Smithfield Farms, LLC v. Riverside Developers, LLC

566 S.W.3d 566
CourtCourt of Appeals of Kentucky
DecidedAugust 17, 2018
DocketNO. 2016-CA-001520-MR
StatusPublished
Cited by12 cases

This text of 566 S.W.3d 566 (Smithfield Farms, LLC v. Riverside Developers, LLC) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Smithfield Farms, LLC v. Riverside Developers, LLC, 566 S.W.3d 566 (Ky. Ct. App. 2018).

Opinion

ACREE, JUDGE:

The issue before us is whether the Gallatin Circuit Court properly entered summary judgment against Appellant Smithfield Farms, LLC, finding its contract with Appellee Riverside Developers, LLC was unambiguous and thus not subject to explanation by extrinsic evidence, and that Riverside properly terminated the contract because Smithfield did not qualify as a holdover tenant under KRS1 383.160(1). We find no error, and affirm.

FACTS AND PROCEDURE

In January 2011, Smithfield entered into a written contract with Riverside to lease land to grow soybeans. The term was for a "one[-]year project." The parties agreed to *568evenly split the profits and expenses. The agreement, dated January 20, 2011, stated in full:

I wish to thank you for your time and great discussions on your agreement to raise soybeans on our Riverside Developers LLC land on both sides of US 42 just east of Warsaw! Mr. Stan Freeman, our GM, will handle all issues on this one[-]year project. This will be a 50-50 agreement with your usage of your (very nice equipment) equipment [sic]. Your trucking of finished beans will be charged additional!! Both Stan & I look forward to your experience on this project & hopefully longer[-]term relationship!! Please return to me, one of my contracts!!

Both parties signed the agreement.

Even though the parties did not execute a new written contract, they continued to operate in the same manner in 2012, 2013, and 2014 as they had done under the 2011 lease-Smithfield grew soybeans on Riverside's land, and the parties split the profits equally. In February 2015, representatives from Smithfield and Riverside met to discuss a "price per acre" lease. The parties failed to reach an agreement. Riverside notified Smithfield on March 26, 2015, that it had accepted another offer to lease the property.

Smithfield then filed this breach of contract action, claiming Riverside wrongfully terminated the lease, thereby depriving Smithfield of reasonably anticipated profits. Citing common industry standards, customs, and practices, Smithfield asserted that the parties' 2014 lease expired on November 1, 2014, and that from November 1, 2014 to March 26, 2015, a period in excess of ninety days, it was a holdover tenant under KRS 383.160(1). Consequently, Smithfield claimed, it was entitled to remain as a tenant and to use the land for another year (until November 1, 2015).

Riverside moved for summary judgment, claiming it was undisputed that in February 2015 the parties entered into discussions regarding a new lease agreement and Riverside informed Smithfield that it was going to lease the land to another tenant on March 26, 2015, both within ninety days of the expiration of the 2014 holdover lease on January 20, 2015. Riverside claimed it was entitled to judgment as a matter of law in light of these undisputed facts.

The circuit court granted Riverside's motion by order entered September 16, 2016. It found the contract clear and unambiguous in that it was for a one-year term starting January 20, 2011, and therefore expiring January 20, 2012. However, because the parties treated the contract as continuing after its expiration, by operation of law the parties entered into subsequent one-year term contracts in 2012, 2013, and 2014, with the 2014 lease expiring on January 20, 2015. It then found that Smithfield did not occupy the land for a period of ninety days after the expiration of the 2014 lease, and therefore it did not qualify as a holdover tenant under KRS 383.160(1). It awarded Riverside summary judgment. Smithfield appealed.

STANDARD OF REVIEW

Our review of the circuit court's decision to grant summary judgment is de novo. Harstad v. Whiteman , 338 S.W.3d 804, 809 (Ky. App. 2011). In doing so, we must ascertain "whether the trial court correctly found that there were no genuine issues as to any material fact and that the moving party was entitled to judgment as a matter of law." Scifres v. Kraft , 916 S.W.2d 779, 781 (Ky. App. 1996) ; CR2 56.03. "The moving *569party bears the initial burden of showing that no genuine issue of material fact exists, and then the burden shifts to the party opposing summary judgment to present" evidence establishing a triable issue of material fact. Lewis v. B & R Corp. , 56 S.W.3d 432, 436 (Ky. App. 2001). That is, "[t]he party opposing a properly presented summary judgment motion cannot defeat it without presenting at least some affirmative evidence showing the existence of a genuine issue of material fact for trial." City of Florence, Kentucky v. Chipman , 38 S.W.3d 387, 390 (Ky. 2001).

ANALYSIS

Smithfield argues that genuine issues of material fact exist precluding summary judgment. Specifically, it claims there are genuine disputes as to: when the 2014 contract terminated; whether Smithfield held over for the requisite ninety days; and whether KRS 383.160(1) extended the lease through 2015. We are not persuaded.

We start with KRS 383.160(1), commonly referred to as Kentucky's holdover statute. The statute outlines the ramifications when a tenant overstays the expiration of his or her lease. The statute provides:

If, by contract, a term or tenancy for a year or more is to expire on a certain day, the tenant shall abandon the premises on that day, unless by express contract he secures the right to remain longer. If without such contract the tenant shall hold over, he shall not thereby acquire any right to hold or remain on the premises for ninety (90) days after said day, and possession may be recovered without demand or notice if proceedings are instituted within that time. But, if proceedings are not instituted within ninety (90) days after the day of expiration, *570then none shall be allowed until the expiration of one (1) year from the day the term or tenancy expired.

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Bluebook (online)
566 S.W.3d 566, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smithfield-farms-llc-v-riverside-developers-llc-kyctapp-2018.