## Facts

- Carol Duda (landlord) and Randy Thompson (tenant) renewed a written lease for a single-family house for a two-year term beginning January 1, 1995, and ending December 30, 1996.
- The lease set annual rent at $19,200, payable in monthly installments.
- The lease provided that, upon the tenant’s default in rent payments, the entire unpaid balance for the remainder of the term would automatically accelerate and become immediately due.
- The lease also permitted (but did not require) the landlord to re-enter and re-rent after default; any rent received from a new tenant would be credited first to the landlord’s re-letting costs and then to the tenant’s unpaid obligation.
- Thompson failed to pay three monthly rent installments (November 1995, December 1995, and January 1996).
- Duda served Thompson with notice of default and notice of acceleration and filed suit to recover the unpaid rent and the accelerated balance due under the lease.
- During the litigation, Thompson’s counsel informed the court in June 1996 that Thompson had vacated the premises in March 1996.
- Duda contended that she did not learn Thompson had moved out until that June disclosure and therefore had not attempted to re-rent earlier.
- Thompson argued that Duda could not recover the accelerated future rent because she had a duty to mitigate damages by making reasonable efforts to re-rent the property after he left.

## Issues

1. When a residential tenant abandons the premises before the end of a fixed-term lease, must the landlord mitigate damages by attempting to re-rent before recovering the rent due for the remainder of the term under an acceleration clause?
2. Is an automatic lease acceleration clause requiring immediate payment of the remaining rent upon tenant default enforceable in this context?

## Decision

- The court held that, under New York law, a landlord generally has no duty to mitigate damages by reletting when a tenant abandons the premises during the lease term and the landlord elects not to accept surrender.
- The court enforced the lease’s automatic acceleration provision and allowed Duda to seek the balance of rent due for the remainder of the lease term.
- Any recovery remained subject to the lease’s credit mechanism if the premises were re-rented (crediting new rent after re-letting costs against Thompson’s obligation).

## Legal Principles

- In New York, a lease is treated as a conveyance of an interest in land as well as a contract; abandonment by the tenant does not, by itself, end the tenant’s rent obligation for the balance of a fixed term.
- Absent a statute or an agreement imposing such a requirement, a landlord is not generally required to reduce the tenant’s rent liability by attempting to re-rent after abandonment.
- A landlord faced with abandonment may choose to accept the tenant’s surrender (ending the lease) or refuse surrender and keep the lease in effect, pursuing rent obligations that continue under the lease.
- An acceleration clause that makes the remaining rent immediately due upon default can be enforceable as a change in the time of payment for the rent promised, rather than an unlawful penalty, particularly when it does not demand more than the rent set by the parties.
- Where the lease authorizes re-entry and reletting as an option and provides for credits if reletting occurs, the tenant’s accelerated obligation remains subject to those contractual credits.

## Conclusion

Duda v. Thompson held that a residential landlord in New York could enforce a lease clause automatically accelerating the remaining rent after the tenant’s rent default and later abandonment, and that the landlord was not required to attempt to re-rent the premises as a condition to recovering the accelerated balance, though the tenant was entitled to any credits specified in the lease if the property was re-rented.


Duda v. Thompson, 647 N.Y.S.2d 401 (1996)