135 East 57th Street LLC v. Daffy’s Inc.
Appellate Division of the Supreme Court of New York
934 N.Y.S.2d 112 (N.Y. App. Div. 2011)
Daffy's Inc. (defendant), a discount clothing chain, leased a New York City location from 135 East (plaintiff) in 1994 with an option to renew for a five-year term. The lease required written notice of renewal by January 31, 2010, but Daffy's accidentally missed the deadline, notifying 135 East verbally five days late and in writing five days after that. 135 East sought a declaratory judgment that the renewal was untimely. Daffy's argued its mistake was in good faith, caused no prejudice, and that it had improved the space by painting it back in 1994. The trial court excused the late renewal to avoid a forfeiture, and 135 East appealed.
Whether a tenant's late notice exercising a renewal option may be excused on equitable grounds despite a lease requirement of timely written notice.