Hoyle, Tanner & Assocs., Inc. v. 150 Realty, LLC
| Citation | 215 A.3d 491,172 N.H. 455 |
| Decision Date | 30 July 2019 |
| Docket Number | No. 2018-0182,2018-0182 |
| Parties | HOYLE, TANNER & ASSOCIATES, INC. v. 150 REALTY, LLC & a.; McLean Communications, LLC v. 150 Realty, LLC & a.; At Comm Corporation v. 150 Realty, LLC & a. |
| Court | Supreme Court of New Hampshire |
Sheehan, Phinney, Bass & Green, PA, of Manchester (James F. Ogorchock, Megan C. Carrier, and Bryanna K. Devonshire on the brief, and Ms. Devonshire orally), for the plaintiffs.
Hinckley, Allen & Snyder, LLP, of Manchester (Christopher H.M. Carter and Jamie S. Myers on the brief, and Mr. Carter orally), for the defendants.
The defendants, 150 Realty, LLC and Harbour Links Estates, LLC, appeal orders of the Superior Court (Brown and Schulman, JJ.) denying their motions to dismiss or stay actions filed by the plaintiffs, Hoyle, Tanner & Associates, Inc. (HTA), McLean Communications, LLC (McLean), and At Comm Corporation. The trial court ruled that the plaintiffs' claims relating to the defendants' imposition of certain parking rules and fees did not fall within the scope of identical arbitration clauses included in each of the plaintiffs' lease agreements. The Trial Court (Brown, J.) also granted partial summary judgment to HTA and McLean on their declaratory judgment claims, concluding that the defendants' parking rules that assess fees for certain parking spaces were unenforceable. We affirm.
Accepting the allegations in the plaintiffs' complaints to be true, Cluff-Landry v. Roman Catholic Bishop of Manchester, 169 N.H. 670, 671, 156 A.3d 147 (2017), the pertinent facts are as follows. The plaintiffs lease commercial space located at 150 Dow Street in Manchester. Their tenancies commenced between 1992 and 2001, after they entered into separate lease agreements with the property owner, One Dow Court, Inc. (ODC). The lease agreements allot each plaintiff a specific number of parking spaces adjacent to the 150 Dow Street building and allow the plaintiffs to use additional spaces in other parking areas. Each agreement also provides that "lessee's parking rights are subject to lessor's reasonable rules and regulations." (Capitalization omitted).
The agreements also contain identical provisions in a section captioned "applicable law," that state:
(Capitalization omitted).
In the years following the execution of the lease agreements, ODC assigned HTA and McLean additional parking spaces at 150 Dow Street pursuant to certain lease amendments. However, ODC never charged the plaintiffs a fee for parking. According to the plaintiffs, the original property owner included the cost of parking in the base rent paid by the lessees.
In early 2017, the defendants purchased 150 Dow Street from ODC and thus assumed a landlord-tenant relationship with the plaintiffs. In August 2017, the defendants notified the plaintiffs of new parking rules effective as of October 1, 2017. The new rules require tenant employee vehicles to display a valid front parking tag and a valid rear window parking sticker, and impose monthly fees upon the tenants to validate the parking tags and stickers.
In September 2017, HTA filed a complaint against the defendants in the trial court contesting the new parking rules. The complaint alleges breach of contract and anticipatory breach and requests, inter alia, an injunction, declaratory judgment, and damages. McLean filed a similar complaint, with an additional claim of breach of the covenant of good faith and fair dealing. In October 2017, At Comm also filed a complaint against the defendants in another trial court, alleging the same claims as those alleged in McLean's complaint. After HTA and McLean initiated suit, the defendants filed demands for arbitration with the American Arbitration Association (AAA) alleging that the plaintiffs failed to comply with the new parking rules. Shortly thereafter, the Trial Court (Brown, J.) in the HTA action stayed the implementation of the new parking rules until the resolution of the underlying contractual disputes.
The defendants moved to dismiss the plaintiffs' actions or, in the alternative, stay the actions pending arbitration. They argued that the incorporation in the lease agreements of the AAA rules required that an arbitrator, rather than the court, decide whether the dispute was subject to arbitration. They also argued that, regardless of which forum decides this threshold question, the underlying dispute falls within the scope of the arbitration clause and therefore must be resolved in arbitration. These motions were denied.
Shortly thereafter, the Trial Court (Brown, J.) granted a motion for summary judgment filed by HTA and McLean on their requests for declaratory judgment. Eventually, all three actions were consolidated, and the parties filed a joint motion requesting the trial court's approval of, inter alia, the plaintiffs' nonsuit, without prejudice, of all remaining claims, and the parties' stipulation that the trial court's orders on the motions to dismiss and summary judgment applied to all of the consolidated cases. The trial court granted the motion, and this appeal followed.
On appeal, the defendants contend that the trial court erred in two respects. First, they argue that the parties "clearly and unmistakably intended that an arbitrator, not the court, determine any question of arbitrability." Second, they argue that the dispute falls within the scope of the arbitration clause because the lease agreements allow the defendants to submit "any dispute" between the parties "pertaining to this Lease" to binding arbitration.
The defendants' arguments require that we interpret the language of the lease agreements. Because a lease is a form of contract, we construe a lease by applying the standard rules of contract interpretation. Town of Ossipee v. Whittier Lifts Trust, 149 N.H. 679, 685, 827 A.2d 989 (2003). The proper interpretation of a contract is ultimately a question of law for this court to determine. N.A.P.P. Realty Trust v. CC Enterprises, 147 N.H. 137, 139, 784 A.2d 1166 (2001). A contract is interpreted to reflect the parties' intentions at the time of contracting. Id. In the absence of ambiguity, the intent of the parties to a contract is to be determined from the plain meaning of the language used. Whittier Lifts Trust, 149 N.H. at 685, 827 A.2d 989. The parties' contractual terms and phrases will be assigned their common meaning, and we will ascertain the intended purpose of the contract based upon the meaning that would be given to it by a reasonable person. See id.
When parties enter into an agreement to arbitrate certain disputes, the resolution of those disputes falls within the jurisdiction of the arbitrator, rather than the court. See RSA 542:2 (2007); see also John A. Cookson Co. v. N.H. Ball Bearings, 147 N.H. 352, 361, 787 A.2d 858 (2001) (). The underlying disagreement on appeal is whether the parties' dispute involves a matter that the parties have contractually agreed to submit to arbitration. Thus, the parties disagree as to the substantive arbitrability of the dispute. See Appeal of Hillsborough County Nursing Home, 166 N.H. 731, 734, 103 A.3d 1186 (2014) . However, as an initial matter, the parties disagree as to whether the court or the arbitrator has the authority to decide the arbitrability of the dispute.
We have long held that the court, and not the arbitrator, determines the question of arbitrability. See Aetna Life & Cas. Co. v. Martin, 134 N.H. 90, 93, 588 A.2d 813 (1991). As with any general rule, however, there are exceptions. Thus, we have also held that parties to an arbitration agreement "may agree to submit even the question of arbitrability to the arbitrator for decision." Appeal of Police Comm'n of City of Rochester, 149 N.H. 528, 534, 823 A.2d 757 (2003) (quotation omitted). "Where the parties clearly and unmistakably submitted the issue of arbitrability to the arbitrator without reservation," the arbitrator, rather than the court, has the authority to make this determination. Id. (quotation omitted). Nonetheless, in the absence of contractual language "clearly and unmistakably provid[ing] otherwise, the question of whether the parties agreed to arbitrate is to be decided by the [court], not the arbitrator." Appeal of Town of Durham, 149 N.H. 486, 488, 821 A.2d 1097 (2003) (quotations omitted); see also Howsam v....
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