Lagoon Co. v. Utah State Fair Ass'n

214 P.2d 614, 117 Utah 213, 1950 Utah LEXIS 107
CourtUtah Supreme Court
DecidedFebruary 8, 1950
DocketNo. 7255
StatusPublished
Cited by2 cases

This text of 214 P.2d 614 (Lagoon Co. v. Utah State Fair Ass'n) is published on Counsel Stack Legal Research, covering Utah Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lagoon Co. v. Utah State Fair Ass'n, 214 P.2d 614, 117 Utah 213, 1950 Utah LEXIS 107 (Utah 1950).

Opinion

LATIMER, Justice.

Plaintiffs and respondents instituted this action in the court below under Title 104, Chapter 64, U. C. A. 1943, to obtain a declaratory judgment construing a certain lease entered into on the 22nd day of May, 1946, by and between the Utah State Fair Association and Beehive Midways, Inc., a corporation, and to have such agreement declared void. There was a supplemental agreement executed by the parties modifying some of the terms of the original lease, but in view of the fact that the validity of both agreements is determined by the provisions of the original contract we deal only with that one document. The district court held the agreement void for the reason that the officers of the State Fair Association exceeded their statutory authority and a judgment was entered declaring the lease invalid. The defendants appeal from the judgment. The parties are referred to as they appeared in the court below and the.defendant Utah State Fair Association is hereinafter designated as the Association and defendant Beehive Midways, Inc., is designated as the Company.

[215]*215For a number of years prior to the date of the execution of the lease a portion of the fair grounds was uneven and poorly developed. The area was occupied by some stock pens and stables which the Association desired to have located elsewhere. In 1945, the directors of the Association completed master plans and specifications for the overall improvement of the fair grounds. The proposed improvements included the establishment of a midway in the area previously referred to and contemplated the expenditure of large sums of money. The legislature had made no appropriation for such purposes and so the Association attempted to finance the improvements by offering a long-term lease. The reason for the long period was that the directors of the Association believed a lessee would not expend the money necessary to improve the midway and construct the permanent improvements unless the expenditures could be justified by a lengthy occupation of the property and a monopolistic operation of the concessions. Apparently, the directors of the Association concluded that the offer made by the defendant Beehive Midways, Inc., was the best obtainable and the only means of getting the property improved. Accordingly, the lease in question was executed and work on the improvements commenced.

The lease was for a period of five years and the important provisions were substantially as follows: The Company was given the exclusive right to operate and license others to operate all amusements, rides, games and shows upon the property of the Association, during the years 1947 to 1951, inclusive. The Association reserved the right to operate certain transportation facilities around the property and to run check stands, souvenir concessions, and to conduct certain entertainments to be given for the purpose of attracting visitors to the grounds. The Company was given an option to renew and extend the lease for an additional five year period upon the same terms and conditions as any other responsible operator might in good faith be willing to offer. The Company was required to construct cer[216]*216tain buildings, and was authorized exclusively to operate and maintain amusement devices and consessions upon an area which was to be known as the midway. This area was approximately 800 feet long and 210 feet wide. The construction was to consist of laying a hard-surfaced walk in front of the buildings and around the entire midway and erecting not less than twenty buildings with a total frontage of not less than 800 feet, the buildings and the area to be wired for electrical connections. The Company was permitted to lease the buildings to concessionaires and the amounts realized in the way of rents was to be equally divided between the Association and the Company. There were other provisions dealing with the percentage of distribution of admission charges and other fees collected, a detailed description of the rides and amusements to be furnished by the Company or concessionaires, the right of the Association to inspect the Company’s books and the reversion of the buildings to the Association upon the termination or forfeiture of the contract.

The defendants have made eight assignments of error. We, however, need only consider two. These are (1) that the trial court erred in concluding that the Association did not have authority to enter into the lease agreement; and (2) that the Association and the plaintiffs are estopped from questioning the validity of the lease agreement. We treat the assignments in the reverse order.

Defendants’ contention in support of an estoppel arises out of the facts that the defendant Company expended large sums of money in placing permanent improvements on the property of the Association; that these improvements were to revert to the Association upon the expiration of the lease; and, that under the circumstances of this case it would be unconscionable for the court to set aside the lease and allow the improvements to revert to the Association. We express no opinion as to title to the improvements but we are convinced that the doctrine of estoppel cannot be used to defeat plaintiffs’ right to maintain this action.

[217]*217Defendants have not raised the issue of estoppel in the pleadings and the evidence does not show any act on the part of any plaintiff which might have had a tendency to mislead the defendant Company into executing the contract. Either the Association had the right to enter into the lease with the Company and it is not vulnerable to attack, or the Association exceeded its power and the validity of the lease can be attacked by any citizen or corporation having an interest in the subject matter. The claim of estoppel must fail because of the lack of pleadings and evidence to allege and show such a defense.

The next contention involves the authority of the Association to execute the lease. While the parties have argued at length as to whether the Association was exercising governmental or propriety powers when it entered into the lease agreement, we believe this question unimportant in view of the provisions of our statute. If the legislature either expressly authorized the Association to lease the land and the improvements or expressly prohibited the Association from so encumbering the property then it matters not what powers the directors of the Association were attempting to exercise.

Our concern, then, is with the effect to be given certain statutory enactments which must be construed to determine the legislative intent, for unless the legislature either expressly or by implication granted the Utah State Fair Association the power to enter into the particular lease agreement the judgment must be affirmed.

The sections of the statutes involved are quoted:

Section 85-4-1, U. C. A. 1943:

“The Utah state fair association is continued a body corporate with perpetual succession subject to the direction, supervision and control of the commissioners of the department of publicity and industrial development. It may have and use a corporate seal, and by the aforesaid name may sue and be sued, contract and be contracted with, and take and hold by purchase, gift, devise or bequest, real and per[218]*218sonal property required for its uses. It may also, with the approval of the department of finance, convert such property, when not suitable for its uses, into other property, which may be suitable for its uses, into other property, or into money

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Bluebook (online)
214 P.2d 614, 117 Utah 213, 1950 Utah LEXIS 107, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lagoon-co-v-utah-state-fair-assn-utah-1950.