Petitioner tenant, Hip Hop Fries Shop Inc. ("Hip Hop Fries Shop"), commenced this proceeding against respondent landlord, Gibbons Realty Corp. (the "landlord") and respondent tenant-in-possession, Hector Cruz ("Cruz"), seeking an order restoring Hip Hop Fries Shop to possession of the Manhattan premises located at 2459 Eighth Avenue (the "subject premises"). This Court held a hearing on May 20 and 25, 2004.

Preliminarily, this Court finds that Hip Hop Fries Shop has standing to commence and maintain this proceeding insofar as the commercial lease in this matter is between it and the landlord. In that regard, Hip Hop Fries Shop's president, Paul Boritzer, testified that he and his partner, Mario Sanchez, undisputedly entered into a commercial lease with respondent landlord. Although Mr. Boritzer acknowledged that there existed a corporation named "Hip Hop Fries Inc.", and that he was an officer in that corporation (RA and RB), that jural relationship with Hip Hop Fries, Inc. standing alone does not divest him of his legal association with Hip Hop Fries Shop. Indeed, the lease clearly indicates that Hip Hop Fries Shop, Paul Boritzer and Mario Sanchez are the "Tenant" (P1).

Hip Hop Fries Shop entered into a commercial lease with the landlord for the subject premises for a term commencing September 1, 1999 and ending August 31, 2009 (P1). Hip Hop [*2]Fries Shop alleges that some time in February 2004 the landlord and respondent Cruz entered into a commercial lease for the same subject premises commencing January 1, 2004 and ending December 31, 2008. Hip Hop Fries Shop contends that it did not surrender its commercial lease. As such, it vigorously contends that its lease was wrongfully terminated and that it has been wrongfully evicted from the subject premises.

On the other hand, the landlord contends that Hip Hop Fries Shop has no possessory interest in the subject premises because it either sold or assigned its lease to an individual named Jose Polanco some time in November 2002. Further, the landlord and respondent Cruz collectively contend that Jose Polanco surrendered the lease to the landlord, and that the landlord accepted the surrender on January 14, 2004. Under these circumstances, they maintain that Hip Hop Fries Shop is no longer the tenant and, as such, is not entitled to a judgment restoring it to possession of the subject premises.

Mr. Boritzer testified that some time in 2002 or 2003 a Spanish restaurant was set up in the subject premises. He testified that he did not operate the restaurant. Instead, an individual named Jose Polanco was in charge of the restaurant. Mr. Boritzer testified that he visited the restaurant once or twice a week. Mr. Boritzer also testified that he did not notice anything different with the subject premises in January or February 2004. In March 2004, however, he testified that he noticed a different person behind the counter. Mr. Boritzer testified that he approached the individual and told him that he owned the restaurant. In response, the individual told Mr. Boritzer that he was not the owner. Mr. Boritzer vigorously maintained that he did not surrender the lease and never authorized anyone to do the same. Inescapably clear from his testimony is the conclusion that Mr. Boritzer was an absentee tenant who had practically no idea of what was going on in the restaurant. That conclusion, while pointing to a lack of business judgment, is not fatal to this proceeding.

Mr. Boritzer testified that the last time he paid rent was around December 2003. In that regard, he submitted four checks, dated December 10, 2003, with each totaling $1,275 (P2). Mr. Boritzer testified that when he presented these checks to Arthur Gibbons, respondent landlord's owner, Mr. Gibbons told him that he wanted to "talk" to him when he returned from vacation. As to his relationship with Mr. Polanco, Mr. Boritzer testified that Mr. Polanco was his manager. He further testified that he was not paid, and that Mr. Polanco owed him money.

Mr. Gibbons testified that with respect to the commercial tenancy he dealt with Mr. Boritzer. On the other hand, Mr. Gibbons also testified that he had dealings with Jose Polanco. Mr. Gibbons further testified that Jose Polanco told him that he paid Mr. Boritzer for the lease and represented to him that he had authority to surrender the lease.

