Does a surrender require acceptance for it be effective in landlord / tenant law? Well, that really depends on the lease as we recently learned from NYS' highest court, the Court of Appeals. Before the Court was a good guy guaranty being litigated. "[A] 'good guy' guaranty is a limited guaranty in which the guarantor’s obligation extends only up to the point that the tenant surrenders the premises to the landlord, leaving the tenant solely responsible for rent due from that point forward" according to the Court in 1995 CAM LLC v. West Side Advisors, LLC, et al. This is a huge reminder because in commercial real estate litigation, tenants are often dumbfounded to learn that the good guy guaranty does not excuse the tenant from liability, just the guarantor. Regardless, the case before the highest court was far more nuanced and involved another real issue that frequently arises in commercial real estate litigation - the interplay of a tenant vacating a tenancy and a landlord accepting a surrender. Stated otherwise, the Court needed to determine whether the guarantor's "liability ends with [tenant's] surrender of possession, or with [landlord's] acceptance of surrender." In deciding this issue, and while being mindful that the contractual language at issue could change the result, the Court found that the landlord's acceptance of surrender was irrelevant to the issue because acceptance would result in the landlord never accepting and the lease running its course and therefore, the good guy language of the lease would be superfluous. Therefore, the Court reminded us that "[i]mportantly, an interpretation that renders language in the guaranty superfluous is “a view unsupportable under standard principles of contract interpretation” (Lawyers’ Fund for Client Protection of State of N.Y. v Bank Leumi Tr. Co. of New York, 94 NY2d 398, 404 [2000]).
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