Title: Root v. Allstate Insurance Company
Citation: 158 S.E.2d 829, 272 N.C. 580
Docket Number: 529
State: north-carolina
Issuer: north-carolina Supreme Court
Date: February 2, 1968

158 S.E.2d 829 (1968) 272 N.C. 580 Mrs. Olivia Smith ROOT, Hubert Stockard and wife, Margaret Vass Stockard, and Annie Smedes Vass, Plaintiffs, v. ALLSTATE INSURANCE COMPANY, Defendant. No. 529. Supreme Court of North Carolina. February 2, 1968. *832 Maupin, Taylor &amp; Ellis and Thomas P. McNamara, Raleigh, for plaintiffs. Dupree, Weaver, Horton, Cockman &amp; Alvis, Raleigh, for defendant. BRANCH, Justice. The ultimate question presented by this appeal is whether the basement of the building located at 747 Hillsboro Street, Raleigh, N. C., was included in the premises demised in the written lease from plaintiffs to defendant. Lessors' position is that lessee has no right to use the basement under the lease, and they admit that all of the rents required by the terms of the lease have been paid. The action is therefore based on an implied or quasi-contract. "A quasi-contractual obligation is one that is created by the law for reasons of justice, without any expression of assent and sometimes even against a clear expression of dissent," Cox v. Shaw, 263 N.C. 361, 139 S.E.2d 676, and "generally, quasi or constructive contracts rest on the equitable principle that a person shall not be allowed to enrich himself unjustly at the expense of another, and on the principle that whatsoever it is certain that a man ought to do, that the law supposes him to have promised to do. The obligation to do justice rests on all persons, and if one obtains money or property of others without authority, the law, independently of express contract, will compel restitution of compensation." 17 C.J.S. Contracts § 6, pp. 570, 571. It is apparent that if the basement area is demised by the written lease, lessors' cause of action is without merit. It is the position of lessee that the cause of action is ill-founded because of the well-recognized principle that an express contract precludes an implied contract with reference to the same subject matter. Vetco Concrete Co. v. Troy Lumber Co., 256 N.C. 709, 124 S.E.2d 905. This contention is untenable, since the very basis of this controversy is whether the precise subject matter, that is, the basement, is included in the express contract. It is a well-recognized principle of construction that when the language of a contract is clear and unambiguous, the court must interpret the contract as written, Parks v. Venters Oil Co., 255 N.C. 498, 121 S.E.2d 850, and "The heart of a contract is the intention of the parties, which is to be ascertained from the expressions used, the subject matter, the end in view, the purpose sought, and the situation of the parties at the time." Sell v. Hotchkiss, 264 N. C. 185, 141 S.E.2d 259. In determining whether the basement area was demised by the lease, we first seek to determine the intention of the parties as shown by the whole written instrument. Lessee contends that the language of the lease clearly and without ambiguity conveys all of the space in the building located at 747 Hillsboro Street, Raleigh, N. C., emphasizing that the language "comprising 1772 square feet" was simply a formula to determine the amount of rent for the entire building and premises. In support of this contention, lessee cites the case of Miller *833 v. Johnston, 173 N.C. 62, 91 S.E. 593, where it is stated: "`"Include" is defined as "to confine within, to hold, to attain, to shut up"; and synonyms are "contain," "inclose", "comprise," * * *'" In the case of Hoskins Mfg. Co. v. General Electric Co., D.C.Ill., 212 F. 422, a case involving patent law, the court compared the words "comprise" and "consist" and held that the latter is a more specific term, in that it means "to stand together," "to be composed of," or "made up of," while the former means "comprehend," "include," "contain," and "embrace." It is of interest to note that the terms recited in Miller v. Johnston, supra, to wit, "to confine within" and "to shut up" are not considered in this decision. However, in the case of Steigerwald v. Winans, 17 Md. 62, the court construed a statute which provided that on an appeal from an order denying an injunction the clerk shall forthwith transmit the original papers, comprising the bill of petition, exhibits, and the court's order of refusal, to the Court of Appeals for determination. The court held that the word "comprising" should be construed "as determining what are the original papers, which only are to be transmitted. * * *" The Court noted