                 NOTE: Pursuant to Fed. Cir. R. 47.6, this disposition
                   is not citable as precedent. It is a public record.


 United States Court of Appeals for the Federal Circuit


                                       05-5181

                         KIMCO REALTY CORPORATION
                                    and
                      CENTEREACH MALL ASSOCIATES, L.P.,

                                               Plaintiffs-Appellants,

                                          v.

                                  UNITED STATES,

                                               Defendant-Appellee.

                          ___________________________

                          DECIDED: June 30, 2006
                          ___________________________


Before MICHEL, Chief Judge, PLAGER, Senior Circuit Judge, and BRYSON, Circuit
Judge.

BRYSON, Circuit Judge.

      Kimco Realty Corporation and Centereach Mall Associates, L.P., (collectively

“Kimco”) appeal from a decision of the United States Court of Federal Claims in a case

involving the government’s obligations under a lease agreement. Kimco Realty Corp. v.

United States, No. 98-736C. Kimco, the landlord, alleged that the government, the

tenant, owed additional funds under two provisions of the lease—one for common area

maintenance (“CAM”) charges and the other for reimbursement of building-value taxes.

The Court of Federal Claims granted the government’s motion for summary judgment
on the CAM charges issue. On the tax reimbursement issue, the court ruled for the

government after a trial on the documentary record. Because we conclude that the

court properly interpreted the provisions of the lease pertaining to tax reimbursement

and did not commit clear error in the findings it made based on the evidence relating to

that issue, we affirm that portion of the court’s judgment.       However, because we

conclude that the lease is ambiguous with regard to the issue of the CAM charges, we

vacate the summary judgment on the CAM charges issue and remand for further

proceedings on that portion of the trial court’s judgment.

                                             I

       Kimco owns and manages a shopping center in the Town of Brookhaven, New

York. The United States Postal Service is a tenant in the shopping center, pursuant to a

ground lease that the Postal Service entered into in 1984 with the original fee owner,

Firstcent Shopping Center, Inc. In 1993, Centereach Mall Associates, L.P., acquired

the shopping center through foreclosure and is now the successor-landlord to the lease.

Kimco Realty Corporation operates and manages the shopping center on behalf of

Centereach Mall Associates.

       The Postal Service’s leased parcel consists of 38,618 square feet. Although it

originally intended to transfer and assign the ground lease to a non-governmental entity

for construction of a post office, the Postal Service ultimately constructed the building

itself. The post office building covers 9,790 square feet of the leased space.

       Two disputes have arisen between Kimco and the government. First, the parties

disagree about the scope of the government’s payment obligations for CAM charges.

The government contends that its responsibility is limited to three percent of the CAM




05-5181                                      2
charges for the shopping center’s general parking area. Kimco, on the other hand,

asserts that the government is responsible for three percent of the CAM charges

attributable to the entire shopping center. Second, the parties disagree about whether

the government is required, under the terms of the lease, to reimburse Kimco for a

portion of the building-value taxes Kimco has paid.

       With regard to the CAM charges, the lease provides:

       It is mutually understood that the U.S. Postal Service will be responsible
       for their proportionate share of all applicable common area maintenance
       charges . . . . That amount begin [sic] agreed as three (3%) percent of all
       costs. Said costs shall include, but not limited to the following: general
       cleaning including maintenance personnel; snow removal, maintenance of
       lighting and cost of electricity; parking lot maintenance & stripping;
       maintenance of signs; landscaping & maintenance thereof; repair of
       curbing.

Lease, ¶ 33 (emphasis added). In addition, the lease states:

       Tenant will be responsible for any and all general maintenance for the
       common area maintenance for his 38,618 [square feet], which shall
       include, but is not limited to general cleaning including maintenance
       personnel; snow removal, maintenance of lighting and cost of electricity;
       parking lot maintenance & stripping; maintenance of signs; landscaping &
       maintenance thereof; repair of curbing.

Id., ¶ 43 (emphasis added).

