Civil Court, City of New York,
New York County, Trial Term, Part 52.
Samuel KIRSCHENBAUM, as attorney for Stage Glens Falls Corp. and Stage
Industries, Inc. (New York corporation) Petitioner (Landlord),
v.
M-T-S FRANCHISE CORP. (a New York corporation), Respondent (Tenant).
April 10, 1974.
 Holdover proceeding.  On motion of respondent to dismiss, the Civil Court of 
the City of New York, Trial Term, County of New York, Shanley N. Egeth, J., held 
that notice to cure default which enabled lessor transmitting notice to 
unilaterally thereafter determine whether to deem default remedied or 
substantially remedied and to seek payment of rent or, alternatively, to refuse 
rent and claim default and termination could not be deemed a valid, clear, 
unambiguous, unequivocal notice of termination or limitation in that it provided 
lessee with no clear course of action and put him in a position where, even if 
he made effort to cure alleged default, lessor could nevertheless attempt to 
retain benefit of that labor while simultaneously claiming termination of lease 
by asserting that notice to cure was a notice to terminate or that default was 
insufficiently remedied.
 Motion granted; petition dismissed.
West Headnotes
[1] Landlord and Tenant  103(1)
233k103(1) Most Cited Cases
"A conditional limitation" has the dire effect of forfeiting all rights under a 
lease which may not thereafter be revived even if the condition is subsequently 
cured. 
[2] Landlord and Tenant  37
233k37 Most Cited Cases
In construing a lease, court must read entire document, including that which is 
incorporated therein by reference, and attempt to construe it in any manner 
which gives harmonious meaning to all parts thereof.
[3] Landlord and Tenant  103(1)
233k103(1) Most Cited Cases
A court should seek to strictly construe a lease instrument against its 
draftsman to avoid gross hardship of forfeiture.
[4] Landlord and Tenant  94(3)
233k94(3) Most Cited Cases
A notice of termination of lease must be clear, unambiguous and unequivocal if 
it is to function as the catalyst which terminates a leasehold.
[5] Landlord and Tenant  94(3)
233k94(3) Most Cited Cases
Before a lease is declared forfeited, notice of termination must be carefully 
analyzed and strictly construed to assume full, clear and proper compliance with 
right to terminate tenancy.  Real Property Law §  232-a.
[6] Landlord and Tenant  94(3)
233k94(3) Most Cited Cases
Notice to cure default which enabled lessor transmitting notice to unilaterally 
thereafter determine whether to deem default remedied or substantially remedied 
and to seek payment of rent or, alternatively, to refuse rent and claim default 
and termination could not be deemed a valid, clear, unambiguous, unequivocal 
notice of termination or limitation in that it provided lessee with no clear 
course of action and put him in a position where, even if he made effort to cure 
alleged default, lessor could nevertheless attempt to retain benefit of that 
labor while simultaneously claiming termination of lease by asserting that 
notice to cure was a notice to terminate or that default was insufficiently 
remedied.  Real Property Law §  232-a.
 *1012 **257 Dreyer & Traub, New York City (by Samuel Kirschenbaum and Thomas C. 
Lambert, New York City), of counsel, for petitioner.
 Laitman, Mathews & Magidson, New York City (by Morton H. Rosen, Ernest L. 
Mathews and Simon K. Barsky, New York City, of counsel), for respondent.
 SHANLEY N. EGETH, Judge.
 The respondent in this holdover proceeding has moved to dismiss the petition on 
the grounds that the proceeding is not maintainable in that its sublease has not 
been terminated.  Respondent contends that petitioner's purported termination 
was ineffective because a proper notice of termination was never served in 
conformity with the provisions of the sublease.  Petitioner opposes the motion 
claiming that its **258 letter of May 2, 1973 resulted in a termination of the 
leasehold as of July 31, 1973.
 *1013 The single question presented on this motion is whether the sublease 
terminated by virtue of petitioner's May 2, 1973 notice.  The basic facts and 
the text of the controlling documents are not in dispute.
