Nextel WIP Lease Corp. v. Saunders

Present: Hassell, C.J., Keenan, Koontz, Kinser, Lemons, and
Agee, ∗ JJ., and Carrico, S.J.

NEXTEL WIP LEASE CORPORATION

v. Record No. 071653

ROSCOE NEAL SAUNDERS,
EXECUTOR OF THE
ESTATE OF CORA BELL MEADOR
SAUNDERS, ET AL.

OPINION BY
SENIOR JUSTICE HARRY L. CARRICO
September 12, 2008

TOWERCO LLC

v. Record No. 071655

ROSCOE NEAL SAUNDERS,
EXECUTOR OF THE
ESTATE OF CORA BELL MEADOR
SAUNDERS, ET AL.

FROM THE CIRUIT COURT OF BEDFORD COUNTY
James W. Updike, Jr., Judge

The issue in these appeals is whether the lease of a parcel

of land atop a mountain in Bedford County permits the erection

of one telecommunications tower or two such towers. In a

declaratory judgment proceeding, the circuit court held that the

lease permitted only one tower. We agree with the circuit court

and will affirm its judgment.

∗
Justice Agee participated in the hearing and decision of
this case prior to his retirement from the Court on June 30,
2008.
 The parcel of land, measuring approximately 50’ by 50’, is

part of a larger tract owned by Roscoe Neal Saunders and Ralph

Edward Saunders, Executors of the Estate of Cora Bell Meador

Saunders (the Saunders). In an Option and Ground Lease

Agreement dated July 13, 2004 (the lease agreement), the

Saunders, as lessors, leased the parcel to Nextel WIP Lease

Corporation (Nextel), as lessee, for a term of five years, with

five successive five-year options to renew for a monthly rental

of $670.00.

Nextel constructed an 80’ high telecommunications tower on

the property and then on June 30, 2005, assigned the lease to

TowerCo, LLC (TowerCo), as the lease agreement permitted. In

March 2006, an application was filed with the Bedford County

Department of Planning for an amended special use permit to

allow TowerCo to increase the height of the 80’ tower to 100

feet. Another application was filed for a special use permit to

allow the construction of a second 80’ tower on the leased

premises. On April 24, 2006, the County’s Board of Supervisors

denied the application to increase the height of the existing

tower because a zoning regulation forbade any height above 80

feet. However, the Board approved the construction of a second

80’ tower on the leased premises.

Construction was begun on the new tower, and on September

12, 2006, Nextel and TowerCo were confronted with a motion for

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declaratory judgment filed by the Saunders in the circuit court.

The motion alleged that the “lease provided for the construction

of one communication tower on the lease[d] premises” but “the

lessee and its assignees have commenced construction of a second

tower on the lease[d] premises contrary to the provisions of the

lease agreement and has [sic] refused to forego construction

upon confrontation by the plaintiffs.” The Saunders prayed that

the circuit court “determine the number of towers permitted

pursuant to the aforementioned Lease Agreement dated July 13,

2004.”

Nextel and TowerCo filed answers to the motion for

declaratory judgment and also filed motions for summary

judgment. Nextel alleged in its motion that it was entitled to

summary judgment because there were no material facts in dispute

and “the Lease at issue is unambiguous, and it clearly allows

Nextel and its assignees to build a second telecommunications

tower on the Premises.” In its motion, TowerCo alleged that it

was entitled to summary judgment “because the only issue to be

resolved is a question of law – interpretation of three clear

and unambiguous provisions of the Lease Agreement” expressing

the parties’ intent “that more than one tower may be constructed

on the Leased Premises.”

The three paragraphs referenced by TowerCo provide in

pertinent part as follows:

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 10. Use. The premises may be used by Lessee for the
transmission and receipt of wireless communication signals
in any and all frequencies and the construction and
maintenance of towers, antennas, or buildings, and related
facilities and activities (“Intended Use”). Lessor agrees
to cooperate with Lessee in obtaining, at Lessee’s expense,
all licenses and permits required for Lessee’s use of the
Premises (the “Governmental Approvals”). Lessee may
construct additional improvements, demolish and reconstruct
improvements, or restore replace and reconfigure
improvements at any time during the Initial Term or any
Renewal Term of this Lease. [Emphasis added.]

