Guarantor Not Liable for Lease Renewal

Landlord sued rent-stabilized tenant's mother for rent owed by tenant. Mother claimed she wasn't responsible for tenant's rent. Mother had signed tenant's initial lease as guarantor for rent. The lease stated that the guaranty would remain in effect even if the lease was renewed, changed, or extended in any way. After one lease renewal, mother advised landlord in writing that she would no longer guarantee tenant's rent payments upon further lease renewals. The court ruled for landlord, and mother appealed. The appeals court reversed and ruled for mother. Generally, if a guaranteed contract has no definite time to run, an uncompensated guarantor may revoke and end its liability by reasonable notice. Mother gave landlord reasonable notice that she didn't intend to continue as the guarantor. And landlord wasn't required to renew tenant's lease once advised by mother that she'd revoked the guaranty.

Levine v. Segal: NYLJ, p. 28, col. 3 (10/22/97) (App. T. 1 Dept.; Ostrau, PJ, Parness, Freedman, JJ)