Opinion ID: 1347665
Heading Depth: 1
Heading Rank: 6

Heading: leasehold interest

Text: One issue is determinative of all of appellant's assignments of error: whether the document entitled Business Property Lease granted appellant a valid leasehold interest for the purposes of a condemnation proceeding. The NRD, relying upon Morgan, et ux., v. Bergen, et ux., 3 Neb. 209 (1874); Wheeler v. Walden, 17 Neb. 122, 22 N.W. 346 (1895); Persons v. McDonald, 60 Neb. 452, 83 N.W. 672 (1900); State v. Board of Commissioners of Cass County, 60 Neb. 566, 83 N.W. 733 (1900); Heenan & Finlen v. Parmele, 80 Neb. 509, 114 N.W. 639 (1908); and Witt v. Old Line Bankers Life Ins. Co., 89 Neb. 163, 131 N.W. 189 (1911), argues that the business property lease did not convey a leasehold interest. The NRD contends that the above-cited cases stand for the proposition that a contract, in order to be obligatory upon the principal when made by an agent, must be executed in the name of the principal. The NRD argues that since the business property lease was not executed in the name of the principal, the lease is invalid. In Persons v. McDonald, supra , the plaintiffs sued for specific performance of an alleged contract to convey certain property. The contract which allegedly conveyed the property to the plaintiffs was signed by a party purportedly acting as an agent for the owner. The owner sold the property via a separate transaction to the defendants. This court affirmed the trial court's decision to sustain the defendants' demurrer because the alleged contract between the plaintiffs and the owner was not signed by the owner. We held that since the owner had not signed the contract and the contract did not purport to be the owner's contract, the contract could not be specifically enforced. The case at bar is similar to Persons in that the business property lease was signed by an agent of the property owner and made no mention of the owner. However, the instant case is distinguishable from Persons because there is evidence in the record establishing that the Baron Corporation, part owner of the property at the time the lease was signed, authorized David Abboud to negotiate and sign the lease as its agent. In the cases relied upon by the NRD, no extrinsic evidence of a principal-agent relationship appeared in the record. The NRD argues that extrinsic evidence cannot be used to vary or contradict the terms of the business property lease. Specifically, the NRD contends that allowing appellant to present parol evidence regarding the property owner's identity and substituting the owner's name for that of the agent as lessor violates the statute of frauds. The flaw in the NRD's argument is that the NRD, as a third party to the lease agreement, cannot assert the statute of frauds as a defense because that defense is personal to the parties to the contract and their privies. See, Happ v. Ducey, 110 Neb. 429, 193 N.W. 918 (1923); Dailey v. Kinsler, 35 Neb. 835, 53 N.W. 973 (1892). Likewise, the NRD cannot invoke the parol evidence rule to prevent the parties to the lease agreement from adducing extraneous evidence as to the terms of the contract, even if that evidence varies or contradicts the terms of the writing. See, State Bank of Beaver Crossing v. Mackley, 121 Neb. 28, 236 N.W. 165 (1931); American Surety Co. v. School District, 117 Neb. 6, 219 N.W. 583 (1928); Nebraska Wesleyan University v. Smith, 113 Neb. 208, 202 N.W. 625 (1925); Woodruff v. Cooper, 109 Neb. 857, 192 N.W. 725 (1923); Durland Trust Co. v. Payne, 106 Neb. 135, 182 N.W. 1016 (1921). Therefore, we hold that appellant's extrinsic evidence was admissible for the purpose of proving its leasehold interest in the property being condemned.