Justia Landlord - Tenant Opinion SummariesArticles Posted in US Court of Appeals for the Tenth Circuit
Safeway Stores v. WY Plaza
This appeal grew out of overpayments that lessee, Safeway Stores 46, Inc., made to its lessor, WY Plaza, L.C. The lease allowed Safeway to deduct construction costs from the payments to WY Plaza. But Safeway neglected to make these deductions for twelve years before demanding repayment. WY Plaza rejected the demand based on Safeway’s delay. Safeway responded by paying under protest and suing for restitution and a declaratory judgment. Both parties sought summary judgment. In its own motion, WY Plaza denied the availability of restitution because the parties’ obligations had been set out in a written contract. The district court agreed with WY Plaza. But the court went further, deciding sua sponte that Safeway’s delay prevented recovery under the doctrine of laches. So the court granted summary judgment to WY Plaza and denied Safeway’s motion. The Tenth Circuit disagreed as to both trial court rulings. Despite the lack of any laches argument in its motion, the district court relied on laches to grant summary judgment to WY Plaza on the claim for declaratory relief. The Tenth Circuit concluded the district court erroneously failed to notify Safeway before granting summary judgment to WY Plaza based on laches. Furthermore, the Tenth Circuit found that in granting WY Plaza’s motion for summary judgment, the district court relied on arguments that WY Plaza hadn’t raised. The district court also erroneously granted summary judgment to WY Plaza on the restitution claim: "The unilateral nature of Safeway’s mistake doesn’t prevent restitution." The Tenth Circuit held Safeway was entitled to summary judgment because WY Plaza failed to create a triable fact-issue, and Safeway was entitled to summary judgment on its claims for a declaratory judgment and restitution. View "Safeway Stores v. WY Plaza" on Justia Law
LKL Associates, et al. v. Union Pacific Railroad Co.
The Union Pacific Railroad charged Heber Rentals, LC (“Heber”) and L.K.L. Associates, Inc. (“L.K.L.”) rent under a lease that allowed L.K.L. to continue operating a building materials supply business on land that was owned in fee by Heber—and leased to L.K.L.—but encumbered by Union Pacific’s right of way. After the Supreme Court stated in 2014 that railroad rights of way like Union Pacific’s were “nonpossessory” easements, L.K.L. and Heber stopped paying rent and filed suit against Union Pacific. In addition to requesting declaratory relief, L.K.L. and Heber sought to have their leases rescinded and to receive restitution for rent already paid. Union Pacific brought counterclaims arising out of their nonpayment. On summary judgment, the district court held that Union Pacific’s easement, while nonpossessory, gave it exclusive use and possession rights “insofar as Union Pacific elected to use the land subject to its easement for a railroad purpose.” Although it found that the lease agreements served no railroad purpose, it denied the rescission claim as “untimely and redundant.” In a follow-up order, it ruled that L.K.L. and Heber had abandoned their remaining claims. The district court also rejected all of Union Pacific’s counterclaims. The Tenth Circuit agreed with Union Pacific that its right of way included the unqualified right to exclude L.K.L. and Heber, but the Court agreed with L.K.L. and Heber that their leases were invalid. “Even if the incidental use doctrine applies, neither the leases nor the underlying business conduct furthered a railroad purpose, as the easement requires.” The Court: reversed the district court’s declaratory judgment rulings to the extent they are inconsistent with the Court’s opinion; affirmed the district court’s ruling that the rescission claim was time-barred; affirmed the district court’s rejection of Union Pacific’s counterclaim for breach of contract; reversed its rejection of Union Pacific’s other substantive counterclaims; and reversed the district court’s finding of abandonment. The matter was remanded for further proceedings. View "LKL Associates, et al. v. Union Pacific Railroad Co." on Justia Law
United States v. Turley
Richard Turley appealed the grant of summary judgment in favor of the United States, acting on behalf of the United States Postal Service, awarding specific performance of an option to purchase real estate from Turley. The purchase option was contained in a lease of the premises that the Postal Service had renewed on several occasions. Turley argued on appeal: (1) the lease had expired when the Postal Service attempted to exercise the purchase option because he had not received notice that the government was exercising its final option to renew the lease; (2) even if the lease was renewed, the Postal Service did not properly exercise the purchase option because it continued to negotiate for a new lease after it purported to exercise the option; and (3) equity precluded enforcement of the purchase option because the Postal Service attempted to use the purchase option as leverage to negotiate a better lease agreement. The Tenth Circuit was not persuaded. The Court found the lease-renewal option was properly exercised when the notice was delivered to the proper address, even though Turley refused to retrieve it. And Turley has presented no legal or equitable doctrine that would forbid a party who exercises (and is bound by) an option to purchase from pursuing an alternative arrangement. View "United States v. Turley" on Justia Law