Court Opinion

ID: 990127
Source: CourtListenerOpinion
Date Created: 2013-07-03 23:16:31.376357+00
Date Added: 2024-06-11T13:21:37.451295
License: Public Domain

UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

NATIONAL LIFE INSURANCE COMPANY,
Plaintiff-Appellee,

v.                                                                No. 95-1310

CONAGRA INCORPORATED,
Defendant-Appellant.

Appeal from the United States District Court
for the Western District of North Carolina, at Charlotte.
Graham C. Mullen, District Judge.
(CA-91-242-C-MU)

Argued: July 10, 1996

Decided: August 5, 1996

Before WILKINSON, Chief Judge, and HAMILTON and
WILLIAMS, Circuit Judges.

_________________________________________________________________

Affirmed by unpublished per curiam opinion.

_________________________________________________________________

COUNSEL

ARGUED: E. Fitzgerald Parnell, III, POYNER & SPRUILL, L.L.P.,
Charlotte, North Carolina, for Appellant. Robert Burns McNeill,
HORACK, TALLEY, PHARR & LOWNDES, P.A., Charlotte, North
Carolina, for Appellee.

_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

ConAgra Incorporated appeals an order of the district court grant-
ing judgment for National Life Insurance Company in the amount of
$184,977.99, plus interest and attorneys' fees. We affirm.

In April 1985, ConAgra leased warehouse space from Prudential
Insurance Company through Prudential's agent, Vinson Realty Com-
pany. National Life subsequently succeeded to Prudential's interests
under the lease and retained Vinson as the property manager for the
premises. The lease provided for an original term of two years, begin-
ning on May 1, 1985 and ending on April 30, 1987. Thereafter, Con-
Agra had the option to renew the lease for up to five additional one-
year terms. With respect to the renewal option, the lease provided:

          It shall be understood that each option shall automatically
          have been elected 120 days prior to the commencement of
          such option term unless Lessee notifies Lessor in writing
          that Lessee does not wish to extend.

(J.A. at 21.) ConAgra renewed the lease for four years; although it
was not required to provide notice of renewal, ConAgra usually did
so in January or February of each year. The dispute in this case
involves the final option term, May 1, 1991 through April 30, 1992.

In August of 1990, H. T. Lystrup of ConAgra informed Joe Brack-
ett of Vinson that the leased premises were no longer adequate for
ConAgra's needs. Seeking to keep ConAgra as a tenant, Brackett sent
Lystrup a letter on August 24 proposing new terms that would have
reduced the rent on the leased premises. Brackett cautioned Lystrup
that

          for us to offer this rate reduction, we would need to know
          immediately your intent. This offer can only be open until

                    2
          September 15, 1990. After that date, we would have to
          revert to the option as originally stated in your current lease.

(J.A. at 37.) At the conclusion of the letter, Brackett stated, "Once you
receive this letter, I would appreciate a telephone call from you so
that we may discuss the matter further." (J.A. at 38.) The parties agree
that Lystrup never responded to the offer.

In mid-December, Brackett called Lystrup again to inquire whether
ConAgra intended to renew the lease for the final option term. Lyst-
rup responded that he thought ConAgra would move its warehouse to
another location, but that he couldn't be certain whether corporate
headquarters would approve the move. Lystrup further told Brackett
that he would not have a definite answer until the first of January.
Shortly thereafter, Brackett discussed the situation with David Rabin
of National Life, who told Brackett not to contact Lystrup regarding
whether ConAgra intended to renew its lease. Rabin specifically
instructed Brackett not to remind Lystrup of the automatic renewal
provision in the lease.

ConAgra did not notify National Life that it did not intend to renew
the lease prior to the deadline of December 31, 1990. On January 4,
1991, Brackett sent Lystrup a letter informing him that the lease had
automatically been renewed for another year. Lystrup immediately
called Brackett and expressed his shock and dismay; he followed up
with a letter on January 15 that specifically informed National Life
that ConAgra did not wish to renew its lease. Shortly thereafter,
Brackett sent a letter to Rabin telling Rabin that Lystrup had "stubbed
his toe" in failing to provide "proper" notification of nonrenewal.
(J.A. at 233.) ConAgra subsequently vacated the leased premises and
moved into space across the street. National Life attempted to rent the
property, but did not find another lessee until February 1992.

National Life then brought the instant action in the United States
District Court for the Western District of North Carolina, seeking rent
due under the provisions of the lease. ConAgra asserted that National
Life was not entitled to judgment based on three alternative argu-
ments. First, ConAgra argued that it provided adequate notice of its
intention not to renew for the final option period in its letter of Janu-
ary 15. Second, ConAgra maintained that even if its written notice

                     3
was inadequate, National Life had waived the written notice require-
ment and ConAgra had given adequate oral notice of its intention not
to renew the lease. Third, ConAgra claimed that it was entitled to
equitable relief from the terms of the lease under the reasoning of Mer
Properties-Salisbury v. Golden Palace, Inc., 382 S.E.2d 869 (N.C. Ct.
App. 1989). The district court rejected each of these contentions in a
carefully reasoned opinion. See National Life Ins. Co. v. ConAgra,
Inc., No. 91-242 (W.D.N.C. Oct. 21, 1994). Having had the benefit
of oral argument and the parties' briefs, and after careful consider-
ation of the record and applicable law, we affirm on the reasoning of
the district court.

AFFIRMED

                    4