Court Opinion

ID: 9560116
Source: CourtListenerOpinion
Date Created: 2023-08-21 17:43:09.636491+00
Date Added: 2024-06-11T09:12:09.751915
License: Public Domain

CARDINE, Justice.
This case involves a dispute between the State Bank of Green River (Bank) and Automatic Gas Distributors, Inc. (AGD) over which of their competing interests is senior in the property being foreclosed. AGD appeals the district court’s summary judgment ruling that AGD “surrendered” its earlier, unexpired lease when it executed a subsequent lease for a longer term in the same property. As a result of this ruling, the Bank’s mortgage was held senior to AGD’s subsequent lease.
The issues, as presented by AGD, are as follows:
“1. Whether a genuine issue of material fact existed and was unresolved at the time summary judgment was entered herein against Appellant.
“2. Whether the District Court misconstrued one of the documents upon which it relied in entering summary judgment herein against Appellant.
“3. Whether Appellee State Bank of Green River was entitled to judgment against Appellant as a matter of law.”
We affirm.
In 1984, AGD leased property from Wes-tAmerica Foods, Inc. for a self-service gas*442oline station. This lease was for a term of ten years and would expire March 1, 1994. It provided for two renewal options of five years each. A memorandum of this lease was recorded in the Sweetwater County Clerk’s office in 1984. Ownership of the property then passed through various grantees until the Bank became owner of it. On October 6, 1988, Trans-Western Development, Inc. acquired the property from the Bank in exchange for a purchase money mortgage. On October 10, 1988, and before the expiration of the term of the 1984 lease, AGD and Trans-Western executed and entered into a new lease on the same property. The new lease provided:
“Landlord hereby leases to Tenant for the term and on the rentals and conditions set forth herein, that portion of the Premises more particularly described on the map or plat attached hereto as Exhibit B and incorporated herein, along with all of the rights, privileges, easements and appurtenances thereunto attached and belonging, subject only to those leases, deeds of trust, and other encumbrances set forth on Exhibit C attached hereto and incorporated herein.” (emphasis added)
Exhibit C, attached to the lease and as written by the parties, is as follows:
“EXHIBIT C TO SPECIAL PURPOSE LEASE
“ENCUMBRANCES AGAINST THE PREMISES
“State Bank of Green River — $170,000.”
The 1988 lease required a listing of “leases” to which the premises were still “subject.” The 1984 lease was not listed on Exhibit C. Listed on Exhibit C was only the purchase money mortgage which demonstrates clearly that the premises and the 1988 lease were subject to the Bank’s mortgage and nothing else.
On October 21, 1988, the Bank recorded its purchase money mortgage from Trans-Western. Later, on October 31, 1988, a memorandum of the 1988 lease was recorded in the Sweetwater County Clerk’s office. Trans-Western failed to make the payments upon the mortgage, and the Bank filed this foreclosure action.
In its complaint, the Bank included AGD, Trans-Western, and other defendants who had interests in the property. AGD is the only defendant left on appeal, all other defendants having either defaulted or decided not to pursue this appeal. The Bank filed a motion for summary judgment asserting that AGD “surrendered” its 1984 lease when it executed the 1988 lease. In support of its motion, the Bank attached copies of the 1984 and 1988 lease agreements. AGD filed a brief opposing the Bank’s motion for summary judgment and argued that the Bank had failed to present any evidence that would demonstrate that AGD intended to surrender its 1984 lease. The district court noted that there was no genuine issue of material fact and entered judgment for the Bank.
A grant of summary judgment is proper only when there are no genuine issues of material fact, and the prevailing party is entitled to judgment as a matter of law. Brazelton v. Jackson Drug Co., Inc., 796 P.2d 808, 810 (Wyo.1990). Leases are contractual in nature, and their construction and interpretation are for the court as a matter of law. Id. In Jones Land and Livestock Co. v. Federal Land Bank, 733 P.2d 258, 262 (Wyo.1987), we stated that:
“If the language of the contract is plain and unequivocal that language is controlling and the interpretation of the contractual provisions is for the court to make as a matter of law. The meaning of the instrument is to be deduced only from its language if the terms are plain and unambiguous.” (quoting Shepard v. Top Hat Land & Cattle Co., 560 P.2d 730, 732 (Wyo.1977))
The Bank, as the movant, had the initial burden of demonstrating the absence of any genuine issue of material fact and that it was entitled to a judgment as a matter of law that AGD surrendered its 1984 lease. Fiscus v. Atlantic Richfield, 773 P.2d 158, 161 (Wyo.1989).
