Recently, in
Valentino U.S.A., Inc. v. 693 Fifth Owner LLC, Justice Andrew Borrok of the New York County Commercial Division dismissed a complaint brought by Valentino U.S.A., Inc. (“Valentino” or “Tenant”), which sought to rescind or terminate the commercial lease for its Manhattan luxury fashion store and to avoid its rent obligation.[1]
Like many landlord-tenant disputes currently pending or recently decided in light of the COVID-19 Pandemic, this case involved the common law doctrines of frustration of purpose and impossibility. The Commercial Division held that neither doctrine excused Valentino’s rent obligation because the parties’ lease allocated to Valentino the risk that Valentino would not be able to operate its business.
complaint, luxury fashion company
Valentino brought the following eight causes of action against its landlord Defendant 693 Fifth Owner LLC (“Landlord”) to avoid its obligations under its lease agreement (“Lease”) for its prestigious Fifth Avenue storefront in New York City: (i) declaratory judgment of frustration of purpose – lease termination; (ii) in the alternative, declaratory judgment of frustration of purpose – rent abatement; (iii) impossibility of performance – lease rescission; (iv) in the alternative, impossibility of performance – rent abatement; (v) rescission based on failure of consideration; (vii) constructive eviction; (vii) declaratory judgment; and (viii) injunctive relief. While Valentino unsurprisingly cited the series of
executive orders issued by Andrew Cuomo limiting and/or prohibiting “non-essential” business operations, Valentino also argued that even in a “post-pandemic New York City (should such a day arrive)” the “social and