Court of Appeals – Breach of contract: Audthan LLC v. Nick & Duke LLC

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New York State Court of Appeals

Breach of contract

Anticipatory repudiation – Sufficiency of complaint

Audthan LLC v. Nick & Duke LLC

No. 30

Judge Wilson

Background: The parties entered into an agreement to replace a single room occupancy hotel owned by the defendant with a mixed-used residential and commercial building for a 40-year lease term. The parties understood that an approval of a “cure” agreement with the NYC Department of Housing Preservation and Development would be required for the project to go forward and incorporated terms relating to that approval into the agreement. However, both parties agree that the ground lease has terminated, but disagree as to whose fault it was. The parties appealed from the dismissal of two causes of action from the plaintiff’s complaint.

Ruling: The Court of Appeals held that dismissal of the breach of contract action resting on a theory of repudiation was erroneously dismissed. The court noted that the complaint alleged the defendant engaged in multiple acts that breached the ground lease agreement including refusing to sign the cure agreement tendered and issuing a statement that it would never sign any agreement.

Elan R. Dobbs for the appellant-respondent; Jeffrey Turkel for the respondent-appellant.

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