District Court, Provo Department The Honorable M. James Brady
A. Nickel, Joseph Z. Alisa, and Stacy J. McNeill, Attorneys
B. Hancey, Attorney for Appellee
Jill M. Pohlman authored this Opinion, in which Judges Kate
Appleby and David N. Mortensen concurred.
Sealsource International LLC (Tenant) leased commercial
property from Grove Business Park LC (Landlord). After
dealing with a noisy neighbor and other problems with the
premises, Tenant moved out before the expiration of the
parties' lease agreement (the Lease). Landlord sued
Tenant, claiming that Tenant breached the Lease when it
vacated the premises early. Tenant denied liability for
breach, asserting that Landlord first breached the Lease by
constructively evicting it from the premises when Landlord
breached the covenant of quiet enjoyment. Tenant also
asserted that before it vacated the premises, Landlord
breached the warranty of suitability.
After the district court granted partial summary judgment to
Landlord regarding four of Tenant's complaints about the
premises, the case proceeded to trial. The jury found in
favor of Landlord, concluding that Landlord did not breach
the covenant of quiet enjoyment or the warranty of
suitability and that Tenant breached the Lease.
Tenant now appeals the district court's judgment in favor
of Landlord, raising three main issues for our consideration.
First, Tenant contends that the district court erred in
granting partial summary judgment on four of its complaints
about the premises. Second, Tenant contends that the court
abused its discretion in excluding evidence at trial that
Landlord allegedly promised to address those four complaints.
Third, Tenant contends that the court erred in awarding
attorney fees to Landlord. We affirm.
In September 2011, Tenant leased a commercial property from
Landlord for a term of five years and eight months. Soon
after moving in, Tenant discovered that the abutting neighbor
was a dance studio and that loud music from the studio
interfered with its business. Tenant complained to Landlord
about the loud music, and it also complained to Landlord
about other perceived problems with the premises. When the
noise and other issues continued, Tenant vacated the premises
in April 2013 even though more than four years remained on
Landlord sued Tenant, claiming that Tenant breached the Lease
when it left the premises early. In response to the
complaint, Tenant asserted that Landlord had constructively
evicted Tenant by failing to address a number of Tenant's
complaints about the premises: (1) heating and cooling
problems with the HVAC system in Tenant's unit; (2) the
front door of Tenant's unit would swing open from wind;
(3) the below-standard height of the loading dock; (4)
inadequate parking for Tenant and its customers; (5)
pervasive insect problems; (6) unmaintained parking and
common areas; and (7) noise emanating from the dance
Landlord moved for partial summary judgment on Tenant's
counterclaims to the extent they were based on the first four
of these complaints: the HVAC, the front door, the loading
dock, and the inadequate parking (collectively, the Four
Alleged Defects). According to Landlord, it had no obligation
under the Lease to remedy those specific complaints. The
district court agreed and granted partial summary judgment in
favor of Landlord. It ruled that Tenant's
"counterclaims for quiet enjoyment and warranty of
suitability, to the extent they concern [the Four Alleged
Defects were] dismissed with prejudice and on the
Before trial, and in light of the district court's ruling
that Landlord had no obligation to fix the Four Alleged
Defects, Landlord moved to exclude from trial emails with
unredacted references to the Four Alleged Defects. Landlord
asserted that, under rule 403 of the Utah Rules of Evidence,
that evidence would unfairly prejudice Landlord by exposing
the jury to "what appear[ed] to be facts of [Landlord]
not doing something that, in fact, it didn't have to do
under the [Lease]." Tenant opposed the motion, asserting
that its evidence regarding the Four Alleged
Defects-including emails in which Landlord allegedly told
Tenant that it would fix those problems, as well as
Landlord's internal emails wherein Landlord mentioned its
efforts to address Tenant's complaints-was relevant to
its theory of constructive eviction because it showed
Landlord's pattern of stalling, which allegedly induced
Tenant to stay longer in the premises than it otherwise would
have. The court granted Landlord's motion, stating that
it would not admit evidence regarding the Four Alleged
Defects "when it's contrary to the summary judgment
The case proceeded to a five-day jury trial. Landlord sought
approximately $40, 000 from Tenant for unpaid rent; Tenant
sought $300, 000 from Landlord for alleged lost profits and
other losses arising from Landlord's alleged breaches of
the covenant of quiet enjoyment and the warranty of
suitability. As a result of the court's partial summary
judgment ruling and evidentiary decision, Tenant's
constructive eviction theory at trial was based only on
Landlord's alleged failures to fix the insect and noise
problems and to maintain the parking and common areas.
The jury returned a verdict in favor of Landlord. On the
special verdict form, the jury indicated it found that
Landlord did not breach the covenant of quiet enjoyment by
constructively evicting Tenant and that Landlord did not
breach the warranty of suitability. Rather, the jury found
that Tenant breached the Lease by vacating the premises early
and awarded $14, 452.14 in damages to Landlord.
Landlord moved for an award of attorney fees on the ground
that it was entitled to fees under the terms of the Lease.
The district court granted Landlord's motion, concluding
that Landlord was the prevailing party and that its incurred
fees, with a few exceptions, were reasonable. Accordingly,
the district court awarded attorney fees and costs to
Landlord in the amount of $124, 429.97, and it entered a
judgment against Tenant in the total amount of $138, 882.11.
