Plaintiff, Bond Immobilien LP, leased to defendant In the Know Holding Company, LLC, a portion of ground floor premises located at 670 Broadway, New York, New York. The lease term spanned from September 1, 2023, through September 30, 2024. Defendant Richard Beyda signed a guaranty on the lease on August 14, 2023.

Tenant allegedly ceased paying rent as of January 1, 2024. Plaintiff issued two termination notices—one dated June 7, 2024, and one dated August 26, 2024. Under the August 2024 notice, the lease was terminated on September 11, 2024.

In July 2024, plaintiff commenced this action to eject tenant and recover damages. Tenant vacated the premises on April 7, 2025.^[FN1]

Plaintiff now moves for summary judgment on its second, fourth, fifth, sixth, and seventh causes of action. Plaintiff seeks $1,107,682.78 in rent, use and occupancy, additional charges, attorney fees, and related costs. Plaintiff also seeks to dismiss defendants' 26 affirmative defenses.

I. Branch of Motion for Summary Judgement

A. Use and Occupancy (Second Cause of Action)

1. Holdover

Plaintiff second cause of action is for use and occupancy. Plaintiff argues that the amount of use and occupancy defendants owe equals double the fixed rent and double all amounts due under section 5.01 (h) of the lease. Defendants, on the other hand, contend that the language of the lease indicates that In the Know's failure to vacate at the expiration date created a tenancy-at-will—not a holdover-tenancy—and that plaintiff should have taken more steps to terminate that tenancy-at-will.

The language of section 5.01 (h) of the lease (NYSCEF No. 84 at ¶¶ 13-14) reflects two related scenarios: In the first, tenant remains in possession of the premises after the expiration date and without the execution of a new lease—in which a tenancy-at-will is created. In the second, tenant is in default or remains in possession of the premises after the expiration of the tenancy-at-will mentioned above. When the second scenario applies, the tenancy is one at-sufferance. Section 5.01 (h) further provides that during any holdover period, tenant must pay rent at a monthly rate equal to twice the fixed rent, plus all additional rent and other charges last payable under the lease.

The court disagrees with defendants' contention that the lease created a never-terminated tenancy-at-will and therefore that In the Know did not hold over. The record reflects that plaintiff twice exercised its right to terminate the lease by notices dated June 7 and August 26, 2024, with the latter effective September 11, 2024. This court, in an oral decision in September 2024 already held those notices valid and effective. (See NYSCEF No. 86.) Accordingly, the lease ended on September 11, 2024.^[FN2] Tenant's continued possession until April 7, 2025, thus constituted a holdover-tenancy subject to section 5.01 (h) of the lease and the double-rent provision, not a tenancy-at-will.

2. Liquidated Damages

Defendants dispute the holdover rate. Defendants argue that to require defendants to pay damages at the holdover rate of double rent would constitute a penalty, not permissible liquidated damages. (NYSCEF No. 94 at 9.) Plaintiff argues that a provision on a commercial lease that authorizes a landlord to charge multiple amounts of monthly rent during a holdover period is valid. Plaintiff relies on Getty Properties Corp. v Getty Petroleum Mktg., Inc. (150 AD3d 541, 541 [1st Dept 2017]), a case that affirmed an award of double charge for use and occupancy, and Tenber Assoc. v Bloomberg L.P. (51 AD3d 573, 574 [1st Dept 2008]), a case that establishes the enforceability of a liquidated-damages clause of double rent in the case of a holdover.

Defendants distinguish the present case from the caselaw plaintiff cites. But defendants' argument targets factual distinctions rather than legal standards. Defendants say that Getty concerned a referee's recommendation of damages for use and occupancy set at double the rent of the lease. They further argue that the parties in Getty belonged to the oil industry and that Getty involved specialized premises, making the damages difficult to anticipate. Defendants [*2]contend that the lease in Tenber involved 180,000 square feet of office space for a sophisticated company. In sum, defendants argue that the nature of the parties and premises in those cases differ so much from those here such that charging double rent here would constitute a penalty.

A liquidated-damages clause is not an unenforceable penalty if damages cannot be anticipated when the lease is executed and when the amount fixed is not plainly or grossly disproportionate to the probable loss. (Parsons & Whittemore, Inc. v 405 Lexington L.L.C., 299 AD2d 156, 157 [1st Dept 2002].)

This court concludes that the parties' liquidated-damages clause is enforceable. Enforceability depends on the foreseeability and proportionality of damages. And defendants show neither that the damages were capable of anticipation nor that the damages are grossly disproportionate. They say only that the actual rent, alone, would be a fairer variable to use. But as stated above, the lease provides otherwise.

