Malone & Hyde, Inc. v. West & Co. of La, Inc., 89-99

• Decision Date: 20 November 1989
• Docket Number: No. 89-99,89-99
• Citation: 300 Ark. 435,780 S.W.2d 13
• Court: Arkansas Supreme Court
• Parties: MALONE & HYDE, INC., T. Gerald Bowen Enterprises, Inc., and T. Gerald Bowen, Appellants, v. WEST & COMPANY OF LA, INC., et al., Appellees.

Page 13

780 S.W.2d 13

300 Ark. 435

MALONE & HYDE, INC., T. Gerald Bowen Enterprises, Inc., and T. Gerald Bowen, Appellants, v. WEST & COMPANY OF LA, INC., et al., Appellees.

No. 89-99.

Supreme Court of Arkansas.

Nov. 20, 1989.

James P. Beachboard, Mark H. Allison, Little Rock, for appellants.

George Pike, Jr., Little Rock, for appellees.

HICKMAN, Justice.

The controversy in this case is over the interpretation of the leases of two tenants in the North Mall Shopping Center in Conway. The appellant, T. Gerald Bowen, operates a Piggly Wiggly grocery store in the shopping center. The appellee, West & Company, originally operated a discount department store in the center. In 1986, West sublet its premises to the appellee, Sutherland Lumber and Home Improvement Company. Sutherland opened a Crate Deals store, which, according to its sublease, was to be an outlet for building materials, garden supplies, tools, electronic equipment, and home improvement and personal items.

At some point in 1986, Crate Deals began to sell grocery items. The appellants complained that their lease contained a provision in which the lessor, Trent & Company, agreed to prohibit any other tenant in the center from selling groceries, meat, dairy products or produce. When Crate Deals refused to cease its competitive sales, the appellants filed suit seeking an injunction and damages.

Crate Deals argued that its predecessor in the lease, West, had executed its lease on February 9, 1973. At that time, the Piggly Wiggly lease was not yet in existence, having been executed a month later. Therefore, Crate Deals claimed, it did not have to abide by the covenant in the Piggly Wiggly lease. The appellants pointed to a provision in West's lease that the premises could only be sublet if the sublease did not conflict with any lease existing at the time of the sublease. At the time of the sublease to Crate Deals, the Piggly Wiggly lease was in existence. Therefore, the appellants claim, Crate Deals is bound to abide by the covenant through the doctrine of equitable servitude.

The appellants filed a motion for a partial summary judgment seeking a permanent injunction. Attached to the motion were affidavits showing that Crate Deals had sold meat, dairy products, and a wide variety of fresh produce. The affidavits also showed that during the Christmas season, Crate Deals brought in a forty-foot trailer from which it sold turkeys at an extreme discount.

Crate Deals did not deny that it was selling the detailed items, but claimed that such sales were minimal when compared with its overall sales. It was also argued that Crate Deals was maintaining the operation of a discount department store, as contemplated by the original lease to West.

The trial judge refused to grant the injunction and this appeal followed. The basis for the appeal is ARAP Rule 2(a)(6) which provides that an...