 The respondent entered into a license agreement with the parent corporation of 
the sublessor, and simultaneously entered into the sublease for the premises 
which is the subject of this proceeding.  Both documents in combination reflect 
the full agreement negotiated by the parties in licensing the respondent to 
operate a Stage Delicatessen at the subject premises.
 The license agreement provides Inter alia that (in addition to the rent 
directly payable under the term of the sublease) the respondent was required to 
pay a six per cent royalty based upon sales; to supply the petitioner with a 
certified statement of net sales during each calendar month; to transmit a 
certified statement within 60 days after the end of each calendar year setting 
forth in detail gross sales, net sales, costs of goods and a balance sheet; and 
to maintain certain special records in its premises where they might be examined 
upon reasonable notice by the licensor.  Article XX of said agreement further 
grants the licensor the right to terminate the agreement upon 30 days written 
notice upon the occurrence of a number of events, including, but not limited to: 
(b) a default in performance of any provision of the agreement if the licensee 
fails to take action to remedy the default within 30 days following receipt in 
writing of notice of such default; or (e) in the event that the operator shall 
be adjudged to be in default in making any royalty payment.
 Paragraph 7 of the sublease, executed simultaneously therewith, contains a 
recitation of the execution of the license agreement and incorporates the entire 
agreement into the sublease by reference; provides that in the event of conflict 
between the sublease and license agreement, the sublease shall prevail; and, 
expressly and automatically constitutes any default by the sublessee under the 
license agreement as an event of default under the terms of the sublease for the 
purpose of paragraph 10 thereof.
 Paragraph 10 of the sublease defining 'Event of Default' includes as such 
amongst the many enumerated therein: (a) failure to pay rent or any other money 
due within three days after due under the sublease; and (c), failure to perform 
any other terms or provisions of the sublease within five days after service of 
written notice of default, Or any contrary time otherwise specifically set forth 
in the sublease.  Among other *1014 remedies this section explicitly grants the 
sublessor the right to terminate the lease after an event of default on two 
days' notice to the sublessee.
 **259 The parties hereto agree that the efficacy of petitioner's letter of May 
2, 1973 as a termination notice under the sublease is determinative of the issue 
of whether the sublease had been terminated prior to the commencement of this 
proceeding.  It is conceded that no other notice was transmitted after said day.
 This Court concludes that the letter of May 2, 1973 was not sufficient to 
terminate the tenancy.
 [1] The parties agree that the sublease with the license agreement incorporated 
therein provided for a conditional limitation which would automatically 
terminate the lease upon the occurrence of such condition.  (See 2 Rasch, New 
York Landlord and Tenant, Section 747, pages 194--195.) A conditional limitation 
has the dire effect of forfeiting all rights under the lease, which may not 
thereafter be revived even if the condition is subsequently cured.  (First 
National Stores, Inc. v. Yellowstone Shopping Center, Inc., 21 N.Y.2d 630, 290 
N.Y.S.2d 721, 237 N.E.2d 868).
 [2] In analyzing these documents this Court must read the entire document  
(including that which is incorporated therein by reference) and attempt to 
construe it in a manner which gives harmonious meaning to all parts thereof 
(Levine v. Bornstein, 4 N.Y.2d 241, 173 N.Y.S.2d 599, 149 N.E.2d 883; McDonnell 
v. McDonnell, 281 N.Y. 480, 24 N.E.2d 134; Bovin v. Galitzka, 250 N.Y. 228, 232, 
165 N.E. 273, 275); and construe it strictly against its draftsman (Fabulous 
Stationers, Inc. v. Regency Joint Venture, 44 A.D.2d 547, 353 N.Y.S.2d 766 (1st 
Dept.); Rizzo v. Morrison Motors, Inc., 29 A.D.2d 912, 289 N.Y.S.2d 903 (4th 
Dept., 1968.)
 [3][4] Even more significantly, a court should seek to strictly construe the 
document against a draftsman to avoid the gross hardship of forfeiture of lease.  
