NNA RESTAURANT MANAGEMENT LLC v. Nolita Oasis, Inc., Intervenor Defendant-Appellant.

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Supreme Court, Appellate Division, First Department, New York.

NNA RESTAURANT MANAGEMENT LLC, Plaintiff-Respondent, v. Mahrokh ESHAGHIAN, et al., Defendants-Respondents, Nolita Oasis, Inc., Intervenor Defendant-Appellant.

Decided: May 16, 2006

TOM, J.P., ANDRIAS, FRIEDMAN, WILLIAMS, SWEENY, JJ. Thacher Proffitt & Wood LLP, White Plains (Kevin J. Plunkett of counsel), for appellant. Kamerman, Meyrowitz & Soniker P.C., New York (David H. Meyrowitz of counsel), for Eshaghian respondents.

Order, Supreme Court, New York County (Ira Gammerman, J.H.O.), entered August 8, 2005, which, in an action by a commercial tenant against its landlord for a Yellowstone injunction, after a nonjury trial, inter alia, dismissed intervenor defendant-appellant's cross claims against landlord for injunctive relief compelling landlord's consent to tenant's assignment of the lease to appellant, and for damages based on landlord's tortious interference with such assignment, unanimously affirmed, without costs.

 So much of the appeal as concerns appellant's cross claim for injunctive relief has been rendered moot by tenant's surrender of the lease to landlord subsequent to the entry of the order on appeal. We note law of the case that appellant is not a third-party beneficiary of the lease and cannot compel landlord's consent to the assignment in that capacity.   Assuming appellant has a claim for tortious interference with contract or business relations based on landlord's alleged unreasonable withholding of consent, such claim was properly dismissed upon findings that when the assignment was first proposed after tenant's institution of the instant action, tenant was in default of its rent obligation, and that landlord's withholding of consent therefore was not unreasonable (see Sayed v. Rapp, 10 A.D.3d 717, 720, 782 N.Y.S.2d 278 [2004];  cf. F.H.R. Auto Sales v. Scutti, 144 A.D.2d 956, 958, 534 N.Y.S.2d 266 [1988] ).   Tenant's proposed payment of a sum of money in exchange for landlord's release of tenant's lease obligations and consent to the assignment would have transformed the proposed assignment into a novation, for which landlord was not required to act reasonably.   In any event, as the J.H.O. also found, even if tenant were not in default of its lease obligations, landlord's withholding of consent was reasonably based on appellant's and tenant's failure to provide appropriate information about appellant (see 200 Eighth Ave. Rest. Corp. v. Daytona Holding Corp., 293 A.D.2d 353, 740 N.Y.S.2d 330 [2002] ).   We have considered and rejected appellant's other arguments.