Seachase Condominium Owner's Association, Inc. v. Nextel WIP Lease Corporation
MEMORANDUM OPINION AND ORDER granting 17 Motion for Summary Judgment; Seachase's claims are DISMISSED with PREJUDICE and the Clerk is directed to close this case. Parties are to meet and confer by 12/20/13 if attorneys fee issues can be resolved without court involvement; if the issue remains unresolved, Seachase may file a motion for attorney fees and costs by 12/27/13. Signed by Magistrate Judge Katherine P. Nelson on 12/6/2013. (srr)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
OWNER’S ASSOCIATION, INC.,
NEXTEL WIP LEASE CORP., a
Delaware corporation d/b/a NEXTEL
PARTNERS, and SPRINT,
Civil Action No. 1:12-00711-N
MEMORANDUM OPINION AND ORDER
Before the Court1 is a motion for summary judgment (Doc. 17), filed August
21, 2013 by Defendant Nextel WIP Lease Corp. (“Nextel”). The plaintiff, Seachase
Condominium Owner’s Association, Inc. (“Seachase”), has responded (see Doc. 21),
Nextel has replied (see Doc. 28), and, for the reasons explained herein, Nextel’s
motion is GRANTED in its entirety.
Seachase’s claims are DISMISSED with
PREJUDICE, and the Clerk is DIRECTED to CLOSE this case.2
This matter is before the undersigned United States Magistrate Judge,
pursuant to 28 U.S.C. § 636(c), to conduct any and all proceedings, including trial, entry of
final judgment, and all post-judgment proceedings. (See Docs. 8, written consent of the
parties; 9, order of reference.)
Seachase and Nextel are the only entities remaining in this lawsuit. On
September 19, 2013, the Court construed Seachase’s “motion to strike” Sprint (Doc. 22) as
one pursuant to Rule 21—which “empowers federal courts to add parties, ‘drop’ (that is,
dismiss) parties and sever claims[,]” Scottsdale Ins. Co. v. Subscriptions Plus, Inc., 195
F.R.D. 640, 643 (W.D. Wis. 2000) (citations omitted)—and dismissed Sprint, which both
Nextel and Seachase agree is not a proper party (compare Doc. 22, ¶ 2, with Doc. 17 at 11).
Because Sprint neither answered nor filed a motion for summary judgment, Seachase could
have voluntarily dismissed Sprint pursuant to Rule 41(a), without action by the Court. See,
This lawsuit, filed in the Circuit Court of Baldwin County, Alabama on
October 12, 2012, was timely removed by Nextel on November 16, 2013.
generally Doc. 1.) And Nextel timely filed its motion for summary judgment on
August 21, 2013. (See Doc. 11, Rule 16(b) scheduling order, ¶ 11 (“Motions for
summary judgment and any other dispositive motions, especially those which
require little or no discovery, are to be filed as soon as possible but in no event later
than August 21, 2013. . . .”) (emphasis in original)). Without requesting that this
deadline be modified, and without seeking leave to file a dispositive motion outside
of time, Seachase filed its own motion for summary judgment (Doc. 19) on
September 13, 2013, more than three weeks past the deadline. After Seachase was
afforded the opportunity to show why its untimely motion should not be summarily
denied3 (see Docs. 20 (order), 24 (response), and 26 (Nextel’s opposition)), the motion
e.g., Edney v. City of Montgomery, 960 F. Supp. 270, 274 (M.D. Ala. 1997) (“Under the rules
governing dismissal by notice under [Rule] 41 and dismissal by motion under [Rule] 21,
dismissal against such defendants as have not served an answer or motion for summary
judgment is permitted even though the case might remain pending against other
defendants.” (quoting Cordis Corp. v. Siemens-Pacesetter, Inc., 682 F. Supp. 1200, 1201
(S.D. Fla. 1987))). Since that option was not exercised, a Rule 21 dismissal was preferable
to striking a party pursuant to Rule 12(f); notwithstanding the Court’s “liberal discretion to
strike” under that rule, “Rule 12(f) is an unusual mechanism by which to strike a party
from an action[.]” Brodkorb v. Minnesota, Civil No. 12–1958 (SRN/AJB), 2013 WL 588231,
at *16 (D. Minn. Feb. 13, 2013).
“District courts ‘enjoy broad discretion in deciding how best to manage the
cases before them,’ Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1366 (11th Cir.