that the word "comprising" does not under all circumstances imply inclusion of only the things enumerated. (Emphasis ours). Upon substituting the dictionary definitions and synonyms adopted in Miller v. Johnston, supra, in lieu of the word "comprise" and upon a consideration of pertinent decisions, we can interpret the word "comprise" to be either a word of restriction or a word of enlargement. Lessors, conversely, contend that the language of the lease is restrictive and specific and that it demised only 1772 square feet of floor space, which was identified by their witness as being located on the first floor of the building. It is generally recognized in this jurisdiction that the law ordinarily prefers the specific to the general, and where there is a specific description of land, other words in the conveyance intended to describe generally the same lands, do not vary or enlarge the specific description. Lee v. McDonald, 230 N.C. 517, 53 S.E.2d 845; Von Herff v. Richardson, 192 N.C. 595, 135 S.E. 533. This rule is not controlling in the instant case because the rationale of the rule is that the law prefers that which is more certain to that which is less certain. Here, neither the general description, that is, "the premises located at 747 Hillsboro Street, Raleigh, N. C.," nor the description "comprising 1772 square feet" identifies or makes clearly specific the property demised. "If the words employed are capable of more than one meaning, the meaning to be given is that which it is apparent the parties intended them to have." King v. Davis, 190 N.C. 737, 130 S.E. 707. An examination of the entire written lease discloses many indicia of conflicting intent. Examples are: The term "leased building," indicating that the entire building was to be leased; the legend appearing on the plans and specifications, "An office building for Allstate Insurance Company, Hillsboro Street, Raleigh, N. C. Aldert Root, owner," indicating that the entire office building was to be used exclusively by lessee; the only access to the basement area of the building, without passing through the office space, is through an outside rear door which opens onto a stair landing which gives immediate access to the first floor office space, and, through a door, to steps leading to the basement. This indicates that the basement area was not planned for rental to any person other than lessee. On the other hand, terms of the lease indicating that demise of less than the entire building was contemplated by the parties to the lease are: "other tenants," "leased space," "leased premises," rather than the word "building"; use of the phrase "building and leased premises" without indication *834 that the words are interchangeable. The written lease was prepared by lessee, and in considering the contentions of the parties we are cognizant of the well-recognized rule that an ambiguity in a written contract is to be construed against the party who prepared the instrument. Wachovia Bank &amp; Trust Co. v. Medford, 258 N.C. 146, 128 S.E.2d 141; Jones v. Palace Realty Co., 226 N.C. 303, 37 S.E.2d 906. At best, the written lease and the exhibits attached thereto leave it uncertain whether the parties intended for the lease to include the basement of the building. We are thus brought to lessors' assignment of error that the trial court erred in sustaining lessee's objection to questions asked of the witness Aldert Root as to whether or not it was his intention to include the basement in the lease and as to what took place at the negotiations between the witness and lessee's representative when the lease was negotiated in 1960. The judge properly refused to admit the evidence of the witness' unexpressed intention. In the case of Howell v. Smith, 258 N.C. 150, 128 S.E.2d 144, it is stated: However, there is merit in appellants' exception concerning the judge's refusal to admit evidence concerning negotiations between the witness and defendant's representative. In this connection, the record discloses the following: The general rule is that when a written instrument is introduced into evidence, its terms may not be contradicted by parol or extrinsic evidence, and it is presumed that all prior negotiations are merged into the written instrument. Fox v. Southern Appliances, Inc., 264 N.C. 267, 141 S.E.2d 522; Barger v. Krimminger, 262 N.C. 596, 138 S.E.2d 207. A modification of the above stated rule is found in the case of Orion Knitting Mills v. United States Fidelity &amp; Guaranty Co., 137 N.C. 565, 50 S.E. 304, 70 L.R.A. 167, where it is stated: See also Patton v. Sinclaire Lumber Co., 179 N.C. 