September 9, 2016

BRYANT COMMERCIAL POSTAL, LLC v UNITED STATES POSTAL SERVICE

PSBCA No. 6633

APPEARANCE FOR APPELLANT:
Malcolm Bryant
Manager, Bryant Commercial Postal, LLC

APPEARANCE FOR RESPONDENT:
Joseph B. Fray, Esq.
United States Postal Service Law Department  

OPINION OF THE BOARD

Appellant, Bryant Commercial Postal, LLC (Bryant) appeals the denial by a contracting officer for Respondent, United States Postal Service, of its $1,700 claim under a lease agreement between the parties. We grant the appeal, ruling in Bryant’s favor.

FINDINGS OF FACT

1. Bryant leased the Buechel Station Post Office in Louisville, Kentucky to the Postal Service for a twenty-year term ending on March 12, 2018.¹ The Buechel Station is a one-story wood frame with brick veneer building that Bryant constructed to the Postal Service’s specifications. (Appeal File (AF) 1).
2. The lease included a Maintenance Rider which provided in relevant part:
             a. The Lessor [Bryant] shall, except as otherwise specified herein and except for damage resulting from the negligence of Postal
                 Service agents or employees, maintain the demised premises, including the building and any and all equipment, fixtures, and
                 appurtenances, whether severable or non-severable, furnished by the Lessor under this Lease, in good repair and tenantable
                 condition. For the purpose of so maintaining said premises and property, the Lessor may at reasonable times, and upon reasonable
                 notice to the facility manager, enter and inspect the same and make any necessary repairs thereto. . . .
             b. Lessor [Bryant] shall repaint the interior (including but not limited to the walls and ceilings) and exterior at least once every five (5)
                 years (unless the five (5) year period is specifically extended in writing by the Contracting Officer) and at any other time that
                 painting may become necessary as a result of fire or other casualty.
   (AF 1 at 24).
3. The Postal Service vacated the Buechel Station on June 16, 2011, and the building has remained unoccupied since. The Postal Service has remained in possession of the keys and has continued paying the rent. (AF 6 at 71, 76).
4. After the Postal Service vacated the Buechel Station, homeless people regularly congregated and slept on the loading dock outside the post office. They left trash, including mattresses, on the loading dock and elsewhere outside the post office. Graffiti was painted on the exterior brick of the building, on windows, and on HVAC equipment. (AF 2-4, 6).
5. The Postal Service’s internal electronic Facility Management System indicated that the Postal Service is responsible for custodial and janitorial services, and trash removal at the Buechel Station. Opinions by Postal Service officials in several internal emails consistently reached the same conclusion. (AF 6).
6. Neighbors at the shopping center at which the Buechel Station was located threatened to take legal action against Bryant to remedy the situation. Bryant requested that the Postal Service remove the trash and graffiti. The Postal Service declined to do so. Bryant then paid to remove the graffiti, mattresses and other trash, at a cost of $1,700. On March 3, 2015, Bryant filed a claim in that amount with the contracting officer. (AF 2, 6; Bryant’s July 15, 2016 submission to the Board).
7. The contracting officer waited a year,² and on March 4, 2016, denied the claim. The contracting officer concluded that paragraphs (a) and (c) of the lease’s Maintenance Rider placed responsibility on Bryant for painting to cover graffiti placed on the building by homeless people, which she described as “homeless vandalism.” The contracting officer’s final decision did not expressly address trash removal. (AF 3).
8. On March 22, 2016, Bryant sent the contracting officer a letter appealing the final decision, although she failed to forward that appeal letter to the Board as she was required to do.³ See 39 C.F.R. § 955.4. Bryant’s letter explained that its contractual painting obligation did not extend to brick areas that were not intended to be painted. It also explained that as the exclusive tenant in possession, the Postal Service was responsible to keep the property secure after vacating it. Bryant therefore concluded that allowing homeless people on the property constituted negligence by the Postal Service within the meaning of the Maintenance Rider, thereby relieving Bryant from responsibility for the costs at issue. (AF 4-5).

DECISION

At the request of the parties, this appeal is decided on the written record pursuant to 39 C.F.R. § 955.12. See June 29, 2016 Order and Memorandum of Telephone Conference.  The primary issue before the Board is a legal one – which party is responsible under the lease for the costs of removing trash and graffiti from the Buechel Station.  Bryant alleges that the Postal Service’s negligence caused the accumulation of trash and graffiti making the Postal Service liable under the terms of the lease.  The Postal Service responds that it was not negligent and that the terms of the lease require Bryant to maintain the property.

