Landlords who own both residential and commercial properties often assume the eviction process is similar for both. This is a dangerous misconception. While both are handled in landlord-tenant court, the rules, defenses, and strategic considerations for commercial tenants are fundamentally different.
Key Difference 1: The Lack of Tenant Protections
The vast web of protections afforded to residential tenants—the warranty of habitability, rent stabilization, protections against "retaliatory eviction"—generally do not apply to commercial tenants.
No Warranty of Habitability
A commercial tenant generally cannot stop paying rent because the landlord has failed to make repairs, unless such a right is specifically written into their lease. The concept of a "habitable" space is a residential one.
The Lease is King
The commercial relationship is almost entirely governed by the written lease. The complexities and ambiguities of the Real Property Law are far less influential. A well-drafted commercial lease is a landlord's most powerful tool.
Key Difference 2: The "Yellowstone" Injunction
This is a unique and powerful tool available only to commercial tenants. If a landlord claims the tenant has defaulted on the lease (e.g., by failing to maintain the property) and serves a notice to cure, the tenant can run to State Supreme Court and ask for a Yellowstone injunction.
A Yellowstone injunction freezes the clock on the cure period, preventing the landlord from terminating the lease while the court decides whether a default actually occurred. This can halt an eviction in its tracks and move the fight from the faster-paced Landlord-Tenant Court to the much slower Supreme Court.
Strategic Implications for Landlords
Lease Drafting is Crucial
Your commercial lease must be ironclad, with clear default provisions and notice requirements. Any ambiguity will be exploited.
Anticipate the Yellowstone
When serving a notice of default, you must be prepared for the possibility of a Yellowstone injunction and have a strategy to fight it in Supreme Court.
Self-Help is Off-Limits
Despite the fewer protections for commercial tenants, you still cannot engage in "self-help" evictions like changing the locks. The legal process must be followed.
While commercial evictions can be more straightforward than residential ones, they carry their own complex challenges. Understanding the unique landscape of commercial landlord-tenant law is essential to protecting your investment and enforcing your rights as a property owner.