Summary
In Henson v. Airways Service, Inc., 220 Ga. 44, 136 S.E.2d 747, 751 (1964), the Court had under consideration an instrument entitled "Lease and Concession Agreement."
Summary of this case from Lee v. North Dakota Park ServiceOpinion
22358.
SUBMITTED FEBRUARY 11, 1964.
DECIDED APRIL 13, 1964. REHEARING DENIED MAY 19, 1964.
Injunction, etc. Fulton Superior Court. Before Judge Pharr.
Harold Sheats, J. C. Murphy, Lewis R. Slaton, for plaintiffs in error.
Arnall, Golden Gregory, Cleburne E. Gregory, Jr., contra.
Kilpatrick, Cody, Rogers McClatchey, A. G. Cleveland, Jr., Ernest J. Bondurant, for party at interest not party to record.
1. This court will take judicial notice that one of the defendants named is the Tax Commissioner of Fulton County.
2. The petition stated a cause of action for the relief sought and the trial judge did not err in overruling the general demurrers to the petition.
SUBMITTED FEBRUARY 11, 1964 — DECIDED APRIL 13, 1964 — REHEARING DENIED MAY 19, 1964.
Airways Service, Inc., filed its petition in two counts against named persons as members of the Joint City-County Board of Tax Assessors and Jack L. Camp, Tax Commissioner of Fulton County. Count 1 of the petition alleged: The plaintiff entered into a written agreement with the City of Atlanta under the terms of which it obtained the right for the period of 19 years to use and operate for service station purposes, under the terms, conditions, and restrictions set forth in the agreement, a tract of land described in the agreement, for which the plaintiff agreed to pay certain percentages of income as rentals. The plaintiff bound itself to erect a complete gasoline service station and auto service and repair shop at a cost not to exceed $100,000, subject to approval of plans and specifications by the Airport Manager, and providing that title to the improvements should vest immediately upon completion in the city. Under the agreement the plaintiff's use of the described premises was not only restricted to the purposes set forth, but the prices which it could charge, its hours of business, its procedure for ticketing of cars, its method of bookkeeping and advertising, and any changes, additions, or alterations by it of the premises, the quality of its business, the cleanliness of the premises, and the appearance of its employees, were either regulated by the agreement or made subject to the approval of the city. Under the provisions of the agreement the plaintiff did not obtain any interest in the premises, but only a circumscribed and limited use over which the city reserved rights as to control, improvement, inspection, and supervision. The plaintiff has received notice from the Joint City-County Board of Tax Assessors that the leasehold interest in the service station has been assessed for tax purposes at a valuation of $26,170 for the year 1962, and the notice provides that if not protested within ten days, it will become final. Under the provisions of the agreement the plaintiff did not acquire a leasehold interest or any other interest in the real estate or in the improvements erected thereon subject to ad valorem taxation; but acquired only a circumscribed, limited use not subject to ad valorem taxation. The defendants have repeatedly demanded that the plaintiff return its right of use for taxation and have threatened to, and will proceed to assess taxes, and will undertake to collect them, based upon an illegal and void assessment, unless restrained. The plaintiff has no adequate remedy at law and is entitled to equitable relief to enjoin the defendants from proceeding to levy and collect ad valorem taxes on its right of use of the described property.
Count 2 relates to the parking areas described in the agreement, and it is alleged that: Under the agreement the plaintiff bound itself to construct facilities not to exceed $150,000 in cost, title to such improvements to vest immediately upon completion in the city. The plaintiff has received notice that these facilities have been assessed at a valuation of $44,120 for the year 1962, and that the assessment will become final unless protested within ten days. Under the provisions of the agreement the plaintiff did not acquire any interest in the real estate or the improvements erected thereon. It acquired only a circumscribed and limited use which is not subject to ad valorem taxation. The defendants have repeatedly demanded that the plaintiff return its right to the use of the property for taxation and it has been notified that it owes a sum of $12,037.09 for the year 1963. The defendants have threatened to, and will undertake to collect taxes from the plaintiff based on the illegal and void assessment, unless enjoined. The prayers were for process, that the defendants be restrained from assessing and collecting taxes, and for other relief.
The contract attached to the petition as "Exhibit A" is headed: "Lease and Concession Agreement." In the opening paragraph the City of Atlanta is designated as lessor and Airways Service, Inc., a corporation, as lessee. It is then recited: "Whereas, lessor is now in the process of constructing a new terminal building and related facilities at the Atlanta Airport, ... and proposes to furnish the facilities and services customarily furnished at and in connection with similar airport terminals; and whereas, lessee has offered to provide valet parking operations and service station services and auto repair services at said terminal; etc."