(Jones v. Gianferante, 305 N.Y. 135, 138, 111 N.E.2d 419, 420; Brause v. 2968 
Third Avenue, Inc., 41 Misc.2d 348, 244 N.Y.S.2d 587, aff'd 43 Misc.2d 691, 251 
N.Y.S.2d 974.) Brause (41 Misc.2d 348, 353, 244 N.Y.S.2d 587), quotes from Lyon 
v. Hersey, 103 N.Y. 264, 8 N.E. 518, as follows: 'In the construction of all 
contracts, under which forfeitures are claimed, it is the duty of the court to 
interpret them strictly in order to avoid such a result, for a forfeiture is not 
favored in law.'  Additionally, for similar reasons, a notice of termination of 
a lease must be clear, unambiguous and unequivocal if it is to function as the 
catalyst which terminates a leasehold.  (Spencer v. Faulkner, 65 Misc.2d 298, 
317 N.Y.S.2d 374; 28 Mott Street Co. v. Summit Import Corporation, 64 Misc.2d 
860, 316 N.Y.S.2d 259; Granet Construction Corp. v. Longo, 42 Misc.2d 798, 249 
N.Y.S.2d 231.)
 *1015 [5] Although most of the cases involving notice of termination relate to 
thirty day notices pursuant to Section 232--a of the Real **260 Property Law, 
the notice which was construed by the Supreme Court, New York County, in the 
Granet case, Supra, sought termination of a lease in implementation of a 
conditional limitation.  The notice in that case was almost identical in form to 
the one now before this Court.  In that case the Court ruled that the notice 
contained therein was not a notice of termination, but one to cure the claimed 
breach, and that a subsequent notice of unequivocal termination would be 
required to end the lease.  Before a lease is declared forfeited, the notice of 
termination must be carefully analyzed and strictly construed to assume full, 
clear and proper compliance with the right to terminate the tenancy.
 [6] Paragraph 10 of the sublease mandates two days' written notice of 
termination in order to terminate the lease.  Under this sublease, the 
transmittal of such a notice is the final act which creates the conditional 
limitation of this lease, rather than the default which gives rise to the right 
to transmit such notice.  (Matter of Feist v. Long Island Studios, Inc., 29 
A.D.2d 186, 287 N.Y.S.2d257 (2d Dept., 1968); Matter of 19 South Main Street 
Corp. v. Phalanx Motors, Inc., 36 Misc.2d 114, 232 N.Y.S.2d 431; 2 Rasch, New 
York Landlord and Tenant Section 751, pp. 201--203.) Such a notice must clearly 
by its terms provide for the automatic termination of the leasehold and convey 
this knowledge to the other party.  A notice to cure a default which enables the 
party transmitting such notice to unilaterally thereafter determine whether to 
deem the default remedied or substantially remedied and to seek payment of rent, 
or, alternatively, to refuse rent and claim default and termination, cannot be 
deemed a valid, clear, unambiguous, unequivocal notice of termination or 
limitation.  Such a notice provides the tenant with no clear course of action.  
It puts him in a position where even if he makes an effort to cure the alleged 
default, the landlord may, nevertheless, attempt to retain the benefit of that 
labor while simultaneously claiming termination of the lease by asserting that 
the notice to cure was a notice to terminate or that the default was 
insufficiently remedied.
 The respondent is entitled to a clear, unambiguous two-day notice of 
termination after the expiration of the specified time to cure a relevant 
default.  The May 2nd letter referring to various provisions of the licensing 
agreement and the sublease, and specifically requesting compliance within 30 
days, states that the 'sublease will then terminate in accordance with paragraph 
7 and 10 of the sublease.'  Paragraph 10 requires a subsequent *1016 two-day 
notice of termination.  The May 2nd, 1973 letter is not such a letter.  It is 
deemed to be a notice to cure, which may create the right to transmit a two-day 
notice of termination in the event of noncompliance.  Like the letter in Granet, 
it did not clearly convey to the recipient that the lease would terminate 
without further notice.  This is particularly true in **261 the light of the 
different text of two prior notices of termination transmitted to respondent in 
1970.
