Hundal of Union, L.P. v. Metro Insurance Services, Inc.

A-1972-98T5 (N.J. Super. App. Div. 1999) (Unpublished)
  • Opinion Date: December 2, 1999

LANDLORD-TENANT; RENEWAL OPTIONS—Where a lease renewal option is ambiguously stated, the tenant’s interpretation will prevail.

A landlord sought damages from its tenant on the basis that the tenant gave only sixty days’ notice of its intent not to renew its lease, rather than the ninety days required by the lease, and thereby triggered an automatic four year renewal. The record supported the finding that the lease was ambiguous because of its inconsistent provisions respecting the tenant’s notice obligation. One provision of the lease required the tenant to give ninety days’ notice of non-renewal; another stipulated that unless the tenant gave the ninety days’ notice of renewal, the lease would be deemed not to be renewed. The lower court resolved the ambiguity in the tenant’s favor. The Appellate Division agreed and also was satisfied that equitable considerations would have mandated the rejection of the landlord’s claim for four years’ rent, especially when the landlord was aware long before the lease expiration that its tenant needed to move if additional space could not be provided.