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 1999-03

Opinion No. ( 1999 )


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  • Mr. Louis Schaufele, Chairman War Memorial Stadium Commission P.O. Box 250222 Little Rock, AR 72225

    Dear Mr. Schaufele:

    This is in response to your request for an opinion on the following questions concerning a particular lease agreement between the War Memorial Stadium Commission ("Commission") as lessor, and Regions Bank ("Bank") as lessee, involving the scoreboards located in the War Memorial Stadium:1

    1. Did the lease expire on June 30, 1997?

    2. Has the Bank by its actions in November 1998 renewed the lease for an additional ten years?

    3. Does the Stadium now have legal title to the scoreboards?

    4. Can the Stadium remove the Regions signage from the scoreboard and sell this advertising space to another firm?

    It is my opinion that the answers to these questions will depend upon whether a new lease was required to be executed in order for the Bank to be entitled to the additional term provided for under the Lease. The Bank apparently takes the position that the lease has been renewed for an additional ten-year term, whereas the Commission is of the view that the lease expired on June 30, 1997, and was not renewed. It is equally apparent that resolution of this dispute requires interpretation of the Lease, specifically that section concerning renewal. The Lease provides as follows in this regard:

    The term of this amended lease is fourteen (14) years commencing on the 1st day of July, 1983, and ending on the 30th day of June, 1997. The Bank, at the expiration of the initial term hereof, shall have the exclusive right and opportunity to renew the lease for an additional ten-year (10) term.

    1993 Amendment to Amended and Restated Lease Agreement § 1, ¶ 3 (see n. 1, supra).2

    With regard to rental, the Lease states that "[t]he Bank agrees to pay the Commission the sum of $1.00 per year as rental during the term of this lease and any extension thereof." Id. at 4.

    In addressing your questions, I must note that the construction or interpretation of contracts does not fall within the ordinary scope of an Attorney General opinion. I lack both the resources and the authority to act as a factfinder in issuing opinions. My review of the few helpful Arkansas cases in this area leads me to conclude, moreover, that determining the parties' intent under this Lease may require a factual review. The probable need to consider all of the surrounding facts and circumstances thus precludes resolution of these questions in the limited format of an opinion.

    The Lease in question simply states that the Bank shall have the right to "renew" for an additional ten-year term. I cannot predict with certainty how a court would interpret this provision, given the different approaches reflected in the few Arkansas cases on point. See MontgomeryWard Company v. Metzger, 216 Ark. 88, 224 S.W.2d 368 (1949); Beasleyv. Boren, 210 Ark. 603, 197 S.W.2d 287 (1946); Heyden v. BarnsdallRefining Co., 192 Ark. 789, 94 S.W.2d 709 (1936); Riverside Land v. BigRock Stone Material, 183 Ark. 1061, 40 S.W.2d 423 (1931); Keith v.McGregor, 163 Ark. 203, 259 S.W. 725 (1924); Felder v. Hall Bros. Co.,151 Ark. 182, 235 S.W. 789 (1921); Neal v. Harris, 140 Ark. 619,216 S.W. 6 (1919). There are, moreover, no recent cases addressing this precise issue. In addition, I believe the particular facts and circumstances surrounding this Lease may well be relevant to determining the parties' intent. This necessarily precludes resolution of your questions in the limited format of an opinion.

    Assistant Attorney General Elisabeth A. Walker prepared the foregoing opinion, which I hereby approve.

    Sincerely,

    MARK PRYOR Attorney General

    MP:EAW/cyh

    1 Although I have not been provided with a copy of the initial lease agreement, the lease was apparently first entered into in May, 1972. It was amended and restated in 1983 to address the installation of a new scoreboard and time clock located in the south end zone of the stadium ("Amended And Restated Lease Agreement" entered June 17, 1983). In 1993, the parties amended the initial lease, as amended, for the purpose of adding a scoreboard and time clock in the north end zone of the stadium ("1993 Amendment to Amended And Restated Lease Agreement" entered July 15, 1993). References in this opinion to "the Lease" have reference to the 1993 agreement.

    2 The 1983 amended lease contained a similar provision, although it gave the right to renew for five (5) instead of ten (10) years. Amended And Restated Lease Agreement § 1, ¶ 3 (see n. 1, supra).