14. Lessor’s Representations and Warranties. Lessor
represents and warrants that (i) Lessee’s Intended Use of
the Premises as a site for the transmission and receipt of
wireless communication signals; for the construction and
maintenance of towers, antennas or buildings; and related
facilities is not prohibited by any covenants,
restrictions, reciprocal easements, servitudes, subdivision
rules or regulations. [Emphasis added.]

17. Improvements; Utilities; Access. (a) Lessee
shall have the right, at Lessee’s sole cost and expense, to
erect and maintain on the Premises improvements, personal
property and facilities, including without limitation, one
(1) tower, a structural tower base, radio transmitting and
receiving antennas, communications equipment, an equipment
cabinet or shelter and related facilities. [Emphasis
added.]

The circuit court heard oral argument on the motions for

summary judgment and denied them, holding that the lease

agreement was ambiguous and that parol evidence would be

admissible to determine the parties’ intent when the lease was

negotiated. At the conclusion of an ore tenus hearing held for

the taking of parol evidence, the circuit court ruled in its

final order that “said Lease Agreement permits the construction

of one communication tower, and only one communication tower, on

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the leased premises.” We awarded Nextel and TowerCo each an

appeal.

We first must clarify the record. During oral argument

before this Court, counsel for TowerCo made an argument based

upon our decision in Scott v. Walker, 274 Va. 209, 645 S.E.2d

278 (2007), decided after the present case was decided in the

circuit court. There, we held that a restrictive covenant

providing that no lot in a subdivision “shall be used except for

residential purposes” was ambiguous and did not prevent the

lot’s owners from leasing their single-family dwelling by the

day or by the week. We stated as follows:

It is . . . the general rule that while courts of
equity will enforce restrictive covenants where the
intention of the parties is clear and the restrictions are
reasonable, they are not favored, and the burden is on him
who would enforce such covenants to establish that the
activity objected to is within their terms. They are to be
construed most strictly against the grantor and substantial
doubt or ambiguity is to be resolved in favor of the free
use of property and against restrictions.

274 Va. at 212-13, 645 S.E.2d at 280 (quoting Schwarzschild v.

Welborne, 186 Va. 1052, 1058, 45 S.E.2d 152, 155 (1947)).

We also said there is an exception, as follows:

[I]f it is apparent from a reading of the whole instrument
that the restrictions carry a certain meaning by definite
and necessary implication, then the thing denied may be
said to be clearly forbidden, as if the language had been
in positive terms of express inhibition.

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Scott, 274 Va. at 213, 645 S.E.2d at 280-81 (quoting Bauer v.

Harn, 223 Va. 31, 39, 286 S.E.2d 192, 196 (1982) (internal

quotation marks omitted)).

In oral argument before us, TowerCo claimed that the

circuit court held that paragraph 17(a) of the lease agreement,

containing the “one (1) tower” language, was ambiguous.

Therefore, counsel argued, the circuit court should have

construed the paragraph in favor of the free use of the property

and against any restriction as a matter of law, thus barring the

court from admitting parol evidence or drawing necessary

implications. When asked whether this argument had been made in

the circuit court, counsel for TowerCo answered affirmatively

and named three places in the record where the argument would

appear. We have yet to find any argument based upon a purported

holding by the circuit court that paragraph 17(a) was ambiguous.

We will not, therefore, consider TowerCo’s argument. Rule 5:25.

However, while the circuit court did not hold paragraph

17(a) ambiguous, it did, as noted above, hold the lease

agreement ambiguous, and that ambiguity alone will serve as the

focus of our analysis. Whether contractual provisions are

ambiguous is a question of law and not of fact, and we do not on

appeal accord the circuit court’s resolution any deference since

we are afforded the same opportunity to consider the provisions.