1997), [which] discretion extends to whether to consider untimely motions for summary
judgment, see Matia v. Carpet Transport, Inc., 888 F.2d 118, 119 (11th Cir. 1989).”
Enwonwu v. Fulton-Dekalb Hosp. Auth., 286 Fed. App’x 586, 595 (11th Cir. May 12, 2008)
(per curiam) (affirming denial of untimely motion for partial summary judgment, where
trial court noted “it could achieve greater efficiency by adjudicating the case[,]” because the
district court’s decision “was within a range of reasonable choices and was not influenced by
was stricken on September 23, 2013 (see Doc. 27 (finding that Seachase’s admission
that it did not consider preparing its own motion until after it began work on the
opposition to Nextel’s motion, coupled with Nextel’s assertion of prejudice,
prevented a finding of good cause, pursuant to Rule 16(b), to allow the untimely
motion to proceed in contravention of the scheduling order’s deadline).4
The Court has also denied Seachase’s untimely motion for leave to amend the
complaint (Doc. 30), filed October 2, 2013—the day briefing on Nextel’s motion for
summary judgment closed.5 Again, the Court extended Seachase the opportunity to
explain why the motion should not be stricken (see Doc. 31) and considered
responses from both parties (see Docs. 36 (response) and 35 (Nextel’s opposition)).
any mistake of law”); see also Dedge v. Kendrick, 849 F.2d 1398, 1398 (11th Cir. 1988) (per
curiam) (affirming district court’s denial of motion for summary judgment, filed more than
one month late, as untimely pursuant to Rule 16(b)(2) (citing United States Dominator, Inc.
v. Factory Ship Robert E. Resoff, 768 F.2d 1099, 1104 (9th Cir. 1985))); Goode v. Wings of
Alpharetta, Inc., Civil Action No. 1:11–CV–1337–WSD–JSA, 2013 WL 997669, at *17 (N.D.
Ga. Jan. 18, 2013) (recommending denial of motion for summary judgment filed almost one
month past the deadline, noting, “A District Court need not consider an untimely motion for
summary judgment.” (citation omitted)), report and recommendation adopted, 2013 WL
997558 (N.D. Ga. Mar. 13, 2013); but see, e.g., J.V. v. Seminole Cnty. Sch. Bd., No. 6:04–cv–
1889–Orl–28JGG, 2007 WL 7261470, at *1 n.3 (M.D. Fla. Mar. 21, 2007) (“Plaintiff argues
that procedurally, Defendant’s motion for summary judgment should be dismissed as
untimely because the dispositive motion was four days after the filing deadline. Though
there is authority for that course, the motion was only four days late and it is properly
denied on the merits.” (citations omitted and emphasis added)).
See id. at 4 (“While the summary judgment deadline may have been
overlooked in the first instance, once that oversight was realized, counsel could have
conferred with the other side and promptly requested leave to file his motion out of time.
The current situation is far different than that. Here, counsel admits that he did not even
imagine moving for summary judgment until he began work on a response to Nextel’s
timely filed motion. To allow such disregard for the scheduling order, entered pursuant to
Rule 16(b), would relegate that order to a frivolous piece of paper, idly entered, which can
be cavalierly disregarded by counsel without peril.” (citation and internal quotation marks
The applicable deadline was April 12, 2013. (See Doc. 11, ¶ 5.)
Through its response, Seachase explained that the lease contract between
itself and Nextel—the contract at the heart of this lawsuit—contains a provision
requiring Nextel to remove certain “telecommunications equipment from Seachase’s
rooftop and/or repair or return the roof top to its prior condition,” which Seachase
contends “is an integral part of the contract[.]” (Doc. 30, ¶¶ 1-4; see also id., ¶ 7
(explaining that this provision “has been an issue throughout the case”; it “has been
discussed in each and every deposition conducted as well as discussed in any and all
settlement negotiations”).) Despite the essentialness of this provision, Seachase
explained, “it was not specifically referred to in the various pleadings by the parties
in this case[,]” and, according to Seachase, the motion to amend was “an effort . . . to
make the pleadings conform to the evidence.” (Id., ¶¶ 4, 6.) But, as the Court
explained in its previous order,
[t]he problem with seeking leave to amend the complaint to conform to
evidence a party contends “has been an issue throughout the case” at
[such a] late stage—well after the dispositive motions deadline—
should be apparent given the structure of the Federal Rules of Civil
Procedure. Although Seachase explain[ed] why it would like to amend
the complaint, Seachase fail[ed] to explain how it ha[d] been diligent in
pursuit of that effort. And, quite simply, Rule 16(b)’s “good cause
standard precludes modification unless the schedule cannot ‘be met
despite the diligence of the party seeking the extension.’” Cobb v.
