Milt Holdings LLC v 181 PM LLC

[*1] Milt Holdings LLC v 181 PM LLC 2010 NY Slip Op 50858(U) [27 Misc 3d 136(A)] Decided on May 14, 2010 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 May 14, 2010
APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT
PRESENT: McKeon, P.J., Schoenfeld, Hunter, JJ
570014/10.

Milt Holdings LLC, Petitioner-Landlord-Appellant,

against

181 PM LLC, Respondent-Tenant-Respondent, -and- "ABC Corp." and "XYZ Inc.," Respondents-Undertenants.

Landlord, as limited by its brief, appeals from those portions of an order of the Civil Court of the City of New York, New York County (Arthur F. Engoron, J.), entered March 31, 2009, which denied its motion to dismiss tenant's defenses and affirmative defenses and granted tenant's cross motion for summary judgment dismissing that aspect of the non-payment petition seeking additional rent based on a lease escalation clause.

Per Curiam.
Order (Arthur F. Engoron, J.), entered March 31, 2009, insofar as appealed from, affirmed, with $10 costs.

The relevant provisions of the governing written commercial lease agreement appear to be ambiguous with respect to the circumstances under which tenant was obligated to pay additional rent pursuant to a consumer price index escalation clause. That apparent ambiguity is conclusively resolved in favor of tenant's interpretation of the lease agreement that the obligation to pay additional rent only arose if the consumer price index for a given year exceeded by more than six percent the consumer price index of the preceding year, an event that did not occur during the time period at issue based upon the illustrative example in the lease of the operation of the escalation clause and the extensive (approximately decade-long) course of dealings between the landlord, tenant and their respective predecessors in interest (see Waverly Corp. v City of New York, 48 AD3d 261 [2008]; Federal Ins. Co. v Americas Ins. Co., 258 AD2d 39 [1999]; see also One Hundred Grand, Inc. v Chaplin, 70 AD3d 513 [2010]). We note that landlord's predecessor in interest drafted the lease agreement, and that an ambiguity in a contract is generally resolved against the drafter of the document or the drafter's successor in interest (see Two Guys from Harrison-N.Y., Inc. v S.F.R. Realty Assoc., 63 NY2d 396, 403 [1984]; 151 West Assoc. v Printsiples Fabric Corp., 61 NY2d 732, 734 [*2][1984]).

There being no material factual dispute as to the proper interpretation of the consumer price index escalation clause, summary judgment was properly granted to tenant dismissing that aspect of the petition seeking additional rent under this clause, regardless of the existence of general non-waiver clauses in the lease agreement (see TSS-Seedman's, Inc. v Elota Realty Co., 72 NY2d 1024 [1988]; Lee v Wright, 108 AD2d 678 [1985]).

THIS CONSTITUTES THE DECISION AND ORDER OF THE COURT.

Decision Date: May 14, 2010