       With regard to tax reimbursement, the lease provides that “the tenant

agrees to pay . . . all municipal, county, and state taxes . . . that may be properly

levied or assessed against the demised premises or the buildings or

improvements thereon. Id., ¶ 15. Specifically the lease provides:

       From January 1, 1984 to the date of occupancy of the demised premises
       by the U.S. Postal Service, the Postal Service shall reimburse the
       Landlord three (3%) percent of the total General Real Estate Taxes
       attributed to land value, then from the date of the U.S. Postal Service’s
       occupancy of the demised premises for the balance of this lease, . . .




05-5181                                      3
       Postal Service shall reimburse the Landlord three (3%) percent of the total
       General Real Estate taxes attributed to land, buildings, and improvements.

Percentage Reimbursement of Paid Taxes Rider, ¶ 1.              The lease qualifies that

obligation, however, by providing as follows:

       In the event the improvements constructed on the leased property are
       government owned rather than leased,* the U.S. Postal Service shall
       continue to be responsible for 3% of the total General Real Estate Taxes
       attributed to land value only after beneficial occupancy of the newly
       constructed Postal facility. (*and all improvements are tax exempt)

Id., ¶ 5.

       On the issue of CAM charges, the trial court granted summary judgment in favor

of the government. The court explained that Kimco’s interpretation of the lease “fail[ed]

to take into account use of the word ‘applicable’ . . . [and] . . . fail[ed] to account for

lease paragraph 43’s reference to [the government’s] CAM responsibility and its relation

to [the government’s] 38,618 [square feet] of leased space.”      According to the court,

“the use of the word ‘applicable’ limits the term ‘all’ such that [the government] is only

responsible for 3% of those CAM charges pertaining to it.” The court added that its

conclusion was “bolstered by lease paragraph 43, which states that [the tenant] is

responsible for the CAM ‘for his 38,618.’” In addition, the court noted that the examples

of CAM costs listed in paragraph 33 “appear[ ] to refer to performance of those

maintenance services relating to the parking lot only.” The court therefore concluded

that the government is responsible only for three percent of the CAM charges relating to

the shopping center’s parking lot.

       On the issue of tax reimbursement, the court observed that the parties were “in

disagreement over whether the building is tax exempt” but concluded that the “issue is




05-5181                                     4
in fact much simpler.”1 The court explained that James Ryan, the assessor for the

Town of Brookhaven, stated in his deposition that the post office building had been

exempted from tax assessment.       The court therefore reasoned that “[b]ecause the

building was not taxed, [Kimco] made no payments on the building’s value for which it

should be reimbursed by the [government].” Accordingly, the court concluded that the

government “is responsible for reimbursing [Kimco] for 3% of the land value taxes only.”

The court further found that the government had overpaid $27,080 to Kimco and that

the government was entitled to recover the payments it had made for taxes it did not

owe. Kimco appealed from both aspects of the court’s judgment.

                                           II

      On the tax reimbursement issue, Kimco rests its argument on its assertion that

under New York law the post office building is not tax exempt.         For that reason,

according to Kimco, the government is required to pay three percent of the total tax

obligation for the entire shopping center. The trial court, however, concluded that the

evidence showed that the post office building was not in fact taxed and therefore must

be treated as tax exempt for purposes of calculating the government’s tax obligations

under the lease.

      Two provisions of the lease are particularly pertinent. First, paragraph 15 of the

lease provides that the government must pay only those taxes “properly levied or

assessed against the demised premises or the buildings or improvements thereon.”




      1
            The court determined that the tax reimbursement issue was not appropriate
for summary judgment, but it noted that “the parties stipulated that the Court decide the
issues based on the parties’ proposed findings of fact and other pleadings in lieu of an
evidentiary hearing.”


05-5181                                    5
Second, although paragraph 1 of the “Percentage Reimbursement of Paid Taxes Rider”

to the lease states that the government will be obligated to reimburse the landlord for

three percent of “the total General Real Estate taxes attributed to land, buildings, and

improvements,” paragraph 5 of that rider provides that, if the improvements constructed

on the leased property are government owned and tax exempt, the Postal Service is

responsible for only “3% of the total General Real Estate Taxes attributable to land

value only.”   Thus, if the government-owned post office building is tax exempt, the

government’s lease obligation is limited to a percentage of the taxes on the shopping

center land only, not a percentage of all the taxes on the land, buildings, and

improvements at the shopping center.

