Shops at Boardman Park, L.L.C. v. Target Corp.
2016 Ohio 7283
| Ohio Ct. App. | 2016Background
- In 2001 Target and The Shops at Boardman Park, LLC entered an Operations and Easement Agreement (OEA) defining a 19.5-acre "Shopping Center" and allocating Common Area maintenance responsibilities and cost-sharing.
- The OEA defined "Common Area" and established that The Shops (Operator) initially maintained it while Target paid a 43% pro rata share; Section 4.2.7 allowed Target to opt out and assume maintenance of its tract.
- Section 4.2.7 required Operator to continue certain functions after Target's opt-out, including maintaining the "Common Area supervisory program, if any," insuring Target's tract under Operator's program, maintaining utility lines, and sign maintenance.
- In 2009 Target exercised the opt-out provision. A dispute arose when The Shops sought pro rata contributions from Target for costs related to two persons performing oversight/administration for the larger shopping complex.
- The Shops sued for breach of contract and sought a declaratory judgment defining "Common Area supervisory program" as fees for an on-site supervisor and secretary overseeing/administrating common areas; Target counterclaimed, defining the phrase as programs for policing or securing the Common Area.
- The trial court (via magistrate) and the court of appeals adopted Target's definition by granting partial summary judgment; the majority affirmed and remanded for further proceedings, while a dissent argued the declaratory judgment entry was not a final appealable order.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Meaning of "Common Area supervisory program" in §4.2.7 | Means "fees and expenses of a supervisor and a secretary on site" who oversee, administer, coordinate Common Areas (i.e., administrative staffing costs) | Means "any program implemented for policing or securing the Common Area" (i.e., security/policing function) | Adopted Target's definition: any program for policing or securing the Common Area within the Shopping Center |
| Whether phrase is mandatory or optional | The Shops: phrase should impose ongoing obligation and recovery of administrative costs from Target despite "if any" language | Target: "if any" shows the supervisory program is optional and does not require administrative-cost recovery | Court: "if any" renders the program optional; The Shops' interpretation would render "if any" meaningless and conflict with other OEA provisions |
| Whether administrative costs are recoverable as Common Area Maintenance Costs | The Shops: supervisory program costs (supervisor/secretary) are recoverable as Common Area Maintenance Costs | Target: administrative/overhead costs are excluded from Common Area Maintenance Costs and supervisory program refers to security/policing, not administrative staff | Court: Administrative and overhead costs are expressly excluded by §4.2.2; The Shops' definition conflicts with the contract and is rejected |
| Whether extrinsic evidence should be considered | The Shops: court should consider extrinsic evidence/history to interpret ambiguous phrase | Target: contract language is clear in context; extrinsic evidence unnecessary | Court: Phrase is unambiguous in contract context; extrinsic evidence not permitted; de novo review supports Target's construction |
Key Cases Cited
- Arnott v. Arnott, 132 Ohio St.3d 401 (Ohio 2012) (declaratory judgment legal issues reviewed de novo)
- Horton v. Harwick Chemical Corp., 73 Ohio St.3d 679 (Ohio 1995) (summary judgment reviewed de novo)
- Dresher v. Burt, 75 Ohio St.3d 280 (Ohio 1996) (party moving for summary judgment bears burden to show no genuine issue of material fact)
- Gen. Acc. Ins. Co. v. Ins. Co. of N. Am., 44 Ohio St.3d 17 (Ohio 1989) (declaratory-judgment orders may be final appealable orders under R.C. 2505.02)
- Shifrin v. Forest City Enterprises, Inc., 64 Ohio St.3d 635 (Ohio 1992) (extrinsic evidence considered only when contract language is ambiguous)