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New York City’s “Guaranty Law” Remains Legal — For Now

When the COVID-19 pandemic struck in 2020, it brought New York City to a standstill. In response to the worsening pandemic, then Gov. Andrew Cuomo passed a series of Executive Orders mandating the closure of non-essential businesses with the intent of limiting the spread of the deadly disease. Many businesses in the City were forced to temporarily close and found themselves unable to meet their rental obligations.In response, New York City enacted Administrative Code § 22-1005, entitled “Personal Liability Provisions in Commercial Leases.” This provision is commonly known as the “Guaranty Law” and is largely intended to protect personal guarantors of commercial leases from facing liability for obligations incurred at the early height of the pandemic, between March 7, 2020 and June 30, 2021. While the Guaranty Law remains in effect, it is facing a significant constitutional challenge in federal court. Read more…