219 Broadway Corp. v. Alexander’s, Inc., 46 N.Y.2d 506 (1979)

A lease, like other conveyances of interest in land, requires delivery to be effective; the mere signing of a lease, without delivery to the lessee, does not create a binding conveyance of property.

Summary

219 Broadway Corp. sued Alexander’s, Inc. for specific performance or damages, alleging breach of a lease agreement. Although both parties signed the lease, Alexander’s never delivered it to 219 Broadway and instead leased the property to a third party. The New York Court of Appeals held that the complaint failed to state a cause of action because delivery is a necessary element for a lease to be effective. The court emphasized that delivery demonstrates the intent to convey an interest in the property, and without it, the lease is not binding, regardless of signatures.

Facts

219 Broadway Corp. and Alexander’s, Inc. negotiated a lease for a property to be used as a parking lot. After reaching an agreement, a lease document was drafted. 219 Broadway signed the lease and an accompanying memorandum for recording and sent them to Alexander’s attorneys. 219 Broadway alleged that Alexander’s also signed the lease but refused to deliver it. Alexander’s then leased the property to another party, prompting 219 Broadway to sue for specific performance or damages.

Procedural History

219 Broadway Corp. filed suit in Special Term, which denied Alexander’s motion to dismiss, reasoning that the signatures validated the lease. The Appellate Division reversed, holding that delivery was required for the lease to be effective. 219 Broadway appealed to the New York Court of Appeals from the order of the Appellate Division.

Issue(s)

Whether a complaint alleging breach of a written lease states a cause of action when the complaint concedes the lease was never delivered to the lessee.

Holding

No, because delivery is a necessary element for a lease to be effective and convey an interest in land. Without delivery, the lease is not binding, even if it has been signed by both parties.

Court’s Reasoning

The court emphasized that while a lease is a contract, it primarily serves to convey an interest in real property. "[A] lease, especially a modern lease, is generally more than a simple conveyance of an interest in land for a fixed period of time. Typically it is also a contract which requires the parties, particularly the tenant, to fulfill certain obligations while the lease is in effect." The court stated that the General Obligations Law only requires a written instrument, but does not eliminate the common-law requirement of delivery. The court relied on the established rule that delivery is required for conveyances of interests in land to take effect. "It is the well-established rule in this State that delivery is one such requirement, the absence of which, without more, renders the lease ineffective." Delivery signifies the parties’ intent to convey the property interest and ensures the transaction becomes irrevocable only when intended. The court found that 219 Broadway’s allegation of non-delivery was fatal to its claim. The court stated, "[A] delivery of a lease so as to give it effect requires acts or words or both acts and words which clearly manifest that it is the intent of the parties that an interest in the land is, in fact, being conveyed to the lessee." The court explicitly declined to address whether an executory contract to enter into a lease would be enforceable under these circumstances.