College of Virgin Islands v. VITEX CORPORATION
Decision Date | 18 November 1966 |
Docket Number | Civ. No. 210-1965. |
Citation | 283 F. Supp. 379 |
Parties | COLLEGE OF the VIRGIN ISLANDS, Plaintiff-Appellee, v. VITEX CORPORATION, Defendant-Appellant. |
Court | U.S. District Court — Virgin Islands |
Russell B. Johnson, Christstiansted, V. I., for Vitex Corporation.
Peter O'Dea, Asst. Atty. Gen., for College of Virgin Islands.
The appeal of the above case from the decision of the Municipal Court of the Virgin Islands, Division of St. Thomas and St. John, was submitted on briefs and the above appearances were made; appellant was granted until August 7, 1966 to file a brief and appellee was granted until August 27, 1966 to file a response brief and appellant was granted until September 1, 1966 to file a rebuttal brief; the case was submitted for decision as of September 1, 1966.
Appellant contends that the document is in fact a license which has become irrevocable because of improvements made. Appellant argues that the expenditure ripened the license into a grant, an easement or a servitude. The distinction between a lease and a license is set forth in 32 Am.Jur., Landlord and Tenant, § 5 which provides: "A license to do an act upon land involves the exclusive occupation of the land by the licensee, so far as is necessary to do the act and no further, whereas a lease gives the right of possession of the land, and the exclusive occupation of it for all purposes not prohibited by its terms." See also Herigsted v. Hardrock Oil Co., 101 Mont. 22, 52 P.2d 171.
While it is true that a license coupled with a grant is irrevocable (33 Am.Jur., Licenses, § 102) the Court is not satisfied that this contract is a license. Western Union Telegraph Co. v. Pennsylvania Co., 3 Cir., 129 F. 849, which is cited merely exemplifies the rule stated above. That case involves a situation in which the contract in fact did only grant a right to construct, maintain and operate a telegraph line along a railroad right of way. The right to the land was given only for the performance of certain acts and amounted to an easement.
Defendant in this case asserts that the relationship between the parties was that of license rather than a tenancy because defendant asserts defendant did not have exclusive right to the premises as to the world (including, of course, plaintiff). A review of page one of the written agreement between the parties refutes this contention. The benefit, use and possession (in consideration of rent) was unequivocally transferred to defendant and could have been so enforced. The exceptions reserved to plaintiff were specific, were spelled out and set forth in the document (page one and page six paragraphs "n" and "o"). The Court is satisfied that the agreement between the parties was a lease with a right of cancellation reserved to plaintiff at any time with or without notice. Furthermore, the provisions allowing the landlord to terminate the contract without notice does not alter the lease relationship. Leases may and frequently do contain such provisions. 32 Am.Jur., Landlord and Tenant, § 830.
Plaintiff-appellee asserts that the lease being in writing and not ambiguous, the Court cannot receive parol evidence as to its terms. There is no issue asserting that the termination clause was ambiguous. The U. S. Court of Claims set forth the general rule as follows: "When provisions of lease contract are clear, general rule is that prior negotiations and conversations may not serve to vary the terms of an unambiguous document that is finally agreed upon." Mouat v. United States, 127 Ct.Cl. 590, 119 F.Supp. 499. "If a written agreement contains no obvious or latent ambiguities, neither the parties nor their privies may testify to what the parties meant but failed to state." Oxford Commercial Corp. v. Fred Landau et al., individually and as copartners doing business as Fred Landau § Co., 12 N.Y.2d 362, 239 N.Y.S.2d 865, 190 N.E.2d 230, 13 A.L.R.3d 309. See also Burns et al. v. Great Atlantic and Pacific Tea Co., Mass., 45 N.E.2d 739. Ramey v. Charles Koons individually and as a partner in a co-partnership d/b/a Charles A. Koons and Co., 9 Cir., 230 F.2d 802; Courtwright et al. v. Dommick, 22 Cal.App.2d 68, 70 P.2d 269, 20 Am.Jur. Evidence, § 1159, p. 1013; 32A C.J.S. Evidence § 919.
The only exceptions to the use of parol evidence in this situation would be if the language in issue is ambiguous or if there was fraud. Washburn v. Gillespie, 9 Cir., 261 F. 41. There is no issue raised as to ambiguity of the termination language or as to fraud.
Defendant asserts that this Court, being a court of equity, should apply the doctrine of equitable estoppel based upon the alleged representations of VICorp's president when the contract was being negotiated.
It would be best to deal at this point with the principal agent relationship in general. A corporation is bound by all parol contracts of its officers unless the act is ultra vires and the third party should so suspect. 19 Am.Jur.2nd § 1259. Officers of a corporation may impliedly have authority to enter into corporation contracts but not beyond their authority. 19 Am.Jur.2nd § 1176. In this case it is clear from the contract in evidence that VICorp intended that the lease could be broken by VICorp without notice. Defendant who asserts the affirmative defense of equitable estoppel has presented no proof that VICorp extended to its president the authority to represent to the contrary. The alleged act therefore would be ultra vires and the limitation being in the contract and being contrary to the alleged president's representation the defendant should have suspected that the alleged representation was ultra vires.
Defendant having had this actual knowledge, the principal (VICorp) and its assignee (plaintiff) cannot be bound. 3 Am.Jur. 2nd Agency, § 77. Defendant cites Murray v. Gadsden et al., 91 U.S.App.D.C. 38, 197 F.2d 194, 33 A.L.R.2d 554. In that case the court quoted Peugh v. Davis, 96 U.S. 332, 336, 24 L.Ed. 775, as follows: . The distinguishing language is apparent. The present case does not inquire as to the object of why the parties entered into the lease. The issue raised is merely as to the lease language per se. On that point Peugh v. Davis, supra, says parol evidence cannot vary the written instrument.
With respect to defendant's request that the plaintiff be equitably estopped, it should be noted that an essential element of equitable estoppel that the assisting party prove a lack of knowledge of and a lack of the means of knowledge of the truth as to the facts. The evidence showed that the defendant had knowledge of the termination provision. The defendant did not show that it lacked the means to ascertain the policy of enforcement of the clause.
The following cases clarify whether the U. S. can be equitably estopped by an act of one of its agents. "The Government is not responsible for the . . . wrongful acts of its officers." Hart et al. v. United States, 95 U.S. 316, 24 L.Ed. 479. United States v. Steward (1940) 311 U.S. 60, 61 S.Ct. 102, 85 L.Ed. 40.
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