Dawson, No. 5:06-CV-066 (HL), 2007 WL 188269, at *1 (M.D. Ga. Jan.
22, 2007) (quoting Sosa v. Airprint Sys., Inc., 133 F.3d 1417, 1418
(11th Cir. 1998) (citing FED. R. CIV. P. 16 advisory committee’s note)).
“If [a] party was not diligent, the [good cause] inquiry should end.” Id.
(quoting Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th
Cir. 1992) (noting, “Rule 16(b)’s ‘good cause’ standard primarily
considers the diligence of the party seeking the amendment.”)).
(Doc. 37 at 2-3 (footnote omitted); see also id. at 3 n.2 (noting, “Seachase’s response
makes it very clear that this amendment could have been sought at the outset of
discovery or, at the very least, in the midst of discovery and well before the
dispositive motions deadline, which itself came and went more than one month
before Seachase filed the instant motion for leave.”).)6
Pertinent Factual Background
The parties’ submissions establish the following facts—construed in a light
most favorable to Seachase7—pertinent to resolution of the pending motion for
It should be noted that Seachase has conveyed through its opposition that, at
least as of the date the opposition was filed, September 17, 2013—before any attempt by
Seachase to amend its complaint—Nextel’s equipment remains on its rooftop. (See Doc. 21
at 2.) That fact does not, however, play any role in the party’s positions for, or against,
Moreover, in light of the order denying leave to amend the operative complaint,
because Seachase failed to include this issue in that complaint, the issue cannot be raised to
the Court for the first time in an opposition to summary judgment. That is because
“Federal Rule of Civil Procedure 8(a)(2) requires that the allegations in the complaint ‘give
the defendant fair notice of what the plaintiff’s claim is and the grounds upon which it
rests.’” Pickern v. Pier 1 Imports (U.S.), Inc., 457 F.3d 963, 968 (9th Cir. 2006) (quoting
Swierkiewicz v. Sorema N.A., 534 U.S. 506, 512 (2002)). As such, “summary judgment is
not a procedural second chance to flesh out inadequate pleadings.” Wasco Prods., Inc. v.
Southwall Techs., Inc., 435 F.3d 989, 992 (9th Cir. 2006); see Pickern, 457 F.3d at 968-69
(holding that the complaint there failed to satisfy Rule 8(a)’s notice pleading requirements
because it “gave the [defendants] no notice of the specific factual allegations presented for
the first time in [the plaintiff’s] opposition to summary judgment”); Navajo Nation v. U.S.
Forest Serv., 535 F.3d 1058, 1080 (9th Cir. 2008) (“[W]here, as here, the complaint does not
include the necessary factual allegations to state a claim, raising such claim in a summary
judgment motion is insufficient to present the claim to the district court.” (citations
omitted)); accord Sharp v. Costco Wholesale Corp., 577 F. Supp. 2d 767 (D. Md. 2008); see
also Johnson v. Brock & Scott, PLLC, No. 5:11–CV–474–F, 2013 WL 6058199, at *6-7
(E.D.N.C. Nov. 15, 2013) (where a plaintiff raised a statutory violation for the first time on
summary judgment, the court held that the defendants “were entitled to rely on the
operative complaint as fair notice of the general factual allegations forming the basis of
Plaintiff’s claims”; and, like this Court, the court in Johnson also denied leave to amend the
complaint, to conform to the summary judgment motion, pursuant to Rule 16(b)).
The facts as stated herein are necessarily limited by the Court’s task at hand.
At summary judgment, “[t]he Court will not weigh the evidence or make findings of fact”;
its “role is limited to deciding whether there is sufficient evidence upon which a reasonable
juror could find for the nonmoving party.” MSC Mediterranean Shipping Co. SA, Geneva v.
