Case Law Summaries

Estate of Severino v. Vitale Enterprises, Inc.

• Opinion Date: April 23, 2002
• Real Property Law
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LEASES— It is not sufficient for a tenant to show that for a long time it acted in accordance with the terms of a purported lease. A court must examine all of the circumstances surrounding the purported lease to see if it is authentic and not a forgery.

A husband and wife owned a shopping center. The anchor tenant, a grocery store, was leased to an entity owned by the owners’ son-in-law. The grocery store lease term expired in 1983, although the lease contained renewal options that could have extended the lease term through 2003. In 1997, the owners entered into a contract to sell the shopping center “subject to the [grocery store] lease.” At this point, the son-in-law contended that, in 1983, the owners had granted him a new 50 year lease and that the sale would be subject to that lease. The purchase and sale contract was conditioned on termination of the 50-year lease. The owners claimed that they had no idea about a new 50 year lease and that they had never signed such a lease. They subsequently filed an action against their son-in-law to establish that the 50-year lease was a fraud. Before the parties could resolve this dispute, the husband became ill and died, and the wife was declared legally incompetent. The son-in-law made a motion for summary judgment. He claimed that the owners’ course of conduct during the sixteen-year period since the commencement of the 50-year lease was evidence of their ratification of the lease. In particular, the son-in-law pointed to the prior lease, which required him to pay 90% of the CAM charges, insurance, and real estate taxes, and claimed the 50-year lease required him to pay 100% of those charges. The son-in-law claimed that, since the owners did not pay any portion of the CAM charges, insurance, or taxes during that period, it was obvious that they accepted the lease. The trial judge agreed. He concluded that the owners signed the 50-year lease. The Appellate Division reversed. In determining a motion for summary judgment, a judge is required to make all logical inferences in favor of the nonmoving party when determining if there are any genuine issues of material fact in dispute. Here, the trial judge ignored evidence that suggested that the owners had different signatures for different types of documents and that it was conceivable that the 50-year lease contained a forged signature. Further, the trial judge ignored testimony that, under the prior lease, the son-in-law had paid 100% of the CAM charges, insurance, and taxes. It was possible that the owners were unaware of the 50-year lease since the son-in-law’s previous conduct was to pay all of the charges, even though the old lease only called for payment of 90%. In addition, the lower court had rejected an owner’s sworn statement that he did not sign the 50-year lease. Essentially, the Appellate Division found that the trial judge failed to make logical inferences in the owners’ favor, as required. Summary judgment was therefore inappropriate.

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