Appellate Division, First Department · October 20, 2026 · 2026 NY Slip Op 06058
The City’s pandemic guaranty law survives the Contracts Clause, reversing Supreme Court
513 W. 26th Realty LLC v George Billis Galleries, Inc.
Read the official decision: 2026 NY Slip Op 06058
Holding The court held that New York City Administrative Code § 22-1005, which temporarily barred the enforcement of personal liability guaranties for certain commercial leases during the pandemic, does not violate the Contracts Clause of the United States Constitution. Applying the three-part test, the court found the law served a legitimate public purpose and was a reasonable and appropriate means of addressing the economic emergency, warranting substantial deference to the legislative judgment.
Why it matters
Resolves a significant constitutional question regarding the validity of pandemic-era economic relief measures under the Contracts Clause.
Reverses the lower court’s finding of unconstitutionality, establishing a precedent for the deference owed to municipal legislation during emergencies.
The court’s words
we conclude that the guaranty law does not violate the Contracts Clause
2026 NY Slip Op 06058, at the official text
the guaranty law is constitutional
2026 NY Slip Op 06058, at the official text
the strong presumption of constitutionality that attaches to every statute
2026 NY Slip Op 06058, at the official text
the guaranty law was a reasonable and appropriate means of addressing the City's legitimate public purpose
2026 NY Slip Op 06058, at the official text
the City Council acted with a legitimate public purpose when choosing to pass the guaranty law
2026 NY Slip Op 06058, at the official text
| Court | Appellate Division, First Department |
|---|---|
| Decided | October 20, 2026 |
| Citation | 2026 NY Slip Op 06058 |
| Area of law | Civil Rights and Constitutional Law · Contracts and Commercial |
| Week | Week ending October 24, 2026 |
| Official text | Official decision: 2026 NY Slip Op 06058 |
| Publication status | Slip opinions are uncorrected and subject to revision before publication in the Official Reports. |
| Source feed | New York slip opinion page |
| Law Watch record id | 1318 |
Same court and area in the last 180 days
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The court held that the promissory note was an instrument for the payment of money only under CPLR 3213, permitting summary judgment in lieu of complaint. The defendant’s defenses of fraud and breach of the underlying pledge agreement were insufficient to defeat the motion because the note contained an unconditional payment clause and the alleged fraud was legally insufficient.
- Alesco Preferred Funding VIII, Ltd. v ACP Re, Ltd.2026 NY Slip Op 06059
The court granted summary judgment dismissing claims against defendants for breach of indenture, common-law successor liability, alter ego, tortious interference, fraud, and breach of fiduciary duty. It held that unrebutted expert testimony established the defendants were not contractual successors, and that New York law did not apply to the common-law successor liability claim against ACP Re due to minimal Bermuda contacts.
- Waterworks Operating Co., LLC v 514 W. 24th Owner LLC2026 NY Slip Op 06036
The court vacated the judgment and remanded the case for further proceedings on damages because the plaintiff failed to meet its prima facie burden of establishing delivery of all materials required by the contract. The court held that evidence submitted in reply papers without an opportunity for rebuttal must be disregarded.
- Lee v Zeitlin2026 NY Slip Op 06010
The court affirmed summary judgment for plaintiffs on breach of contract and account stated claims, finding defendants failed to fulfill contractual obligations without valid offset or mitigation defenses. The court also affirmed the denial of summary judgment on defendants’ counterclaim for breach of the implied covenant of good faith and fair dealing as premature due to pending discovery.
- BFAM Asian Opportunities Master Fund, LP v Glory Health Indus. Ltd.2026 NY Slip Op 05997
Beneficial owners of notes held through a clearing system have standing to sue based on STAC letters and clearing policies, even if not direct holders. A Chinese law making performance impossible does not excuse performance under a New York law-governed contract lacking a force majeure clause.
Recommended citation
ESQ HQ, New York Law Watch, 513 W. 26th Realty LLC v George Billis Galleries, Inc., 2026 NY Slip Op 06058 (Appellate Division, First Department, October 20, 2026), https://esqhq.com/decisions/2026-ny-slip-op-06058/
How this record was made
Holding drafted by Law Watch’s in-house model, graded by three reviewers; every quotation verified word for word against the official text.
Read how Law Watch worksFeatured by Eric McAvey, November 14, 2026.