Article I provides that, with respect to the service station area, designated as Area A, new valet parking area, designated as Area B, and the existing parking area, designated as Area C, the term of the lease shall be for 19 years, the effective date as to Areas A and B to be five months after the date upon which the premises are available to lessee, and the effective date as to all areas to be determined by a letter addressed to lessee by the Airport Manager of lessor. Article II describes the several tracts of land involved.
Article III provides that the rental for the service station area is to be computed as follows: (a) 1 1/2 ¢ per gallon of gasoline sold; (b) 10% of gross receipts from the sale of oil, tires, batteries, and other accessories; and (c) 15% of gross receipts from auto towage and repairs; the amount due each month to be paid at the office of the Airport Manager on or before the 15th day of the succeeding month. For the parking areas B and C the rental is 15% of the gross receipts, to be paid at the office of the Airport Manager on or before the 10th day of the succeeding month. Lessee at its own expense shall provide one sealed cash register for each operation, which cash register shall be so designed as to show accurately the daily and monthly total gross receipts for each respective operation, with the gross receipts from gasoline sales being shown separately, and such cash registers shall be made available to lessor at any reasonable time for inspection.
Article IV provides that lessee shall construct improvements at a cost not to exceed $150,000 in the parking areas designated as Areas B and C, and shall erect a complete gasoline service station and auto service and repair shop at a cost not to exceed $100,000 in Area A. The plans and specifications are subject to the approval of the Airport Manager of lessor, and immediately upon completion of the improvements described, title is to vest in the lessor.
Article V provides that the premises leased shall be used for the purposes indicated in that article, the service station area being limited to the general servicing, maintenance, and repair of automotive vehicles, and for the selling of gasoline, oil, tires, and general automobile accessories; the parking areas to be used for the parking and storage of automotive vehicles.
Article VI provides that lessee at the parking areas shall not erect or maintain signs, conduct promotional efforts, or otherwise make any effort to divert users of open lot parking facilities into the facilities covered by the lease, nor elsewhere at the Atlanta Airport make any direct effort to divert users of open lot parking facilities.
Article VII provides that lessee shall secure the approval of the Airport Manager for all signs to be displayed on the premises, that lessee shall make no alterations, changes, or additions in or to the premises without the written consent of lessor, acting through its Aviation Committee. With respect to each of the activities to be carried on by lessee, it shall conduct a first class business of high quality and public service, and shall make available to the public on a twenty-four-hour-a-day basis all facilities covered by the agreement. Prices established and maintained by lessee for merchandise and services shall be competitive with the prices maintained for merchandise of like grade and quality at other service stations operated within a radius of two miles. Parking facilities shall be provided at reasonable prices, which prices shall be subject to approval by lessor, provided, however, that such approval shall not be withheld so long as the prices do not exceed those charged for similar facilities at airports of comparable size. Lessee shall require its representatives and employees to wear uniforms, to maintain at all times a neat and clean appearance, and to carry out their duties in an efficient and courteous manner. Lessee shall maintain the premises in a clean and orderly condition at all times. Lessee shall at its own expense comply with all Federal, State, and local laws, rules, and regulations which may be applicable to lessee's operations at the Atlanta Airport, and shall pay for all building permits, licenses, and other permits which may be required for the activities contemplated by the lease. Lessee shall at its own expense provide facilities for the disposal of industrial wastes originating on the premises.
Article VIII provides that if the lessee shall become insolvent, or shall make a general assignment for the benefit of creditors, or sign a voluntary petition in bankruptcy, or if any lien is filed against the premises because of any omission by lessee, or if lessee shall abandon, vacate, or discontinue its operations, or fail to punctually pay the rentals, the agreement may be terminated by lessor at its option, and no acceptance by lessor of rentals or fees shall be deemed as a waiver of any right to terminate the agreement. Before lessor shall be authorized to terminate the agreement under the provisions of Article VIII, it shall give lessee fifteen days' notice in which to cure such default.
Article XI provides that the lessee shall have the privilege of installing intercommunication telephone service, subject to prior written approval of lessor's Airport Manager. Article XII provides that public telephones may be installed, but any and all commissions and proceeds shall be the property of lessor.
