City of Pompano Beach v. Beatty, 222 So. 3d 598

Background

In 1974 Nancy and William Beatty (lessors) leased Broward County property for 99 years to Daniel Garnsey; rent escalations and a reappraisal option were included.
The lease set initial rent schedule for years 1–5 and provided COLA adjustments starting in the 61st month and every 37th month thereafter.
Section 2.2(e) granted the lessors an independent MAI reappraisal “every twenty (20) years” at their expense to show specific returns and stated reappraisal could not yield rent lower than the 19th, 39th, 59th year payments, etc.
In 2006 (year 33) the Beattys sought to reappraise and demand increased rent; the City of Pompano Beach (lessee) refused, prompting the lessors to sue for breach. The City defended that reappraisals were limited to years 20, 40, 60, and 80.
The trial court agreed with the lessors and entered judgment for them (including attorney’s fees); the appellate court reversed, holding the lease unambiguously limited reappraisals to the specified 20-year intervals and remanded for judgment for the lessee.

Issues

Issue	Beatty's Argument	City of Pompano Beach's Argument	Held
Whether §2.2(e) permits a reappraisal at any time so long as 20 years have elapsed from the lease date or last reappraisal	Beatty: First reappraisal allowed any time after 20 years from lease execution, and subsequent reappraisals any time after 20 years from prior reappraisal	City: The clause limits reappraisals to the specified dates—years 20, 40, 60, 80 (every twenty years) only	Court: Reversed trial court; clause is clear and allows reappraisal only at the specified 20-year intervals (20, 40, 60, 80)
Whether the lease language is ambiguous so courts may adopt Beatty’s interpretation	Beatty: Language is susceptible to reading that 20 years is the minimum interval, not fixed dates	City: Language is plain and unambiguous; court must apply text as written	Court: Language is unambiguous; ambiguity exists only if reasonably susceptible to more than one meaning, which is not the case here
Whether the trial court could rewrite contract to afford the lessor greater rights	Beatty: (implicit) equitable construction would allow interpretation favoring exercise of option when advantageous	City: Court cannot rewrite a voluntary contract to benefit one party	Court: Refused to rewrite contract; parties’ bargain controls; cannot grant an extra unilateral option
Effect on attorney’s fees awarded with underlying judgment	Beatty: Prevailing party fees granted below dependent on judgment	City: On reversal, fee award must also be reversed	Court: Reversed fee award because underlying judgment reversed

Key Cases Cited

Okeechobee Resorts, L.L.C. v. E Z Cash Pawn, Inc., 145 So.3d 989 (Fla. 4th DCA 2014) (parties free to contract and courts must enforce clear terms)
Nw. Nat’l Life Ins. Co. v. Riggs, 203 U.S. 243 (U.S. 1906) (contracting freedom is protected)
Hoffman v. Boyd, 698 So.2d 346 (Fla. 4th DCA 1997) (recognizing contractual freedom)
Int’l Expositions, Inc. v. City of Miami Beach, 274 So.2d 29 (Fla. 3d DCA 1973) (court should not substitute its judgment for parties’ bargain)
Gulliver Schs., Inc. v. Snay, 137 So.3d 1045 (Fla. 3d DCA 2014) (clear contracts construed as written)
Khosrow Maleki, P.A. v. M.A. Hajianpour, M.D., P.A., 771 So.2d 628 (Fla. 4th DCA 2000) (court cannot rewrite clear contract terms)
Pol v. Pol, 705 So.2d 51 (Fla. 3d DCA 1997) (same)
Lambert v. Berkley S. Condo. Ass'n, 680 So.2d 588 (Fla. 4th DCA 1996) (ambiguity exists only when language is reasonably susceptible to more than one interpretation)
Campaniello v. Amici P'ship, 832 So.2d 870 (Fla. 4th DCA 2002) (disputed written terms that are reasonably susceptible create fact issues)
Am. Med. Int'l, Inc. v. Scheller, 462 So.2d 1 (Fla. 4th DCA 1984) (court must prevent fanciful or absurd interpretations of plain language)
City of Hollywood v. Witt, 939 So.2d 315 (Fla. 4th DCA 2006) (reversal of underlying judgment necessitates reversal of dependent attorney’s fees award)