Oral Relocation Agreements and Double-Rent Liability: Atlasman v. Korol (2025) Clarifies Pleading Standards in Landlord–Tenant Disputes

Introduction

Background. In Atlasman v. Korol, the Appellate Division, Second Department, tackled an increasingly common post-pandemic scenario: a landlord who contracted to sell a multi-family property “vacant” finds the sale imperiled when a long-time tenant refuses to leave after purportedly agreeing to do so. The plaintiffs, Victor Atlasman and co-owners, alleged that tenant Larisa Korol orally promised to vacate her apartment by December 31, 2020 in exchange for consideration, thereby enabling the plaintiffs to deliver the premises free of tenancy to third-party buyers. When Korol remained in possession, the sale stalled, a holdover proceeding ensued, and five causes of action (breach of contract, fraud, negligent misrepresentation, double rent under Real Property Law §229, and tortious interference with contract) were filed in Supreme Court, Kings County.

Procedural Posture. Before answering, Korol moved to dismiss under CPLR 3211(a)(1) (documentary evidence) and (a)(7) (failure to state a cause of action). The Supreme Court denied the motion in its entirety; the tenant appealed.

Key Issues on Appeal.

Whether an oral agreement to vacate can be sufficiently pleaded as an enforceable contract notwithstanding the Statute of Frauds or Real Property Law complexities.
Whether allegations of fraud and negligent misrepresentation stemming from a tenant’s promises and a COVID-19 hardship declaration meet CPLR 3016(b)’s heightened particularity requirement and the “special relationship” criterion respectively.
Whether liability for double rent under Real Property Law §229 was stated.
Whether a cause of action for tortious interference with the third-party contract of sale was sufficiently pleaded.

Summary of the Judgment

The Second Department affirmed in part and modified in part:

Breach of Contract (First Cause of Action) – survives dismissal. The complaint adequately pleads an enforceable oral agreement, breach, and damages (delayed closing).
Fraud (Second Cause of Action) – dismissed. Allegations merely duplicate the contract claim or lack particularity under CPLR 3016(b).
Negligent Misrepresentation (Third Cause of Action) – dismissed. No privity or “near-privity” special relationship; pleading lacks particularity.
Double Rent (Fourth Cause of Action) – survives. The pleadings align with Real Property Law §229.
Tortious Interference with Contract (Fifth Cause of Action) – dismissed; expressly abandoned on appeal.

Analysis

1. Precedents Cited and Their Influence

The court anchored its reasoning in a string of Second Department and Court of Appeals decisions:

Leon v. Martinez, 84 N.Y.2d 83 (1994) – governing standard for CPLR 3211(a)(1) motions; documentary evidence must “utterly refute.”
Guggenheimer v. Ginzburg, 43 N.Y.2d 268 (1977) – test for CPLR 3211(a)(7) when extrinsic evidence is considered (“has” vs. “stated” a cause of action).
Lama Holding Co. v. Smith Barney, 88 N.Y.2d 413 (1996) – elements of common-law fraud.
Sykes v. RFD Third Ave. 1 Assoc., LLC, 15 N.Y.3d 370 (2010) & Ultramares Corp. v. Touche, 255 N.Y. 170 (1931) – privity or “near-privity” requirement for negligent misrepresentation.
Gorman v. Fowkes, 97 A.D.3d 726 (2d Dep’t 2012) & Michael Davis Constr., Inc. v. 129 Parsonage Lane, LLC, 194 A.D.3d 805 (2d Dep’t 2021) – fraud claims duplicative of contract obligations are not actionable.
Pare v. Aalbue, 222 A.D.3d 769 (2023) – liberal pleading standard for breach of oral contract.

These precedents supplied bright-line tests that guided each prong of the court’s CPLR 3211 analysis. Notably, Ultramares and Sykes conclusively controlled the negligent misrepresentation dismissal, while Gorman and Michael Davis framed the fraud claim as impermissible bootstrapping.

