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Murray Hill Mews Owners Corp v. Rio Restaurant Associates L.P

APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT


December 7, 2010

MURRAY HILL MEWS OWNERS CORP.,
PETITIONER-LANDLORD-RESPONDENT,
v.
RIO RESTAURANT ASSOCIATES L.P.,
RESPONDENT-TENANT-APPELLANT.

Per curiam.

Murray Hill Mews Owners Corp. v Rio Rest. Assoc. L.P.

Appellate Term, First Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 7, 2010

PRESENT: Schoenfeld, J.P., Shulman, Hunter, Jr., JJ

Tenant appeals from a final judgment of the Civil Court of the City of New York, New York County (Jeffrey K. Oing, J.), entered January 11, 2010, in favor of landlord awarding it possession of the demised commercial premises and rent arrears in the principal sum of $ll2,958.79 in a commercial nonpayment summary proceeding. The appeal brings up for review an order (same court and Judge), entered January 7, 2010, which granted landlord's motion for summary judgment on its petition and to dismiss tenant's affirmative defenses, and denied tenant's cross motion for summary judgment dismissing the petition.

Final judgment (Jeffrey K. Oing, J.), entered January 11, 2010, appeal from which brought up for review an order (same Judge), entered January 7, 2010, reversed, with $30 costs, final judgment vacated, landlord's motion for summary judgment on its petition and to dismiss tenant's first affirmative defense denied, the petition and tenant's first affirmative defense reinstated, and matter remanded to Civil Court for further proceedings.

Civil Court improperly granted summary judgment to landlord on its petition seeking rent and additional rent in this commercial nonpayment proceeding. The disputed language of the consumer price index (CPI) escalation clause is ambiguous and, on this record, cannot be determined as a matter of law (see Blue Jeans U.S.A. Inc. v Basciano, 286 AD2d 274 [2001]). In particular, the precise meaning of the disputed language -- which relates to the monetary figure the parties' intended to serve as the measuring rod of the CPI escalation clause -- cannot be discerned from the language of the lease itself and the words of the escalation clause are reasonably susceptible to differing interpretations (see Bakas Rest., Inc. v Charos, 111 AD2d 360 [1985]). Moreover, that ambiguity is not conclusively resolved by either the illustrative example in the lease of the operation of the escalation clause or the course of dealings between landlord and tenant (cf. Milt Holdings LLC v 181 PM LLC, 27 Misc 3d 136[A], 2010 NY Slip Op 50858[U] [2010]). Therefore, triable issues exist as to the meaning of the operative terms of the lease.

A triable issue also exists as to whether tenant had knowledge of landlord's method of calculating rent increases and manifested its consent to these additional rent charges. In this connection we note that, while tenant paid certain additional rent charges under the CPI clause as interpreted by landlord, landlord failed, as required by the lease, to deliver annual CPI escalation statements to tenant's office address; rather, landlord merely sent monthly rent bills to the demised commercial premises.

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.

Decision Date: December 07, 2010

20101207

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