What's happening
This bill prohibits commercial leases from waiving tenants' rights to bring declaratory judgment actions, making such waivers void.
Why it matters
Protects tenants’ legal rights. By making it illegal for commercial leases to include waivers against declaratory judgment actions, tenants retain the ability to ask courts to interpret or clarify aspects of their lease without the threat of having signed away that right.
Balances negotiating power. Commercial landlords often have more leverage in drafting lease agreements; this law prevents them from using their position to force tenants into agreements that restrict their access to the courts.
Encourages fair dispute resolution. Declaratory judgments can resolve uncertainties before disputes escalate—this bill ensures tenants can use this legal tool to address ambiguous or contested lease terms.
Sets a public policy standard. Declaring such waivers void reinforces the principle that certain legal rights—like access to courts for clarification of contracts—cannot be contracted away, promoting transparency and fairness in commercial leasing.
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Who cares
Headline styles
Protect Tenant Legal Rights
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Substituted by A2554
- Ordered to third reading cal.1346
- Committee discharged and committed to rules
- Referred to judiciary
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Protect Tenants’ Legal Rights
Signed by Governor · Sponsor Steven Otis
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
5614
2019-2020 Regular Sessions
IN SENATE
May 9, 2019
Introduced by Sen. LIU -- read twice and ordered printed, and when printed to be committed to the Committee on Judiciary
AN ACT to amend the real property law, in relation to prohibiting leases from including a waiver of the right to a declaratory judgment action
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The real property law is amended by adding a new section 235-h to read as follows:
§ 235-h. Waiver of right to bring a declaratory judgment action. No commercial lease shall contain any provision waiving or prohibiting the right of any tenant to bring a declaratory judgment action with respect to any provision, term or condition of such commercial lease. The inclusion of any such waiver provision in a commercial lease shall be null and void as against public policy.
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01655-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the real property law, in relation to prohibiting leases from including a waiver of the right to a declaratory judgment action
Purpose or general idea of bill
Amends the real property law to prohibit a lease from containing any provision waiving or prohibiting the right of any tenant to bring a declaratory judgment action with respect to any provision, term or condition of such commercial lease.
Summary of provisions
Section 1 adds a new section 235-h to the real property law to prohibit a lease from containing any provision waiving or prohibiting the right of any tenant to bring a declaratory judgment action with respect to any provision, term or condition of such commercial lease.
Section 2 provides that this act shall take effect immediately.
Justification
For the last 50 years, in cases where a landlord serves a commercial tenant with a notice to cure a defect, and seeks to terminate a lease if the defaults under the lease are not cured within a certain amount of time, the tenant has had the right to seek additional time to cure. The commercial tenant has been able to file for an injunction to toll the period of time allowed to cure the default, and to prevent the landlord from terminating the lease. This is known as a Yellowstone injunction, (see First Nail. Stores v. Yellowstone Shopping Ctr., 21 N.Y.2d 630 (1968).
Until recently the question of whether a commercial tenant could waive its right to obtain a Yellowstone injunction had not been ruled upon by an appeals court until a recent ruling in the Second Department of the Appellate Division (159 MP Corp. v. Redbridge Bedford, 2018 N.Y. Slip. Op. 00537 (2d Dept, Jan.31, 2018) held the waiver language in the lease was enforceable and not against public policy. The court further found that the legislature "has not enacted any specific or blanket statutory provision prohibiting as void or unenforceable a tenant's waiver of declaratory judgment remedies."
This legislation seeks to enact such a provision as a matter of public policy and restore the right of commercial tenants to cure under a declaratory judgment action as has been the practice since 1968. The ability to cure through this process protects commercial tenants from landlords seeking to remove tenants in the middle of a lease period without appropriate ability to cure or judicial review. To allow waiver clauses of the Yellowstone injunction will be disruptive of commerce, unfair to commercial tenants and allow landlords to use minor lease issues as a method to remove and replace tenants in the middle of lease terms. Commercial landlords would be able to prematurely terminate leas- es whenever they wanted to force a tenant out, whether the default was legitimate or not, and the tenant who agreed to a waiver would have no recourse.
Fiscal implications for state and local governments
N/A
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.