Metal Worldwide, Inc., 884 F. Supp. 2d 1269, 1273 (S.D. Fla. 2012) (citing Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249 (1986); Morrison v. Amway Corp., 323 F.3d 920, 924
Seachase’s two-count complaint asserts claims for breach of contract and
conversion. The contract at issue, the Radio Roof Top Agreement (Doc. 21-1 (Ex. 1
to Seachase’s opposition)) (the “Agreement”), is dated January 3, 2005 and allowed
Nextel to place certain telecommunications equipment on the roof of the Seachase
condominium building in Orange Beach in exchange for monthly rent. The initial
monthly rent was set at $1,800 (for five years, the “Initial Term” of the contract),
but the contract also provided for a 15% rent increase every five years (that is, with
each “Renewal Term”) based on the monthly rent the previous term. Section IV of
the Agreement addressed its duration (and provided for automatic renewals).
Because that section is central to Seachase’s opposition to summary judgment, it is
set out in its entirety below:
The term of this Agreement shall commence the earlier of start of
construction or March 1, 2005, and run for a period of five (5) years
(“Initial Term”). If either party desires to terminate this Agreement as
of the last day of the initial term, that party shall give the other
written notice of such termination at least ninety (90) days before the
expiration of either the Initial Term Renewal term [sic]. In the
absence of such notice, the Agreement shall automatically renew for an
additional four (4) five (5) year periods (“Renewal Terms”) on the same
terms and conditions as set forth herein.
At lease termination, Tenant [Nextel] will remove all properties
installed on Landlord’s [Seachase’s] premises and leave said premises
in the same condition existing prior to the installation of Tenant
(11th Cir. 2003)); see also Cassady v. Walker, No. CV 109–128, 2012 WL 899913, at *12 n.12
(S.D. Ga. Feb. 6, 2012) (“Of course, the Court’s finding . . . is limited to the present
summary judgment stage of these proceedings, in which the facts are viewed in the light
most favorable to Plaintiff. This finding should not be construed as any ruling or
commentary on whether Plaintiff will ultimately prevail on his [ ] claims.”), report &
recommendation adopted, 2012 WL 899200 (S.D. Ga. Mar 15, 2012).
Facilities, ordinary wear and tear and occurrences for which Tenant is
not responsible hereunder, excepted.
(Doc. 21-1 at 3.)
As Seachase stated in opposition to summary judgment, “[t]he Agreement
proceeded pursuant to its terms until July 30, 2012[,] when Nextel mailed a letter
to Seachase which purported to give notice of termination of the Agreement[.]”
(Doc. 21 at 2.) That letter, attached to Seachase’s opposition, is dated July 25, 2012
and, in pertinent part, provides:
Pursuant to Section XIV(v) of the [ ] Agreement, this letter will serve
as notice that Nextel is exercising its right to terminate the
Agreement, effective September 21, 2012.
Section XIV of the Agreement, the basis for Nextel’s termination of the
Agreement in 2012, and also the basis for Nextel’s motion for summary judgment
(see Doc. 17 at 6-10), provides in pertinent part:
This Agreement may be terminated without further liability as follows:
. . . (v) on thirty (30) days prior written notice by Tenant [Nextel] if
Tenant determines that the Premises are not appropriate for its
operations for economic or technological reasons.
(Doc. 21-2 at 8.)
These sections of the Agreement, and their proper interpretation, are the
crux of this case. (Compare, e.g., Doc. 1-1, Seachase’s complaint, ¶¶ 11-17 (breach of
contract claim based on Nextel’s failure and refusal “to pay [ ] monthly rental
payments[, after its] attempt to terminate [the Agreement] without good cause”),
with id., ¶¶ 18-21 (conversion claim based on Nextel’s September and October 2012
conversion of “specific property owned by Seachase, to wit: rent payments in the
amount of $2,070 for each respective month”).)
It is well-established that, consistent with Federal Rule of Civil Procedure
56(c), summary judgment is proper “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that the moving party is
entitled to a judgment as a matter of law.” Celotex Corp. v. Catrett, 477 U.S. 317,
The party asking for summary judgment “always bears the initial
responsibility of informing the district court of the basis for its motion,
and identifying those portions of the ‘pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if
any,’ which it believes demonstrate the absence of a genuine issue of
material fact.” Id. at 323. The movant can meet this burden by
presenting evidence showing there is no dispute of material fact, or by
showing, or pointing out to, the district court that the nonmoving party
has failed to present evidence in support of some element of its case on
which it bears the ultimate burden of proof. Id. at 322-24.
Once the moving party has met its burden, Rule 56(e) “requires the
nonmoving party to go beyond the pleadings and by [its] own
affidavits, or by the ‘depositions, answers to interrogatories, and
admissions on file,’ designate ‘specific facts showing that there is a
genuine issue for trial.’” Id. at 324. To avoid summary judgment, the
nonmoving party “must do more than show that there is some
metaphysical doubt as to the material facts.” Matsushita Elec. Indus.
Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).8 On the other
hand, the evidence of the nonmovant must be believed and all
Further, “[a] factual dispute is genuine only if a ‘reasonable jury could return
a verdict for the nonmoving party.’” Ware v. Nationwide Ins. Co., No. 7:11–cv–4272–LSC,
2013 WL 1680514, at *3 (N.D. Ala. Apr. 12, 2013) (quoting Information Sys. & Networks
Corp. v. City of Atlanta, 281 F.3d 1220, 1224 (11th Cir. 2002) (in turn quoting United States
v. Four Parcels of Real Prop., 941 F.2d 1428, 1437 (11th Cir. 1991))).
justifiable inferences must be drawn in its favor. See Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). After the nonmoving
party has responded to the motion for summary judgment, the court
must grant summary judgment if there is no genuine issue of material
fact and the moving party is entitled to judgment as a matter of law.
FED. R. CIV. P. 56(c).
Archie v. Home-Towne Suites, LLC, 749 F. Supp. 2d 1308, 1312 (M.D. Ala. 2010)
(some internal citations modified and footnote added); see also Avenue CLO Fund
Ltd. v. Bank of Am., NA, 709 F.3d 1072, 1077 (11th Cir. 2013) (“The interpretation
of a contract is a question of law” subject to de novo review if appealed. (quoting
Daewoo Motor Am. v. Gen. Motors Corp., 459 F.3d 1249, 1256 (11th Cir. 2006)));
accord American Cas. Co. of Reading, Pa. v. Etowah Bank, 288 F.3d 1282, 1285
(11th Cir. 2002).
Breach of contract
Seachase argues that the Agreement is susceptible to factual questions that
preclude summary judgment pursuant to a “pure contract interpretation.” (Doc. 21
at 13 (conceding that if purported “ambiguities, vagueries [sic] and/or conflicts are
construed against Nextel,” as the drafter of the Agreement, “and in favor of
Seachase, this Court may very well be able to interpret the contract[,]” but
concluding, “if the contract remains as written, there are various factual issues
which should be resolved by a duly-empaneled jury”).) The pertinent facts set forth
above and Seachase’s arguments confirm that the proper interpretation of the
Agreement, rather than disputed underlying facts, is the basis by which Seachase
opposes summary judgment. And it is established that “[t]he ability of a court to
enter summary judgment on a contractual dispute, where there are no underlying
facts in dispute, [is] an issue driven by the applicable state contractual law.” Bayer
CropScience AG v. Dow AgroSciences LLC, Civil No. 12–256 RMB/JS, 2013 WL
5539410, at *5 n.5 (D. Del. Oct. 7, 2013) (collecting cases, including Dew Seven,
L.L.C. v. Big Lots Stores, Inc., 354 Fed. App’x 415, 416 (11th Cir. Dec. 2, 2009) (per
curiam) (in which the Eleventh Circuit, applying Florida law, held that “[i]n a case
involving contract interpretation, summary judgment is appropriate when any
ambiguity may be resolved by applying the rules of construction”)).
Under Alabama law,9
“The issue whether a contract is ambiguous or unambiguous is a
question of law for a court to decide.” American Resources Insurance
Co. v. H & H Stephens Construction, Inc., 939 So. 2d 868, 873 (Ala.
2006). “A contractual provision is ambiguous if it is reasonably
susceptible of more than one meaning.” FabArc Steel Supply, Inc. v.
Composite Construction Systems, Inc., 914 So. 2d 344, 357 (Ala.2005).
Conversely, “[a] document is unambiguous only if one reasonable
meaning emerges from a reading of the document.” Drummond Co. v.
Walter Industries, Inc., 962 So. 2d 753, 780 (Ala. 2006).