 Accordingly, the May 2nd 1973 letter being insufficient to terminate the 
sublease, the sublease remains in existence and a holdover proceeding is not 
maintainable.  The petition in the holdover proceeding is therefore dismissed.
355 N.Y.S.2d 256, 77 Misc.2d 1012
END OF DOCUMENT
Civil Court, City of New York,New York County, Trial Term, Part 52.
Samuel KIRSCHENBAUM, as attorney for Stage Glens Falls Corp. and StageIndustries, Inc. (New York corporation) Petitioner (Landlord),v.M-T-S FRANCHISE CORP. (a New York corporation), Respondent (Tenant).

April 10, 1974.

 Holdover proceeding.  On motion of respondent to dismiss, the Civil Court of the City of New York, Trial Term, County of New York, Shanley N. Egeth, J., held that notice to cure default which enabled lessor transmitting notice to unilaterally thereafter determine whether to deem default remedied or substantially remedied and to seek payment of rent or, alternatively, to refuse rent and claim default and termination could not be deemed a valid, clear, unambiguous, unequivocal notice of termination or limitation in that it provided lessee with no clear course of action and put him in a position where, even if he made effort to cure alleged default, lessor could nevertheless attempt to retain benefit of that labor while simultaneously claiming termination of lease by asserting that notice to cure was a notice to terminate or that default was insufficiently remedied.
 Motion granted; petition dismissed.

West Headnotes
[1] Landlord and Tenant  103(1)233k103(1) Most Cited Cases
"A conditional limitation" has the dire effect of forfeiting all rights under a lease which may not thereafter be revived even if the condition is subsequently cured. 
[2] Landlord and Tenant  37233k37 Most Cited Cases
In construing a lease, court must read entire document, including that which is incorporated therein by reference, and attempt to construe it in any manner which gives harmonious meaning to all parts thereof.
[3] Landlord and Tenant  103(1)233k103(1) Most Cited Cases
A court should seek to strictly construe a lease instrument against its draftsman to avoid gross hardship of forfeiture.
[4] Landlord and Tenant  94(3)233k94(3) Most Cited Cases
A notice of termination of lease must be clear, unambiguous and unequivocal if it is to function as the catalyst which terminates a leasehold.
[5] Landlord and Tenant  94(3)233k94(3) Most Cited Cases
Before a lease is declared forfeited, notice of termination must be carefully analyzed and strictly construed to assume full, clear and proper compliance with right to terminate tenancy.  Real Property Law §  232-a.
[6] Landlord and Tenant  94(3)233k94(3) Most Cited Cases
Notice to cure default which enabled lessor transmitting notice to unilaterally thereafter determine whether to deem default remedied or substantially remedied and to seek payment of rent or, alternatively, to refuse rent and claim default and termination could not be deemed a valid, clear, unambiguous, unequivocal notice of termination or limitation in that it provided lessee with no clear course of action and put him in a position where, even if he made effort to cure alleged default, lessor could nevertheless attempt to retain benefit of that labor while simultaneously claiming termination of lease by asserting that notice to cure was a notice to terminate or that default was insufficiently remedied.  Real Property Law §  232-a. *1012 **257 Dreyer & Traub, New York City (by Samuel Kirschenbaum and Thomas C. Lambert, New York City), of counsel, for petitioner.
 Laitman, Mathews & Magidson, New York City (by Morton H. Rosen, Ernest L. Mathews and Simon K. Barsky, New York City, of counsel), for respondent.


 SHANLEY N. EGETH, Judge.
 The respondent in this holdover proceeding has moved to dismiss the petition on the grounds that the proceeding is not maintainable in that its sublease has not been terminated.  Respondent contends that petitioner's purported termination was ineffective because a proper notice of termination was never served in conformity with the provisions of the sublease.  Petitioner opposes the motion claiming that its **258 letter of May 2, 1973 resulted in a termination of the leasehold as of July 31, 1973.
