Spokane Airport Bd. v. Experimental Aircraft Ass'n, Chapter 79

495 P.3d 800
Washington Supreme Court·Decided September 30, 2021·No. 99180-4·Published·Cited by 1 cases

Opinion

FILE THIS OPINION WAS FILED FOR RECORD AT 8 A.M. ON SEPTEMBER 30, 2021 IN CLERK’S OFFICE SUPREME COURT, STATE OF WASHINGTON SEPTEMBER 30, 2021 ERIN L. LENNON SUPREME COURT CLERK

IN THE SUPREME COURT OF THE STATE OF WASHINGTON

SPOKANE AIRPORT BOARD, ) No. 99180-4 ) Petitioner, ) ) v. ) EN BANC ) EXPERIMENTAL AIRCRAFT ) ASSOCIATION, CHAPTER 79, ) ) Filed : September 30, 2021 Respondent. ) ______________________________ )

MONTOYA-LEWIS, J.—Under RCW 59.12.030(1), a tenant who leases

premises for a specified term or period becomes a holdover tenant liable for unlawful

detainer when they remain in possession of the premises “after the expiration of the

term for which it is let to him or her.” The question before the court is whether a

tenant in a fixed-term commercial lease can become a holdover tenant when the

tenancy ends pursuant to an early termination provision. The tenant argues that this

unlawful detainer provision applies only when the tenant remains after the end of

the original term specified in the lease. We disagree. We hold that in this case,

exercising the no-fault early termination provision in the lease revised the term of Spokane Airport Bd. v. Experimental Aircraft Ass’n Ch. 79 No. 99180-4

the lease, and the term expired on the revised termination date. Therefore, the tenant

became a holdover tenant under RCW 59.12.030(1) when they continued in

possession of the leased premises after that date. Accordingly, we reverse.

I. FACTS AND PROCEDURAL HISTORY

A. Factual Background

In 2011, Experimental Aircraft Association, Chapter 79 (EAA), entered into

a lease agreement with the Spokane Airport Board (Airport) to rent an aircraft hangar

at Felts Field airport in Spokane. EAA leased Building 7 “to offer facilities and

training for aircraft construction, restoration, and flight training.” 2 Clerk’s Papers

(CP) at 417.

Article 1 of the original lease agreement specified a term of 5 years, from

March 1, 2011, to February 28, 2016, “unless sooner terminated or canceled as

herein provided.” Id. at 34. The next sentence of that clause also stated, “Either party

may cancel this Agreement upon one hundred eighty (180) days advance written

notice.” Id.

Other provisions of the lease addressed the circumstances under which the

parties could terminate the lease for cause; some delineated specific notice

requirements and cure periods, while others were silent as to notice. For example,

Article 5 entitled the landlord to reenter and take possession of the premises when a

tenant failed to pay rent, and it specified a 10-day notice and cure period. Article 23

2 Spokane Airport Bd. v. Experimental Aircraft Ass’n Ch. 79 No. 99180-4

addressed the landlord’s rights of cancellation if the tenant breached any of its

covenants in the lease, and it specified a 30-day notice and cure period. It also

permitted the landlord to terminate the lease under various circumstances involving

the tenant’s bankruptcy, which did not require any form of notice from the landlord.

These termination rights were “[i]n addition to any conditions as specified herein

and all other remedies available to the Airport.” Id. at 46. Article 24 addressed the

tenant’s rights of cancellation. Similar to the provisions addressing the landlord’s

rights, some of the tenant provisions required written notice and/or the passage of a

specified time period (60 days for the Airport’s breach of any lease covenants, 90

days for actions by the federal government that restrict use of the premises), while

others would apparently be automatic (e.g., abandonment or force majeure).

The lease also included an option to renew for an additional 5-year term. In

February 2016, the parties executed an amendment to the lease agreement, amending

the term to “five (5) years commencing March 1, 2016 and ending February 28, 2021

unless sooner terminated or canceled as herein provided.” Id. at 56. The term

provision in the lease amendment reiterated the language, “Either party may cancel

this Agreement upon one hundred eighty (180) days advance written notice.” Id. The

amendment adjusted the amount of rent due but otherwise stated that “[a]ll other

terms and conditions [of the original lease agreement] . . . shall remain in full force

and effect.” Id. at 57.

3 Spokane Airport Bd. v. Experimental Aircraft Ass’n Ch. 79 No. 99180-4

On November 28, 2017, the Airport provided written notice to EAA that it

was canceling the lease with 180 days’ notice, effective May 29, 2018. The Airport

informed EAA that it was terminating the lease for Building 7 because the hangar

was going to be demolished to allow construction of a new building. The Airport

indicated that it hoped to work with EAA to lease a portion of a different hangar and

that, since the Airport planned to move forward with the construction project as soon

as possible, EAA may need to move into the other building before the lease ended. 1

The written notice stated that the Airport was canceling the lease “[p]ursuant to

Article 1 – Term, either party may cancel this agreement upon providing 180 days

written notice.” Id. at 60.

Over the next nine months, EAA and the Airport tried to determine whether

another hangar, Building 17, would provide a suitable space for EAA to lease.

Meanwhile, since the construction project did not move forward as quickly as the

Airport had anticipated, the Airport sent EAA several notices extending its

occupancy in Building 7, eventually extending the termination of the lease to August

17, 2018. 2

1 The lease provided that the Airport may require the tenant to relocate if it determined relocation was “necessary for the orderly expansion and development of the [Felts Field] facilities.” 2 CP at 52. 2 The parties do not advance any arguments regarding the validity or effect of the extensions. We view it conceded that if the Airport was permitted to terminate the lease early at will, it was also permitted to extend the termination date to August 17, 2018, with notice to EAA. 4 Spokane Airport Bd. v. Experimental Aircraft Ass’n Ch. 79 No. 99180-4

As the final deadline for EAA’s occupancy of Building 7 approached, the

Airport began preparing to coordinate EAA’s move to Building 17. The Airport

made arrangements to move EAA to Building 17 the week of August 13, 2018, and

obtained EAA’s consent to an indemnification agreement for the move—but it had

to cancel the reservation with the moving company when EAA failed to find a

member who could be present to oversee the move. The parties also negotiated over

a new lease for Building 17 to begin September 1, 2018, but EAA never signed the

new lease agreement. August 17, 2018, passed, and EAA remained in Building 7.

B. Procedural History

On August 20, 2018, the Airport filed a complaint for unlawful detainer under

RCW 59.12.030(1). The superior court issued an order authorizing a writ of

restitution and issued the writ the same day. EAA filed a motion to stay the writ, but

the court fixed the bond at an amount much higher than what EAA proposed, and

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Spokane Airport Bd. v. Experimental Aircraft Ass'n, Chapter 79, 495 P.3d 800 (Wash. 2021).

495 P.3d 800 (Spokane Airport Bd. v. Experimental Aircraft Ass'n, Chapter 79) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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