## Facts

- A commercial landlord leased a store in Hempstead, New York, to a prospective drugstore operator under a written lease dated February 10, 1938, with possession to begin July 1, 1938.
- At the time of leasing, the premises were occupied by prior tenants whose lease expired June 30, 1938.
- On July 1, 1938, the prior tenants refused to vacate, asserting a renewal based on an alleged oral agreement.
- The landlord brought summary proceedings to remove the occupants; an initial verdict favored the occupants, an appellate court ordered a new trial, and the occupants later defaulted and vacated in January 1939.
- The tenant sued the landlord for $25,000 in damages for failure to deliver possession and resulting business losses.
- After a bench trial, the court found the occupants wrongfully withheld possession and that the landlord neither refused to deliver possession nor hindered the tenant’s entry, and pursued removal efforts beyond what was legally required.

## Issues

1. Whether a commercial landlord is liable in damages for failure to deliver actual physical possession at the start of the lease term when a third-party wrongful occupant holds over without the landlord’s sanction.
2. Whether, absent an express covenant to deliver actual possession, the landlord’s implied obligation extends beyond providing good title and the right to lease the premises free of encumbrance.

## Decision

- Judgment was entered for the landlord, and the complaint was dismissed.
- The court held the landlord had no implied duty to deliver actual physical possession at the term’s start when possession was blocked by a wrongful occupant not holding with the landlord’s sanction.
- The tenant’s inability to enter was caused by the wrongful act of the holdover occupants, not by any defect in the landlord’s title or conduct.
- A prior decision imposing liability where the occupying tenant had a superior right under a prior lease from the same landlord was distinguished because the landlord there lacked authority to deliver possession, unlike here.

## Legal Principles

- In New York, absent an express covenant, a landlord’s implied undertaking is to provide good title and the right to a free and unencumbered lease for the demised term, not to guarantee actual physical possession at commencement.
- When premises are held at the start of the term by a trespasser or wrongful occupant not holding with the landlord’s sanction, the landlord has no implied obligation to oust that occupant to enable the tenant’s entry.
- Liability may arise where the landlord’s own prior lease or other authorized arrangement gives an occupant a superior right to possession, preventing the landlord from lawfully delivering possession to the new tenant.

## Conclusion

The court denied the tenant’s damages claim because the lease contained no express promise to deliver actual possession and the landlord satisfied its implied obligations by having good title and the right to lease; the failure of entry resulted from wrongful holdover occupants acting without the landlord’s sanction.


Teitelbaum v. Direct Realty Co., 13 N.Y.S.2d 886 (Sup. Ct. Nassau Cnty. 1939)