We have previously warned that performing alterations within one's commercial or residential space--without a landlord's written consent--is fraught with peril. Another appellate decision has reinforced that point.
In PWV Acquisition, LLC v. Pescador, a tenant screened-in and enclosed the terrace of her twelfth-floor apartment purportedly with the knowledge or "acquiescence" of the building's then managing agent, Gloria Huachamber. When the tenant's contractor attempted to perform the work, he was stopped by building personnel and directed to Ms. Huachamber, who advised the contractor that while she had no objection to the work, the tenant would have to secure written consent and provide proof that contractor was insured. Tenant reportedly complied with this procedure and obtained oral permission. We are further advised that the contractor was later allowed into the building and performed the work "without further objection from the managing agent and/or building personnel."
Since the tenant was found to have violated the lease's "no alterations" clause (which required landlord's "written" consent for all work), and breached a substantial obligation of her tenancy, by allowing the screens to be "screwed...into the bricks of the exterior of the building," the Housing Court found in the landlord's favor.
On appeal, the Appellate Term, First Department, affirmed and afforded the tenant ten days from receipt of a copy of the court's order to cure the breach--that is, to remove the enclosure and seal any holes that may have been drilled into the structure--in order to avoid a forfeiture of her tenancy.
In a dissent, the Honorable Phyllis Gangel-Jacob respectfully noted her disagreement with the appeal's outcome. The dissenter was persuaded by the tenant's argument that there had been a "waiver" of the "written consent requirement" and felt that the landlord was now "estopped" from taking the position that the tenant had breached the lease.
Apparently, the landlord did not produce Ms. Huachamber or other witness at the trial to rebut the tenant's claim of "oral consent" to install the screen. For some undisclosed reason, the owner relied solely on the testimony of the current managing agent, "who had no personal knowledge as to whether her predecessor consented to the installation of the screen." As a result, the dissent concluded:
On this record, I find that tenant established by a preponderance of the evidence that the managing agent knowingly acquiesced to the alteration, thus voluntarily and intentionally waiving the written permission requirement, and further, that tenant detrimentally relied upon the managing agent's conduct, which was not compatible with the lease agreement as written...Contrary to the majority's view, the nonwaiver and merger clauses of the parties' lease are no bar to waiver because "a contractual provision against oral modification may itself be waived"....In view of this dissent, the tenant may seek further appellate review. Will the Appellate Division turn the screws?
We'll keep you posted.
For a copy of the Appellate Term's decision in PWV Acquisition, LLC v. Pescador, please click on the following link: