Union Bldg. Materials Corp. v. Kakaako Corp.

682 P.2d 82
CourtHawaii Intermediate Court of Appeals
DecidedMay 29, 1984
Docket9030
StatusPublished
Cited by17 cases

This text of 682 P.2d 82 (Union Bldg. Materials Corp. v. Kakaako Corp.) is published on Counsel Stack Legal Research, covering Hawaii Intermediate Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Union Bldg. Materials Corp. v. Kakaako Corp., 682 P.2d 82 (hawapp 1984).

Opinion

682 P.2d 82 (1984)

UNION BUILDING MATERIALS CORP., Plaintiff-Appellant, Cross-Appellee,
v.
The KAKAAKO CORPORATION and Partnership Pacific Bank, N.V., Defendants-Appellees, Cross-Appellants.

No. 9030.

Intermediate Court of Appeals of Hawaii.

April 10, 1984.
As Amended April 17, 1984.
As Amended May 29, 1984.

*84 W. Patrick O'Connor, Honolulu (Barlow & O'Connor, Honolulu, of counsel), for plaintiff-appellant, cross-appellee.

Daral G. Conklin, Honolulu (Chad P. Love, Honolulu, with him on the briefs; Conklin, Schneider & Love, Honolulu, of counsel), for defendants-appellees, cross-appellants.

Before BURNS, C.J., and HEEN and TANAKA, JJ.

HEEN, Judge.

Plaintiff, appellant-cross appellee, Union Building Materials Corp. (Union) and defendants, appellees-cross appellants, The Kakaako Corporation and Partnership Pacific Bank N.V. (hereafter Kakaako and Pacific, or collectively Defendants where appropriate) have appealed from the declaratory judgment of the trial court. We affirm the trial court's holding that the sublease between the parties is a valid sublease, *85 but reverse its holding that the sublease is for a term of years.

On September 7, 1978, Union sued Kakaako for damages alleging that Kakaako had breached the terms of a sublease between Kakaako, as sublessor, and Union, as sublessee, and had committed certain tortious acts. Pacific was joined later as a co-defendant. Kakaako and Pacific denied Union's allegations. Kakaako counterclaimed for damages and for a declaratory judgment "decreeing and determining the date and conditions upon which [the sublease] will terminate."

Jury trial on the parties' monetary claims and a concurrent bench trial on Kakaako's declaratory relief counterclaim began on September 21, 1981. The jury's verdict awarding money damages to Union was entered on October 2, 1981, and on December 2, 1981, the court entered its findings of fact, conclusions of law and declaratory judgment on Kakaako's counterclaim. In response to Union's motion, the court filed amended findings of fact and conclusions of law and declaratory judgment on August 25, 1982. Union filed its notice of appeal on September 24, 1982, and Defendants filed their notice of cross-appeal on October 8, 1982.[1] The parties have not appealed from the jury verdict.

The appeals will be discussed seriatim.

FACTS

The sublease was originally entered into by Mainline Harbor Properties (MHP), as sublessor, and Union, as sublessee, effective November 25, 1974. Pacific acquired the sublease in June 1976, upon MHP's default on its mortgage to Pacific, and transferred the sublease to Kakaako in June 1977. The sublease demised to Union approximately 100,525 square feet of the property in downtown Honolulu known as the "Iron Works" property owned by the B.P. Bishop Estate. The total area of the property exceeds 9 acres.

The dispute involves the interpretation of the following provision of the sublease:

2. TERM. The term of this sublease shall commence at 8:00 a.m. on November 25, 1974 and shall continue, thereafter, until the premises occupied by the sublessee under this sublease shall be required by MHP or its successors and assigns for major redevelopment of five million dollars ($5,000,000.00) or more by the sublessor. In order to cancel said sublease, the sublessor shall be required to give the sublessee one hundred twenty (120) days advance written notice prior to the starting date of physical redevelopment; which date shall be the corresponding termination date of this sublease. The sublessee may cancel this sublease at any time by giving the sublessor one hundred twenty (120) days advance written notice by registered mail of sublessee's intention to terminate the sublease.

The court's amended findings of fact, conclusions of law and declaratory judgment are as follows:

1. Sublease No. 19, the subject matter of this litigation, has sufficient definiteness to constitute a sublease for a term of years. The provisions under paragraph 3 Rent reflect that the parties intended that the sublease run for a period of years. There is also a definite outside termination date as the sublease must terminate upon expiration of the Bishop Estate Master Lease.
2. Paragraph 2 Term provides for an earlier termination date upon fulfillment of certain conditions that were bargained for and agreed upon between the parties. One condition is that the premises occupied by Plaintiff under the Sublease be required by Defendant or its successors as a part of a major redevelopment project of $5,000,000.00 or more.
3. The evidence clearly reflects that the parties intended that $5,000,000.00 be *86 expended on a redevelopment project which would include the premises occupied by Plaintiff under Sublease No. 19. Furthermore, Defendants went to great lengths at the trial to show that considerably more than $5,000,000.00 will be spent on a project which includes Plaintiff's premises as part of the proposed major redevelopment.
4. Paragraph 2 Term of Sublease No. 19 also provides:
"... In order to cancel said sublease the sublessor shall be required to give the advance written notice prior to the starting date of physical redevelopment; which date shall be the corresponding termination date of the sublease..."
The evidence also reflects that the parties fully intended that Plaintiff be permitted to remain upon the premises until the start of physical redevelopment and that this would be triggered by commencement of actual demolition of improvements existing on the subject premises.
5. This event is capable of ascertainment and is not so ambiguous or vague as to render the provision meaningless. Furthermore, this language was put into final form by Defendant-landlord and it should not be permitted to use the same to defeat both the operation of the contract or the expressed intent of the parties.
CONCLUSIONS
1. Sublease No. 19 is a valid sublease for a term of years.
2. Said Sublease will terminate upon expiration of the Bishop Estate Master Lease and may be terminated earlier pursuant to provisions in paragraph 2 Term of said Sublease.
3. Paragraph 2 Term requires that the sublessor expend at least $5,000,000.00 on a major redevelopment project which includes Plaintiff's demised premise.
4. Paragraph 2 Term further requires that the sublessor give Plaintiff 120 days advance written notice prior to the starting date of physical redevelopment, that is, the commencement date of actual demolition of improvements existing on the subject property, which date shall be the corresponding termination date of the sublease.
JUDGMENT
IT IS HEREBY ORDERED, ADJUDGED, DECREED AND DECLARED that Sublease No. 19, dated November 25, 1974, concerning real property described therein and located at the area commonly known as "The Ironworks", is a valid sublease for a term for years and may be terminated prior to expiration of the master lease in accordance with the provisions of paragraph 2 Term

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Bluebook (online)
682 P.2d 82, Counsel Stack Legal Research, https://law.counselstack.com/opinion/union-bldg-materials-corp-v-kakaako-corp-hawapp-1984.