Epic Properties v. Osu Labamba, Inc., 07ap-44 (9-25-2007)

2007 Ohio 5021
CourtOhio Court of Appeals
DecidedSeptember 25, 2007
DocketNo. 07AP-44.
StatusPublished
Cited by7 cases

This text of 2007 Ohio 5021 (Epic Properties v. Osu Labamba, Inc., 07ap-44 (9-25-2007)) is published on Counsel Stack Legal Research, covering Ohio Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Epic Properties v. Osu Labamba, Inc., 07ap-44 (9-25-2007), 2007 Ohio 5021 (Ohio Ct. App. 2007).

Opinion

OPINION
{¶ 1} Plaintiff-appellant, Epic Properties ("Epic"), appeals from the November 9, 2006 entry of the Franklin County Municipal Court ("Trial Entry"), interpreting terms in a commercial lease between Epic, as the original landlord's assignee, and defendant-appellee, OSU LaBamba, Inc. ("LaBamba"). Epic further appeals from the trial court's *Page 2 December 21, 2006 decision and entry denying Epic's motion for a new trial ("New Trial Entry").

{¶ 2} This action arises out of a commercial lease ("Lease"), dated March 16, 2001, between 1960 High Street Ltd. and LaBamba, pursuant to which LaBamba leased premises located at 1956 North High Street in Columbus, Ohio. In 2002, 1960 High Street Ltd. assigned the Lease to Epic in connection with Epic's purchase of property, including the leased premises, from 1960 High Street Ltd. The Lease requires LaBamba to reimburse Epic for a share of taxes and insurance. Section 1.7 of the Lease defines "Tenant's Share of Taxes and Insurance" as 12.50 percent, and Section 5 of the Lease sets forth LaBamba's responsibility to pay its share of taxes and insurance, providing:

With respect to each calendar year or portion thereof during the term of this Lease, Tenant shall pay, as additional rent, Tenant's share, as set forth in Section 1.7, of any and all Taxes which are payable by Landlord during such calendar year or portion thereof. In addition, with respect to each calendar year or portion thereof during the term of this Lease, Tenant shall pay, as additional rent, Tenant's share, as set forth in Section 1.7, of the premiums for fire and extended coverage insurance covering the building of which the Premises are a part (the Building) and the improvements thereon which are payable by Landlord during such calendar year or portion thereof. * * * The term Taxes, as used herein shall mean all real property taxes (and any tax levied wholly or partly in lieu thereof), assessments, vault charges, licenses and permit fees and other governmental levies, unforeseen as well as foreseen, of any kind and nature which are assessed, levied, confirmed or imposed, or which become a lien, upon the Building or the sidewalks or streets in front of or adjoining the same, and which become payable by Landlord, during the term of this Lease.

(Emphasis added.) The crux of the parties' dispute concerns the interpretation of Section 5. *Page 3

{¶ 3} On November 16, 2005, Epic filed a complaint for forcible entry and detainer, alleging that LaBamba failed to pay its share of real estate taxes and demanding restitution of the premises and payment for past due amounts. On November 30, 2005, LaBamba filed an answer to Epic's complaint along with counterclaims for breach of contract and unjust enrichment, alleging that Epic and 1960 High Street Ltd. overcharged LaBamba for its share of taxes and insurance since the inception of the Lease term. On December 7, 2005, Epic filed a reply to LaBamba's counterclaim, denying the allegations therein.

{¶ 4} It is undisputed that LaBamba is responsible for reimbursing Epic for some portion of taxes and insurance and that its share of such expenses is 12.5 percent. The parties' dispute centers around the whole to which LaBamba's 12.5 percent share applies. Pursuant to Section 5 of the Lease, LaBamba is responsible for 12.5 percent of the insurance premiums "covering the building of which the Premises are a part (the Building) and the improvements thereon" and for 12.5 percent of taxes "upon the Building or the sidewalks or streets in front of or adjoining the same." The Lease does not define the term "building." Epic contends that the Lease requires LaBamba to pay 12.5 percent of the taxes and insurance on the entirety of Epic's property located at 1948-1960 North High Street and 18-24 East 17th Street (the "Epic Property")1 and that LaBamba paid such amount, without complaint, for the first four years of the Lease term. LaBamba, on the other hand, claims that the Lease requires it to pay only 12.5 *Page 4 percent of the taxes and insurance related to the lease premises, i.e., 1956 North High Street.

{¶ 5} On October 5, 2006, the trial court held a bench trial to determine the meaning of the relevant Lease terms. Epic's counsel framed the single issue before the trial court as "what is the meaning of the lease as respects to the word `building' in Section 5 under Tenant's Share of Taxes and Insurance." (Tr. at 138.) Before trial, Epic's counsel explained, "what the parties are stipulating from a procedural standpoint is a trial on the issue of the meaning of the lease as to what is or is not reimbursable; and based on that determination by the Court, then we would submit either a joint accounting or separate accounting for the Court then to rule on." Id. at 13-14. At trial, the court admitted the stipulated evidence and heard testimony from four witnesses.

{¶ 6} On November 9, 2006, the trial court issued the Trial Entry, reiterating that the bench trial was held "for the sole purpose of interpreting the [Lease], particularly Section 1.7 governing the tenant's share of taxes and insurance." The court noted the Lease's distinction between the "premises," defined as 1956 North High Street, and the larger, undefined "building" of which the premises is a part. Finding the term "building" ambiguous, the trial court sought to determine the parties' intent. The trial court reviewed the Lease and the leases of other tenants in the Epic Property and examined photographs of the Epic Property. The trial court also noted the testimony of Ramiro Aguas, who executed the Lease on behalf of LaBamba, that he viewed the Epic Property as separate buildings and the leased premises as the first floor of one building. The court concluded that "12.50% pertains to more than [LaBamba's] leased premises *Page 5 but less than all of [Epic's] properties in this vicinity." Applying the common definition of "building" as a structure enclosing a space within its walls, the court found that:

* * * [T]he "building" [LaBamba] occupies is parcel 010-023557 and that the portion or premises of this building that [LaBamba] occupies is the first floor and is assigned the address of 1956 North High Street. Based upon this determination of the term building, the Court finds that [LaBamba], according to the language of the [Lease], is responsible for 12.50% of the taxes and insurance of this building or parcel 010-023557. * * *

The trial court also stated that Epic's construction of "building" to include the entire Epic Property would result in Epic recovering more than 100 percent of its taxes and insurance, based on the percentages assigned to each tenant.

{¶ 7} On November 22, 2006, Epic filed a motion for a new trial, pursuant to Civ.R. 59(A)(6), arguing that the Trial Entry was based on a mathematical error and was, thus, against the manifest weight of the evidence. Epic based its argument in support of a new trial on the trial court's statement that Epic would recover more than 100 percent of its costs were the court to conclude that LaBamba owed 12.5 percent of the taxes and insurance for the Epic Property. Epic contends that only some of its tenants' leases include terms applying the tenants' shares of taxes and insurance to the entire Epic Property and that simply adding the percentage assigned to each tenant results in an inaccurate representation of Epic's recoupment.

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Cite This Page — Counsel Stack

Bluebook (online)
2007 Ohio 5021, Counsel Stack Legal Research, https://law.counselstack.com/opinion/epic-properties-v-osu-labamba-inc-07ap-44-9-25-2007-ohioctapp-2007.