Defendants further argue that section 5.01 (h) of the lease includes no double charge for electricity and therefore that they should not have to pay the double-electricity-holdover charge accounted for in plaintiff's ledger. Section 5.01 (h) provides that "tenant shall pay rent to landlord at a monthly rental equal to two (2) times the monthly fixed rent, plus all additional rent and other charges last payable by tenant hereunder." (NYSCEF No. 84 ¶14.) The structure of section 5.01 (h) has two separate components: A provision that the holdover rent is twice the monthly fixed rent and another which makes tenant liable for all other amounts. The term "plus" creates a textual separation; the provision is properly read as requiring (1) payment of two times the monthly fixed rent and (2) all additional rent and other charges. Plaintiff may not, therefore, recover double the electricity charge.

With respect to liquidated damages, plaintiff seeks $1,042,109.68. To that effect, plaintiff submits an affidavit from an employee of its managing agent (NYSCEF No. 80), who relies on a chart reflecting charges plaintiff incurred. (NYSCEF No. 89). That sum reflects rent, additional rent (including doubled electricity charges), and use and occupancy reduced by $300,000 defendants paid to plaintiff.^[FN3]

Based on its own review of plaintiff's chart, the court concludes that plaintiff is entitled only to $675,429.22. This amount includes (i) the base rent, electric charge (excluding the doubled electric charge), and water charges from January 2024 (the date of default) through June 2025 (the last date on plaintiff's chart) and (ii) subtracts $300,000 defendants undisputedly paid previously. (See NYSCEF No. 89.) It excludes interest and late fees, because the ledger does not reflect when defendants made payments to plaintiff. Indeed, defendants' payments each month would affect the amount left unpaid for that month. And the total unpaid that month affects the interest and late fees for that month. The court lacks the requisite information to determine interest and late fees.

B. Breach of Lease and Guaranty (Fourth and Sixth Causes of Action)

The branch of plaintiff's motion for summary judgment on its fourth and sixth causes of action is granted as unopposed.

C. Attorney Fees Against Tenant and Guarantor (Fifth and Seventh Causes of [*3]Action)

A prevailing party may collect attorney fees when authorized by agreement between the parties, by statute, or by court rule. (See e.g. Hooper Assoc., Ltd. v AGS Computers, Inc., 74 NY2d 487, 491 [1989].) Plaintiff argues that sections 20.01 and 28.04 of the lease (NYSCEF No. 84), and the guaranty (NYSCEF No. 85 at 4 [pdf pagination]), entitle plaintiff to reasonable attorney fees.

Defendants argue that plaintiff is not the prevailing party and that even assuming otherwise, plaintiff should not be entitled to fees plaintiff incurred in issuing a defective notice of termination and in moving to amend its second amended complaint (mot seq 002). (NYSCEF No. 94 at 12.) According to defendants, plaintiff needed to file the amended complaint only to account for the defective June 2024 termination notice. Defendants say they should not have to foot that portion of plaintiff's counsel's bill.

The court concludes that plaintiff is the prevailing party, because it has been "successful with respect to the central relief sought," i.e., use and occupancy. (Blinds to Go (U.S.), Inc. v Times Plaza Dev., L.P., 191 AD3d 939 [2d Dept 2021].) Moreover, defendants provide no support for the proposition that a party does not have to pay attorney fees to the prevailing party if the prevailing party incurred additional attorney fees based on mistakes made in pre or post litigation conduct.

Plaintiff seeks $147,908.14 in attorney fees, costs, and disbursements. First, $24,412.50 stem from plaintiff's counsel's work in drafting and executing the lease. That sum is non-compensable under the lease. The lease permits recovery "in any action or proceeding in connection with this Lease or Premises" (NYSCEF No. 84 at ¶ 24.8) and for "reasonable counsel fees and disbursements, involved in collecting or endeavoring to collect the Fixed Rent or additional rent or other charge" (id. at ¶ 20.01). The lease does not allow for attorney fees incurred in drafting or executing lease documents. With respect to the remainder, the court concludes that the reasonable amount in fees is $92,012.85, plus $1,352.84 in costs and disbursements, not the larger amount plaintiff seeks.^[FN4]

II. Branch of Motion to Dismiss Affirmative Defenses

Defendants oppose dismissal of only the first (payment), second (failure to state a cause of action), fifth (improper demand), and thirteenth (failure of a condition precedent) affirmative defenses. The rest of the affirmative defenses are dismissed as unopposed.