Video Zone, Inc. v. KF&F Properties, L.C., 267 Va. 621, 625, 594

6
S.E.2d 921, 923 (2004). Thus, we conduct a de novo review.

Eure v. Norfolk Shipbuilding & Drydock Corp., 263 Va. 624, 631,

561 S.E.2d 663, 667 (2002).

Contractual provisions are ambiguous if they may be

understood in more than one way or if they may be construed

to refer to two or more things at the same time. Berry v.

Klinger, 225 Va. 201, 207, 300 S.E.2d 792, 796 (1983). The

ambiguity, if it exists, must appear on the face of the

instrument itself. Salzi v. Virginia Farm Bureau Mut. Ins.

Co., 263 Va. 52, 55, 556 S.E.2d 758, 760 (2002). In

determining whether the provisions are ambiguous, we give

the words employed their usual, ordinary, and popular

meaning. Pocahontas Mining, L.L.C. v. Jewell Ridge Coal

Corp., 263 Va. 169, 173, 556 S.E.2d 769, 772 (2002). And

contractual provisions are not ambiguous merely because the

parties disagree about their meaning. Dominion Savings

Bank, FSB v. Costello, 257 Va. 413, 416, 512 S.E.2d 564,

566 (1999).

In addition to Scott v. Walker, Nextel and TowerCo rely

heavily upon Parrish v. Robertson, 195 Va. 794, 80 S.E.2d 407

(1954), Oakwood Smokeless Coal Corp. v. Meadows, 184 Va. 168, 34

S.E.2d 392 (1945), and Stonegap Colliery Co. v. Kelly, 115 Va.

390, 79 S.E. 341 (1913). In Parrish, we stated as follows:

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 In . . . an instrument, where uncertainties or ambiguities
exist, the tenant is favored by law . . . because the
landlord, having the power of providing expressly in his
own favor, has neglected to do so; and also upon the
general principle that every man’s grant is to be taken
most strongly against himself. Thus, the language of a
lease which is fairly susceptible of two constructions is
to be taken most against the lessor.

195 Va. at 800, 80 S.E.2d at 410-11 (citations and internal

quotation marks omitted).

In Oakwood Smokeless Coal Corp., we stated as follows:

A lessee of real property is entitled to exclusive use of
the demised premises for any purpose not prohibited by the
lease, not amounting to waste or destruction of the subject
matter.
. . . .

It has been stated as a general rule that where doubt
exists as to the meaning of lease restrictions as to the
use of property, such provisions are to be resolved in
favor of the lessee and against the lessor.

184 Va. at 177, 34 S.E.2d at 396 (citations and internal

quotation marks omitted).

And in Stonegap Colliery Co., a case Nextel says is

controlling, we stated as follows:

A covenant that premises shall be used by a lessee for a
particular specified purpose does not impliedly forbid that
they may be used for a similar lawful purpose which is not
injurious to the landlord’s rights, unless such other use
is expressly forbidden.

115 Va. at 394, 79 S.E. at 342.

Nextel and TowerCo argue that the provisions of the

lease are not ambiguous. They say that paragraphs 10 and

14, which permit “towers,” are consistent with and not

8
contradictory of paragraph 17(a), which permits

“improvements . . . including without limitation, one (1)

tower,” indicating, as Nextel puts it, that the lease

provides the lessee with “the right to construct a minimum

of one tower on the Premises,” or, as TowerCo puts it, that

“there simply is no basis to either ascribe ambiguity to

the provision or construe the provision as limiting use of

the leased property to the construction of one tower only.”

Nextel and TowerCo contend that the word “including,”

found in paragraph 17(a), implies that the list following

is not exhaustive and not exclusive. They cite several

cases for definitions of the word to support their claim

that the provision “including without limitation, one (1)

tower” unambiguously permits the erection of more than one

tower on the leased premises. For example, in Federal

Election Comm’n v. Mass. Citizens for Life, Inc., 769 F.2d

13 (1st Cir. 1985), aff’d, 479 U.S. 238 (1986), the United

States Court of Appeals for the First Circuit stated that

“the word ‘includes’ is usually a term of enlargement, and

not of limitation,” and therefore “conveys the conclusion

that there are other items includable, though not

specifically enumerated.” Id. at 17. Also cited is

Black’s Law Dictionary, 777 (8th ed. 2004) (“including

typically indicates a partial list”).