FDIC v. JDC Acquisition Corp., Civil Action No. 05-0536-WS-C, 2007 WL 987474, at
*2 (S.D. Ala. Mar. 28, 2007) (Steele, J.) (internal citation modified). Accordingly,
“[i]f the terms within a contract are plain and unambiguous, the construction of the
contract and its legal effect become questions of law for the court and, when
appropriate, may be decided by a summary judgment.”
McDonald v. U.S. Die
Casting & Dev. Co., 585 So.2d 853, 855 (Ala. 1991) (citing Dill v. Blakeney, 568
The parties agree, and the Agreement provides, that Alabama law applies.
(See, e.g., Doc. 21-1, § XVII, at 9 (“The Agreement shall be governed by the laws of the
State in which the Property[—the Seachase condominium building—]is located.”).)
So.2d 774 (Ala. 1990)). Further, under “principles of Alabama contract law[,]”
[i]f a contract is unambiguous on its face, there is no room for
construction and it must be enforced as written. A court may not
twist the plain meaning of the terms in a contract to create an
ambiguity under the guise of interpretation. The primary source
for deciding whether a contract is clear is the text of the document
itself. It is well established in Alabama that when an instrument is
unambiguous its construction and legal effect will be based upon what
is found within its four corners. . . . Even if some ambiguity does
exist in a contract, a court has the duty to accept a construction
that will uphold the contract, rather than one that will make it
invalid. . . .
Southland Quality Homes, Inc. v. Williams, 781 So. 2d 949, 953 (Ala. 2000) (internal
citations omitted and emphasis added).
Again, even if the Agreement “is unclear and ambiguous in its terms, but not
void for uncertainty, then[, at summary judgment,] it must be interpreted and
construed [by the Court] under well-settled rules of construction applicable to all
contracts.” American & Foreign Ins. Co. v. Tee Jays Mfg. Co., Inc., 699 So. 2d 1226,
1228 (Ala. 1997) (citing Home Indem. Co. v. Employers Nat’l Ins. Corp., 564 So. 2d
945 (Ala. 1990)) (emphasis added).10
Under Alabama law, this Court is,
furthermore, “guided by the intent of the parties, which, absent some exceptional
That, under Alabama law, at summary judgment, courts resort to well-settled
rules of contract construction first, before finding a contract to be ambiguous and, thus,
susceptible to factual disputes, is no surprise. Such an approach is consistent with the
majority of jurisdictions. Compare, e.g., Smith v. Seaboard Coast Line R. Co., 639 F.2d
1235, 1239 (5th Cir. Unit B 1981) (“Only if ambiguity remains after the court applies the
pertinent rules of construction does [the language of an agreement] become a question of
fact.” (citations omitted)) and Tyson v. McPhail Props., Inc., 478 S.E.2d 467, 472 (Ga. App.
1996) (“In interpreting a contract, an ambiguity will bar summary judgment only if the
rules of contract construction fail to resolve it.”), with Stonebridge Life Ins. Co. v. Horne,
No. W2012–00515–COA–R3–CV, 2012 WL 5870386, at *4 (Tenn. Ct. App. Nov. 21, 2012)
(“If the contract is ambiguous even after this Court applies the pertinent rules of
construction, then the interpretation of the contract becomes a question of fact such that
summary judgment is not proper.” (citations and internal quotation marks omitted)).
circumstance, is evidenced by the plain language of the document itself.” Southland
Quality Homes, 781 So. 2d at 953 (internal citations omitted); see also University of
Ala. Bd. of Trs. v. New Life Art, Inc., Civil Action No. 7:05–cv–0585–AKK, 2013 WL
5442191, at *5 (N.D. Ala. Sept. 27, 2013) (“Under Alabama law, ‘[w]hen interpreting
a contract, a court should give the terms of the agreement their clear and plain
meaning and should presume that the parties intended what the terms of the
agreement clearly state.’” (quoting Public Bldg. Auth. of City of Huntsville v. St.
Paul Fire & Marine Ins. Co., 80 So. 3d 171, 180 (Ala. 2010) (internal citations
Here, in an effort to avoid summary judgment, Seachase argues that the
renewal provision of the Agreement (Article IV) “is ambiguous and open to differing
interpretations”—specifically, Seachase contends, that provision, can be read to
mean that Nextel’s termination notification to Seachase, dated July 25, 2012—after
the expiration of the Initial Term—was invalid. (See Doc. 21 at 4 (because “such
notice [was] not made within the first five (5) year term, then the ‘agreement shall
automatically renew for an additional four (4) five (5) year periods’” (quoting Article
IV)).) Seachase thus contends that Article IV is “in conflict” with Article XIV (the
termination provision) and concludes, “Because the purported termination by
Nextel was not within the initial five (5) year period, there no longer exists a right,
by either party, to terminate.” (Doc. 21 at 9.)
