67 Wall St. Co. v. Franklin Nat. Bank

• Decision Date: 17 June 1975
• Citation: 37 N.Y.2d 245,371 N.Y.S.2d 915
• Parties: , 333 N.E.2d 184 67 WALL STREET COMPANY, Appellant, v. FRANKLIN NATIONAL BANK, Respondent.
• Court: New York Court of Appeals Court of Appeals

Page 915

371 N.Y.S.2d 915

37 N.Y.2d 245, 333 N.E.2d 184

67 WALL STREET COMPANY, Appellant, v. FRANKLIN NATIONAL BANK, Respondent.

Court of Appeals of New York.

June 17, 1975.

Martin Kleinbard and Cameron Clark, New York City, for appellant.

Milton Kunen, Sidney Kwestel and Vincent J. Syracuse, New York City for respondent.

COOKE, Judge.

Plaintiff, a limited partnership, owns the office building located at 67 Wall Street in New York City. In the late summer of 1969, defendant, in need of additional office space, negotiated a lease for six floors in said structure. The lease, executed on October 20, 1969, contained the following provision denominated as article 41: 'Tenant understands that the demised premises are presently occupied by the International Nickel Company, Inc. ('INCO'). INCO has indicated to Landlord that it will vacate the demised premises on or about January 1, 1970. Landlord shall give notice to Tenant promptly after being advised by INCO of the date on which it actually will vacate, but Tena understands that Landlord does not and cannot guarantee or assure Tenant possession of the demised premises until INCO does actually vacate. If INCO has not vacated the demised premises by August 31, 1970, either party may cancel this lease by giving sixty (60) days notice to the other, and on the date fixed in such notice, this lease shall terminate and expire, both parties shall be relieved of all obligation hereunder and Landlord shall refund to Tenant any rent prepaid by Tenant.' As the premises were not available for occupancy on August 31, 1970, defendant on that day notified the plaintiff that, pursuant to said article, it elected to cancel the lease, effective immediately.

Plaintiff brought this action seeking a declaratory judgment that the lease remain in full force and effect both because the notice of cancellation was improper and defective and because the premises were available to the tenant within 60 days after the purported cancellation, or 'cut-off' date. Additionally, plaintiff sought reformation in the event that said article, as written, was held not to subject the defendant to liability if the premises became available within 60 days of the 'cut-off' date.

The trial court held that defendant's notice of August 31, 1970, electing immediate cancellation of the lease, was legally sufficient under article 41 and therefore effective. On the issue of reformation, the court admitted testimony, offered by plaintiff, relating to the circumstances surrounding the negotiations and execution of the lease, but disallowed such relief, holding that there was neither clear evidence that the parties intended a 60-day 'salvage' period, nor evidence of mistake or fraud. Rather, the court indicated that article 41 was an unequivocal agreement to cancel if the premises were unavailable as of August 31, 1970. It noted in passing, that, were there ambiguity, such must be resolved in favor of the defendant and against the plaintiff who drew the instrument.

On review, the Appellate Division acknowledged the trial court's finding that there was insufficient evidence to ascribe to article 41 the meaning urged by plaintiff and held that, as the findings below rested in large part upon considerations relating to the credibility of the witnesses, they should be accorded the greatest weight, citing Amend v. Hurley, 293 N.Y. 587, 594, 59 N.E.2d 416, 418. In addition, the Appellate Division held that, even if plaintiff's contentions were to be accepted, plaintiff failed to cure the defect within the 60-day period. One Justice concurred solely on this last point, and another, accepting plaintiff's view, dissented.

Unlike the trial court, we find article 41 to be ambiguous, susceptible of differing interpretations. Although recognizing the proposition that words are never to be construed as meaningless if they can be made significant by any reasonable construction (Matter of Buechner, 226 N.Y. 440, 443, 123 N.E. 741, 742; Allen v. Forsyth, 25 N.Y.S.2d 822, 825; R. I. Realty Co. v. Terrell, 254 N.Y. 121, 124, 172 N.E. 262, 263), we also recognize that if several such constructions are possible, the court can look to the surrounding facts and circumstances to determine the intent of the parties (O'Neil Supply Co. v. Petroleum Heat & Power Co., 280 N.Y....