B & C Management Vermont, Inc. v. John

Summary

The Vermont Supreme Court considered a dispute over the interpretation of a commercial lease’s cost-of-living rent-adjustment provision. The court held that the provision was ambiguous when read as a whole and that the parties’ course of performance was relevant to determining their intent. The court affirmed summary judgment for the landlords and upheld the rent-calculation method used by the parties during the lease term.

Holdings

1. The rent-increase provision was ambiguous because its provisions were inconsistent about whether annual increases were calculated from the basic rent or the previous year's rent, and because the lease did not clearly identify what variable was subject to the four-percent cap.
2. Once the lease provision was found ambiguous, the court properly considered the parties' performance under the contract, including their mutual acquiescence in the prior rent-calculation method, as evidence of their intent.
3. The landlords could not seek to alter the trial court's order to obtain their proposed higher rent calculation because they did not file a cross-appeal.

Questions Presented

1. Whether the lease's rent-increase provision was ambiguous when read as a whole and in light of the surrounding circumstances.
2. Whether the court properly considered the parties' subsequent performance under the lease as extrinsic evidence of their intent to interpret the ambiguous rent-increase provision.
3. Whether summary judgment for the landlords was proper under the interpretation based on the parties' prior method of calculating rent increases.
4. Whether the landlords could seek a different, higher rent calculation on appeal without filing a cross-appeal.

Disposition

affirmed