Neither lease is ambiguous, and therefore, we do not look beyond those *443documents to determine their meaning. Jones Land & Livestock, 733 P.2d at 262. The express language of the 1988 lease states that it is
“subject only to those leases * * * set forth on Exhibit C attached hereto and incorporated herein.” (emphasis added)
Significantly, the 1984 lease was not listed on Exhibit C. The only document listed on Exhibit C as an encumbrance was the Bank’s mortgage. The 1984 lease not being listed, it, by written agreement of the parties, is not embraced and did not survive the 1988 lease. Our examination of the documents attached to the Bank’s motion for summary judgment convince us that the Bank met its burden.
AGD nevertheless alleges that, contrary to its express written agreement and without any supporting facts, that it alone intended that its 1984 lease survive without being listed on Exhibit C attached to the 1988 lease and that it remained an encumbrance prior to the Bank’s purchase money mortgage.
It is probably unnecessary for us to address this unilateral conclusory claim supported by nothing. Nevertheless, we find additional support, as did trial Judge Ryckman, for the result here reached in Barber v. Smythe, 59 Wyo. 468, 143 P.2d 565, 568 (1943), wherein we said:
“It is agreed among the authorities that a lease for a term of years may be surrendered by operation of law and that an agreement in writing is not necessary in such a ease.”
See also Application of Hagood, 356 P.2d 135 (Wyo.1960); Casper Nat’l Bank v. Curry, 51 Wyo. 284, 65 P.2d 1116, 1118-19, 110 A.L.R. 360 (1937). Thus there is a presumption, to which the Bank was entitled, that acceptance by the tenant of a new lease of the demised premises during the term of an old lease operates as a surrender of the old lease by the act of the parties. Presumption of intent to surrender results from the making of the new lease and acceptance. State v. Fin & Feather Club, 316 A.2d 351, 356-57 (Me.1974) (citing Brown v. Linn Woolen Co., 114 Me. 266, 269, 95 A. 1037, 1038 (1915)). See also 49 Am.Jur.2d Landlord and Tenant § 1103 (1970), wherein it is stated:
“A surrender of a lease is implied by law when another estate is created by the reversioner or remainderman, with the assent of the tenant, incompatible with the existing term. So, as a general rule, when a new lease of the premises is taken by the lessee from the lessor for the whole or a part of the term embraced in the former one, there is said to be a surrender in law, because the giving of a new lease necessarily implies a surrender of the old one.” (footnotes omitted)
The rule of surrender implied by law is so well established as to be without dispute.
We also have duly considered the remainder of the above quotation, which is:
“In any case, however, if the. circumstances are totally inconsistent with the intention of the parties that the giving of the new lease shall operate as a surrender of the existent lease, it will not be given such an operation.” Id.
It has no application to this case. Nothing was presented which constituted “circumstances * * * totally inconsistent with the intention of the parties ” to surrender. Thus, appellant does not claim it was misled by the parties’ negotiations, statements, misrepresentations, or promises that induced making the new lease. Appellant does not explain why it made a new lease nor does it claim that the parties intended the 1984 lease remain in effect. Appellant only claims that it, one party, intended that the 1984 lease remain in effect; and that claim is based upon its bald, concluso-ry, single assertion that appellant did not intend to surrender. That is insufficient to defeat summary judgment.
There was nothing before the court concerning acts of the parties to rebut the presumption or establish a different intention. The 1988 lease took effect before the expiration of the 1984 lease and extended the term of the lease beyond that called for in the 1984 lease. The fact that the 1984 and 1988 leases are for the same property, that the property changed hands between leases, that the new lease is for a longer term and is subject only the Bank’s encum*444brance, is sufficient to establish the surrender of the earlier lease.
The trial court is accused of a result oriented decision when the dissent states “a presumed intent to achieve a probable undesired result * * * fuels my disagreement with [the majority].” Dis. op. at 1. In truth, the disagreement really is fueled by inappropriate use of conjecture, speculation or private inquiry, assembling special facts and then retrying and redeciding the case according to a personal view of justice — alluded to as a rule of “common sense.” See also Monn v. State, 811 P.2d 1004 (Wyo.1991); Clarke v. Vandermeer, 740 P.2d 921 (Wyo.1987). For example, it is interesting here that the precise language of the parties’ written agreement is ignored and a nonexistent legal principle asserted that if a party to an agreement did not intend to face foreclosure, and foreclosure results, then his agreement is unenforceable and void. It is then stated that we “ ‘begin with a presumption’ that Automatic Gas Distributors, Inc. intended to surrender the first lease.” Dis. op. at 446. We did not begin with that presumption at all. We began with the plain, unambiguous provisions of the lease itself.
