Trustees of the Independent Presbyterian Church of Savannah v. Savannah Kidswear, Inc.

Smith, Judge.

The Trustees of the Independent Presbyterian Church of Savannah (“the landlord”) filed a declaratory judgment action against Savannah Kidswear, Inc. (“the tenant”), seeking a declaration of its continuing obligations under a lease agreement following a fire which destroyed the leased premises. The tenant counterclaimed for breach of contract and prayed for specific performance of the landlord’s alleged duty to rebuild. The landlord filed a motion for summary judgment, and the tenant filed a motion for partial summary judgment on its breach of contract claim. The trial court ruled that the obligations under the contract were continuing in nature, but found that the tenant was not entitled to specific performance. The court granted the tenant’s motion for partial summary judgment, ruling that the landlord had breached the lease agreement as a matter of law by failing to make a decision whether to rebuild within 90 days as expressly provided. The landlord appeals.

1. The landlord contends that the lease terminated when it notified the tenant of its decision not to rebuild and that the trial court erred in denying its motion for summary judgment on this issue. We agree.

The lease agreement unambiguously states that “[s]hould Landlord decide not to rebuild or restore, then this Lease shall terminate and neither party shall be further obligated.” The provision in the preceding paragraph requiring the landlord to make a decision within 90 days did no more than establish that the landlord would breach the contract by failing to make a decision within that time period. See Separk v. Caswell Builders, 209 Ga. App. 713, 714 (1) (434 SE2d 502) (1993). The trial court erred in construing the contract provision in question as dependent on whether the landlord breached a separate provision requiring a decision to rebuild to be made within 90 days. Separk, supra; OCGA §§ 13-2-2 (9); 13-1-7. No further obligations remain under the lease agreement, and the landlord therefore is not obligated to give tenant “the first right of refusal to purchase the Premises” as provided therein.

2. The landlord contends that the trial court erred in granting summary judgment to the tenant on its breach of contract claim. We disagree. The agreement provides that “[t]he determination whether the Premises shall be rebuilt or restored shall rest solely with the Landlord, which determination Landlord shall make as soon as practicable but in no event later than ninety (90) days following the date of occurrence. . . .” It is undisputed that the landlord failed to do this. The tenant was entitled to a decision within that period of time and was likewise entitled to forego other options until a decision was finally made some six months after the premises were originally destroyed by fire. The tenant is therefore entitled to damages flowing from that breach, if any such damages can be proven. We therefore find no error.

Judgment affirmed in part and reversed in part.

Birdsong, P. J., Beasley, P. J., Andrews, Johnson and Ruffin, JJ., concur. Pope, C. J., McMurray, P. J., and Blackburn, J., dissent.