Parkwood Realty Co. v. Marcano

• Decision Date: 15 February 1974
• Parties: PARKWOOD REALTY COMPANY, Plaintiff, v. Leonard MARCANO, Defendant.
• Court: New York City Court

Page 623

353 N.Y.S.2d 623

77 Misc.2d 690

PARKWOOD REALTY COMPANY, Plaintiff, v. Leonard MARCANO, Defendant.

Civil Court of the City of New York, Queens County, Trial

Term, Part I.

Feb. 15, 1974.

Sylvan Rosenbaum, for plaintiff.

Mark H. Spires, Jamaica (Doris E. Mortis, of counsel), for defendant.

BENTLEY KASSAL, Judge.

The only issues presented in this action for rental damages (because of the tenant's breach of a residential lease) are whether the landlord has a duty to mitigate its damages and, if so, what steps were taken to do so.

Defendant had been in possession of an apartment under a lease, expiring September 30, 1973. He defaulted by failing to pay rent for April, 1973 and voluntarily vacated the premises in May, 1973. The landlord re-rented the apartment on July 1, 1973. The only rent in issue is for the month of June since tenant's responsibility for rent for the months of April and May is not controverted.

Hornbook law to the contrary (see Rasch, New York Landlord & Tenant (2d ed.) Sec. 875), there is no longer good reason--if there ever was--why leases should be governed by rules different from those applying to contracts in general. The traditional and majority view is based upon the theory that the lessee becomes the owner of the premises for the term with the right to occupy or not, as he chooses, but with the independent obligation to pay rent, as the purchase price for the estate acquired. Sancourt Realty Corp. v Dowling, 220 App.Div. 660, 222 N.Y.S. 288; Becar v. Flues, 64 N.Y. 518; 49 Am.Jur.2d Landlord and Tenant, Sec. 621; Annot., 21 A.L.R.3d 534, 553, Sec. 3(i) and cases cited therein.

However, since the decision of Judge J. Skelly Wright in Javins v. First Nat. Realty Corp., 138 U.S.App.D.C. 369, 428 F.2d 1071, there has been a growing trend toward reading mutual contract obligations (such as warranties of habitability) into residential leases. Amanuensis, Ltd. v. Brown, 65 Misc.2d 15, 318 N.Y.S.2d 667; Morbeth Realty Co. v. Rosenshine, 67 Misc.2d 325, 323 N.Y.S.2d 363; Mannie Joseph, Inc. v. Stewart, 71 Misc.2d 160, 335 N.Y.S.2d 709.

As Justice Markowitz so pointedly stated in 57 E. 54 Realty Corp. v. Gay Nineties Realty Corp., 71 Misc.2d 353, 355, 335 N.Y.S.2d 872, 873; leave to app. den. N.Y.L.J., October 18, 1972, p. 2, col. 1:

'. . . Unfortunately, the law, 'as to leases is not a matter of logic In vacuo; it is a matter of history that has not forgotten Lord Coke' (Gardiner v. Butler & Co., 245 U.S. 603, 605, 38 S.Ct. 214, 62 L.Ed. 505). Archaic in its origins the effect of this background is still felt. The time has come to bring it up to date; to make the rules governing leases consistent with the rules governing contracts in all other fields . . .

. . . They call for mutual obligations; they differ little, if at all, from other agreements.'

Should not the duty to mitigate, particularly by re-letting, likewise be applied to all leases? In my opinion it should.

Perhaps, in feudal times, there may have been some persuasive reason to allow a landlord to do nothing about abandoned premises but in these times, and especially in a city of this size with a residential vacancy rate under two per cent (Talbot v. Romney, D.C., 321 F.Supp. 458, 470), it should not be permitted.

Numerous commentators have criticized the traditional rule which permits a landlord to stand idly by while damages accumulate in his favor (See Gruman v. Investors, 247 Minn. 502, 78 N.W.2d 377; Wright v. Bauman, 239 Or. 410, 398 P.2d 119, 21 A.L.R.3d 527) and a survey of other jurisdictions indicates that at least 12 other states now follow the rule requiring mitigation. Annot., 21 A.L.R.3d 534, 541; 49 Am.Jur.2d Landlord and Tenant Sec. 621.

In this state, some recent reported cases, particularly in the First Department, have resolved this issue apparently on the basis of the landlord's failure to act in good faith. Howard Stores v. Robison Rayon Co., 36 A.D.2d 911, 320 N.Y.S.2d 861, aff'g. 64 Misc.2d 913, 315 N.Y.S.2d 720; Gracie Town House v. Weinstein, N.Y.L.J. March 14, 1973, p. 17, col. 4 (App.Term., 1st Dept.); New York University v Nieto, N.Y.L.J. April 13, 1973, p. 18, col. 4 (Civ.Ct.N.Y.); Sherman Taylor Corp. v. Cohen, N.Y.L.J. July 10, 1973, p. 10, col. 8 (Civ.Ct.N.Y.).

This issue should be met head-on by removing the long-established and deeply encrusted veneer from the real estate lease contract and showing it for what it is--a contract like any other contract.

This has been recognized by the National Conference of Commissioners on Uniform State Laws when it approved for enactment the Uniform Residential Landlord and Tenant Act.

Section 4.203 entitled

'Remedies for Absence, Non-Use and Abandonment' states:

(c) If the tenant abandons the dwelling unit, The landlord shall make reasonable efforts to rent it a fair rental. * * * (emphasis added)

In almost all other instances, when there has been a breach of a contract, the imposes a duty upon the non-defaulting party to make reasonable efforts to reduce or extinguish the injury, Losei Realty Corp. v. City of New York, 254 N.Y. 41, 171 N.E. 899. Accordingly, applying this principle, the tenant will only be liable for such items of loss as the landlord could not have avoided by reasonable effort, without undue risk, expense or...