AND STANDARDS OF REVIEW
Tenant advances three main challenges on appeal. First,
Tenant contends that the district court erred in granting
partial summary judgment on its claims as they related to the
Four Alleged Defects. A motion for summary judgment shall be
granted "if the moving party shows that there is no
genuine dispute as to any material fact and the moving party
is entitled to judgment as a matter of law." Utah R.
Civ. P. 56(a). "In reviewing a trial court's grant
of summary judgment, we consider only whether it correctly
applied the law and correctly concluded that no disputed
issues of material fact existed." Pigs Gun Club,
Inc. v. Sanpete County, 2002 UT 17, ¶ 7, 42 P.3d
379 (cleaned up). "In so doing, we view all facts and
reasonable inferences drawn therefrom in a light most
favorable to the nonmoving party." Id.
Similarly, questions of contract interpretation that
"are confined to the language of the contract itself are
questions of law, which we review for correctness."
iDrive Logistics LLC v. IntegraCore LLC, 2018 UT App
40, ¶ 30, 424 P.3d 970 (cleaned up).
Second, Tenant contends that the district court abused its
discretion in excluding evidence referring to the Four
Alleged Defects. When reviewing a district court's
exclusion of evidence, we grant the court "broad
discretion to admit or exclude evidence and will disturb its
ruling only for abuse of discretion." Daines v.
Vincent, 2008 UT 51, ¶ 21, 190 P.3d 1269. But
"error in the district court's evidentiary rulings
will result in reversal only if the error is harmful."
Anderson v. Larry H. Miller Commc'ns Corp., 2015
UT App 134, ¶ 17, 351 P.3d 832.
Third, Tenant contends that the district court erred in
awarding attorney fees to Landlord, attacking its
determinations that Landlord was the prevailing party and
that the amount of Landlord's claimed fees was
reasonable. We review the district court's
"determination as to who was the prevailing party under
an abuse of discretion standard." R.T. Nielson Co.
v. Cook, 2002 UT 11, ¶ 25, 40 P.3d 1119. Likewise,
the district court "has broad discretion in determining
what constitutes a reasonable fee, and we will consider that
determination against an abuse-of-discretion standard."
Dixie State Bank v. Bracken, 764 P.2d 985, 991 (Utah
Partial Summary Judgment Ruling
Tenant first challenges the district court's grant of
partial summary judgment to Landlord on Tenant's claims
for breach of the covenant of quiet enjoyment and breach of
the warranty of suitability. Tenant asserts that the premises
had the Four Alleged Defects, which it believes Landlord was
obliged to remedy. In Tenant's view, Landlord was
obligated to make the repairs pursuant to the Lease and, at a
minimum, the jury should have been allowed to decide whether
Landlord was required to fix any of the Four Alleged Defects.
Landlord responds that because it "had no obligation to
address the Four Alleged Defects," it was not in breach
and the district court correctly granted summary judgment.
According to Landlord, "the Four Alleged Defects do not
fall within the plain language of [the] limited repair
obligation" contained in the Lease, and therefore it
"could not be held liable for failure to address"
Before reaching the specific arguments of the parties, we
note that in challenging the district court's grant of
partial summary judgment, Tenant does not engage with the
nature of, or the particular protections afforded by, its
affirmative claims for breach of the covenant of quiet
enjoyment and breach of the warranty of suitability. But
because Tenant's arguments focus on whether the Lease, or
modifications of the Lease, expressly required Landlord to
repair the Four Alleged Defects,  we likewise focus on the
Lease to resolve its challenge to the district court's
summary judgment decision.
In turning our attention to the terms of the Lease, we employ
the rules for contract interpretation. Those rules require
that "we first look to the writing alone to determine
its meaning and the intent of the contracting parties."
Skolnick v. Exodus Healthcare Network, PLLC, 2018 UT
App 209, ¶ 14, 437 P.3d 584 (cleaned up). "If the
language is unambiguous, the parties' intentions are
determined from the plain meaning of the contractual
language, and the contract may be interpreted as a matter of
law." Id. (cleaned up). "A contractual
term is ambiguous if, looking to the language of the contract
alone, it is reasonably capable of being understood in more
than one way such that there are tenable positions on both
sides." Id. (cleaned up); see also
Brodkin v. Tuhaye Golf, LLC, 2015 UT App 165, ¶ 21,
355 P.3d 224 ("[E]xtrinsic evidence cannot be used to
create an ambiguity not reasonably supported by the text of
the contract." (citing Daines v. Vincent, 2008
UT 51, ¶ 27, 190 P.3d 1269)). "But terms are not
ambiguous simply because one party seeks to endow them with a
different interpretation according to [its] own
interests." Skolnick, 2018 UT App 209, ¶
14 (cleaned up).
The pertinent provisions of the Lease are as follows.
Paragraph 6 states that "Tenant accepts the Premises in
the condition they are in at the inception of this
Lease." Paragraph 8 states that Tenant agrees "to
pay for all labor, materials and other repairs to the . . .
heating and air conditioning systems in or serving the
Premises." And Paragraph 9 states:
Landlord agrees for the term of this Lease, to maintain in
good condition and repair any latent defects in the exterior
walls, floor joists, and foundations of the building in which
the Premises is located, and to repair any defects in the
plumbing and electrical lines, facilities and equipment in
the common areas, (subject to the provisions of paragraph
3(b)), for one year after date of occupancy, as well as any
damage that might result from acts of Landlord or
Landlord's representatives. Landlord shall not, however,
be obligated to repair any such damage until written notice
of the need of ...