Lexington Insurance v. All Regions Chemical Labs, Inc.

Nolan, J.

The Lexington Insurance Company (Lexington) issued a property damage and loss insurance policy covering premises owned by Henry R. DeLeo and Carlo S. Rovelli, as partners in D&R Realty Co. As a result of a fire to the premises at One Allen Street, in Springfield, Lexing*713ton paid D&R for the fire damage and loss of rents. Lexington, subrogated to the rights of D&R, now seeks to recover that payment from two tenants of D&R, All Regions Chemical Labs, Inc. (doing business as Advanced Laboratories, Inc.), and Armory Distributors, Inc. (the tenants).

To Lexington’s complaint the tenants filed various motions for summary judgment and Lexington filed cross motions for summary judgment in its favor. Summary judgment was entered for the tenants and Lexington appealed. We transferred the case to this court on our own motion. We affirm.

A motion for summary judgment should be allowed if there is no genuine issue of material fact and if the party seeking it is entitled to a judgment as a matter of law. Mass. R. Civ. P. 56 (c), 365 Mass. 824 (1974). Cassesso v. Commissioner of Correction, 390 Mass. 419, 422 (1983). The sole issue is the propriety of the judgment for the tenants.

Lexington is suing as subrogee of the rights of D&R to whom it paid the loss and has any right that D&R had against the tenants. See New England Gas & Elec. Ass’n v. Ocean Accident & Guarantee Corp., 330 Mass. 640, 659 (1953). Hence, the issue is what right, if any, does D&R have against the tenants, arising from the losses incurred as a result of a fire in the leased premises, allegedly due to the negligence of the tenants? Among other matters, in the lease between D&R and the tenants there is a so-called “yield-up” clause which provides in pertinent part that at the expiration of the lease tenants will “peaceably yield up the Demised Premises ... in the same condition and repair as the same were in at the commencement of the term . . . damage by fire or other casualty . . . only excepted.”

The interpretation of a written contract or lease is a question of law, not of fact. Allstate Ins. Co. v. Bearce, 412 Mass. 442, 446-447 (1992). A contract should be construed in such a way that no word or phrase is made meaningless by interpreting another word or phrase, because the interpretation. should favor a valid and enforceable contract or lease rather than one of no force and effect. See Shayeb v. Holland, 321 Mass. 429, 432 (1947).

*714We have held that a yield-up clause shields a lessee from contract liability to the lessor for fire loss or damage caused by negligence. See Slocum v. Natural Prods. Co., 292 Mass. 455, 456-457 (1935). Therefore, the tenants are protected from liability to their lessor, D&R, and to the subrogee of D&R, Lexington. This holding is.consistent with the law in most other jurisdictions. See, e.g., Safeco Ins. Co. v. Capri, 101 Nev. 429, 430-431 (1985) (yield-up clause makes tenant coinsured with lessor). If D&R intended to exclude from its lease with the tenants fires negligently caused, it could have inserted such a limitation. It did not do so. See New Hampshire Ins. Group v. Labombard, 155 Mich. App. 369 (1986). The judge concluded that the tenants were coinsureds with D&R and we agree. See Lumber Mut. Ins. Co. v. Zoltek Corp., ante 704 (1995), decided today.

Accordingly, the summary judgment for the tenants and the denial of summary judgment for Lexington are affirmed.

So ordered.