*1 APPEAL by the plaintiffs, in an action, inter alia, for a judgment declaring that two commercial leases are in full force and effect and that the plaintiffs are not in violation of their obligations under the leases, from an order of the Supreme Court (David I. Schmidt, J.) dated January 29, 2015, and entered in Kings County, which denied their motion for a Yellowstone injunction (see First Natl. Stores v. Yellowstone Shopping Ctr., 21 NY2d 630) and granted the defendant’s cross motion for summary judgment dismissing the complaint. Justice Dillon has been substituted for former Justice Dickerson (see 22 NYCRR 670.1[c]).*2
OPINION & ORDERThis appeal raises an issue of first impression in the appellate courts of New York, which was identified in an Outside Counsel article in the New York Law Journal in 20141. Specifically, we address the question of whether written leases negotiated at arm’s length by commercial tenants may include a waiver of the right to declarative relief that is enforceable at law or, alternatively, whether such a waiver is void and unenforceable as a matter of public policy.For reasons set forth below, we conclude that under the circumstances of this case, the commercial tenants’ voluntary and limited waiver of declaratory judgment remedies in their written leases is valid and enforceable, and not violative of New York’s public policy, particularly as the tenants in this instance did not waive other available legal remedies.I. Factual and Procedural BackgroundOn April 7, 2010, the plaintiffs, 159 MP Corp. and 240 Bedford Ave Realty Holding Corp., entered into leases for 10,000 square feet of retail space and 3,000 square feet of storage space, respectively, at premises located at 159 North 3rd Street, also known as 241 Bedford Avenue, also known as 160 North 4th Street, in Brooklyn. The original landlord on the leases, BFN Realty Associates, LLC, was later succeeded by the defendant, Redbridge Bedford, LLC. Each lease was to run for 20 years from May 1, 2010, with a 10-year renewal option.Paragraph 67(H) in the rider of each lease provided that the tenant:“waives its right to bring a declaratory judgment action with respect to any provision of this Lease or with respect to any notice sent pursuant to the provisions of this Lease. Any breach of this paragraph shall constitute a breach of substantial obligations of the tenancy, and shall be grounds for the immediate termination of this Lease. It is further agreed that in the event injunctive relief is sought
