Opinion ID: 1659283
Heading Depth: 1
Heading Rank: 12

Heading: rent adjustment provision

Text: As noted previously, the ground lease provides for several extension periods and also provides for adjustment of the annual rent for each extension period based on a percentage of the fair market value of the premises. However, the ground lease also provides in relevant part: In no event shall the annual rent be adjusted below Sixty Thousand Dollars ($60,000.00) per year, and in no event shall the annual rent be adjusted above Ninety Thousand Dollars ($90,000.00) per year or thirty per cent (30%) of Tenant's annual gross rental receipts from Tenant's subleases, which ever is greater. (Emphasis supplied.) Spanish Oaks argues that this provision is ambiguous and should be construed to refer to the sub-subleases between Hy-Vee's sublessees and the tenants who actually occupy the premises. To this end, Spanish Oaks adduced evidence generally indicating that when the ground lease was executed, the original parties to the ground lease expected there to be only one level of subleases, i.e., that the original lessee of the premises would sublease the premises to a retail occupant. Thus, argues Spanish Oaks, the above-quoted language of the rent adjustment provision was intended to limit the annual rent under the ground lease based on the rental receipts from the occupying tenants of the property, i.e., the businesses that have sublet the premises from Ocho and Lerner. The district court, however, did not consider Spanish Oaks' parol evidence, as the district court determined that the rent adjustment provision is unambiguous. Extrinsic evidence is not permitted to explain the terms of a contract that is not ambiguous. McDonald's Corp. v. Goler, 251 Neb. 934, 560 N.W.2d 458 (1997). When a contract is unambiguous, the intentions of the parties must be determined from the contract itself. Ruble v. Reich, 259 Neb. 658, 611 N.W.2d 844 (2000). A contract is ambiguous when a word, phrase, or provision in the contract has, or is susceptible of, at least two reasonable but conflicting interpretations or meanings. Malone v. American Bus. Info., 264 Neb. 127, 647 N.W.2d 569 (2002). In this case, however, the contractual provision at issue is susceptible to only one reasonable meaning. It is well-established that an assignee stands in the shoes of the assignor and is bound by the terms of the contract to the same extent as the assignor. Vowers & Sons, Inc. v. Strasheim, 248 Neb. 699, 538 N.W.2d 756 (1995). The assignment of a lease places the assignee in the same relationship toward the lessor as was occupied by the lessee. See Beltner v. Carlson, 153 Neb. 797, 46 N.W.2d 153 (1951). Thus, the current parties to the lease, Spanish Oaks and Hy-Vee, are respectively the Landlord and Tenant described in the ground lease. The Tenant's annual gross rental receipts from Tenant's subleases can refer only to Hy-Vee's annual gross rental receipts from Hy-Vee's subleases, which are currently to Ocho and Lerner. A contract written in clear and unambiguous language is not subject to interpretation or construction and must be enforced according to its terms. Ruble, supra . Spanish Oaks' extrinsic evidence cannot be used to create ambiguity where the terms of the contract are clear and unambiguous. Although a party may in retrospect be dissatisfied with a bargained-for provision, an appellate court will not rewrite a contract to provide terms contrary to those which are expressed. Reichert v. Rubloff Hammond, L.L.C., 264 Neb. 16, 645 N.W.2d 519 (2002). The district court correctly determined that the ground lease is unambiguous and that the Tenant's annual gross rental receipts from Tenant's subleases refer to Hy-Vee's subleases with its sublessees, Ocho and Lerner. Spanish Oaks assignments of error to the contrary are without merit.