Roadepot, LLC v. Home Depot, U.S.A., Inc.
163 A.3d 513
R.I.2017Background
- Commerce Park leased property to Home Depot in 2004; Roadepot bought the property in 2005 subject to that lease and became Home Depot’s landlord.
- Coventry imposed a one-time Fast Track sewer assessment (payable over 20 years) in 2004 to fund sewer infrastructure; Commerce Park/Roadepot were assessed but the bill was passed along to Home Depot, which paid from 2005–2014.
- Lease Article V assigned to tenant responsibility for "Real Estate Taxes," defined to include assessments for betterments, but §5.1(b)(v) excluded from that definition "any fees
- in consideration of obtaining
- utility service, specifically, excluding, impact, loophole and proffer fees."
- in consideration of obtaining
- Dispute: Roadepot sued for a declaratory judgment that Home Depot must pay the Fast Track Assessment; Home Depot counterclaimed for declaratory relief and breach of contract to recover amounts it had paid.
- Superior Court granted summary judgment that Roadepot (landlord) is liable for the assessment under the lease; after bench trial the court ordered Roadepot to reimburse Home Depot for amounts paid 2005–2014 but denied recovery of late fees and limited prejudgment interest to amounts paid after September 17, 2009.
- On appeal the Rhode Island Supreme Court affirmed landlord liability, vacated the reimbursement ordered for payments before Sept. 17, 2009 (because the trial court applied unjust enrichment sua sponte without notice), affirmed reimbursement for payments after that date, and affirmed denial of late fees and the prejudgment interest award for post-September 17, 2009 payments.
Issues
| Issue | Plaintiff's Argument (Roadepot) | Defendant's Argument (Home Depot) | Held |
|---|---|---|---|
| Whether lease language is ambiguous as to who pays the Fast Track Assessment | §5.1(a) (tenant pays assessments) makes tenant liable; §5.1(b)(v) is ambiguous and could carve the assessment back to tenant | §5.1(b)(v) unambiguously excludes fees for obtaining utility service (like the Fast Track Assessment) from "Real Estate Taxes," making landlord liable | Lease unambiguous: landlord (Roadepot) liable for Fast Track Assessment; summary judgment for Home Depot affirmed |
| Whether extrinsic evidence (subjective intent, course of dealing) should be admitted to interpret the lease | Extrinsic evidence shows parties understood tenant would pay | If contract is unambiguous, extrinsic evidence is irrelevant | Court excluded extrinsic evidence correctly because the lease was unambiguous |
| Whether Home Depot could recover payments (2005–2009) under unjust enrichment / voluntary payment doctrine | Payments were mistakenly made by Home Depot but Roadepot should reimburse under contract or restitution | Home Depot sought relief in equity; Roadepot argued contract remedies control and voluntary payment doctrine bars recovery | Court vacated reimbursement for payments before Sept. 17, 2009 because trial justice applied unjust enrichment sua sponte without notice; voluntary payment analysis otherwise properly applied; recovery affirmed for payments after Sept. 17, 2009 |
| Whether Home Depot may recover late fees and prejudgment interest for earlier payments | Late fees resulted from Roadepot’s failure to pay; should be recoverable; interest should run on all recoverable amounts | Home Depot failed to exercise reasonable diligence; late fees are Home Depot’s responsibility; prejudgment interest governed by statute and applies to pecuniary damages | Late fees denied (Home Depot not entitled). Prejudgment interest awarded only on amounts after Sept. 17, 2009 (affirmed for post‑Sept. 17 amounts); court declined to resolve interest on vacated portion pending further proceedings |
Key Cases Cited
- 5750 Post Road Medical Offices, LLC v. East Greenwich Fire District, 138 A.3d 163 (R.I. 2016) (standard of review for cross-motions for summary judgment)
- Medical Malpractice Joint Underwriting Ass’n of Rhode Island v. Charlesgate Nursing Center, L.P., 115 A.3d 998 (R.I. 2015) (summary judgment standards)
- Botelho v. City of Pawtucket School Dep’t, 130 A.3d 172 (R.I. 2016) (contract interpretation principles; unambiguous contracts)
- JPL Livery Servs., Inc. v. Rhode Island Dep’t of Admin., 88 A.3d 1134 (R.I. 2014) (give words plain meaning; avoid creating ambiguity)
- Sturbridge Home Builders, Inc. v. Downing Seaport, Inc., 890 A.2d 58 (R.I. 2005) (reasonable meaning test for ambiguity)
- Textron, Inc. v. Aetna Cas. & Sur. Co., 638 A.2d 537 (R.I. 1994) (contract construction principles)
- Cathay Cathay, Inc. v. Vindalu, LLC, 962 A.2d 740 (R.I. 2009) (parties’ subjective intent irrelevant where contract is clear)
- Cappalli v. BJ’s Wholesale Club, Inc., 904 F.Supp.2d 184 (D.R.I. 2012) (description of the voluntary payment doctrine)
- Nelson v. Swenson, 124 A. 468 (R.I. 1924) (voluntary payment rule and burden on payor to show mistake or ignorance of law)