Landlord Orally Gave Tenants Option to Buy House

Landlord sued to evict tenants for nonpayment of back rent totalling $6,900. By the time the case reached trial, landlord said tenants now owed $23,000. Tenants claimed that landlord owed them $44,000 and had been unjustly enriched. When they moved into the house, landlord agreed orally that tenants could buy the house for $480,000 if they rented it for four years. Tenants paid rent while they made repairs, renovated the house, and made it wheelchair accessible based on landlord's promise. They asked the court to enforce landlord's oral agreement. The court ruled for tenants. At trial, landlord admitted that he made the oral agreement, and tenants showed that they relied on landlord's promise when they made improvements to the house. And landlord fraudulently induced tenants to pay for the improvements and to pay rent while the improvements were being done. So tenants had the option to buy the house, even though the agreement wasn't in writing and took more than a year to perform. However, tenants also owed landlord $4,200 in rent.

Kaur v. Guida: NYLJ, 10/7/08, p. 26, col. 3 (Dist. Ct. Nassau; Fairgrieve, J)