Court Opinion

ID: 9656799
Source: CourtListenerOpinion
Date Created: 2023-08-23 20:01:49.722156+00
Date Added: 2024-06-11T18:13:36.416239
License: Public Domain

Annabelle Clinton Imber, Justice, dissenting. Because all of the terms of the 1993 lease apply here, I disagree with the majority’s conclusion that the Dosses wrongfully terminated the lease by not giving Seidenstricker Farms six-months’ notice under Ark. Code Ann. § 18-16-105 (Repl. 2003). The majority agrees that the terms and conditions of the 1993 lease apply to the hold-over, year-to-year tenancy. Yet, in its attempt to distinguish this court’s holding in Lamew v. Townsend, 147 Ark. 282, 227 S.W. 593 (1921), the majority ignores the provision of the written lease that conditions the one-year lease period upon the mutual satisfaction of the parties. This court’s holding in Lamew is instructive on the issue of whether the lease in the instant case was wrongfully terminated. In Lamew, the parties contracted for a farmland lease, and the lease stated that the lease would last for the period of one year “with the option to continue from time to time as long as conditions are satisfactory to both parties hereto.” Lamew v. Townsend, 147 Ark. 282, 284, 227 S.W. 593, 594 (1921) (emphasis added). Our court read the “satisfactory” language as meaning that the parties contemplated the continuation of the lease for more than one year, but that the continuance was conditional upon the arrangement remaining mutually satisfactory to the parties. Id. Similarly, we recognized that under the law of contracts the parties were entitled to bind themselves in such a manner, and it was this court’s duty to give effect to the parties intent. See id. The Lamew court thus determined that the parties intended the lease provision to allow for termination of the lease at anytime during the lease term despite the common-law requirement that a year-to-year tenant be given six-months’ notice of the landlord’s intent to terminate the lease. Id. Our court explained its holding by stating, The dissatisfaction contracted against might have arisen within less than six months of the end of the year, and, even though these differences had previously arisen, they might become so accentuated when the crop was being harvested that one or the other of the parties might desire to terminate the tenancy. They had mutually reserved the right to do so. If the difference arose in the first half of the year, there would be time for the common-law notice of six months of the intention to terminate the tenancy, and the language quoted would be surplasage, as the right to terminate could be exercised whether cause for dissatisfaction had arisen or not. But the language quoted gave the right whether the dissatisfaction arose in the first half of or the last half of the year. Id. at 286-87, 227 S.W. at 594. In sum, the Lamew court stressed that it was the parties’ right to contract for the terms of the lease and to mutually reserve the right to waive the common-law requirement of six-months’ notice if either party became dissatisfied with the business arrangement. See id. The court did, however, recognize that neither party had the right to act arbitrarily or capriciously, and each party was entitled to reasonable notice from the other of an intent to terminate the contract. Id. In the instant case, the 1993 lease contains language similar to that used in Lamew. The lease states, TO HAVE AND TO HOLD unto said TENANT from the date of January 1, 1993, until the first of January 1994, provided it [sic] satisfactory with both parties. Giving effect to the intent of the parties, and in light of our holding in Lamew, I must conclude that the language of the lease here contemplates that the parties could cut short the one-year lease period at anytime during a lease term. Just as in Lamew, if either party became dissatisfied with the business arrangement, that party could give the other notice of its intent to cut short the lease anytime during the lease term, as long as reasonable notice was given. The question of what constitutes reasonable notice is a question of fact, and accordingly, under our “clearly erroneous” standard of review, we should defer to the circuit court’s decision that the lease was not wrongfully terminated in this case. Lamew v. Townsend, supra. In sum, because all of the terms and conditions of the 1993 written lease apply to the hold-over, year-to-year tenancy,1 including the provision that makes the one-year lease period subject to the satisfaction of both parties, I would affirm the decision of the circuit court. Brown, J., joins this dissent.   The majority’s use of the term “year-to-year” is somewhat inaccurate. Although the distinction may make little difference in the instant case because the lease was renewed for the term of one year, I wish to point out the difference between a true year-to-year tenancy and a periodic, holdover tenancy, or a renewal of a lease for a specific period. In cases in which the original written lease did not contain language that made specific reference to the conditions of renewal, but the tenant retained possession of the property and paid rent, a year-to-year tenancy controlled by the terms of the written lease was created. See Lamew v. Townsend, 147 Ark. 282, 227 S.W. 593 (1921); Bedding v. Texas Produce Co., 61 Ark. 377, 33 S.W. 421 (1895). However, in cases like the one at hand, in which the lease specifically stated that renewal of the lease will be for another “term,” this court has held that by holding over and waiving notice, a tenant renewed the lease for another term. See Riverside Land Co. v. Big Rock Stone & Material Co., 183 Ark. 1061, 40 S.W.2d 423 (1931). This principle, of renewing the specific lease term designated in the written lease, applies whether the lease period is one year or less, or more than one year. Regardless of this distinction, Lamew v. Townsend, supra, is applicable to our analysis of the mutually “satisfactory” language in the lease at issue here.