 *1013 The single question presented on this motion is whether the sublease terminated by virtue of petitioner's May 2, 1973 notice.  The basic facts and the text of the controlling documents are not in dispute.
 The respondent entered into a license agreement with the parent corporation of the sublessor, and simultaneously entered into the sublease for the premises which is the subject of this proceeding.  Both documents in combination reflect the full agreement negotiated by the parties in licensing the respondent to operate a Stage Delicatessen at the subject premises.
 The license agreement provides Inter alia that (in addition to the rent directly payable under the term of the sublease) the respondent was required to pay a six per cent royalty based upon sales; to supply the petitioner with a certified statement of net sales during each calendar month; to transmit a certified statement within 60 days after the end of each calendar year setting forth in detail gross sales, net sales, costs of goods and a balance sheet; and to maintain certain special records in its premises where they might be examined upon reasonable notice by the licensor.  Article XX of said agreement further grants the licensor the right to terminate the agreement upon 30 days written notice upon the occurrence of a number of events, including, but not limited to: (b) a default in performance of any provision of the agreement if the licensee fails to take action to remedy the default within 30 days following receipt in writing of notice of such default; or (e) in the event that the operator shall be adjudged to be in default in making any royalty payment.
 Paragraph 7 of the sublease, executed simultaneously therewith, contains a recitation of the execution of the license agreement and incorporates the entire agreement into the sublease by reference; provides that in the event of conflict between the sublease and license agreement, the sublease shall prevail; and, expressly and automatically constitutes any default by the sublessee under the license agreement as an event of default under the terms of the sublease for the purpose of paragraph 10 thereof.
 Paragraph 10 of the sublease defining 'Event of Default' includes as such amongst the many enumerated therein: (a) failure to pay rent or any other money due within three days after due under the sublease; and (c), failure to perform any other terms or provisions of the sublease within five days after service of written notice of default, Or any contrary time otherwise specifically set forth in the sublease.  Among other *1014 remedies this section explicitly grants the sublessor the right to terminate the lease after an event of default on two days' notice to the sublessee.
 **259 The parties hereto agree that the efficacy of petitioner's letter of May 2, 1973 as a termination notice under the sublease is determinative of the issue of whether the sublease had been terminated prior to the commencement of this proceeding.  It is conceded that no other notice was transmitted after said day.
 This Court concludes that the letter of May 2, 1973 was not sufficient to terminate the tenancy.
 [1] The parties agree that the sublease with the license agreement incorporated therein provided for a conditional limitation which would automatically terminate the lease upon the occurrence of such condition.  (See 2 Rasch, New York Landlord and Tenant, Section 747, pages 194--195.) A conditional limitation has the dire effect of forfeiting all rights under the lease, which may not thereafter be revived even if the condition is subsequently cured.  (First National Stores, Inc. v. Yellowstone Shopping Center, Inc., 21 N.Y.2d 630, 290 N.Y.S.2d 721, 237 N.E.2d 868).
 [2] In analyzing these documents this Court must read the entire document  (including that which is incorporated therein by reference) and attempt to construe it in a manner which gives harmonious meaning to all parts thereof (Levine v. Bornstein, 4 N.Y.2d 241, 173 N.Y.S.2d 599, 149 N.E.2d 883; McDonnell v. McDonnell, 281 N.Y. 480, 24 N.E.2d 134; Bovin v. Galitzka, 250 N.Y. 228, 232, 165 N.E. 273, 275); and construe it strictly against its draftsman (Fabulous Stationers, Inc. v. Regency Joint Venture, 44 A.D.2d 547, 353 N.Y.S.2d 766 (1st Dept.); Rizzo v. Morrison Motors, Inc., 29 A.D.2d 912, 289 N.Y.S.2d 903 (4th Dept., 1968.)
