Metro Office Parks Co. v. Control Data Corp., 43411
| Decision Date | 16 February 1973 |
| Docket Number | No. 43411,43411 |
| Citation | 205 N.W.2d 121,295 Minn. 348 |
| Parties | METRO OFFICE PARKS COMPANY, Respondent, v. CONTROL DATA CORPORATION, Appellant. |
| Court | Minnesota Supreme Court |
Oppenheimer, Brown, Wolff, Leach & Foster and John D. Healy Jr., John H. Wolf, and Harris Ravine, St. Paul, for appellant.
Haverstock, Gray, Plant, Mooty & Anderson and Robert E. Bowen and John S. Crouch, Minneapolis, for respondent.
Heard before KNUTSON, C.J., and PETERSON, MURPHY, and SCHULTZ, JJ.
Plaintiff lessor, Metro Office Parks Company (Metro), instituted a declaratory judgment action against defendant lessee, Control Data Corporation (Control Data), to interpret or, alternatively, to reform two leases, as amended by a supplementary agreement, the effect of which would prohibit defendant lessee, upon termination of the leases, from initially vacating more than 25,000 square feet of leased premises aggregating more than 61,000 square feet.
The two leases between the parties were negotiated in three steps. The first lease, made on April 5, 1968, involving approximately 30,000 square feet of office space, was for the term of June 1, 1968, to May 31, 1971. The second lease, made on August 29, 1968, involving nearly 24,000 square feet of office space, was for the term of October 1, 1968, to September 30, 1971. The second lease was amended on March 15, 1969, to include additional office space of approximately 8,000 square feet. Each lease granted Control Data the option to extend the lease for a 5-year period. There is no dispute with respect to the contents of these basic lease instruments.
Two separate instruments relating to the amendment of the leases are the subject of this litigation. The first is a letter of intent, dated July 25, 1968, prior to the date of the second lease and incident to the negotiation of that lease, which in pertinent part provided:
'Pursuant to our discussions, we are pleased to offer Control Data Corporation 24,500 sq. ft. of office space in Metro Office Park Building #2, 7850 Metro Parkway. * * * The terms and conditions are to be the same as the terms and conditions of the existing lease by and between Control Data and Metro for space in Metro #1 with the following modifications:
3. The term of the lease is to be for three years.
4. Metro and Control Data Corporation will agree to modify the lease so that regardless of anything in either of the leases, Control Data Corporation will note vacate more than 25,000 sq. ft. in any 12 month period.'
The second instrument in dispute is a subsequent supplementary agreement dated September 30, 1968, which in the following pertinent parts undertook more formally to modify the first and second leases:
'WHEREAS, Article XXIII of the 7800 Metro Parkway lease and of the 7850 Metro Parkway lease gives unto the Lessee the option to extend the term thereof for a period of five (5) years and further provides that the Lessee shall have the right to terminate the lease at any time after the option to extend the original term has been exercised by giving written notice unto the Lessor at least twelve months prior to the date of any such termination; and
'WHEREAS, it is the desire and intent of the parties hereto to amend and modify the 7800 Metro Parkway lease and the 7850 Metro Parkway lease to grant unto the Lessee the right to vacate portions of the premises demised thereunder after the initial term of the leases pursuant to the notice requirement set forth in Paragraph XXIII of said leases provided, however, that CDC shall not vacate more than 25,000 square feet in any given twelve month period, all in accordance with the provisions contained herein;
Subsequent to its execution of the supplementary agreement, Control Data decided to construct its own office building, located in the immediate vicinity of the Metro buildings. Control Data elected not to exercise its option to renew either of the Metro leases and, instead, undertook to return the whole of the leased office space to Metro upon expiration of the initial terms of the leases. The effect would be to vacate the more than 61,400 square feet within a 4-month period.
The issue in the trial court was whether, as Control Data contended, the vacation-limiting provisions of the supplementary agreement applied only to vacations upon termination of any Extended period of the leases or whether, as Metro contended, it applied as well to vacations upon termination of the Original periods of the leases. The court sustained the contention of Metro, finding that the parties intended to prohibit the vacation of more than 25,000 square feet of space in Any 12-month period.
1. The trial court's interpretation of the supplementary agreement was based upon parol evidence, the court having made a threshold finding that the agreement was ambiguous. The court expressed the ambiguity in these words:
'Exhibit E is ambiguous in that the first operative paragraph thereof numbered 1 could be construed to mean either: (1) that defendant is prohibited from vacating more than 25,000 square feet of space within any twelve month period, including the period which includes the expiration dates of Lease No. 1 and Lease No. 2; or (2) that defendant is not prohibited from vacating more than 25,000 square feet of space within a twelve month period where said vacation occurs by reason of the expiration of the initial terms of Lease No. 1 or Lease No. 2 or both, and that the limitation on vacation applies only to vacations which occur by reason of termination of the extended terms of said Leases.'
We do not agree with this threshold finding of ambiguity. A writing is ambiguous if, judged by its language alone and without resort to parol evidence, it is reasonably susceptible of more than one meaning. Employers Lia. Assur. Corp. v. Morse, 261 Minn. 259, 111 N.W.2d 620 (1961). Except for our reservation as to the determination that the agreement was ambiguous, we would have no reservation as to the court's resolution of the asserted ambiguity.
The first sentence of the crucial paragraph 1 of the supplementary agreement, like most of the paragraphs of the agreement plainly refers to a period 'after the expiration of the initial term and the commencement of the extension of the original term.' This language clearly excludes the unextended, original term.
The second sentence of that paragraph 1, to be sure, contains no such words of limitation:
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