The lease does not expressly allocate responsibility between the parties for trash removal or for the costs of damage from vandalism such as graffiti. However, the lease contemplates exclusive possession by the Postal Service, and the Postal Service has maintained exclusive possession throughout the course of this dispute (Findings 1-3).  Indeed the Maintenance Rider requires Bryant to provide notice to the Postal Service just to enter and inspect the property for purposes of performing repairs or maintenance (Finding 2, Maintenance Rider section (a)).

We have addressed similar situations in the past. Because the Postal Service has exclusive possession, it is responsible for routine housekeeping functions such as trash removal.  See Real Properties, MLP, PSBCA No. 3453, 95-2 BCA ¶ 27,829 at 138,754-55; cf. Trust of Penachio, PSBCA No. 4965, 04-1 BCA ¶ 32,599 at 161,315 (finding Postal Service responsible for removal of trash at a leased post office where it consistently had performed such custodial maintenance).

The parties’ interpretation before the dispute arose is important in interpreting the contract terms. See Real Properties, MLP, 95-2 BCA ¶ 27,829 at 138,757; see also Penachio, 04-1 BCA at 161,315; Edward R. and Lorraine Ester, PSBCA No. 1559, 88-2 BCA ¶ 20,573 at 104,000.  Here, the Postal Service’s own consistent interpretation acknowledged its leasehold obligation to conduct basic housekeeping (Finding 5).  The debris described by the parties is an accumulation of trash.  The trash would not have accumulated if the Postal Service had conducted its normal housekeeping function.  Accordingly, the Postal Service is liable for its removal.

As for the graffiti, which Bryant painted over following the threat of litigation from nearby businesses (Finding 6), the Postal Service argues that the lease makes Bryant liable to correct the unsightly damage. However, we have held that cosmetic repairs are outside the lessor’s normal maintenance obligations under section (a) of the Maintenance Rider.  See Real Properties, MLP, 95-2 BCA ¶ 27,829; Ester, 88-2 BCA ¶ 20,573.

Additionally, the Postal Service had exclusive possession of the property which it abandoned. The record does not reflect that the Postal Service took any security precautions after it vacated.  Indeed, the photographs in the record show no fencing, barriers, or other measures to protect the property, thus increasing the likelihood of vandalism and graffiti.  Cf. Restatement (Second) of Property, Land. & Ten., § 12.1, cmt. i (1977)(“A tenant who abandons leased property is not entitled to insist on action by the landlord to mitigate damages . . . . Abandonment of property [by a tenant] is an invitation to vandalism, and the law should not encourage such conduct by putting a duty of mitigation of damages on the landlord.”).

The Postal Service also argues that Bryant is responsible under Maintenance Rider section (c) to paint the exterior every five years (Finding 2). However, the area on which the graffiti was present was unpainted brick, windows, and HVAC equipment, which would not have been covered by that painting obligation.⁴  Additionally, the record does not explain whether five years had elapsed since the exterior was last painted.  Under the circumstances of this case, we conclude that the Postal Service is liable for remediating the vandalism.⁵  As with the trash removal issue, our conclusion also is consistent with the pre-dispute interpretation by Postal Service officials (Finding 5).

As there has been no challenge to the amount spent by Bryant, it is entitled to recover the entirety of its $1,700 claim plus applicable interest.

CONCLUSION

The appeal is granted. The Postal Service shall pay Bryant $1,700 plus applicable interest.

Gary E. Shapiro
Administrative Judge
Chairman

I concur:
Peter F. Pontzer
Administrative Judge
Board Member

I concur:
Diane M. Mego
Administrative Judge
Board Member

¹ The lease identified the original lessors as Malcolm Bryant and Sally Bryant (AF 1 at 2).

² It appears that in the intervening year, the situation described in this Opinion has persisted (see AF 4).

³ This appeal was initiated when Bryant filed an appeal directly with the Board’s electronic filing system on April 29, 2016.

⁴ To the extent that precedent distinguishes responsibility for painting or for cosmetic repairs between areas visible or not visible to postal employees or customers, see J. Leonard Spodek, Nationwide Postal Management, PSBCA Nos. 4206, et al., 00-2 BCA ¶ 30,979 at 152,878; Ester, 88-2 BCA ¶ 20,573; J & R Realty Co. v. United States, 418 F. Supp. 391, 392-93 (E.D. Pa. 1976), the fact that Buechel Station was a vacant non-operating post office eliminates any need for such analysis.

⁵ We emphasize that our conclusion applies only to the facts presented – where the Postal Service held exclusive possession, abandoned the property, and did not show that it took security precautions.  We save the issue of responsibility for vandalism under other circumstances for another day.