Opinion
16-P-880
03-22-2017
Shirley M. SHERIDAN, trustee, v. LEASEHOLD, INC.
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
The defendant appeals from a Superior Court judgment in which the judge, on cross motions for judgment on the pleadings, interpreted a certain clause in a lease amendment in favor of the plaintiff. The defendant alleges that the judge erred in doing so, claiming that the amendment at issue in fact means the opposite. Finding no error with the judge's decision, we affirm.
Background . In 1965, the plaintiff's predecessor-in-interest executed a commercial lease to let land, located in the town of Yarmouth, to the defendant's predecessor-in-interest. The initial term of the lease was fifty-one years, with annual rent set in the amount of $7,200. The lease also provided the lessee with the option of two ten-year extensions after the expiration of the initial term. The amount of rent for those extensions was to be determined by the parties, or, in the event they could not agree, by arbitration.
The parties have stipulated that the initial term will expire on May 10, 2017.
Two years later, the parties executed an amendment to the lease. That amendment altered certain provisions of the original lease. Most notably, the second paragraph of page two of the lease was amended to state that the annual rent was to be $7,200, "for and during the life of MARY ANGUS MULLEN and no longer, and thereafter during the remainder of the term of the said lease, or any renewal or extension thereof , the rental shall be Six Thousand Dollars ($6,000.00) per year" (emphasis supplied). Aside from one additional change, the amendment "confirmed and ratified" the lease's other terms in all respects.
The amendment also released approximately 20,000 square feet of the subject property from the lease.
As alluded to above, this case arises from the parties' different interpretations of the effect of the amendment's rent provision. The plaintiff contends, and the judge below agreed, that the amendment changed the amount of rent payable upon Mullen's death to $6,000 per year for the remainder of whatever term was in effect at the time, i.e., if she passed away during the initial term of the lease, the rent would reduce to $6,000 per year for the remainder of that initial fifty-one-year term. Then, if the defendant exercised its option of an additional ten-year term, the original lease provision calling for a new rental amount by agreement or by resort to arbitration would take effect.
The defendant takes the opposite view, claiming that the phrase, "during the remainder of the term of the said lease, or any renewal or extension thereof," means that the reduction in rent applies to the initial term of the lease, as well as any extensions that may be later optioned. Effectively, under that interpretation, the annual rental amount would be set, upon Mullen's death, at $6,000 for any remainder of the initial term, and all potential future extensions and renewals, in perpetuity, until the lease's termination. For the reasons set forth below, we disagree.
Discussion . We review a judgment on the pleadings de novo, as Mass.R.Civ.P. 12(c), 365 Mass. 754 (1974), "effectively functions as a ‘motion to dismiss.’ " Okerman v. VA Software Corp ., 69 Mass. App. Ct. 771, 775 (2007), quoting from Jarosz v. Palmer , 436 Mass. 526, 529 (2002). Here, our review is confined to the contents of the pleadings, along with any documents that are incorporated by reference therein. See Home Depot v. Kardas , 81 Mass. App. Ct. 27, 28 (2011).
The interpretation of an unambiguous written contract, such as a lease, is a matter of law for the court to determine. Great Atl. & Pac. Tea Co . v. Yanofsky , 380 Mass. 326, 334 (1980). If the language of a contract is unambiguous, the contract must be enforced according to its terms. Schwanbeck v. Federal-Mogul Corp ., 412 Mass. 703, 706 (1992). A contract term is ambiguous if it is "susceptible of more than one meaning and reasonably intelligent persons would differ as to which meaning is the proper one." Citation Ins. Co . v. Gomez , 426 Mass. 379, 381 (1998). When there are no ambiguous terms, a court will construe the contract terms in their "usual and ordinary sense." DeWolfe v. Hingham Centre, Ltd ., 464 Mass. 795, 803 (2013), quoting from Citation Ins. Co ., supra . In addition, a court must "construe the [contract's] language to give it reasonable meaning wherever possible." Shea v. Bay State Gas Co ., 383 Mass. 218, 225 (1981).
If the language of the amendment is read in isolation, it may appear to be ambiguous. However, when the amendment is read together with the lease, any potential ambiguity is resolved. The amendment only altered certain portions of the lease, with the unaltered portions expressly remaining in effect. Thus, construing the lease as a whole, the provision in the original lease that "each such extension to be for a period of ten (10) years at a monthly rental to be agreed upon by and between the parties" must be accorded the same effect as if no amendment had been made, because the amendment did not alter that provision. To read the amendment as the defendant does, i.e., that the amendment expressly resolved the rental amount for the ten-year extensions, would conflict with the terms of the original lease. Therefore, we agree with the judge, who interpreted the amendment to mean that the reduction to $6,000 applied to " ‘the remainder of the term of the said lease’ or ‘remainder of the term of renewal or extension thereof.’ " Read in that way, the lease provided that upon the death of Mullen, the rent was to be reduced to $6,000 per year for the remainder of such term that was then in effect, whether it was the initial term, the first ten-year extension, or the second ten-year extension. As Mullen passed away during the initial term, the rental amount was properly reduced to $6,000 per year. Upon the expiration of the initial term on May 10, 2017, see note 2, supra , the defendant shall have the option of extending the lease for an additional ten-year term. If it chooses to exercise that option, the parties shall negotiate the rental amount as per the terms of the lease.
The parties sharply disagree on the meaning of the word "or" as it is used in the following phrase from the amendment: "during the remainder of the term of the said lease, or any renewal or extension thereof" (emphasis supplied). The plaintiff argues that "or" is used in the usual disjunctive manner; the defendant in effect is claiming that it is used in the conjunctive sense and interprets it as having the same meaning as "and." We disagree with the defendant. Generally, "or" is disjunctive; it is not synonymous with "and" unless "the context and the main purpose of all the words demand otherwise." Eastern Mass. St. Ry . v. Massachusetts Bay Transp. Authy ., 350 Mass. 340, 343 (1966). The use of "or" here is not such a case. See Bello v. South Shore Hosp ., 384 Mass. 770, 782 (1981) (use of comma before "or" in list of options interpreted to mean choice of one of those options, not all). Thus, the defendant is correct when it stated in its brief that using "or" in the conjunctive sense would be "nonsensical," as it would amount to an agreement for rent for an extension that had not yet been optioned.
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Judgment affirmed .