On November 29, 2021, Justice Cohen of the New York County Commercial Division issued a decision in 1855 Broadway LLC v. New York Inst. of Tech., 2021 NY Slip Op. 32501(U), refusing to dismiss a claim for anticipatory repudiation of a real estate sales contract based on factual questions, explaining:
Assuming the truth of its factual allegations, Plaintiff states a viable claim for breach of contract based on Defendant’s alleged anticipatory repudiation of the SPA. The anticipatory repudiation doctrine provides that a wrongful repudiation of the contract by one party before the time for performance entitles the nonrepudiating party to immediately claim damages for a total breach. A repudiation can be either a statement by the obligor to the obligee indicating that the obligor will commit a breach that would of itself give the obligee a claim for damages for total breach or a voluntary affirmative act which renders the obligor unable or apparently unable to perform without such a breach. Whether expressed through words or deeds, the repudiation must be unequivocal, definite, and final.
Often, whether such a repudiation took place is a factual determination, not suitable for resolution as a matter of law.
Here, the Complaint alleges that on September 29, 2020, Defendant’s broker directly confirmed to Plaintiff that Defendant had abandoned its plans to relocate its New York City campus and to move forward with the sale in light of the pandemic. Those statements, accepted as true at the pleading stage, may constitute anticipatory repudiation under New York law. To be sure, there may be fact disputes about, inter alia, what the broker said and whether it was accurate, what communications the parties engaged in following the broker’s statement, and whether Defendant retracted a prior repudiation (more on that below). But those are issues for discovery, not grounds for dismissal.
At this stage, Defendant’s arguments for dismissal as a matter of law are unavailing. To begin with, Defendant oversimplifies the issue when insisting that NYIT’ s relocation plans, or lack thereof, have no contractual connection to its ability or inability to deliver the premises vacant and free of all tenancies on the Closing Date. While it is true that the SPA does not explicitly require NYIT to relocate its Manhattan campus, relocation is still relevant to the SPA. The contract requires Defendant to “vacate and then sell the premises to Plaintiff. Relocation, generally understood, involves vacating one place and moving someplace else. So, even if relocation is not a requirement under the contract, vacating the premises is a requirement for relocation. Therefore, giving Plaintiff the benefit of all permissible inferences in its favor, Defendant’s apparent abandonments of its plan to relocate signaled that Defendant would breach its contractual obligation to vacate. In any event, Plaintiffs’ allegations are not cabined to conjecture about NYIT’ s relocation plans (or lack thereof): it specifically alleges that Defendant, through its broker, announced that the sale was off.
Next, Defendant argues, without authority, that statements made to a third party, or the general public, are not proper grounds for a claim of anticipatory repudiation. Public statements can, in fact, constitute an anticipatory repudiation, though it remains to be seen whether such a repudiation occurred here.
And finally, Defendant argues that even if an anticipatory repudiation did occur, it retracted any repudiation with its October 28, 2020 letter to Plaintiff. The October 28 Letter stated only that Defendant looked forward to closing. Despite defense counsel’s gloss on it, the October 28 Letter did not clearly state that NYIT was ready, willing and able to close this transaction.
Ultimately, whether the October 28 Letter constituted a retraction may raise issues of fact.
(Internal quotations and citations omitted).