Opinion ID: 1217773
Heading Depth: 2
Heading Rank: 2

Heading: finding of a month-to-month tenancy

Text: The trial court heard testimony taking up three volumes of transcript about the parties' intentions regarding the Interim Lease Agreement. It considered the original complaint and the supporting affidavit, along with all the other evidence. The trial court found that too many details were left undecided for the agreement to be a long-term lease, including the crucial issue of responsibility for repairs and improvements of the property. [20] The trial court found that the Interim Lease Agreement embodied a month-to-month tenancy and that the parties merely agreed to negotiate a long-term lease. [21] Wright argues that the trial court's findings are unsupported as a matter of law. In reviewing the trial court's interpretation of a contract, we view the facts most favorably to the party that prevailed below. E.g., Jackson v. White, 556 P.2d 530, 533 (Alaska 1976). Our task is to determine if the facts, so construed, support the trial court's interpretation of the lease agreement between Wright and the Vickaryouses. We believe that the trial court's construction was sound. A contract is interpreted to give effect to the reasonable expectations of the parties. Wessells v. State, 562 P.2d 1042, 1048 (Alaska 1977); Day v. A & G Construction Co., 528 P.2d 440, 443-46 (Alaska 1974). As we stated in Stordahl v. Government Employees Insurance Co., 564 P.2d 63 (Alaska 1977), in the context of an insurance contract: To ascertain the reasonable expectations of the parties, we look to the language of the disputed policy provisions, the language of other provisions of the insurance policy, and to relevant extrinsic evidence. In addition, we refer to case law interpreting similar provisions. Id. at 66 (footnote omitted). [22] We believe the trial court's construction of the agreement between the Vickaryouses and Wright as a month-to-month lease was sound. The language of the lease agreement is strong support for this conclusion. It provides for monthly rental payments of $1,500.00. until a permanent lease agreement acceptable to both parties can be drawn up. The monthly rental of $1,500.00 shall be continued after the second month has elapsed as per the lease agreement to be implemented. Both parties agree that there is a basic understanding of what the lease agreement shall contain... . The failure of the lease to address repairs and improvements was a crucial defect because, according to both parties, Cottonwood Dairy generally needed repairs and needed specific changes to be suitable for Wright's herd. As Vickaryous testified, the situation was rather complicated, and the Vickaryouses' financial position made approval of the lease by their creditors a must. This would require a formal lease drawn by an attorney, not something quickly typed up one evening by Jim Vickaryous. Also relevant is the parties' conduct after they had signed the Interim Lease Agreement. Jim Vickaryous hired a lawyer and paid him approximately $5,000.00 for negotiations with Wright for a long-term lease. Thus, the language of the instrument and the surrounding circumstances indicate a temporary agreement, to be replaced by a long term one. The parties could not have reasonably expected that the document entitled Interim Lease Agreement represented a five-year lease. Wright cites authority that the mere fact that future negotiations are contemplated does not preclude a present formation of a lease. While the fact that future negotiations are contemplated may not negate the present forming of a lease, it certainly does not require a finding that a lease was formed. There is no indication that the trial court made an erroneous assumption that contemplation of future negotiations, per se, prevented establishment of a binding five-year lease. Wright asserts that the court excluded evidence because of the parol evidence rule but cites no instances in the record where the court did this. Finally, Wright cites Klinger v. Peterson, 486 P.2d 373 (Alaska 1971), for the proposition that the Vickaryouses could not terminate a lease interest by notice. We stated in Klinger : In Alaska, absent a special agreement of the parties, a leasehold interest in land can be terminated prematurely only by judicial decree in a statutory action. 486 P.2d at 378 (emphasis added). If the agreement was a month-to-month lease, Wright's termination was not premature. [23] Since the Vickaryouses properly terminated Wright's lease by notice, the trial court correctly found that Wright was unlawfully holding over after the notice. AS 09.45.090.