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Tuesday, July 10, 2012

Residential Landlord's Duty to Mitigate Damages

In an issue often debated and recently re-visited by the Civil Court, Kings County, a residential landlord does not have a duty to mitigate damages when a tenant breaches the lease by vacating the premises prior to the expiration of the term.  See Kings Holding, LLC v. Terrick, 2012 NY Slip OP 51153U. The Court cited to the previous holding of Holy Properties v. Cole Products, which found that the duty to mitigate does not exist concerning commercial premises, and additionally cited to Rios v. Carrillo, which subsequently adopted the holding of Holy Properties by finding that the duty to mitigate does not exist concerning residential premises. It is important to note that in Holy Properties and Rios, both holdings of the Second Department, the leases governing each respective premises specifically provided that the landlord was under no duty to mitigate damages or that the tenant remained liable to landlord for rent upon the cancellation of the lease except as provided by law.
Furthermore,  the landlord is not entitled to rent until the lease term has expired and there is a surrender of the premises by operation of law. In Kings, the surrender occurred after the landlord had submitted a "move out form" to the tenant after the tenant had moved out without notice, notified the tenant of the amount owed in arrears and informed the tenant that it was withholding the security deposit. This date of surrender actually occurred one month after the tenant physically left the premises. The date of surrender will be case specific, but may be interpreted from the conduct of the parties, the abandonment of the premises by tenant and the landlord's acceptance of tenant's surrender.

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