103, 101 S.E. 613. In 30 Am.Jur.2d, § 1069, we find the following: 30 Am.Jur.2d, § 1071, states, in part: This jurisdiction has recognized that the office of a description is to furnish means of identifying the property to be conveyed by the instrument, and where the language is patently ambiguous, parol evidence is not admissible to aid the description. To the contrary, where a latent ambiguity occurs, that is, when the words of the instrument are plain and intelligible but leave it uncertain as to what property is embraced in the conveyance and presents a question of identification of the property, *836 parol evidence is admissible to fit the description to the property sought to be conveyed. Such parol evidence cannot be used to enlarge the scope of the descriptive word. North Carolina Self Help Corp. v. Brinkley, 215 N.C. 615, 2 S.E.2d 889; Redd v. Taylor, 270 N.C. 14, 153 S.E.2d 761. Although the words of the instrument are plain and intelligible, it is uncertain whether the basement of the area of the building was demised by the written lease. This constitutes a latent ambiguity which permits the introduction of parol evidence to aid in determining what property the parties intended to include in the instrument. The admission of evidence of prior negotiations in the instant case does not contradict or vary the terms of the instrument but tends to show the intent of the parties as to whether the entire area was to be included in the lease or whether the space was to be leased on a square-foot basis. Therefore, the trial court erred in sustaining lessee's objection to that part of the testimony as to prior negotiations which tended to show intent of the parties. Lessee further contends that even if the lease did not authorize the use of the basement, the judge correctly allowed its motion for nonsuit, since it had an easement in the basement by implication. In the case of Rickman Manufacturing Co. v. Gable, 246 N.C. 1, 97 S.E.2d 672, the owner of a three-story building leased the second and third floors to the plaintiff and leased the first floor to other tenants. The lease prorated the cost of fuel and maintenance of the heating plant two-thirds to plaintiff and one-third to the other tenants. The Court held that the heating plant was an appurtenance included in the property leased, and stated: See also State v. Foster, 196 N.C. 431, 146 S.E. 69. Lessee cites in support of this contention the case of Maiatico v. Stevens, D.C.Mun.App., 125 A.2d 275. This was an action by lessor to recover possession of two basement rooms which were not covered by lease of premises. Holding that the evidence sustained the finding that there was in contemplation of the parties when the lease was executed that lessee would continue to use the rooms for storage, etc., the Court stated: It is noted that in the Maiatico case the lease provided that tenant must keep clean "such portions of the building * * * as may be used incident to the operation of said restaurant * * *." Further, there *837 was parol evidence showing knowledge by lessor, when the lease was executed, that lessee had the use and enjoyment of the basement under a previous lease. These cases are factually distinguishable from the instant case, in which the lease, plans and specifications reveal that lessors were responsible for the heating, air conditioning and other utilities (all of which were located in the basement) for the office space, and that storage space was provided on the first floor. In the instant case there is no conclusive showing that the use of the basement was essential or reasonably necessary for the full and beneficial use of the property demised. Thus no easement passes by implication. In the case of Williams v. Greensboro Fire Insurance Co., 209 N.C. 765, 185 S.E. 21, defendant issued a policy against fire loss on premises described as the "one-story brick building * * * while occupied by tenants as stores * * * number 107, on the North side of East Church Street, Block No. ___, Rose Hill, N. C." The property consisted of one building, divided into three stores or compartments. Each of the stores was damaged by fire. Defendant contended that the policy covered only one store. The Court held that the policy was ambiguous as to property covered thereby, and stated: It is stated in Hite v. Aydlett, 192 N.C. 166, 134 S.E. 419: Applying the rules of law set out above to the facts of instant case, we hold that the trial judge erroneously allowed defendant's motion for nonsuit. The case should be submitted to the jury under proper instructions. Reversed. BOBBITT and SHARP, JJ., dissent.