Article XIII provides that lessee shall not sell or dispense food or drinks; provided, however, if lessee wishes to have installed vending machines for foods, drinks, or tobacco, lessor will provide such machines, and no part of the proceeds of such machines shall be paid to lessee.
Article XVI provides that so long as lessee shall comply with its obligations, it shall have quiet and peaceable possession of the premises.
The general demurrers of the defendants were overruled, and the exception is to that judgment.
1. The omission of the word "Tax" following the name of Jack L. Camp and preceding the word "Commissioner" where the defendants are named in the petition would not render it subject to general demurrer. The law requires that all civil officers of a county be commissioned by the Governor. Code § 89-202. "The courts of this State are bound to take judicial notice of who are the public officers of the State holding under commissions issued by the Governor." Bailey v. McAlpin, 122 Ga. 616, 619 ( 50 S.E. 388); Powell v. Hansard, 206 Ga. 505, 509 ( 57 S.E.2d 677). Under the law of this State this court knows judicially that Jack L. Camp is the Tax Commissioner of Fulton County.
2. Counsel for the parties have not cited any case in point on its facts with the present case, and our search has not revealed such a case. The contract must, therefore, be construed to determine the intention of the parties. "The cardinal rule of construction is to ascertain the intention of the parties." Code § 20-702; Asa G. Candler, Inc. v. Georgia Theater Co., 148 Ga. 188 (4) ( 96 S.E. 226, LRA 1918F 389); Hartsfield Co., v. Shoaf, 184 Ga. 378, 381 ( 191 S.E. 693); Brown v. Farkas, 195 Ga. 653 (2) ( 25 S.E.2d 411).
The contract is headed "Lease and Concession Agreement." The term "lease" without more could be construed to indicate that the city had granted an estate for years to the plaintiff (defendant in error here). Code § 85-806. The word "concession" means "a grant by a government of land, or property, or of a right to use land or property for some specified purpose, ... [italics ours]." Webster's New Int. Dictionary, 2d Ed., p. 553. Black's Law Dictionary, 3d Ed., p. 385, defines the word "concession" as "a grant; ordinarily applied to the grant of specific privileges by a government; ..."
After reciting the date and the names of the parties the contract recites that the lessor (the city) "is now in the process of constructing a new terminal building and related facilities at the Atlanta Airport, ... and proposes to furnish the facilities and services customarily furnished at and in connection with similar airport terminals; and whereas, lessee has offered to provide valet parking operations and service station services and auto repair services at said terminal; etc." These provisions of the contract alone are not conclusive as to the intention of the parties. Considering them, however, with the terms, limitations, restrictions, and conditions of the contract (as shown by our statement of its recitals), it is clear that under the contract the plaintiff was granted a limited and restricted use of the premises pursuant to the proposal of the city to furnish such "facilities and services" customarily furnished at similar airport terminals.
Counsel for the taxing authorities of Fulton County (plaintiff in error here) state in their brief that the present case is clearly controlled by the decisions of this court in Conley Housing Corp. v. Coleman, 211 Ga. 835 ( 89 S.E.2d 482); and Delta Air Lines, Inc. v. Coleman, 219 Ga. 12 ( 131 S.E.2d 768). Under the contract between the City of Atlanta and Delta Air Lines, Inc., (as shown by the copy in the record in the Delta Air Lines case), Delta acquired under lease for 30 years certain, with right of renewal for 20 years, 50 acres of land "for such uses and purposes as are a part of or incident to the operation of its business of operating a transportation system by aircraft." In acquiring the land described in the lease from the city, Delta acquired the unquestioned dominion and control of the land for the operation of its transportation system by aircraft. The lease did not purport to vest in the city any right of limitation in the use of the land by Delta for the purposes set forth, nor did the city purport to retain any control over the operation of the transportation system by aircraft of Delta. The interest of Delta in the land was a leasehold estate for years. In writing the opinion for this court Mr. Justice Candler (at page 16) stated: "In this State there can be several separate and distinct estates in the same parcel of land, and Code § 92-104 requires the owner of any estate in land less than the fee to return it for taxes and pay taxes on it as on other property. A leasehold is an estate in land less than the fee; it is severed from the fee and classified for tax purposes as realty." In construing the word "estate" Mr. Justice Candler was giving it the meaning fixed by the law of this State in Code § 85-104, where the word "estate" is defined as "the quantity of interest which an owner has in property." Delta had acquired and owned the right to operate its transportation system by aircraft without interference, dominion, or control by the city, and the Delta case is clearly not in point on its facts with the present case.
