No. 53331-2-IThe Court of Appeals of Washington, Division One.
Filed: September 27, 2004 UNPUBLISHED OPINION
Appeal from Superior Court of Snohomish County. Docket No: 02-2-10709-3. Judgment or order under review. Date filed: 10/08/2003. Judge signing: Hon. Linda C. Krese.
Counsel for Appellant(s), J. Bradley Meagher, Meagher Meagher LLP, 6324 Broadway, Everett, WA 98203-4837.
Counsel for Respondent(s), J. Robert Leach, Attorney at Law, PO Box 5397, Everett, WA 98206-5397.
PER CURIAM.
The intent of the parties to a lease is to be gleaned from the document itself where possible. While resort to parol, extrinsic or collateral evidence may be heard to explain the content and intent of the parties in entering into a written contract, it will not be heard to modify, contradict, add to, or vary the terms of that written agreement. Here the written agreement is a lease between American Construction Company, Inc. and the Port of Everett for premises in the Port’s North Marina. The terms of the lease are unambiguous and permits the Port to make an annual review of the rent pursuant to the ceiling established in the lease. The trial court’s grant of summary judgment setting the amount of rent under the lease is affirmed.
FACTS
American Construction Company, Inc. (American) occupied a portion of the North Marina of the Port of Everett (Port) since the early 1960s, and had otherwise been a tenant of the Port since 1908. In 1988, the parties negotiated a new lease. The Port was considering development of the North Marina, which might force American to relocate during the term of the lease. The lease was negotiated to cover that contingency. The lease at issue had an initial term of 5 years beginning July 1, 1988 ending June 30, 1993. Paragraph 2.6 of the lease provides for five options to renew for additional 5-year periods and also provides:
The rent during renewal periods shall be determined and adjusted as provided in paragraphs 3.1, 3.4 and 3.5.
Article 3 of the lease establishes the rent to be paid, and contains provisions for adjustment of the rent during its term and any renewal periods. The rent for the initial 5-year term was $2,000 a month. If American remained at the original site following the initial 5-year term the lease gave the Port discretion to annually adjust the rent as set forth in paragraph 3.1. Paragraph 3.1 of the lease provides:
3.1 Review of Rent. If Lessee remains at the present site, at the expiration of the initial five (5) year term of this lease, the Port shall annually review the adequacy of the rent. After such review the Port may, at its sole discretion, increase the rent to an amount not greater than that provided for in paragraph 3.4. If Lessee does not approve the adjusted rent for the present site, Lessee shall have the right to terminate the lease and vacate the premises within six (6) months of the date on which Lessee received the Port’s notice under this section.
Paragraph 3.4 and 3.5 of the lease provide as follows:
3.4 Rent Adjustments for New Site. Monthly rent for the new site will be established at not to exceed one percent (1%) of the then appraised market value of the site. The appraised market value shall be the average of the market value appraisals made by three (3) Snohomish County M.A.I. appraisers, with one selected by the Port, one selected by the Lessee, and one selected by the two appraisers selected by the parties. The Port shall pay the fees of the appraiser selected by the Port and one-half of the fees of the appraiser selected by the two appraisers. Lessee shall pay the fees of the appraiser selected by the Lessee and one-half of the fees of the appraiser selected by the two appraisers.
3.5 Five Year Rent Adjustments. At the conclusion of the fifth year, and the conclusion of each subsequent five year period, the monthly rent will be adjusted on the basis of the movement in the Consumer Price Index maintained by the U.S. Department of Labor Bureau of Labor Statistics for the U.S. city average during the five year period.
American exercised its option for 5-year renewal periods beginning in 1993 and 1998. In 1993, pursuant to paragraph 3.5 of the lease, the rent for the new period was set at $2,438 per month. In 1998, the rent was not adjusted. American continued to occupy the original leasehold premises.
In June 2001, the Port advised American that it was exercising its right to review the monthly rent and adjust it subject to the ceiling of paragraph 3.4. The Port’s notice designated its appraiser and requested that American do the same. American, through its president, Steve Brannon, responded and disputed the approach the Port used for the annual adjustment. Brannon claimed the Port did not have the discretion to increase the rent under paragraph 3.4 as American remained at the old site and no new site had been selected. Brannon suggested that paragraph 3.5 required that the Port’s annual review was to be based on the movement of the Consumer Price Index (CPI).
