Yellowstone Injunctions

A Yellowstone injunction — named after the Court of Appeals decision First Nat. Stores, Inc. v. Yellowstone Shopping Ctr., Inc., 21 N.Y.2d 630 (1968) — is available to a commercial tenant that has been issued a notice of default and disputes that it is in default during the cure period, but is willing and able to cure if the default is found to exist.  The New York Legislature has made waivers in leases that prevent a tenant from seeking a Yellowstone injunction “null and void as against public policy.”  See RPL §235-h.  New York courts have been issuing Yellowstone injunctions with regularity for decades, and they have become a generally accepted part of New York’s commercial real estate practice.  Yellowstone injunctions are valuable tools for New York commercial lease tenants to stop (enjoin) an eviction proceeding.  When the landlord claims the tenant is in default of its lease and attempts to terminate the lease, an experienced NYC Yellowstone Injunction lawyer can help the tenant file for a Yellowstone injunction.  If the tenant ignores a notice to cure a default from the landlord, the lease will expire, and the landlord will evict the tenant as a “squatter” in a holdover proceeding.  A Yellowstone injunction tolls the period to cure the default and delays the eviction process. For example, a retail tenant will have additional time to comply with the landlord’s demands and cure the purported default. Alternatively, a retail lease tenant will have the opportunity to persuade a judge that he is not in fact in default. Without it, the landlord could terminate the lease when the notice to cure expires and before the judge could make a determination as to the underlying merits of the dispute.