In Conley Housing Corp. v. Coleman, 211 Ga. 835, supra, it was determined by this court that the buildings upon the land in question were privately owned, and in the Conley case it was said in part (p. 838): "There can be no denial that the property sought to be taxed is private property. Nor can it be denied that it is personalty and not realty, in view of the terms of the lease that title to all improvements shall be in the lessee and authorizing the lessee to mortgage them and remove them from the lands before a termination of the lease." Certainly counsel for the taxing authorities do not intend to insist that the buildings located upon the land in the present case are private property since the contract between the parties clearly and distinctly stipulates that upon the completion of the construction of the buildings by the plaintiff title to the property shall vest immediately in the city. The Conley case is not in point on its facts and the present case is not controlled by the Conley case.
Counsel for the taxing authorities also cite State of Georgia v. Davison, 198 Ga. 27 ( 31 S.E.2d 225). While this decision was by a divided court and would not be binding, it is not in point on its facts and is not authority to sustain a tax assessment against the plaintiff in the present case. In the Davison case the lessees obtained an interest for 99 years, with the right to sell and convey the same, and it is clear under the facts of the Davison case that the lessee obtained absolute dominion and control over the leased property. In the present case the plaintiff did not acquire dominion over any of the lands, nor can it transfer its limited use of the lands.
We are not unmindful of the language in Lowery v. Powell, 109 Ga. 192, 194 ( 34 S.E. 296), where this court stated: "An estate is defined by Anderson, to be `the quantity of interest which a person has, from absolute ownership down to naked possession'." This statement in the Lowery case was not related to any question of taxes, and was not necessary to a decision in the case. This language appears to have originated in Jackson v. Parker, 9 (Cowen) New York Supreme Court Reports, pp. 73, 81, decided by the Supreme Court of New York in 1828. While we have much respect for the decisions emanating from our great sister State of New York, such decisions can not change or modify the statutory law of this State. Under our statutory law in order for there to be an estate, there must be ownership of an interest in the property.
Code § 61-101 provides in part: "When the owner of real estate grants to another simply the right to possess and enjoy the use of such real estate, either for a fixed time or at the will of the grantor, and the tenant accepts the grant, the relation of landlord and tenant exists between them. In such case no estate passes out of the landlord, and the tenant has only a usufruct, which he may not convey except by the landlord's consent and which is not subject to levy and sale; ..." Our statutes do not define the word "usufruct." Black's Law Dictionary, 3d Ed., at page 1799, defines "usufruct" as: "The right of enjoying a thing, the property of which is vested in another, and to draw from the same all the profit, utility, and advantage which it may produce, provided it be without altering the substance of the thing." See also Bouvier's Law Dictionary, 3d Rev., Vol. 2, p. 3380. From the definitions of the word "usufruct" it appears that the plaintiff did not obtain as much as a usufruct in the property, since it did not obtain the right "to draw from the same all the profit, utility, and advantage which it may produce."
The present case in principle (because of the limited use acquired) is controlled by Johnson v. Brice, 151 Ga. 472 ( 107 S.E. 338); Griffith v. Smith, 155 Ga. 717 ( 118 S.E. 194); and Southern Airways Co. v. DeKalb County, 216 Ga. 358 ( 116 S.E.2d 602). Under the limitations, restrictions, and conditions of the contract between the parties no estate in the lands passed to the plaintiff. It obtained merely a license in real property, which is defined as "authority to do a particular act or series of acts on land of another without possessing any estate or interest therein." Black's Law Dictionary, 3d Ed., p. 1110. See also Bouvier's Law Dictionary, 3d Rev., Vol. 2, p. 1974; Webster's New International Dictionary, 2d Ed., p. 1425. The plaintiff acquired "only a license to use it [the land] for the purpose stated, during the period specified in the contract." Johnson v. Truitt, 122 Ga. 327 ( 50 S.E. 135); Lott v. Denton, 146 Ga. 363, 364 ( 91 S.E. 112); Harrell v. Williams Sons, 159 Ga. 230 ( 125 S.E. 452); Treisch v. Doster, 171 Ga. 525 ( 156 S.E. 231); Whitehead v. Kennedy, 206 Ga. 760 ( 58 S.E.2d 832).
Judgment affirmed. All the Justices concur.