Radha Krishna, Inc. v. Desai
| Decision Date | 15 December 2009 |
| Docket Number | No. A09A2324.,A09A2324. |
| Citation | 301 Ga. App. 638,689 S.E.2d 78 |
| Parties | RADHA KRISHNA, INC. v. DESAI, et al. |
| Court | Georgia Court of Appeals |
Davis, Matthews & Quigley, Vincent J. Arpey, for appellant.
Shawn F. Bratton, J. Michael McGarity, Buford, appellees.
In this breach of contract action, Radha Krishna, Inc. ("RK") sued Nimish K. Desai and his business Vaikunth, Inc. (collectively "Desai") for failure to pay operating costs allegedly owed pursuant to a commercial lease agreement. RK appeals the partial grant of summary judgment to Desai, contending that the trial court erred in ruling that Desai's status as a tenant at will barred RK's claims for operating costs for the period of time that Desai occupied the property after the lease expired, and in ruling that the statute of limitation barred RK's claims for operating costs incurred prior to June 20, 2001. For the reasons set forth below, we reverse.
Summary judgment is proper when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. OCGA § 9-11-56(c); Britt v. Kelly & Picerne, Inc.1 "On appeal from the grant or denial of a motion for summary judgment, we review the evidence de novo, and all reasonable conclusions and inferences drawn from the evidence are construed in the light most favorable to the nonmovant." (Punctuation omitted.) McCall v. Couture.2
So viewed, the record shows that on July 2, 1999, RK and Desai executed a 60-month commercial lease agreement, in which RK leased property in a shopping center to Desai for Desai's dry cleaning business. Desai moved his business onto the property in November 1999, after construction on the property was completed, and opened it a few months later. Under the terms of the lease Desai owed "Minimum Rent" in the amount of $1,250 per month for the first year and in the amount of $1,550 per month for years two through five. In addition, paragraph 3.5 of the lease, which was titled "Operating Costs," provided:
Tenants shall pay to Landlord along with its monthly installment of Minimum Rent, as Additional Rent, Tenant's Proportionate Share of all costs incurred by Landlord in maintaining, lighting, repairing, replacing, operating, cleaning, painting, landscaping, securing, managing, and insuring the portions of the Shopping Center which are the responsibility of Landlord hereunder (collectively, the "Operating Costs"). By way of illustration, but not limitation, Operating Costs shall include payments of ... real estate taxes and assessments associated with the Shopping Center.... Tenant's monthly payments of Operating Costs shall be based on estimates calculated by Landlord and such estimates shall be adjusted necessary as determined by Landlord. Tenant shall receive an annual reconciliation for each component of Tenant's Proportionate Share of Operating Costs.
(Emphasis supplied.)
By the beginning of 2001, the county was still in the process of re-classifying the property from "C-1 Undeveloped" to "C-1 Developed" for purposes of appraisal and taxation, and therefore RK had not been able to accurately calculate its operating costs associated with the shopping center. Accordingly, RK had not been billing or attempting to collect monthly Operating Costs from Desai. At that time, RK explained to Desai the reason that it had not been billing him for monthly Operating Costs but also informed him that he would be billed after the property classification issue was resolved. In 2003, the county finally resolved the classification issue and began taxing RK based on the new assessment. As a result, RK notified Desai that it would be providing him with a bill for the Operating Costs but, for reasons which are not clear from the record, did not do so.
The lease expired on July 2, 2004. RK alleges that the parties orally agreed to extend the lease prior to its expiration. Although Desai disputes this allegation, it is undisputed that for the next couple of years after this date, Desai continued occupying the property and operating his dry cleaning business, with RK's permission. During that time, Desai continued paying Minimum Rent, and RK continued to discuss calculation and payment of the Operating Costs with Desai. RK alleges that Desai never objected when it notified him that he would eventually be billed for the Operating Costs, and that Desai only requested that he not be billed a lump sum.
In early December 2006, Desai notified RK that he intended to vacate the property. A few weeks later, RK provided Desai with a bill for the Operating Costs for the period of time that Desai occupied the property, which totaled just over $33,000. Initially, Desai did not object to the bill but instead requested to review the documents that supported RK's total calculation. However, after reviewing the documents, Desai informed RK that he would not be paying the amount billed for the Operating Costs.
On June 20, 2007, RK sued Desai and his dry cleaning business, alleging breach of contract and claiming damages in the amount of $33,549.20. Desai filed an answer and eventually moved for summary judgment as to all of RK's claims. The trial court held a hearing on the matter, after which it issued an order granting Desai's motion in part and denying it in part. Specifically, the trial court found that Desai became a tenant at will when the lease expired and that his status as a tenant at will barred RK's claims for Operating Costs for the period of time that Desai occupied the property after the lease's expiration. The court also found that the six-year statute of limitation barred RK's claims for Operating Costs that were owed prior to June 20, 2001. The court denied Desai's motion for summary judgment as to RK's claims for Operating Costs owed between June 20, 2001, and July 2, 2004. This appeal followed.
1. RK contends that the trial court erred in partially granting summary judgment in favor of Desai on the ground that his status as a tenant at will after the lease expired barred RK's claims for Operating Costs for the period of time that Desai occupied the property after the lease's expiration. We agree.
It is undisputed that the lease in this matter expired on July 2, 2004, but that Desai continued to occupy the property for another two years, with RK's permission. RK claims that the parties orally agreed to extend the lease past the lease's expiration but does not specify the length of the alleged extension and...
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