There is also allusion to an “intent and circumstance rule” said to be found in Application of Hagood, 356 P.2d 135, which is said to not support our conclusion. The alleged rule, if it can be found in Hagood, has no bearing on this case. And the rule of “common sense” is indeed an odd anomaly. Were we to adopt this rule, we could repeal all statutes and common law and in each case just determine what common sense tells us should be the final decision. Solemn agreements, even written contracts, would be unenforceable — of no effect. Only what some jurist perceived as “common sense” would survive, and we truly would be a government of men and not law.
Let us now examine the rather unusüal manner in which the dissent assembles a hypothetical factual basis for application of nonexistent law. Thus, initially stated was the following:
“The record, such as it is, would suggest [changed in revised dissent to ‘reveals in leasehold documentation’] that the convenience store operation included normal maintenance and general operation of the gasoline facility. Actually, we do not know [changed in revised dissent to ‘are not informed at this summary judgment stage'] whether this was a self-standing coin-operated installation or a facility with in-store controls. Marketing agreements of this type could either be a royalty arrangement payable to the adjacent store operator with responsibilities for gas purchases and general operation vested in the facility owner or general operational responsibility vested in the store with a royalty interest payable to the facility owner. Whichever this may have been could significantly impact the ultimate resolution to determine intent where clearly State Bank of Green River decided after foreclosure to end the operation of Automatic Gas on the premises.” (emphasis added) Dis. op., n. 2.
Relying upon “would suggest,” “we do not know,” “could be,” and “whichever this may have been” cannot form a sound basis for this inappropriate effort to inject a nonexistent doctrine that the contrary intent of a party to an agreement is sufficient to void the agreement. It is likely that had appellant foreseen a foreclosure, it may not have entered into the 1988 lease. The same can be said of the purchase of real estate at a price too great which then goes into foreclosure, or of any other agreement which is less favorable than hoped for. The essence of this proposed doctrine is that we void the express written agreement of the parties, recognize that the party facing foreclosure did not intend to face foreclosure, and rewrite and relieve that party of the obligation of his agreement. If this result is appealing, it is a result we should not effect, for we are obligated to apply the law as we find it.
The intent of one party alone is not sufficient to avoid surrender of a prior lease. Thus, quoting from Van Rensselaer’s Heirs v. Penniman, 6 Wend. 337, 343 (N.Y.1831), it is stated:
*445“[i]f the acts of the parties in this case, taken all together, are such as to rebut the idea of a surrender, then none ought to be presumed.”
The intent not to surrender must be the intent of the parties — not one of the parties. The intent of the Bank could not have been more clear. Its purchase money mortgage with $170,000 exposure was conditioned upon there being no encumbrance ahead of the Bank. Otherwise, why make a new lease? Both parties must have understood the new lease had some purpose. Appellee does not tell us what that purpose was. But the purpose appears from the lease itself which clearly provides that the prior lease is not an encumbrance. It was interesting that when appellee’s counsel was asked at argument what he would think if this court held the prior lease— though not listed on Exhibit C — to be an encumbrance, counsel replied, “I’d be flabbergasted.” So would the writer of this opinion, as would members of the bar.
Given the Bank’s evidence that AGD surrendered its lease, the burden shifted to AGD to provide evidence to the contrary. See Jones Land & Livestock, 733 P.2d at 263 wherein it is stated:
“[O]nce the movant has established a prima facie case, the burden then shifts to the opposing party to come forward with competent evidence of specific facts countering the facts presented by the movant.”
Admittedly, AGD’s burden to show a contrary intent was difficult given the unambiguous provisions of the 1988 lease. AGD’s conclusory single assertion denying intent to surrender contrary to the subsequent unambiguous lease did not provide any sufficient evidence to overcome the plain meaning of the documents. Allegations stating a different theory in opposing a summary judgment motion are insufficient. We stated in Fiscus, 773 P.2d at 160-61 (Wyo.1989), that “the beneficial purpose of summary judgment would be defeated if cases could be forced to trial simply by an assertion that a genuine issue of material fact exists.” In order to defeat the Bank’s showing of surrender, AGD needed to come forward with specific competent evidence showing that there existed a genuine issue of material fact concerning surrender of the lease. Jones Land & Livestock, 733 P.2d at 263. It failed to do this. The Bank was therefore entitled to judgment as a matter of law that AGD surrendered its 1984 lease.
Finally, this opinion does not memorialize discord within the court, but rather demonstrates an honest disagreement upon a point of law — not an uncommon occurrence within the legal profession. Thus, involved here is a healthy, robust debate of important questions by professionals that can only be of benefit to all.
The district court’s judgment ruling the Bank’s mortgage senior to AGD’s lease and foreclosing AGD’s interest in the property is
Affirmed.
THOMAS, J., concurred in the result.
MACY, J., filed a specially concurring opinion.
URBIGKIT, C.J., filed a dissenting opinion.