Judge Guido Calabresi
Association of Graphic Communications Inc. (AGC) stopped paying rent to landlord Super Nova. Its 2007 Chapter 7 bankruptcy filing stayed Super Nova’s eviction efforts. After lifting the stay Super Nova executed its eviction warrant on April 24, 2007. In 2010, bankruptcy court denied Super Nova’s motion under Bankruptcy Code §365(d)(3) to recover post-petition rent, attorney fees and prejudgment interest between the Chapter 7 filing date and AGC’s 2007 eviction. District court affirmed bankruptcy court’s determination that because it had been “terminated” pre-petition by the eviction warrant’s issuance, the lease was not “unexpired.” Vacating judgment, the Second Circuitapplying Brattleboro Hous. Auth. v. Stoltz (In re Stoltz) and Canney v. Merchants Bank (In re Canney) to N.Y. Real Property Actions and Proceedings Law §749(3)held that even when a commercial lease is “terminated” through a state-court eviction proceeding, the lease is “unexpired” for purposes of Bankruptcy Code §365(d)(3). Because in New York it is an eviction warrant’s execution, not its issuance, that extinguishes the tenant’s interest in the lease, the lease is “unexpired” for §365(d)(3) purposes until the warrant is executed.