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 We are willing to adopt these definitions of the word

“including,” but we do not agree that as used in paragraph

17(a) the word has the effect Nextel and TowerCo claim for

it. In the context in which it appears, the “including

without limitation” language means that there could be no

limitation upon the maintenance, use, or improvement of the

one tower listed in paragraph 17(a). Nor could there be

any limitation upon the addition of some different item not

specifically enumerated that might be necessary or

convenient to the erection, maintenance, use, or

improvement of that one tower.

Furthermore, the “including without limitation”

language certainly does not require us to ignore that the

“usual, ordinary, and popular meaning” of the word “one,”

appearing in paragraph 17(a), is “one,” not “two.” See

Pocahontas Mining, 263 Va. at 173, 556 S.E.2d at 772.

However, we cannot view paragraph 17(a) in isolation but

must consider it along with all the other provisions of the

lease. Berry, 225 Va. at 208, 300 S.E.2d at 796 (contract

“must be read as a single document” and its meaning “is to

be gathered from all its associated parts”).

In this approach, paragraphs 10 and 14 come into play.

Paragraph 17(a) may be understood as permitting only one

10
tower while paragraphs 10 and 14 may be understood as

permitting more than one. Thus, there is an unmistakable

ambiguity in the provisions of the lease agreement. The

question then becomes how the ambiguity should be resolved.

TowerCo argues that “rather than admitting parol

evidence, the trial court should have considered whether

‘settled rules of interpretation, applied to the writing as

a whole, leave a genuine uncertainty as to which [of] two

or more possible meanings represents the contracting

parties’ true intent. Thus, if the words chosen by the

parties have an ordinary, plain meaning, the parol evidence

inquiry is ended; parol evidence is inadmissible.’ ”

The difficulty, however, is that it is impossible to

ascertain from a consideration of the lease agreement as a

whole which of the two possible meanings represents the

true intent of the parties. In the effort to ascertain the

appropriate meaning, Stonegap Colliery Co. is helpful, but

not to the position espoused by Nextel and TowerCo.

In Stonegap Colliery Co., this Court considered an

abundance of extrinsic evidence. At issue was a claim by a

lessor that a lease of land for the purpose of mining coal

thereon impliedly prohibited the construction of housing

for miners on a part of the land unusable for mining

11
purposes. The Court stated that it “appears from the

testimony of numerous coal operators . . . that it is usual

and customary for the lessee to have the possession,

control and use of the surface of the leased premises . . .

for all purposes,” including “tenement houses.” 115 Va. at

395-96, 79 S.E. at 343. The Court also stated that “the

action of the parties is significant as showing their

intention, and that the construction of the lease now

contended for by the [lessors] is not warranted.” Id. at

396, 79 S.E. at 343. The Court then proceeded to recite a

lengthy list of activities supporting the view that

construction of the housing for miners was a use intended

by the parties. Id. at 396-97, 79 S.E. at 343.

In Dart Drug Corp. v. Nicholakos, 221 Va. 989, 277

S.E.2d 155 (1981), we indicated that when a case involves

the construction of covenants requiring strict construction

and the provisions are ambiguous, “the intention of the

parties is the controlling factor” and extrinsic evidence

is admissible to discern that intention. Id. at 993, 277

S.E.2d at 157. In a number of other cases involving

ambiguous contractual provisions, we have approved the use

of extrinsic evidence to resolve the ambiguity.

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 As recently as this past January, in Ott v. L&J

Holdings, LLC, 275 Va. 182, 654 S.E.2d 902 (2008), we said

that “[w]hen a document is ambiguous, . . . the court will

look to parol evidence in order to determine the intent of

the parties.” Id. at 187, 654 S.E.2d at 905. In Prospect

Dev. Co. v. Bershader, 258 Va. 75, 515 S.E.2d 291 (1999),

we said that “‘where the writing on its face is ambiguous,

. . . parol evidence is always admissible . . . to

establish the real contract between the parties.’ ” Id. at

84, 515 S.E.2d at 296. And in Cascades North Venture Ltd.

