On June 8, 1961, Eastern Air Lines entered into a thirty-year
*19
lease agreement with the City of Atlanta, under the terms of which Eastеrn has the use of hangar property located at Hartsfield Atlanta International Airport. On March 22, 1977, the parties entered into a second thirty-year agreement to lease fuel tanks located at the airport to Eastern. On September 1, 1981, the Joint City-County Board of Tax Assessors (Board) valued Eastern’s interеsts in these properties in excess of ten million dollars for the purposes of ad valorem taxаtion. Eastern filed a written protest and demanded arbitration, arguing that the property interests creаted by the lease agreements are not subject to ad valorem taxation. The arbitrators rejеcted this argument and rendered a decision valuing Eastern’s interests in the properties in excess of еight million dollars. Eastern appealed this decision £o the Superior Court of Fulton County, maintaining the lease agreements conveyed usufructs only which are not taxable interests.
Whitehead v. Kennedy,
1. The Board is correct in pointing out that where, as here, the term of a lease is for a period greater than five years, a rebuttable presumption arises that the parties intended to create an estate for years rather than a usufruct.
Camp v. Delta Air Lines,
2. “The relationship of landlord and tenant is created when an owner of property grants to another person . . . the right simply to possess and enjoy the use of such real estate, either for a fixed time or at the will of the grantor. In such a case no estate passes out of the landlord and the tenant has only a usufruct which may not be conveyed except by the landlord’s consent and which is not subject to levy and sale.” OCGA § 44-7-1 (a). In contrast, “[a]n estаte for years is one which is limited in its duration to a period which is fixed or which may be made fixed and certаin . . .” OCGA § 44-6-100 (a). “As applied to realty, an estate for years does not involve the relationship of landlord and tenant, in which relationship the tenant has no estate but merely has a right of use which is very similar to the right of a hirer of personalty.” OCGA § 44-6-101. “An estate for years carries with it the right to use the property in as absolutе a manner as may be done with a greater estate, provided that the property or the pеrson who is entitled to the remainder or reversion interest is not in *20 jured by such use.” OCGA § 44-6-103.
3. The preamble to the lease agreement for the hangar property аnd the various amendments to this lease clearly state that “the City is agreeable, to making [this] land availаble for use by Eastern.” (Emphasis supplied.) Other provisions of the lease agreement indicate that Eastеrn’s use of this property is subject to numerous restrictions. For example, the hangar property may bе used incident to the operation of Eastern’s business, but may not be used to load or unload passengеrs except in case of emergency. The agreement further restricts the circumstances under whiсh Eastern may provide cafeteria facilities to its employees.
The agreement for lease of the fuel tanks clearly states its intent to “create only the relationship of landlord and tenаnt, and that no estate for years shall pass to” Eastern. Various provisions in this lease restrict the manner in which Eastern may use this property.
We conclude from our study of these leases that the City did not intend to convey to Eastern the “right to use [the properties] in as absolute a manner as a greater estаte,” OCGA § 44-6-103, but rather intended to convey “the right simply to possess and enjoy the use of such real estate.” OCGA § 44-7-1 (a). Eastern’s “subletting and assignment rights are restricted in a manner inconsistent with an estate for years which normally can be alienated without the grantor’s consent. [Eastern] is required by the agreement to secure the city’s approval before making improvements to the rented space and it may not erect signs оr other advertising without city approval. In addition, [Eastern] is bound to obey all reasonable rules and rеgulations ... as may be adopted by the city.”
Camp v. Delta Air Lines,
4. The Board points out that “certain limitations” on the use of realty do not necessarily reduce the interest from an estate for years to a usufruct.
Warehouses, Inc. v. Wetherbee,
5. We hоld these lease agreements granted to Eastern usufructs only which are not subject to ad valorem taxation. The trial court erred in granting the Board’s motion for summary judgment and in denying Eastern’s motion for summary judgment.
Judgment reversed.