## Facts

- A building owner leased a portion of an exterior Manhattan wall to a billboard company for a three-year term with additional renewal options.
- The wall location was highly valuable because it was visible to traffic entering Manhattan from a major tunnel exit ramp.
- The lease contemplated installation of an illuminated billboard and subleasing of advertising rights; the tenant subleased the sign at a fixed rate to an advertising company.
- The lease contained a clause permitting the lessor (or successor) to terminate on at least 60 days’ notice only upon a bona fide sale of the building to an unrelated third party.
- The owner sold the building to a purchaser, who later attempted to terminate the lease by invoking the sale-termination clause.
- The tenant vacated under protest and sued for a declaration that termination was ineffective, specific performance of the lease, and damages.
- The trial court and intermediate appellate court held the purchaser’s termination ineffective but denied specific performance as unnecessary given money damages; damages were limited to the period up to trial.

## Issues

1. Whether the lease’s sale-termination clause authorized the purchaser, as a successor lessor, to cancel the billboard lease after the sale.
2. Whether the tenant was entitled to specific performance of the lease or had an adequate remedy at law in money damages.
3. If specific performance was denied, whether damages could be limited to the period before trial rather than the remaining term of the lease.

## Decision

- The court held the purchaser breached the lease; the attempted cancellation was not authorized under the sale-termination clause as applied.
- The court affirmed denial of specific performance because the tenant’s loss could be compensated with money damages and equitable relief would impose a disproportionate burden on the landlord.
- The court modified the damages ruling, holding that limiting damages to the pretrial period was improper.
- The case was remitted for determination of damages through the expiration of the lease term, consistent with contract-damages principles.

## Legal Principles

- Specific performance is an equitable remedy generally reserved for situations where money damages cannot adequately compensate the injured party.
- Physical or commercial “uniqueness” of the subject matter does not by itself require specific performance; the key inquiry is whether the promised performance is difficult to value with acceptable certainty.
- Where market-based evidence (including an existing sublease at a fixed rate) provides a reliable basis to measure loss, damages are ordinarily adequate.
- Even if valuation is not perfect, a court may deny specific performance when the hardship and practical burdens of compelling performance are disproportionate to the promisee’s compensable loss.
- Expectation damages for breach of a lease aim to provide the benefit of the bargain and generally extend through the remaining term, subject to proof, mitigation, and deductions for avoided costs.

## Conclusion

The court enforced the billboard-wall lease against the purchaser as a matter of contract interpretation but denied specific performance because lost profits were measurable and compelling continued use of the wall for signage would impose an excessive burden; however, it required damages to be assessed for the remaining lease term rather than ending at trial.


Van Wagner Advert. Corp. v. S & M Enters., 67 N.Y.2d 186, 492 N.E.2d 756 (N.Y. 1986)