The Port disagreed and indicated it would proceed with the market value appraisal under paragraph 3.4, and that if American failed to select an appraiser the Port would proceed with two appraisers to determine the market value, their selected appraiser and an appraiser designated by their appraiser. American did not select or provide an appraiser. The two appraisers reached a mediated settlement agreement of $1.3 million as the market value of the property leased to American.
On August 22, 2002, the Port notified American that pursuant to paragraph 3.1 of the lease, the monthly rent was adjusted to $13,000 effective November 1, 2002. American did not agree to this rent but also failed to exercise its right to terminate the lease and vacate the premises within 6 months. Instead, it sought a declaratory judgment to fixing the monthly rent in accordance with its version of the terms of the lease, asserting that a permitted increase was equal only to the increase in the CPI.
The Port sought summary judgment and following argument the trial court entered summary judgment in its favor holding as a matter of law that the monthly rent under the lease was $13,000 per month plus applicable excise tax, effective November 1, 2002. The court also awarded reasonable attorney fees to the Port. American appeals.
ANALYSIS
At summary judgment and on appeal American argues the lease should be construed and interpreted to allow for an increase in rent pursuant to paragraph 3.5 only, as American had not been forced to move to a new site, thus obviating the use of paragraph 3.4. In reviewing a grant of summary judgment, this court engages in the same inquiry as the trial court.[1] We review the motion for summary judgment de novo, and treat all facts and inferences therefrom in a light most favorable to the nonmoving party.[2] If a contract or lease provision is unambiguous, summary judgment is proper even if there are differences between the parties as to the legal effect of the provision.[3]
In interpreting a lease, the court determines the intent of the parties at the time of its execution and the plain meaning of the language used.[4] Where the lessor drafts the lease, ambiguities, if any, must be resolved in favor of the lessee.[5] While the intent of the parties to a lease is determined from the language of the lease, extrinsic evidence may be considered by the court to discover the circumstances surrounding the making of the lease, the subsequent acts and conduct of the parties thereto, and the reasonableness of respective interpretations advocated by the parties.[6]
`[P]arol evidence is admissible to show the situation of the parties and the circumstances under which a written instrument was executed, for the purpose of ascertaining the intention of the parties and properly construing the writing. Such evidence, however, is admitted not for the purpose of importing into a writing an intention not expressed therein, but with the view of elucidating the meaning of the words employed. . . . It is the duty of the court to declare the meaning of what is written, and not what was intended to be written. If the evidence goes no further than to show the situation of the parties and the circumstances under which the instrument was executed, then it is admissible.’[7]
As a threshold matter, we must determine whether the language of the lease is ambiguous. Whether a written instrument is ambiguous is a question of law for the court.[8] Words in a contract should be given their ordinary meaning.[9] Contracts should be construed to reflect the intent of the parties, but courts, under the guise of construction or interpretation, should not make another or different contract for the parties.[10] A contract provision is ambiguous when its terms are uncertain or when its terms are capable of being understood as having more than one meaning. A contract provision is not ambiguous merely because the parties suggest opposite meanings, and an ambiguity will not be read into a contract where it can reasonably be avoided by reading the contract as a whole.[11]
Here, by its plain and unambiguous terms, paragraph 3.1 applies if American remained at its present site after the expiration of the initial 5-year term of the lease. The same paragraph grants the right to increase the monthly rent to the Port at its sole discretion, but any increase to an amount no greater than provided for in paragraph 3.4. American remained at the present site and paragraph 3.1 applies, merely incorporating the potential rent increase of paragraph 3.4, even though that paragraph separately contemplates a new site.
The interpretation of paragraph 3.1 asserted by the Port is the only reasonable meaning which can be given to the paragraph when viewed in context of the entire lease.
Even if this court resorts to the extrinsic evidence offered by American to support its position, the result does not change. Extrinsic evidence does not include: (1) evidence of a party’s unilateral or subjective intent as to the meaning of the contract; (2) evidence showing any intention independent of the instrument; and (3) evidence that varies, contradicts or modifies the written word of the instrument. As noted above, the intent of the parties to the lease is easily ascertained from the lease itself. There is no ambiguity in the document and American’s reliance on extrinsic evidence regarding its intent is misplaced as it only would impermissibly serve to modify the lease or write an intention into the lease that is not present.
The decision of the trial court is affirmed.
GROSSE, COLEMAN and APPELWICK, JJ.
(1944)).
(1983) (citing Ladum v. Utility Cartage, Inc., 68 Wn.2d 109, 411 P.2d 868 (1966)).