Constructive Eviction Claim Not Valid

Facts: A tenant who provided physical therapy services rented space on the top floor of a five-story building. After three months, the tenant stopped paying full rent. The owner sued the tenant to recover the space and won. The tenant sued the owner for constructive eviction. The tenant claimed that the owner’s failure to maintain the site and elevator caused it to lose many patients, and to suffer numerous cancellations, leading to it losing $250,000 in business.

Decision: A New York trial court ruled in favor of the owner.

Reasoning: To prove that it was constructively evicted, the tenant had to show that the acts of the owner “precluded her from the use and enjoyment of the premises.” Here, the tenant alleged that: (1) the leased space was rendered unusable by the lack of elevator service and other maintenance problems in the building; (2) the owner failed to make elevator repairs in a timely manner; and (3) the tenant’s business was partially evicted and constructively evicted from the premises by the lack of essential services. For example, many of the tenant’s clients included the elderly, recently injured, and those who had recently undergone surgery; the use of the elevator was required for the tenant’s business since it was impossible for a patient with a knee injury, hip replacement, or in a wheelchair to reach the third floor without an operable elevator.

In a claim dealing with the issue of rent, it’s not sufficient for the tenant to defend its nonpayment of rent on the theory that there was a diminution of the beneficial enjoyment of the property, argued the owner. The owner asserted that the obligation to pay rent is not suspended even if a landlord fails to provide essential services. And, according to the owner, the tenant must actually physically abandon the premises in order to claim a constructive eviction.

“To invoke a constructive eviction defense, there must be a substantial interference with the tenant’s use and enjoyment of the leased premises, including access to goods and services, which causes the tenant to vacate the premises,” said the court. In this case, the tenant wasn’t removed from the premises, noted the court. In fact, the tenant remained in possession of the space through 27 months, and only left because the owner sought, and won, possession of the premises in a holdover proceeding. Additionally, the tenant wasn’t relieved of her fundamental obligation to pay rent even if the owner failed to provide essential services, the court added.

• Winner Communications, Inc. v. Bell, February 2013