2. Legal Reasoning

Breach of Oral Agreement. The court accepted for pleading purposes that an oral “cash for keys”-type promise to vacate constitutes a valid contract. Although real estate contracts for terms exceeding one year typically invoke the Statute of Frauds, New York courts have long recognized ancillary occupancy-termination agreements as outside its bar where full performance by one side (e.g., payment) is plausible within one year. The tenant’s continued possession and the alleged consideration rendered factual questions inappropriate for pre-answer dismissal, and the defendant’s proffered e-mails/affidavits failed to “utterly refute” the bargain.

Fraud. Two fatal defects appeared. First, any misrepresentation tied to Korol’s “intent to honor” the oral contract is contractual in nature, leaving no independent fraud. Second, subsequent promises and statements—including those in the statutory COVID-19 hardship declaration—were described in vague terms (“unspecified dates”) and thus flunk CPLR 3016(b)’s particularity mandate.

Negligent Misrepresentation. The claim required a “special, privity-like relationship.” The court found none: landlord and tenant, especially after litigation commenced, are adversaries, not fiduciaries. Absent this relationship and given insufficient detail, dismissal was compelled.

Double Rent under Real Property Law §229. The statute imposes double rent for a tenant’s “holding over” after notice and demand. The complaint alleged refusal to vacate after December 31, 2020, and resulting damages; that sufficed at the pleading stage. The tenant’s evidentiary submissions did not conclusively negate these allegations.

Tortious Interference with Contract. A prima facie case requires (1) a valid contract with a third party, (2) defendant’s knowledge, (3) intentional procurement of breach, and (4) damages. The complaint was silent or conclusory on intentional procurement, and plaintiffs abandoned the claim on appeal—thus dismissal.

3. Impact of the Decision

Landlord–Tenant Bar. Upholding the enforceability of oral “move-out” agreements signals that landlords may reliably plead breach without a written surrender, provided consideration and clear terms can be alleged.
Pleading Strategy. Plaintiffs must differentiate between contract breaches and fraud with meticulous chronology and detail. The decision underscores the peril of “shotgun” fraud claims lacking specificity or independent harm.
COVID-19 Declarations. The ruling implicitly rejects attempts to recast statutory hardship declarations as negligent misrepresentations absent a special duty—a safeguard for tenants invoking pandemic-era protections.
Real Property Law §229 Revitalized. Few modern cases consider double rent; the court’s willingness to let such claims proceed may encourage landlords to invoke §229 more frequently when sales or refinancings are thwarted.

Complex Concepts Simplified

CPLR 3211(a)(1) – Documentary Evidence Dismissal: A rare dismissal tool. Only indisputable, authentic documents (e.g., deeds, contracts, court orders) that conclusively destroy the claim qualify. Affidavits and disputed e-mails usually do not.
CPLR 3211(a)(7) – Failure to State a Cause of Action: The court assumes all pleaded facts are true and asks: even if true, do they fit any legal theory? If supporting evidence is introduced, the test shifts to whether plaintiff has a claim, not just whether it is artfully pleaded.
CPLR 3016(b) – Particularity in Fraud: Fraud must be stated “in detail”: who said what, to whom, when, why it was false, and how plaintiff relied. Vague, collective, or date-less allegations fail.
Privity / Near-Privity: A relationship so close it resembles a contract. Required for negligent misrepresentation claims outside contractual settings.
Real Property Law §229 – Double Rent: Permits a landlord to recover twice the rent for a holdover tenant after proper demand. Designed to deter dilatory occupants.

Conclusion

Atlasman v. Korol crystallizes three significant principles:

An oral promise by a tenant to vacate, supported by consideration, can withstand CPLR 3211 scrutiny and supply damages tied to lost real-estate transactions.
Fraud and negligent-misrepresentation claims will be culled early unless pleaded with granular detail and anchored in a duty or relationship distinct from the contract.
Real Property Law §229 remains a potent, if under-used, remedy for landlords facing costly holdovers.

By delineating the line between contract and tort in landlord–tenant disputes, the Second Department offers a roadmap for practitioners: plead cleanly, separate theories, and marshal documentary evidence that is truly “unassailable.” Future cases involving pandemic-era hardship declarations and “cash for keys” negotiations are likely to rely on Atlasman when assessing motion-to-dismiss challenges.