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THE COMPLAINT SUFFICIENTLY ALLEGED BOTH BREACH OF CONTRACT AND ANTICIPATORY REPUDIATION OF THE CONTRACT (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Wilson, in a factually-complex case which cannot be fairly summarized here. determined the complaint adequately alleged both a breach and an anticipatory repudiation of a contract which encompassed the replacement by plaintiff developer of defendant’s single room occupancy building with a mixed-use residential and commercial building for a 40-year lease term:

” ‘An anticipatory breach of contract by a promisor is a repudiation of [its] contractual duty before the time fixed in the contract for . . . performance has arrived’ ” … . Under the doctrine of anticipatory repudiation or anticipatory breach, “if one party to a contract repudiates [its] duties thereunder prior to the time designated for performance and before [it] has received all of the consideration due . . . thereunder, such repudiation entitles the nonrepudiating party to claim damages for total breach” … . To constitute repudiation, “there must be some express and absolute refusal to perform” … that is “positive and unequivocal” … .

The first cause of action alleges [defendant] engaged in multiple acts that breached the ground lease agreement: a set of acts in refusing to sign the cure agreement tendered in 2015, and a 2021 statement that it would never sign any agreement. Contrary to the conclusions of the courts below, a claim for breach and a claim for anticipatory repudiation can both be stated on these facts at the pleading stage. * * *

Taking the facts alleged in the complaint as true, which we must do at this stage of the proceeding, [plaintiff] sufficiently demonstrated that [defendant’s] 2021 statement was both a new development and a distinct “material breach that escalated, for the first time, to an unequivocal repudiation” … . Audthan LLC v Nick & Duke, LLC, 2024 NY Slip Op 02223, CtApp 4-25-24

Practice Point: Here the complaint adequately alleged both a breach of contract and an anticipatory repudiation of the contract.

 

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