Western Properties v. Southern Utah Aviation, Inc.

Southern Utah Aviation (defendant) subleased vacant airport land from Western Properties (plaintiff) and covenanted to build a maintenance building that would become Western's property at lease end, with the sublease itself reviewed and approved by the city; both parties assumed the city would approve the actual building plan, but the city unexpectedly denied approval and never developed an overall airport plan, and Southern abandoned the property. Western sued for back rent, future rent, and the building's expected value; the trial court awarded rent only up to the abandonment date and denied the rest, and both sides appealed the relevant portions.

Whether a lessee who covenanted to build on leased land, where both parties assumed government approval would be granted, is excused from building and paying rent when that approval is unexpectedly withheld.