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Appellate Division Sends Strong Rebuke to an Illegally Subletting Executor of an Estate that Sought to Misapply the Yellowstone Doctrine

Under the terms of a Proprietary Lease of a Cooperative, the daughter and children of the lessee were permitted to occupy the unit while the lessee was alive. Once the lessee died, and the unit passed to the Estate, the daughter and children were no longer permitted continued occupancy rights.

The daughter became the executor of the estate and continued to assert a right to continued occupancy in her individual capacity. The Cooperative then served a Notice to Cure, alleging an illegal subletting. The executor sought to delay the summary proceeding by commencing an action in the Supreme Court seeking a Yellowstone injunction, a preliminary injunction, and other relief. However, Yellowstone injunctions – except for rare exceptions – are only available to commercial tenants because it provides them with an opportunity to cure a breach before a lease is terminated. Residential tenancies do not need such relief because Real Property Actions and Proceedings Law 753(4) provides that, if a lessee is found in breach of a substantial obligation of tenancy, the lessee has thirty days after the entry of a possessory judgment to effect a cure of the breach and preserve the tenancy. In representing the Cooperative at both the Supreme Court and Appellate Division level, Adam Leitman Bailey, P.C. argued that the executor was misapplying the Yellowstone doctrine to delay any summary proceeding because, among other things, the Executor – who was looking to sell the unit – was attempting to time the market. Adam Leitman Bailey, P.C. demonstrated that the Executor had three discrete means to effect a post-judgment cure, foremost among them was simply removing from possession. After the Supreme Court agreed with Adam Leitman Bailey, P.C.’s position, the Executor, looking for further delay, appealed to the Appellate Division. The court soundly rejected the Executor’s claims noting that the Executor failed to demonstrate that RPAPL 753(4) relief would be unavailable, writing that “Plaintiffs have not made a showing that it would take more than thirty days to move to another residence if unsuccessful in a summary proceeding.” The court also took the Executor to task for her “apparent lack of effort to transfer the shares into Plaintiff executor’s name or to sell the apartment thus far…”, two other means by which a cure could be effected.  For good measure, the Appellate Division concluded that it had “considered plaintiffs” remaining contentions and found them “unavailing.”

Jeffrey R. Metz represented the Cooperative before the Appellate Division.

Read the published decision here.

Watch Jeffrey R. Metz speak at the Appellate Division, First Department here.

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