Hidden in most Real Estate Board of New York and other standard form leases for commercial tenants is a seemingly innocuous sentence in a typically lengthy paragraph dealing with destruction, fire and other casualty occurring to a leased space. That sentence typically states, in one form or another, that the tenant waives the provisions of Section 227 of the New York Real Property Law (RPL) and agrees that the provisions of the lease shall govern and control in lieu thereof. The waiver is seemingly innocent enough, until one fully understands the ramifications of what has been waived in agreeing to this sentence.
Under the common law, a tenant was held to its obligation to pay rent even in situations where the premises were destroyed.1 However, New York Real Property Law §2272 changed the common law rule to provide that a tenant is not liable to pay rent subsequent to its surrender of the premises in the event that the destruction occurred without its fault or neglect.