P’ship v. PRC Inc., 249 Va. 574, 457 S.E.2d 370 (1995), we

said that “where the writing on its face is ambiguous,

. . . the court should receive extrinsic evidence to

ascertain the intention of the parties.” Id. at 579, 457

S.E.2d at 373. See also Video Zone, 267 Va. at 626, 594

S.E.2d at 924; Tuomala v. Regent University, 252 Va. 368,

374-75, 477 S.E.2d 501, 505 (1996); Georgiades v. Biggs,

197 Va. 630, 634, 90 S.E.2d 850, 854 (1956); Young v.

Schriner, 190 Va. 374, 379, 57 S.E.2d 33, 35 (1950);

Shockey v. Westcott, 189 Va. 381, 389, 53 S.E.2d 17, 20

(1949); Stewart-Warner Corp. v. Smithey, 163 Va. 476, 487,

175 S.E. 882, 886 (1934).

We hold that the trial court did not err in admitting

parol evidence. We will now consider that evidence,

13
viewing it in the light most favorable to the Saunders, who

prevailed at trial. Tuomala, 252 Va. at 375, 477 S.E.2d at

505.

The record shows that on some unspecified date, a

representative of Nextel approached the Saunders brothers

and told them that Nextel was interested in the mountain on

their property “because of its height for a

telecommunications tower.” (Emphasis added.) Later, over

a period of several months beginning in the summer or

autumn of 2003, the Saunders negotiated numerous times with

as many as five or six different representatives of Nextel.

A summary of the matters that the Saunders and

Nextel’s representatives negotiated is important for it is

indicative of their intentions at the time they signed the

lease agreement. Ultimately, Nextel presented the Saunders

with a draft of a lease agreement, included in the record

as Exhibit A. Ralph Saunders, with the agreement of his

brother, Roscoe, made numerous changes in the draft,

including in paragraph 18(a), which is now paragraph 17(a).

Originally, paragraph 18(a) provided in part that

“Lessee shall have the right, at Lessee’s sole cost and

expense, to erect and maintain on the Premises

improvements, personal property and facilities, including

14
without limitation, towers.” However, the Saunders struck

through the words “including without limitation,” struck

the “s” from the end of the word “towers,” and placed ”1-”

before the new word “tower.”

Roscoe Neal Saunders testified that these changes were

made because “we figured . . . it needed to be with

limitations,” and where on “the original it says towers

. . . we changed that over to one because negotiating on

one tower was all that Nextel was doing at that point . . .

one tower only . . . [o]ne tower was negotiated.” And,

significantly, when Roscoe Saunders was asked “how many

towers did Nextel represent to you was going to be built up

there,” he replied: “One only.” And he affirmed that Paul

Tobias, a Nextel representative, “said during the

negotiations that they were planning on building one tower

on the property.”

On cross-examination, Roscoe Saunders was asked

whether he had discussed with anyone on behalf of Nextel

concerning the possibility that Nextel would construct more

than one tower. He responded that there was not a

discussion but only a mention by a Nextel representative

that there “may be a possibility but he didn’t think so”

and “it was not discussed as a possibility of a contract.”

15
 Later on, Nextel asked the Saunders to return the

“including without limitation” language to the lease

agreement. A Nextel representative explained that the

return was necessary to allow Nextel to upgrade its

equipment and “lease part of [its] tower to . . . someone

else,” and the removal of the language “would have stopped

[it] from doing so.” Accordingly, Roscoe Saunders

testified, “we put that back into the contract for that

reason.”

The Saunders then received from Nextel another draft

of the lease agreement, included in the record as Exhibit

B. This draft returned the “including without limitation”

language to the text of what then became paragraph 17(a),

but, significantly, Nextel included in paragraph 17(a) the

“one (1) tower” change the Saunders had made in Exhibit A.

As Ralph Saunders put it in his testimony, “they brought

[the draft] back with the one wrote in it.”

