In Hamilton 65th Partners, LLC v. Smallbone Inc., tenants entered into a lease for the first and second floors of a building, agreeing to pay $33,333.33 for monthly rent, but in the event it continued to occupy the premises after the lease’s expiration, it would pay use and occupancy of two and one half times last month’s rent (holdover rent). The lease expired and tenants continued to occupy the premises paying the regular rent. Landlord sought to recover holdover rent of nearly $3.4 million. Tenants argued landlord was judicially estopped form denying their status as a month-to-month tenant as it previously asserted same in prior proceedings. The court found the lease contained an express agreement tenant would be liable for two and one half times the last month’s rent for the holdover period, finding RPL §232-c did not apply to create a month-to-month tenancy. Yet, it found landlord was judicially estopped from denying tenants’ status as a month-to-month tenant and from collecting holdover rent as allowing it to change positions now and seek holdover rent would prejudice tenants. Tenants’ motions were granted.
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