The Court rejects this attempt by Seachase to read into the Agreement (i.e.,
create) conflict and ambiguity where none exists. Seachase is quick to point out
that the Agreement was drafted by Nextel and that, “[u]nder Alabama law, when a
court is confronted with an ambiguous contract, if all other rules of contract
construction fail to resolve the ambiguity, then, under the rule of contra
proferentum, any ambiguity must be construed against the drafter of the contract.”
(Doc. 21 at 4-5 (internal quotation marks omitted and emphasis added) (collecting
As Seachase admits, “[t]he case law emphasizes that contra
proferentum is generally a rule of last resort and should be applied only when other
rules of construction have been exhausted.”
(Id. at 5 (citation and internal
quotation marks omitted).) And by assuming an ambiguity exists and jumping to a
rule of construction “of last resort,” one which favors its position, Seachase skips the
seminal rule of construction that a contract must be “construed as a whole[,]” not in
isolated parts, and “whenever possible, effect must be given to all its parts.” N &
L Enters., LLC v. Lioce Props., LLP, 51 So. 3d 273, 279-80 (Ala. 2010) (quoting Gulf
Coast Realty Co. v. Professional Real Estate Partners, Inc., 926 So. 2d 992, 1005
(Ala. 2005) (emphasis added)); accord Dyas v. City of Fairhope, Civil Action No. 08–
0232–WS–N, 2010 WL 5158381, at *5 (S.D. Ala. Dec. 14, 2010) (Steele, J.); cf.
Caribbean I Owners’ Ass’n, Inc. v. Great Am. Ins. Co. of N.Y., 600 F. Supp. 2d 1228,
1245 (S.D. Ala. 2009) (DuBose, J.) (“‘To the extent the language of a[ contract]
provision is ambiguous, all ambiguities must be resolved against the [drafter].’
That said, ambiguities cannot be constructed from thin air by ‘strained or
twisted reasoning’ in interpreting the language.” (quoting Safeway Ins. Co. of
Ala., Inc. v. Herrera, 912 So. 2d 1140, 1143 (Ala. 2005)) (other citation omitted and
emphasis added)). In fact, “[e]ven if some ambiguity does exist in a contract,” under
Alabama law, “a court has the duty to accept a construction that will uphold the
contract,” as drafted.
Southland Quality Homes, 781 So. 2d at 953 (emphasis
added); see also American & Foreign Ins. Co., 699 So. 2d at 1228 (a contract with
“unclear and ambiguous terms” that is “not void for uncertainty . . . must be
interpreted and construed under well-settled rules of construction”).
Accordingly, the Court cannot accept Seachase’s “strained and twisted”
reading of the Agreement, which essentially engrafts the automatic renewal
provision of Article IV onto the termination for cause provision of Article XIV.
Doing so, Seachase admits (see Doc. 21 at 4), removes either party’s ability to
terminate the Agreement after expiration of the Initial Term. That interpretation
is clearly counter to both the plain language of the Agreement and the rule of
construction that a court should give effect to all provisions in a contract, not use
claimed ambiguity in one provision to nullify the effect of an independent provision.
E.g., N & L Enters., 51 So. 3d at 279-80. In other words, even accepting Seachase’s
interpretation of Article IV (the automatic renewal provision), that provision says
nothing about termination for cause, which is addressed in a separate provision of
the Agreement: Article XIV.
Seachase offers no support for interpreting one
provision of the Agreement in a way that eviscerates the effect of an independent
Such a strained interpretation, in fact, runs counter to the rule of
construction that requires that, where possible, a court should give effect to all
provisions in the parties’ contract. See, e.g., id. There is no reason not to honor that
rule of construction in this case.
Seachase also argues that, even if Nextel’s termination pursuant to Article
XIV(v) was timely, Nextel is not entitled to summary judgment because whether
“the Premises are not appropriate for its operations for economic or technological
reasons” is a factual question that should be submitted to a jury. (See Doc. 21 at 1012.)