Hector Cruz is the current tenant of the subject premises. The three witnesses Mr. Cruz called to testify on his behalf gave credible testimony that he has been operating a restaurant in [*3]the subject premises since February 2003. That, however, is not dispositive of the issue of whether there has been a valid surrender of the lease. Instead, the following testimony is critical to the issue of the surrender. He testified that he had several dealings with Mr. Polanco and that he was present when Mr. Polanco executed the "surrender affidavit". He further testified that his understanding was that Mr. Polanco owned the restaurant and that this understanding came from the fact that everything was in Mr. Polanco's name.

Considering the demeanor, content and consistency of the testimony and the evidence, this Court is compelled to conclude that Jose Polanco holds the key to what actually transpired in December 2003 and January 2004. In that regard, this Court notes that Mr. Polanco submitted two conflicting affidavits relating to his execution of the "surrender affidavit". Mr. Polanco avers in a hastily prepared handwritten affidavit, dated April 20, 2004, that he was the successor-in-interest to Hip Hop Fries Shop's previous owner, that he purchased the business, and that on January 14, 2004 he voluntarily surrendered the subject premises to the landlord. Taking a diametrically opposite position, in his type written affidavit, dated April 22, 2004, just two days later, Mr. Polanco avers that not only did he not voluntarily surrender the subject premises, but that he was pressured to do so otherwise he would suffer "severe consequences".

What is clear from the testimony is that Hip Hop Fries Shop and Mr. Boritzer entered into a valid commercial lease with the landlord. The party claiming surrender of possession must prove not only the surrender by the tenant, but also the acceptance of that surrender by the landlord (Levitt v Zindler, 136 AD 695, 121 NYS 483, 484 [2d Dept 1910]). Under these circumstances, this Court finds that the burden rests with the landlord and Mr. Cruz given that they collectively argue that there has been a surrender.

The landlord's and Mr. Cruz's failure to produce Mr. Polanco despite the fact that he has been seen around the area of the subject premises casts a shadow over their testimony as to the bona fides of their belief that Mr. Polanco had the authority to surrender the lease, and of the circumstances under which the "surrender affidavit" was obtained. This finding is particularly compelled given Mr. Polanco's statement that he executed the surrender under duress. There can be no doubt in this Court's opinion that Mr. Polanco would provide elucidating, material information concerning the transaction at issue and that such information would not be cumulative of the testimony already provided. The landlord's and Mr. Cruz's failure to produce Mr. Polanco, indeed, no indication was given that any attempt was made to secure his attendance, requires this Court to presume that the reason Mr. Polanco's attendance was not secured or compelled was because his information and testimony would be unfavorable to the landlord and Mr. Cruz.

The shadow gets even longer when this Court considers the fact that Mr. Cruz took it upon himself to indemnify the landlord in the event a proceeding, such as the present one, is commenced against the landlord (RG). To say the least, such indemnification is extremely curious under these circumstances. Based on the foregoing, this Court finds that respondent landlord and Mr. Cruz have failed to establish that there was a validly tendered surrender of the lease.

Accordingly, the petition is granted. The motion to dismiss this petition at the close of petitioner Hip Hop Fries's case because it lacked standing to commence and maintain this proceeding, or, in the alternative, it failed to show that there was an illegal lockout is denied. [*4]

This Court awards judgment of possession to petitioner Hip Hop Fries Shop, Inc., and restores it to possession of the subject premises. This Court directs respondent landlord to restore petitioner to possession of the subject premises within 10 days after service of a copy of this judgment with notice of entry. Petitioner shall serve a copy of this judgment upon the appropriate Clerk.

This memorandum opinion constitutes the decision and judgment of the Court. The respective exhibits of the parties have been mailed to the parties along with a copy of this decision and judgment.

Dated: July 16, 2004

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HON. JEFFREY K. OING, C.C.J.