A. First Affirmative Defense

Plaintiff moves to dismiss defendants' first affirmative defense: that they paid plaintiff. Defendants contend that plaintiff's ledger is unreliable and does not reflect the correct amount they owe nor the payments they made. But a mere allegation of payment without supporting facts is not enough to defeat a motion to dismiss. (Morgenstern v Cohon, 2 NY2d 302, 308 [1957].) And defendants do not provide evidence of the alleged payments. The branch of the motion to dismiss defendants' first affirmative defense is granted.

B. Second Affirmative Defense

Defendants contend that the first-amended complaint fails to state a claim against defendants. Defendants further argue this affirmative defense may be dismissed only if their other affirmative defenses have already been dismissed or stricken.

An affirmative defense for failure to state a claim is surplus and effective only when defendant moves to dismiss on that ground. (San-Dar Assoc. v Fried, 151 AD3d 545, 546 [1st Dept 2017].) As will be shown below, all of defendants' affirmative defenses are dismissed. Moreover, plaintiff has stated causes of action; indeed, this court granted summary judgment on several of plaintiff's claims. The branch of the motion to dismiss plaintiff's second affirmative defense is granted.

C. Fifth Affirmative Defense

Defendants, relying on section 11.01 (b) of the lease (NYSCEF No. 84 at ¶ 22), assert that plaintiff did not make a proper demand for rent and electricity charges, because plaintiff stopped sending rent and electric-bill statements after September 2024.

Section 11.01 (b) provides that "[n]otwithstanding anything contained in this lease to the contrary, bills for additional rent shall be deemed to have been duly given if sent to tenant only . . . at the premises by first class mail . . . or by messenger or recognized overnight courier. . . ." (NYSCEF No. 84 at 18.) Section 11.01 (b) does not provide that plaintiff must send defendants bills as a precondition to a proper demand for additional rent and charges. Section 11.01 (b) describes when bills for additional rent and charges are deemed to have been sent.

The branch of plaintiff's motion to dismiss the fifth affirmative defense is granted.

D. Thirteenth Affirmative Defense

Defendants argue that plaintiff's claims are barred, because plaintiff did not satisfy a condition precedent that triggered In the Know's obligation to pay rent and expenses. Defendants contend that plaintiff stopped sending rent statements to defendants after September 2024 and that according to section 11.01 (b) of the lease (NYSCEF No. 84 at ¶ 22), doing so was a condition precedent to any obligation of payment.

A condition precedent is "an act or event, other than a lapse of time, which, unless the condition is excused, must occur before a duty to perform a promise in the agreement arises." (Oppenheimer & Co. v Oppenheim, 86 NY2d 685, 690 [1995].) Terms such as "if," "unless," and "until" constitute unmistakable language of condition. (MHR Capital Partners LP v Presstek, Inc., 12 NY3d 640, 645 [2009].) The language of the lease determines the existence of a condition precedent.

Section 11.01 (b) of the lease, as explained above, establishes when bills for additional rent and charges are deemed "sent" to the tenant, not that sending them is a condition precedent for payment. This section does not use language like "if," "unless," or "until," which might indicate the creation of a condition.

The branch of plaintiff's motion to dismiss the thirteenth affirmative defense is granted.

Accordingly, it is

ORDERED that plaintiff's motion for summary judgment on its second cause of action is granted in part and denied in part as set forth above; and plaintiff is awarded $675,429.22 in use and occupancy against defendants, jointly and severally, with interest at the statutory rate running from October 16, 2024, plus costs and disbursements as taxed by the Clerk upon the submission of an appropriate bill of costs; and it is further;

ORDERED that the branches of plaintiff's motion for summary judgment on its fourth and sixth causes of action is granted; and it is further

ORDERED that the branch of plaintiff's motion for summary judgment on its fifth and seventh causes of action (attorney fees, costs, and disbursements) is granted; and plaintiff is awarded $93,365.69 in attorney fees, costs, and disbursements against defendants, jointly and severally; and it is further

ORDERED that plaintiff's third cause of action, which it asserts against unnamed individuals and entities, is dismissed; and it is further

ORDERED that the branch plaintiff's motion to dismiss defendants' affirmative defenses is granted; and it is further

ORDERED that plaintiff serve a copy of this order with notice of its entry on defendants and on the office of the County Clerk (using the NYSCEF document type "Notice to the County Clerk - CPLR § 8019 (c)"), which shall enter judgment accordingly.