conditional Loan Approval at Closing
By Matthew Kramer
With rising interest rates and more stringent lending standards for both residential and commercial properties, security deposit disputes caused by buyers’ inability to satisfy pre-closing purchase-financing conditions are also increasing.
New York’s Seldom Used Expedited Money Judgment Mechanism: CPLR 3213
By Massimo F. D’Angelo and Gregory Wong
In New York state and local court cases, there is a seldom-used procedural mechanism for obtaining an expedited money judgment against a guarantor. This article provides an overview of CPLR 3213 motions, an update on the resolution of the split that previously existed between the New York State Supreme Court, Appellate Division, First and Second Departments, and practical guidance for transactional counsel drafting commercial leases and guaranties.
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