       The trial court found that the post office building was tax exempt. In making that

finding, the court relied on the deposition of the town tax assessor, who testified that the

post office building was not included in his tax assessment. The trial court reasoned

that “because the town did not tax plaintiffs on the Post Office building, there are no

taxes paid by [Kimco] for which [the government] needs to reimburse [Kimco].” That is,

because the court found that the post office building was tax exempt, it held that the

government’s tax obligation was limited to the amount set forth in paragraph 5 of the tax

rider to the lease.

       The trial court’s decision on the tax reimbursement issue rested on the evidence

submitted to it. Although Kimco challenged that evidence at trial and continues to do so

on appeal, the evidence came from a competent source and could properly be credited

by the court. Because the court did not commit clear error in relying on that evidence,

we affirm the court’s decision that the post office building was tax exempt and that the




05-5181                                      6
government therefore owed Kimco three percent of the tax obligation for the shopping

center land only, and not three percent of the total tax obligation for the shopping center

land, buildings, and improvements. Accordingly, we uphold the trial court’s ruling with

regard to the tax reimbursement issue.

                                             III

       With respect to the CAM charges issue, the lease does not define the terms

“common area” or “common area maintenance.” In particular, it does not expressly

restrict those terms to refer to the shopping center parking lot. Thus, as the trial court

acknowledged, “[a]t first glance, it seems that the [CAM] charges would include, as

[Kimco] claim[s], the cost of maintaining all common areas within the entire shopping

center.”

       Despite the apparent breadth of the term “common area maintenance,” the trial

court concluded that the lease unambiguously limits the government’s CAM charge

obligation to paying three percent of the common area maintenance charges for the

shopping center parking lot. In reaching that conclusion, the court relied, first, on the

use of the word “applicable” in paragraph 33 of the lease. That paragraph provides that

the Postal Service “will be responsible for their proportionate share [three percent] of all

applicable common area maintenance charges.” The court concluded that the term

“applicable” defines a subset of all common area maintenance charges, and that the

Postal Service’s three percent share must relate to less than all the common area

maintenance charges for the entire shopping center.             While that is a plausible

interpretation of the term “applicable,” it is not the only possible interpretation. The term

could be interpreted to refer to the particular types of charges set forth in the lease,




05-5181                                      7
without specific limitation to the common area maintenance charges pertaining to the

parking lot.   Under that interpretation, paragraph 33 of the lease would require the

government to pay three percent of the CAM costs for all non-leased portions of the

shopping center.

       The trial court also found that the clause in paragraph 43 of the lease providing

that the tenant “will be responsible for any and all general maintenance for the common

area maintenance for his 38,618 [square feet]” supports a narrow interpretation of the

phrase “all applicable common area maintenance charges” in paragraph 33. The court

viewed that language as indicating that the tenant would be responsible for the CAM

charges “related to the [tenant’s] leased space.” Because the court concluded that the

“only space used by the [tenant] in relation to its leased plot is the parking lot,” the court

considered paragraph 43 as providing support for the government’s submission that its

CAM charge obligation was limited to charges associated with the parking lot.

       We disagree with the trial court’s interpretation of the language from paragraph

43. We interpret that language as meaning simply that the government is responsible

for all the common area maintenance services for its 38,618 square foot plot. Under our

interpretation of paragraphs 33 and 43, when read together, the government is

responsible for all CAM charges pertinent to its leased area and, in addition, for three

percent of “all applicable common area maintenance charges” pertaining to common

areas outside of its leased space. That interpretation would appear to support Kimco’s

argument that the term “common area maintenance charges” refers to the charges for

all areas within the shopping center that are not leased to particular tenants.




05-5181                                       8
      In further support of its restrictive interpretation of the disputed lease language,

the trial court held that the specific examples of CAM costs listed in paragraphs 33 and

43 “appear[ ] to refer to performance of those maintenance services relating to the

parking lot only.” That is, the court invoked the rule of ejusdem generis and concluded

that the CAM charges relate only to parking lot maintenance.