 [3][4] Even more significantly, a court should seek to strictly construe the document against a draftsman to avoid the gross hardship of forfeiture of lease.  (Jones v. Gianferante, 305 N.Y. 135, 138, 111 N.E.2d 419, 420; Brause v. 2968 Third Avenue, Inc., 41 Misc.2d 348, 244 N.Y.S.2d 587, aff'd 43 Misc.2d 691, 251 N.Y.S.2d 974.) Brause (41 Misc.2d 348, 353, 244 N.Y.S.2d 587), quotes from Lyon v. Hersey, 103 N.Y. 264, 8 N.E. 518, as follows: 'In the construction of all contracts, under which forfeitures are claimed, it is the duty of the court to interpret them strictly in order to avoid such a result, for a forfeiture is not favored in law.'  Additionally, for similar reasons, a notice of termination of a lease must be clear, unambiguous and unequivocal if it is to function as the catalyst which terminates a leasehold.  (Spencer v. Faulkner, 65 Misc.2d 298, 317 N.Y.S.2d 374; 28 Mott Street Co. v. Summit Import Corporation, 64 Misc.2d 860, 316 N.Y.S.2d 259; Granet Construction Corp. v. Longo, 42 Misc.2d 798, 249 N.Y.S.2d 231.)
 *1015 [5] Although most of the cases involving notice of termination relate to thirty day notices pursuant to Section 232--a of the Real **260 Property Law, the notice which was construed by the Supreme Court, New York County, in the Granet case, Supra, sought termination of a lease in implementation of a conditional limitation.  The notice in that case was almost identical in form to the one now before this Court.  In that case the Court ruled that the notice contained therein was not a notice of termination, but one to cure the claimed breach, and that a subsequent notice of unequivocal termination would be required to end the lease.  Before a lease is declared forfeited, the notice of termination must be carefully analyzed and strictly construed to assume full, clear and proper compliance with the right to terminate the tenancy.
 [6] Paragraph 10 of the sublease mandates two days' written notice of termination in order to terminate the lease.  Under this sublease, the transmittal of such a notice is the final act which creates the conditional limitation of this lease, rather than the default which gives rise to the right to transmit such notice.  (Matter of Feist v. Long Island Studios, Inc., 29 A.D.2d 186, 287 N.Y.S.2d257 (2d Dept., 1968); Matter of 19 South Main Street Corp. v. Phalanx Motors, Inc., 36 Misc.2d 114, 232 N.Y.S.2d 431; 2 Rasch, New York Landlord and Tenant Section 751, pp. 201--203.) Such a notice must clearly by its terms provide for the automatic termination of the leasehold and convey this knowledge to the other party.  A notice to cure a default which enables the party transmitting such notice to unilaterally thereafter determine whether to deem the default remedied or substantially remedied and to seek payment of rent, or, alternatively, to refuse rent and claim default and termination, cannot be deemed a valid, clear, unambiguous, unequivocal notice of termination or limitation.  Such a notice provides the tenant with no clear course of action.  It puts him in a position where even if he makes an effort to cure the alleged default, the landlord may, nevertheless, attempt to retain the benefit of that labor while simultaneously claiming termination of the lease by asserting that the notice to cure was a notice to terminate or that the default was insufficiently remedied.
 The respondent is entitled to a clear, unambiguous two-day notice of termination after the expiration of the specified time to cure a relevant default.  The May 2nd letter referring to various provisions of the licensing agreement and the sublease, and specifically requesting compliance within 30 days, states that the 'sublease will then terminate in accordance with paragraph 7 and 10 of the sublease.'  Paragraph 10 requires a subsequent *1016 two-day notice of termination.  The May 2nd, 1973 letter is not such a letter.  It is deemed to be a notice to cure, which may create the right to transmit a two-day notice of termination in the event of noncompliance.  Like the letter in Granet, it did not clearly convey to the recipient that the lease would terminate without further notice.  This is particularly true in **261 the light of the different text of two prior notices of termination transmitted to respondent in 1970.
 Accordingly, the May 2nd 1973 letter being insufficient to terminate the sublease, the sublease remains in existence and a holdover proceeding is not maintainable.  The petition in the holdover proceeding is therefore dismissed.
355 N.Y.S.2d 256, 77 Misc.2d 1012
END OF DOCUMENT