In Jarecki v. Shung Moo Louie, 95 NY2d 665, 745 N.E.2d 1006, 722 N.Y.S.2d 784 (2001), plaintiff exercised an option to purchase an apartment under a sublease.
After exercising the option and entering into a purchase agreement, the parties signed a written contract of sale. The contract of sale contained a merger clause which merged and integrated the terms of the purchase agreement into the written contract of sale. Id. 95 NY2d at 669.
The court ruled that, "because the terms of the purchase agreement were merged and integrated into the written contract of sale, the bilateral contract to purchase the apartment was terminated when the contract of sale was cancelled." Id. 95 NY2d at 669.