June 30, 1999

Appeal of

 

ROSALIND SPODEK d/b/a NATIONWIDE POSTAL MANAGEMENT

 

LEASE AGREEMENT

(Main Post Office – Albany, OH)

PSBCA No. 4331

 

APPEARANCE FOR APPELLANT:

J. Leonard Spodek

 

APPEARANCE FOR RESPONDENT:      Gary Shapiro, Esq.

 

OPINION OF THE BOARD ON MOTION TO DISMISS

            Respondent has filed a motion to dismiss this appeal, stating three grounds:  (1) that Appellant seeks tort relief which is beyond the Board’s jurisdiction; (2) that consideration of the instant claim is barred by principles of res judicata and election of forum and (3) that Respondent is entitled to judgment based on the undisputed facts in the record.  Appellant has filed an opposition to the motion.  For the reasons explained below, the motion is denied.  The following findings of fact are made for purposes of deciding this motion.

FINDINGS OF FACT

            1.  Under a lease dated March 13, 1967, Respondent leased the premises used for the Albany, Ohio Post Office (Appeal file in PSBCA No. 4331, Tabs (“AF”) 27, 28).

            2.  At the time the lease expired in 1995, Respondent and the lessor entered into a lease extension agreement providing for Respondent’s continued occupancy of the premises.  The lease extension was on a month-to-month basis, and allowed the lessor to terminate the lease extension by giving the contracting officer written notice.  (AF 27).

            3.  Appellant acquired the property sometime in 1995 (AF 25, 26), and on March 14, 1996, Appellant notified Respondent that the lease was cancelled.  Appellant urged Respondent to negotiate a new lease agreement for the premises promptly, and stated, “Failure to negotiate a new lease will result in a hold-over rental of $12 psf with the Lessor responsible for roof and structure only.”  (Appeal File in PSBCA No. 4021, Tab (“4021AF”) 7, 12, 14).

            4.  The parties were unable to negotiate a new lease, and Respondent unilaterally adjusted the rental rate to a rate less than the $12 per square foot demanded by Appellant (AF 23, 24).

            5.  The parties continued to dispute the rental rate, and on November 8, 1996, the contracting officer issued a final decision denying Appellant’s claim for a rental rate higher than that determined by the contracting officer (AF 18).

            6.  Appellant’s appeal of that final decision to the Board was docketed as PSBCA No. 4021 (AF 17).

7.  On May 28, 1997, PSBCA No. 4021 was dismissed with prejudice for Appellant’s failure to prosecute (AF 13).  Subsequent reconsideration requests were denied.  (Nationwide Postal Management, PSBCA Nos. 4016-17, 4019-24, 4026-29, 4031, 4035, and 4059, 98-2 BCA  29,895 and 99-1 BCA  30,109; AF 3, 11).

8.  Respondent remained in possession of the post office, and in 1998, a dispute arose over responsibility for repairing the post office roof.  Respondent contracted for its repair, and, in an October 27, 1998 final decision, the contracting officer asserted Respondent’s claim against Appellant for the cost of the repair.  (AF 4).

9.  In November 1998, Appellant filed a Second Amended Complaint in a case before the United States Court of Federal Claims, Leonard Spodek, et al. v. United States, CA No. 98-686C.  In Count 30 of the Second Amended Complaint, Appellant alleges as a breach of an implied contract, Respondent’s failure to pay her fair market rent for the Albany, Ohio Post Office, and in Count 45, Appellant alleges Respondent’s continued occupancy of the premises constitutes a temporary taking in violation of the Fifth Amendment to the Constitution entitling her to compensation.  (Exhibit 1 to Respondent’s Motion to Dismiss).

10.  Appellant filed this appeal from the October 27, 1998 final decision on January 14, 1999 (AF 1).

DECISION

In her Complaint, Appellant characterizes Respondent as an “illegal holdover tenant.”  From this, Respondent argues that Appellant is seeking a tort remedy that is beyond the jurisdiction of the Board.  Regardless of the wording used in the Complaint, it is plain that Appellant seeks relief under what she contends is an implied-in-fact contract between her and Respondent for the lease of the premises.  Accordingly, Respondent’s argument in this regard is without merit.

Respondent argues that the Board’s dismissal with prejudice of an earlier appeal raising Appellant’s fair market rental claim (Finding 7) bars consideration of Appellant’s claim for relief from Respondent’s roof repair claim under the principle of res judicata.  Respondent also argues that by including the rental and “temporary taking” claims in her action before the Court of Federal Claims (Finding 9), Appellant has elected to proceed in that forum and is barred under the Contract Disputes Act from proceeding also before the Board.  Both of these theories fail for the same reason:  Respondent has not shown that Appellant’s defense to Respondent’s roof repair claim involves the same cause of action as the fair market rental claim asserted in the previous Board case (PSBCA No. 4021) or the same cause of action as the rental and “temporary taking” claims before the Court of Federal Claims.  See Martin Leasing, Inc., PSBCA No. 3063, 92-2 BCA  24,855; Monde Constr. Co., ASBCA Nos. 44993, 45079, 45142, 93-3 BCA  25,997 at 129,242.

Finally, Respondent argues that any contractual relationship between the parties is on the same terms and conditions as the previous lease, and that it is entitled to judgment because under the former lease roof repairs were Appellant’s responsibility.  However, there is evidence that although Appellant acquiesced in Respondent’s continued occupancy of the premises after the lease was terminated, Appellant attempted to condition that occupancy on certain changes to the contractual obligations of the parties (Finding 3).  See Garrity v. United States, 107 Ct. Cl. 92, 97 (1946).  Respondent has not disputed Appellant’s evidence in this regard.  Determining the details of the contractual relationship between the parties will require further development of the facts surrounding the termination.  Furthermore, even if the contract between the parties for the holdover period placed responsibility for roof repairs on Appellant, further factual development would be appropriate before the Board addresses issues such as the need for the repairs, the scope of repairs actually performed, and the reasonableness of Respondent’s procurement of the roof repairs.

Respondent’s Motion to Dismiss is denied.  The parties are to file their response to the Board’s March 8, 1999 Order not later than July 23, 1999.

Norman D. Menegat

Administrative Judge

Board Member

 

I concur:

James A. Cohen

Administrative Judge

Chairman

 

I concur:

David I. Brochstein

Administrative Judge

Vice Chairman