Desciose v. United States

40 Cont. Cas. Fed. 76,873, 34 Fed. Cl. 606, 1995 U.S. Claims LEXIS 239, 1995 WL 759774
CourtUnited States Court of Federal Claims
DecidedDecember 21, 1995
DocketNo. 94-526 C
StatusPublished
Cited by1 cases

This text of 40 Cont. Cas. Fed. 76,873 (Desciose v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Desciose v. United States, 40 Cont. Cas. Fed. 76,873, 34 Fed. Cl. 606, 1995 U.S. Claims LEXIS 239, 1995 WL 759774 (uscfc 1995).

Opinion

OPINION

HODGES, Judge.

I.

Plaintiff leased office space to the Federal Aviation Administration (FAA) under three separate lease agreements. The first lease expired in 1980. The second agreement extended the lease through 1985. A bilateral modification of the second lease in 1984 required plaintiff to make certain improvements and alterations for $84,514. The modification also deleted a restoration clause that required the government to restore the premises upon vacating.

A May 1985 agreement extended the lease for a term of 14 years. Paragraph four of the third lease provided that the government could terminate at any time with 180 days notice in writing. The lease automatically renewed from year to year unless the government gave 90 days notice that it would not renew.

II.

Plaintiff contends that the modification does not reflect the parties’ full agreement because defendant assented to a 14-year lease that could be canceled only upon a lack of appropriations or a material change of circumstance. According to plaintiff, the ter[607]*607mination provision and the automatic renewal provision create an ambiguity that permits us to consider parol evidence, and parol evidence would show that the parties intended to waive the restoration provision in favor of a long-term lease.

The FAA gave plaintiff notice of termination in October 1992. Although plaintiff had more than 180 days notice, he argues wrongful termination because no loss of appropriations or material change of government circumstances occurred. Plaintiff also seeks restoration costs.

Plaintiff claims that defendant damaged the leased premises by installing tacks, nails, screws, and brads on linen-covered wall panels and hardwood doors in violation of plaintiffs instructions and lease obligations. The contracting officer testified that any damage to the premises did not exceed ordinary wear and tear. Plaintiff also seeks rental adjustments for the rental periods from 1985 to 1990 and from 1990 to 1993.

We ruled for the government on the issues of wrongful termination and restoration costs at trial. The termination and automatic renewal provisions did not create an ambiguity, and plaintiffs evidence of wrongful termination would contradict the plain language of the contract. If plaintiff had evidence of a collateral agreement to waive the restoration provision in exchange for a 14 — year lease, its admission would violate the parol evidence rule.

The remaining issues are whether plaintiff is entitled to compensation for damage to the premises, and whether defendant should reimburse plaintiff for rental rate assessments by the City of Long Beach. We rule for plaintiff on the issue of rental rate adjustments.

Discussion

The 1964 lease provided that the government could alter the premises, but plaintiff could require restoration “to the same condition as that existing at the time of entering ... reasonable and ordinary wear and tear ... excepted.” The 1980 lease allowed the government to make alterations, and either restore the premises or make a cash settlement. This provision was deleted pursuant to a modification whereby plaintiff replaced office partitions and installed electrical lines and outlets. Defendant reimbursed plaintiff for these renovations.

The 1985 lease noted that the restoration clause had been deleted by the 1984 modification. The 1985 lease does not specify the condition in which the premises should be returned. Although the government did not consider itself to be responsible for restoration, the contracting officer considered claims for items beyond normal wear and tear. Defendant admits liability for damages beyond normal wear and tear, but argues that the condition in which the premises were left represents normal wear and tear. Plaintiff concedes responsibility for normal wear and tear, but argues that the premises were severely damaged. The issue is whether the condition in which the premises were left constitutes normal wear and tear.

Plaintiff testified to discussions with FAA representatives concerning permissible wall hangings and the use of tacks. He wanted the tenants to use very small tacks and to put as few items as possible on the linen-covered walls. One manager allowed employees to hang toy airplanes, blimps, personal photos, and calendars with nails and screws in a variety of sizes, according to plaintiff.

The contracting officer testified that ordinary wear and tear results from “normal usage.” Large holes and ripped carpet would be damage beyond ordinary wear and tear. Defendant presented a video tape of the leased premises at trial and argued that it showed normal wear and tear. The video revealed nail holes in the walls, discoloration of the wall fabric from pictures and furniture, gouges in the fabric, and carpet stains from water seepage.

If a tenant does not promise to return premises in a certain condition, it is liable for substantial repairs but not for those necessitated by ordinary wear and tear. See City of New York v. United States, 119 Ct.Cl. 769, 793, 97 F.Supp. 808, 818 (1951). Provisions excepting normal wear and tear reflect basic obligations between lessor and lessee, and [608]*608they normally are included in rental contracts. Id., 97 F.Supp. at 819. “[Ljeases, like other contracts, are to receive a reasonable interpretation that -will effectuate the intention of the parties.” Singer v. United States, 126 Ct.Cl. 417, 421, 115 F.Supp. 166, 168 (1953) (citation omitted).

The parties excepted normal wear and tear in the 1964 lease. The clause was omitted from the 1980 and 1985 leases, perhaps inadvertently. A reasonable interpretation of the lease and the intent of the parties would assume a provision excepting ordinary wear and tear.

The video tape of the premises did not show damage beyond ordinary wear and tear. Plaintiff must have anticipated that a tenant occupying this building for nearly 30 years would leave nail holes and minor carpet and wall damage. Plaintiff cannot recover for this ordinary wear and tear.

Plaintiff contends that he is entitled to ground rental adjustments for the periods from 1985 to 1990 and from 1990 to 1993. The lease provides that the annual base rental rate would be modified in May 1985 and on May 1 every five-year period thereafter, to reflect land lease adjustments that the City of Long Beach assessed against plaintiff. The adjustment option required plaintiff to submit written notice to the government with documented copies of any rental increase notice. The government could refuse to adjust the rental rate if plaintiff did not submit the necessary information in a timely manner. According to defendant, plaintiffs request for rental adjustment was not timely.

The 1964 and 1980 leases did not provide for rental rate adjustments. The first escalation clause was in the 1985 lease. To implement the escalation clause and ascertain a ground rental rate, plaintiff was required to document the city’s rental increase for 1980-1985. The amount of rent plaintiff paid the city for 1980-1985 was to be the base ground rental rate for the 1985 lease with the FAA The land rental rate adjustment for 1980-1985 was assessed in 1980, but plaintiff disputed the increase and did not settle with the city until 1986. Plaintiff submitted a claim to the FAA in 1987 for rental adjustment based on the 1980-1985 term.

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Bluebook (online)
40 Cont. Cas. Fed. 76,873, 34 Fed. Cl. 606, 1995 U.S. Claims LEXIS 239, 1995 WL 759774, Counsel Stack Legal Research, https://law.counselstack.com/opinion/desciose-v-united-states-uscfc-1995.