However, a plain reading of the Agreement shows that, according to the
parties’ terms, whether the Premises are not appropriate for [Nextel’s] operations
for economic or technological reasons” is a determination to be made solely by
Nextel, as the Tenant. (See Doc. 21-1 at 8 (“on thirty (30) days prior written notice
by Tenant if Tenant determines that the Premises are not appropriate for its
operations for economic or technological reasons” (emphasis added).)
interpretation, through which Seachase again attempts to engraft requirements
that clearly do not exist under a plain reading of the Agreement, is also rejected.
Accordingly, Nextel’s motion for summary judgment as to Seachase’s breach
of contract claim is due to be and is hereby GRANTED.
Because the Court has determined that Nextel has not breached the
Agreement as a matter of law, Seachase cannot, as a matter of law, prevail on its
claim for conversion. See, e.g., Murray v. Holiday Isle, LLC, 620 F. Supp. 2d 1302,
1336 (S.D. Ala. 2009) (Steele, J.) (“To establish a claim of conversion in Alabama,
‘one must present proof of a wrongful taking, an illegal assumption of ownership, an
illegal use or misuse of another’s property, or a wrongful detention or interference
with another's property. . . .’ Simply stated, ‘[c]onversion requires a wrongful
exercise of dominion over property in exclusion or defiance of a plaintiff’s rights,
where said plaintiff has . . . the immediate right of possession.” (respectively
quoting SouthTrust Bank v. Donely, 925 So. 2d 934, 939 (Ala. 2005); Gardner v.
State Farm Mut. Auto. Ins. Co., 842 So. 2d 1, 7 (Ala. Civ. App. 2002))). Since there
has been no breach of the Agreement by Nextel, there has been no “wrongful
exercise of dominion over,” id., “specific property owned by Seachase, to wit: rent
payments” Seachase claims are due under the Agreement because of Nextel’s
purported breach (see Doc. 1-1, ¶¶ 18-21).
Accordingly, Nextel’s motion for summary judgment as to Seachase’s
conversion claim is also due to be and is hereby GRANTED.
Conclusion and Attorneys’ Fees
For the reasons discussed above, Nextel’s motion for summary judgment
(Doc. 17) is GRANTED in its entirety. Seachase’s claims are DISMISSED with
PREJUDICE, the final pretrial conference, previously set for December 19, 2013
(see Doc. 11, ¶ 1), is CANCELED, and the Clerk is DIRECTED to CLOSE this
case. A corresponding judgment will be entered separately.
As to attorneys’ fees, an issue both sides address in their pleadings, Article
XVII of the Agreement in pertinent part provides:
The parties hereto agree that in the event it becomes necessary for any
party to defend or institute legal proceedings as a result of the failure
of either party to comply with the terms, covenants, agreements,
and/or conditions of this Agreement, it is understood and agreed upon
that the prevailing party in such litigation shall be entitled to be
reimbursed for all costs incurred or expended in connection therewith,
including, but not limited to, reasonable attorney’s fees, including
appellate fees, and court costs.
(Doc. 21-1 at 9.)
The parties, further, agree that the prevailing party in this
litigation is entitled to recover attorneys’ fees pursuant to the Agreement. (See, e.g.,
Doc. 21 at 13 (“Seachase agrees with Nextel that the prevailing party in this
litigation is entitled to recover its attorney’s fees.”).)
The Court’s entry of summary judgment in favor of Nextel makes it the
prevailing party. As such, the parties are ORDERED to meet and confer (e.g.,
discuss either in person or over the telephone, not through an exchange of letters or
emails) no later than December 20, 2013 to determine if the attorneys’ fees and
costs issue can be resolved without Court involvement. If, after a meaningful meet
and confer has occurred, the issue remains unresolved, Seachase may file a motion
for attorneys’ fees and costs, pursuant to the Agreement, no later than December
27, 2013. Any motion shall be supported by evidence sufficient to enable the Court
to determine whether the requested fees and costs are reasonable.11
DONE and ORDERED this the 6th day of December, 2013.
/s/ Katherine P. Nelson
KATHERINE P. NELSON
UNITED STATES MAGISTRATE JUDGE
These deadlines do not affect (that is, extend) the deadline for Nextel to file a
verified bill of costs pursuant to Local Rule 54.1.
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