Morrell & Company the Wine Emporium, Ltd. v. Richalan Realty Corp

In Morrell & Company the Wine Emporium, Ltd. v. Richalan Realty Corp., 93 AD2d 736 (1st Dept. 1983) the tenant rented premises under a lease that expired on October 31, 1982. The lease included a provision granting the tenant a right to first refusal if the landlord received a bonafide offer to purchase the premises. The tenant commenced an action for declaratory judgment and related relief in the Supreme Court in March 1982, alleging that the landlord had failed to communicate offers to purchase the premises, and seeking specific performance of the landlord's contractual obligation to sell the premises to the tenant. Soon after the lease expired, the landlord commenced a summary holdover proceeding in Civil Court. The Appellate Division found that if the tenant was entitled to purchase the premises, the holdover proceeding would become "academic" (93 AD2d at 737). Moreover, the landlord had failed to show that the declaratory judgment and specific performance issues should be resolved in its favor (id.). The Appellate Division held that the Supreme Court should have removed the Civil Court proceeding and consolidated it with the declaratory judgment action to permit resolution of all issues in one forum (id.).