This draft became the final lease agreement without

further change. This agreement and a memorandum of

agreement were signed by the Saunders on July 2, 2004.

Before signing, they saw attached to the memorandum a

“blueprint drawing of one tower and its equipment.”

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 The Saunders learned in notices from Bedford County

dated March 3, 2006, that TowerCo had filed applications

for an amended special use permit to increase the height of

the existing tower from 80’ to 100’ and for a special use

permit to construct a second tower. Roscoe Saunders

attended the first hearing on the applications and opposed

the second tower but did not oppose increasing the height

of the existing tower.

The Saunders’ counsel also sent a letter to TowerCo

stating that his clients “do not want the obstruction of

another tower on the skyline or the additional burden on

the road.” Counsel concluded with the statement that if

TowerCo considered “another tower a necessity, it may be

that these issues could be addressed in negotiation.” No

negotiation ensued, and the Saunders filed their motion for

declaratory judgment.

In their case in chief, Nextel and TowerCo each called

only one witness. Nextel called Marsha Monique Fruit, its

project manager for southern Virginia and all of West

Virginia. However, Nextel does not mention Fruit’s name or

set forth any of her testimony in either its opening brief

or its reply brief. The same is true of the one witness

TowerCo called, its co-location manager, Martha Province,

17
whose job was to lease space on towers that TowerCo owned.

We must assume, therefore, that Nextel does not intend to

rely on Fruit’s testimony on appeal and that TowerCo does

not intend to rely on Province’s.

TowerCo did mention Fruit’s name in one of its briefs

and advanced an argument based upon her testimony. TowerCo

quoted Fruit as having testified that “the Lease contained

nothing to restrict the ‘use of the property at all . . .

in particular the number of towers’” and that “a one-tower

restriction would have caused her to flag the Lease as a

‘non-standard’ Lease.”

However, there is a problem with Fruit’s testimony.

The evidence showed that five or six Nextel representatives

negotiated with the Saunders, but Fruit admitted that she

did not “participate directly” in the negotiations with the

Saunders, and she did not claim that she was present during

any discussion between them and any other Nextel

representative.

Furthermore, Fruit denied ever having seen Exhibit A,

the draft of the lease agreement the Saunders returned to

Nextel “all marked-up,” and she disavowed knowing anything

about paragraph 18(a), now paragraph 17(a), “where it has

marked out towers and going into one tower.” Her testimony

18
was insufficient, therefore, to contradict the testimony of

the Saunders that they and Nextel’s representatives

negotiated for only one tower or to show that the change in

paragraph 17(a) from “towers” to “one (1) tower” did not

reflect the true intent of the parties.

In the end, under cross-examination, all Fruit could

say was she knew that anything in the lease agreement

limiting the number of towers would be “non-standard.” But

this is beside the point. The point is that, standard or

not, Nextel kept the “one (1) tower” provision in Exhibit

B, the final version that it prepared of the lease

agreement and that was signed by the parties.

Finally, we must address a contention made by TowerCo

that “[a]t best, the evidence at trial points only to what

was in Lessors’ heads contrary to both Nextel’s

understanding and the language of the Lease, which

represents what the parties bargained for and agreed to.”

However, there is the evidence of Nextel’s first contact

with the Saunders, when its representative told them Nextel

was interested in their mountain for “a,” meaning one,

“tower,” there is the evidence that the Saunders and

Nextel’s representatives negotiated for only one tower, and

there is the evidence of the representation made by a

19
Nextel representative that only one tower would be built,

all uncontradicted and all showing what was in the “heads”

not only of the lessors but of the lessee’s personnel as

well. It is this evidence, coupled with the evidence of

Nextel’s retention of the “one (1) tower” language in the

lease agreement, that truly “represents what the parties

bargained for and agreed to.”

We hold that the circuit court did not err in denying

the motions for summary judgment and in holding that the

lease agreement “permits the construction of one

communication tower, and only one communication tower.”

Accordingly, we will affirm the circuit court’s judgment.

Affirmed.

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