Case Name: PIGGLY WIGGLY SOUTHERN, INC. v. HEARD et al.
Court: Supreme Court of Georgia
Jurisdiction: Georgia
Decision Date: 1991-06-28
Citations: 261 Ga. 503
Docket Number: S91G0333
Parties: PIGGLY WIGGLY SOUTHERN, INC. v. HEARD et al.
Judges: Smith, P. J., Weltner, Fletcher, JJ., and Judge Stephen E. Boswell concur; Bell and Benham, JJ., dissent; Clarke, C. J., not participating.
Reporter: Georgia Reports
Volume: 261
Pages: 503–507

Head Matter:
S91G0333.
PIGGLY WIGGLY SOUTHERN, INC. v. HEARD et al.
(405 SE2d 478)

Opinion:
Hunt, Justice.
This case involves the construction of a shopping center store lease. Both the trial court and the Court of Appeals held the lease contained an express continued use covenant as well as an implied covenant of continued operation. Piggly Wiggly Southern v. Heard, 197 Ga. App. 656 (399 SE2d 244) (1990). We granted the writ of certiorari to determine whether the Court of Appeals was correct in its construction of the parties' lease, and reverse.
In 1963, the parties executed a lease in which appellees' predecessor agreed to construct a supermarket for appellant according to plans prepared by appellant. Appellant drafted the lease, which began in 1964 for a term of 15 years, and called for an annual base rent of $29,053.60 as well as a percentage rent of annual gross sales exceeding $2,000,000. The lease was renewed on the same terms for an additional seven years in 1979, with options to renew for two additional three-year terms. Appellant exercised both renewal options and, after it was acquired by a new corporation, one month into the second three-year term, closed its store, vacated the premises, and moved its grocery store operation to a nearby shopping center belonging to its new owner. While appellant continued to pay the annual base rent to appellees, it refused to sublease the vacant store, despite the interest of other supermarkets in the abandoned space. Appellees filed suit seeking damages for appellant's alleged breach of the lease.
We agree with appellant that the lease agreement between the parties does not contain an express covenant of continuous operation. Rather, the language of the agreement is plainly to the contrary, and, therefore, the trial court, the Court of Appeals, and this court are not authorized to construe it otherwise. Heyman v. Financial Properties Developers, 175 Ga. App. 146 (332 SE2d 893) (1985). The language of the agreement expressly negates a requirement of continuous operation:
. . . LESSEE'S use of the leased building and the leased property shall not be limited nor restricted to such purposes [use as a super-market, etc.], and said building and property may be used for any other lawful business, without the consent of LESSOR (emphasis supplied).
See Kroger Co. v. Bonny Corp., 134 Ga. App. 834 (216 SE2d 341) (1975).
Nor does the lease agreement contain any provision which would create an implied covenant of continuous operation. Rather, the contract, read as a whole, indicates otherwise. The agreement's provision for free assignability by the tenant, without consent of the lessor, weighs strongly against a construction of the contract which would require the tenant to continue its business throughout the term of the lease. Kroger Co. v. Bonny Corp., supra at 836 (1). Likewise, the existence of a substantial minimum base rent, in addition to the provision for percentage rental payments, suggests the absence of an implied covenant of continuous operation. Id. at 838 to 839 (2). See also 38 ALR2d Annot., p. 1113 et seq., Construction and Application of Provision in Lease Under Which Landlord is to Receive Percentage of Lessee's Profits or Receipts.
The parties did not agree to nor bargain for appellant's continuous operation of the premises, and we are not authorized to rewrite the contract to create such a provision. See Coffee System of Atlanta v. Fox, 227 Ga. 602 (182 SE2d 109) (1971).
Judgment reversed.
Smith, P. J., Weltner, Fletcher, JJ., and Judge Stephen E. Boswell concur; Bell and Benham, JJ., dissent; Clarke, C. J., not participating.
In Kroger Co. v. Bonny Corp., the Court of Appeals rejected the contention that language in the lease agreement providing the tenant "use said premises in a lawful manner" created a covenant of continuous operation.
See Generally 40 ALR3d Annot., p. 971 et seq., Lease of Store as Requiring Active Operation of Store, which states the general rule that
. . . the courts take the position that the lessee is under no obligation, in the absence of a specific provision therefor, to occupy or use, or continue to use, the leased premises, even though one of the parties, or both, expected and intended that they would be used for the particular purpose to which they seemed to be adapted or for which they seemed to be constructed.
Id. at 975.