Southern Airways Co. v. De Kalb County
| Decision Date | 11 October 1960 |
| Docket Number | No. 20979,20979 |
| Citation | 216 Ga. 358,116 S.E.2d 602 |
| Parties | SOUTHERN AIRWAYS COMPANY v. DE KALB COUNTY. |
| Court | Georgia Supreme Court |
Syllabus by the Court
Though a lease of real property for a term of 5 years prima facie creates an estate for years, if, upon examination of the lease it is clearly shown that it was the intent of the parties to create the relationship of landlord and tenant, the lease will be so construed by the court. The Court of Appeals erred in holding that the lease contract between the parties conveyed an interest in the leased premises in the lessee and was violative of the rule against perpetuities.
Wm. G. Grant, Moise, Post & Gardner, Fisher, Phillips & Allen, Atlanta, for plaintiff in error.
George P. Dillard, Decatur, Spalding, Sibley, Troutman, Meadow & Smith, M. H. Blackshear, Jr., Atlanta, for defendant in error.
Southern Airways Company, a corporation, in its petition for a declaratory judgment against DeKalb County in substance alleged: On October 25, 1940, the county leased to it a described tract of land comprising 325 acres, known as Camp Gordon Airport, for a period of 15 years--the lease to begin on the date of the completion of the airport at a monthly rental of $550; that, on October 25, 1940, the plaintiff paid to the defendant $3,000 as advance rental. It was provided that, if the entire premises of the airport should be taken over by the United States Government for governmental functions, so that the lessee would be deprived of its rights, the beginning period of the lease would be terminated for the period in which the Federal Government would be in possession of the premises. On June 20, 1941, the United States Government took possession of the entire airport facilities before the facilities had been completed. Since that date the possession and use of the premises has been in the United States Government.
In the latter part of 1943, the parties entered into a new agreement covering the same airport property as contained in the 1940 contract. (The terms of this new agreement will be set out more fully hereinafter.) This lease by its express terms canceled and declared the 1940 lease contract to be null and void and provided that the 1943 lease constituted the full and complete 'Understanding and agreement respecting the leasing of the premises herein described in as full and complete manner as if the other instrument had never been executed.' It was alleged that, between October 25, 1940, and December 28, 1954, the plaintiff paid the defendant the sum of $11,700 as rental for the leased premises; that, in December, 1954, the defendant refunded to the plaintiff all of this amount except $1,000 which was left with the defendant as evidence of the plaintiff's good faith and as an initial deposit on any rentals that might accrue. It was alleged that, in April, 1954, the Federal Government announced its intention to surrender possession of the Camp Gordon Airport; and that the defendant had stated its intention to take possession of these premises to the exclusion of the plaintiff and deny to it its rights under the 1943 lease contract, the county contending that this lease contract was void.
The prayers of the petition were for a declaratory judgment declaring that the plaintiff had the right to the possession of the premises under the 1943 lease contract; and that the defendants be restrained from interfering with its rights under the contract.
The defendant's motion for a summary judgment was granted and a judgment was entered declaring the 1943 lease contract to be null and void. This judgment was affirmed by the Court of Appeals (100 Ga.App. 689, 115 S.E.2d 207). We granted the plaintiff's application for the writ of certiorari.
The Court of Appeals ruled that, under the allegations in the petition, the plaintiff had never gone into possession of the leased premises, and since its right to enter into possession was dependent upon the surrender of the airport premises by the Federal Government, which could extend to a period in excess of 21 years, the lease contract was void as being in violation of the rule against perpetuities. This ruling was predicated upon the court's ruling that the lease 'sought to grant the lessee an interest in the land to begin at a time in the future upon the happening of events which might or might not occur within 21 years.'
The primary question, and in our opinion the decisive one is: Did the contract lease of 1943 constitute a lease for years, in which the relation of landlord and tenant was established, or did it convey an estate for years, that is, convey an interest in the land? If the contract only gave an usufruct in the premises, the rule against perpetuities would not apply. If it conveyed an estate for years (assuming that the county could legally convey an interest in property owned by it and used for governmental purposes), the rule would be applicable.
While the rule as between private parties is that a lease for a term exceeding five years prima facie conveys an estate for years, if, upon examination of the lease agreement, it appears that the parties, either by express terms or by necessary implication, intended that the lessee should enjoy only the right to the possession and use of the leased premises, and it was not the purpose of the agreement to convey to the lessee any interest in the leased premises, the lease will be construed as creating the relationship of landlord and tenant and not as creating an estate for years. Warehouses, Inc. v. Wetherbee, 203 Ga. 483(3, 4, 5), 46 S.E.2d 894, and cases therein cited.
We must, in considering the provisions of the contract or lease agreement of 1943, do so in the light of the statutory provisions and decisions of this court. Code § 85-803 provides: 'An estate for years carries with it the right to use in as absolute a manner as a greater estate, but not to the injury of the property or of the person entitled either in remainder or reversion; the acts of omission and commission prescribed as grounds of forfeiture of an estate for life shall operate to the same effect as against a tenant for years.' Code § 61-101 declares:
The only authority for the defendant county to acquire or lease the premises in question is found in Chapter 11-2 of the Code, which authorizes a county to acquire, establish, construct and maintain airports and thereafter to lease to private parties for operation, space, area, improvements, and equipment on such airports; and where such airports are maintained by the county or leased to others, such use is declared to be for public or governmental purposes. We also recognize the general rule that property owned by the county and leased for public and governmental purposes cannot be alienated except by express legislative authority. Kirkland v. Johnson, 209 Ga. 824(1), 76 S.E.2d 396.
We will now examine and construe the contract lease of 1943. It recites that the county,...
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