      We do not agree that the principle of ejusdem generis applies here. It is not clear

that services such as “general cleaning,” “maintenance of lighting and cost of

electricity,” and “maintenance of signs” are pertinent only to a parking lot; any one of

those services is likely to be needed in other common areas of the shopping center.

Consequently, that language does not resolve the ambiguity of the lease, because it

does not establish that the government’s responsibility to Kimco is limited to three

percent of the CAM charges that relate to the parking area.

      It is well established that “if more than one meaning is reasonably consistent with

the contract language it can not be deemed unambiguous.” C. Sanchez & Son, Inc. v.

United States, 6 F.3d 1539, 1544 (Fed. Cir. 1993). Moreover, “[t]o the extent that the

contract terms are ambiguous, requiring weighing of external evidence, the matter is not

amenable to summary resolution.” Beta Sys. v. United States, 838 F.2d 1179, 1183

(Fed. Cir. 1988) (citing Samuel Williston, A Treatise on the Law of Contracts § 616, at

649, 652 (3d ed. 1961)). Based on its analysis of the contract language, the trial court

concluded that the contract unambiguously obligated the government to pay three

percent of the CAM charges relating to the parking lot only, and on that ground the court

granted the government’s motion for summary judgment. Because we are unable to

agree with the court’s conclusion that the contract unambiguously supports that




05-5181                                    9
interpretation, we reverse the grant of summary judgment for the government on the

CAM charge issue.

       Kimco urges us not only to reverse the district court’s grant of summary judgment

to the government on the CAM charge issue, but to go further and direct the entry of

summary judgment for Kimco. We decline to do so. The only question before us on the

appeal of the CAM charges issue is the propriety of the summary judgment granted to

the government. While an appellate court, in an appeal from the grant of summary

judgment for the appellee, may direct the entry of summary judgment for the appellant,

such a step is an unusual one that is reserved for circumstances in which the outcome

is not in doubt and no useful purpose would be served by further proceedings on

remand. See Lighting World, Inc. v. Birchwood Lighting, Inc., 382 F.3d 1354, 1366

(Fed. Cir. 2004); Conoco, Inc. v. Dep’t of Energy, 99 F.3d 387, 394-95 (Fed. Cir. 1996);

Jewelers Vigilance Comm., Inc. v. Ullenberg Corp., 853 F.2d 888, 890 n.2 (Fed. Cir.

1988); 10A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice &

Procedure § 2720, at 355 (1998).

       In this case, the proper resolution of the lease interpretation issue is not so clear

as to justify our taking the unusual step of deciding the case on the merits without

remanding it for the trial court to decide in the first instance. For one thing, it is not clear

from the record before us just what portions of the shopping center constitute non-

leased, common areas that are not included within the parking lot, and what sorts of

maintenance services are required for those areas. That factual question may affect the

way the trial court construes the lease.           A further reason counseling against our

directing the entry of judgment for Kimco without further proceedings in the trial court is




05-5181                                       10
that the record below contains at least some parol evidence supporting the

government’s interpretation of the CAM charge provisions of the lease. In its summary

judgment papers, the government proffered an affidavit from a Postal Service employee

who asserted that he negotiated the lease and that “[i]t was the Postal Service’s

understanding when it accepted the lease that it would only have to pay 3% of the CAM

attributable to the parking lot areas only, not for the entire mall property.” Declaration of

Nicholas J. Menchise in Support of Defendant’s Motion for Summary Judgment, ¶ 12.

Because the trial court found the lease language to be unambiguous, it had no occasion

to consider that evidence. On remand, however, the trial court may determine that such

parol evidence is pertinent to the proper interpretation of the contract language. We

therefore decline Kimco’s invitation to direct the entry of judgment in its favor on the

CAM charges issue. Instead, we vacate the trial court’s grant of summary judgment

with regard to the question of CAM charges and remand for further proceedings on that

issue.

         Each party shall bear its own costs for this appeal.




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