Great American Airways, Inc. v. Airport Authority of Washoe County

• Citation: 743 P.2d 628,103 Nev. 427
• Decision Date: 07 October 1987
• Docket Number: No. 17248,17248
• Parties: GREAT AMERICAN AIRWAYS, INC., a Nevada corporation, Appellant, v. AIRPORT AUTHORITY OF WASHOE COUNTY, Respondent.
• Court: Supreme Court of Nevada

Page 628

743 P.2d 628

103 Nev. 427

GREAT AMERICAN AIRWAYS, INC., a Nevada corporation, Appellant, v. AIRPORT AUTHORITY OF WASHOE COUNTY, Respondent.

No. 17248.

Supreme Court of Nevada.

Oct. 7, 1987.

Bowen, Swafford, Hoffman, Test & Dickey, Reno, for appellant.

Erickson, Thorpe, Swainston & Cobb, Reno, for respondent.

OPINION

STEFFEN, Justice:

Great American Airways (Great American) sued the Airport Authority (Authority), claiming damages under theories of negligence and breach of contract. The trial court dismissed Great American's complaint on a Rule 41(b) motion at the conclusion of plaintiff's case. This appeal ensued.

On February 27, 1983, while attempting to take off from a runway at Reno-Cannon Great American contends that it had proved both its claims. We agree with the trial court's disposition of the tort claim, but conclude that the court erred in dismissing the claim for breach of contract.

                International Airport, a Great American jet allegedly struck a large chunk of ice, damaging the airplane's nose wheels, fuselage and engines. 1  The pilot landed safely and the passengers were transferred to another airplane.  The record indicates that the weather that morning was dry and the runway was clear of snow and slush.  In addition, the Authority had inspected the runway at least once during the two hours prior to takeoff
                

The written agreement between Great American and the Authority provided, in pertinent part, as follows:

ARTICLE 9

OBLIGATIONS OF AUTHORITY

Section 9.01--Operation and Maintenance of the Authority

A. Authority agrees, except as herein otherwise provided, that it will, during the term of this Agreement, operate and maintain the Authority facilities in a safe, workable, clean, and sanitary condition, and in good repair and free from obstructions, including such clearing and removal of snow that is reasonably necessary to permit operations and as soon as it is practical for Authority to do. Authority agrees to maintain and operate the Authority facilities so that they are suitable for Lessee [Great American] to use in its air transport operations (emphasis supplied).

The trial court apparently construed this provision as requiring the Authority to remove obstructions from the runways to a degree "reasonably necessary to permit operations." Accordingly, Great American was denied relief on the basis that the Authority had, in fact, maintained the runway in a condition sufficiently free of obstructions to permit Great American's use of the runway.

When, as here, a trial court has interpreted a contract solely from its written terms, this court may apply a plenary review without deference to the lower court's interpretation. Caldwell v. Consolidated Realty & Management Co., 99 Nev. 635, 668 P.2d 284 (1983).

The preeminent rule of construction is to ascertain the intention of the contracting parties. Barringer v. Gunderson, 81 Nev. 288, 302, 402 P.2d 470, 477 (1965). If that intention is clear from the text, no construction is required, id., 81 Nev. at 302-03, 402 P.2d at 477, and this court is bound by the language of the agreement, Watson v. Watson, 95 Nev. 495, 596 P.2d 507 (1979).

As previously noted, no extrinsic evidence was taken to shed light on the intent and meaning of section 9.01 of the contract. When read in its entirety, the phrase "that is reasonably necessary to permit operations" clearly appears to modify only the Authority's responsibility concerning the clearing and removal of snow. In drafting the contract, the Authority did not specify that it would keep the runways "reasonably" free from obstructions. To the contrary, the requirement to maintain the facilities "free of obstructions" is unqualified and consistent with the Authority's contractual obligation to maintain its facilities "so that they are suitable for Lessee [Great American] to use in its air transport operations." By modifying the Authority's express agreement to keep its facilities "free of obstructions," the district court effectively revised the agreement while professing to construe it. This the court was not free to do. Geo. B. Smith Chemical Works v. Simon, 92 Nev. 580, 582, 555 P.2d 216, 217 (1976).

This reading of the contract does not lead to absurd results. When runway obstructions cause damage or injury, the burden must fall on someone. If the Authority had intended that Great American bear such losses, it could have so specified. Since it failed to do so, we must assume that the Authority willingly assumed the risk of loss, based upon such considerations as an effective preventive maintenance program insurance, and adequate charges to the users of its facilities.

Although Great American presented substantial evidence indicating that ice caused the damage sustained by its aircraft, the 41(b) dismissal precluded consideration of the Authority's evidence, if any, to the contrary. A new trial is therefore required on the issue of contract liability.

The judgment of the district court is affirmed as to Great American's negligence claim, but reversed as to its claim for breach of contract. The matter is remanded to the district court for a new trial consistent with this opinion.

YOUNG and MOWBRAY, JJ., concur.

SPRINGER, Justice, dissenting:

The Airport Authority was sued by Great American for damage incurred by one of its airplanes when it struck a "chunk of ice" on the runway. Great American's tort action was dismissed, but the majority permits it to pursue its claim for damages in the form of a contract action.

With the negligence action out of the picture, the Authority is now...