Opinion
No. CV05 4004782 S
February 20, 2007
MEMORANDUM OF DECISION
The plaintiff has brought this action by way of a writ summons and complaint dated December 3, 2004, bearing a return date of January 11, 2005. The complaint consists of one count alleging that the parties are owners of real estate in which they lived together located at 780 Hunting Ridge Road, Easton, Connecticut. The plaintiff alleges that the parties were joint tenants of said real estate with rights of survivorship, and, as such, each has an undivided fifty percent interest therein. The plaintiff seeks a partition of the real estate, according to the respective rights of the co-owners, with a sale of the premises and a division of the proceeds between the parties according to their respective rights.
The Emigrant Mortgage Company, Inc. was also a named defendant. However, the action was withdrawn as to Emigrant on August 3, 2006.
General Statutes § 52-495 regarding partition of real property reads as follows:
"Courts having jurisdiction of actions for equitable relief may, upon the complaint of any person interested, order partition of any real property held in joint tenancy, tenancy in common, coparcenary or by tenants in tail. The court may appoint a committee to partition any such property. Any decrees partitioning entailed estates shall bind the parties and all persons who thereafter claim title to the property as heirs of their bodies."
The subject property was sold on December 9, 2005, while the action was pending, and the net proceeds of the sale in the amount of $192,065.09 has been held in escrow since the sale date.
The defendant, by way of an Answer dated March 28, 2006, admits that his name appears on record title as a co-owner of the subject real estate. However, he claims that he has made all financial contributions to the purchase, maintenance and improvement of the property, in amounts that would entitle him to the entire escrow of $192,065.09, which represents the net proceeds of the sale of the real estate.
A court trial was held on October 19, 2006. Thereafter, the parties were given a briefing schedule by the court. The court is in receipt of the plaintiff's memorandum of law dated November 21, 2006 and the defendant's memorandum of law, dated November 22, 2006. Each party has submitted, as part of its memorandum, a proposed finding of facts.
I Finding of Facts
The plaintiff and the defendant first met in 1987 when the plaintiff was hired at Neumade Products, a company owned by the defendant. The plaintiff served in the capacity as a secretary for the defendant. At that time the plaintiff was a resident of Norwalk, Connecticut where she resided until 1991 when she obtained a divorce. She then relocated to an apartment in Norwalk and subsequently she purchased a condominium unit in Shelton, Connecticut. Approximately eighteen months later, she sold that condominium unit and returned to Norwalk, and purchased another condominium unit.
In 1997, the plaintiff and the defendant commenced a dating relationship, which resulted in the parties living together in a romantic relationship at the plaintiff's condominium unit in 1998. In 1999, the parties began looking for a home to purchase together. They subsequently agreed to purchase the residence located at 780 Hunting Ridge Road, Easton, Connecticut. The parties purchased said residence by way of Warranty Deed with rights of survivorship on July 22, 1999 for the purchase price of $856,000 from MAC Construction, LLC. The parties paid an additional sum of $10,076.00 to the seller an as additional adjustment for "extras" identified on Exhibit B, bringing the total purchase price due to the seller from the buyers (DiCerto and Jones) to $866,076.00. The defendant had previously provided the total contract deposit in the amount $85,600.00. Closing adjustments including property taxes and a purchasers' allowance of $4,500.00 resulted in the purchasers receiving total credits of $90,262.33 from the seller on the date of the closing, leaving a balance due from the plaintiff and the defendant to the MAC Construction, LLC in an amount of $775,813.67.
On the same date of the purchase of the subject property, the parties were co-signers on a purchase money mortgage in the amount of $850,000. The mortgage lender was Citibank, F.S.B. (Citibank). A review of the closing documents for this purchase (Exhibit B) reveals that in addition to the sum due the seller, the plaintiff also incurred additional closing costs and mortgage lender fees totaling $26,580.85. The plaintiff by her testimony at trial agreed that the defendant contributed the net sum of $47,605.48 to the purchase, of the real estate, while the plaintiff did not contribute any money.
The defendant had made the initial deposit of $85,600. However, the net mortgage proceeds at the time of purchase exceeded the balance due the sellers resulting in a partial reimbursement to the defendant. His net contribution to the purchase was therefore $47,605.48. The plaintiff confirmed this amount in her testimony.
Subsequent to obtaining joint ownership to the subject real estate, the court finds that the defendant paid all financial charges and payments relating to said real estate relating to taxes, insurance and mortgage payments until sold on December 9, 2005. The defendant also paid associated mortgage refinance costs in the amount of $3,276.00 when the original mortgage of $850,000 with Citibank was replaced with a $820,000 first mortgage to the Emigrant Mortgage Company, Inc. (Emigrant). The new mortgage note with Emigrant was also signed by the defendant, while the mortgage deed was signed by both parties, as title remained in both names. All payments for the monthly mortgage charges to Emigrant, were also paid solely by the defendant. The reduction in the principal of the original mortgage to Citibank from $850,000 to the new principal amount of $820,000 to the Emigrant was due solely to the mortgage payments from the defendant's funds. The reduction in principal is found to be $30,000.00
In addition to the payments listed above, which were paid exclusively from the defendant's funds, the defendant paid for all improvements to the property between the date of purchase and the time of sale. The court also finds that the defendant made expenditures for fixtures, furnishings, appliances, equipment, improvements and landscaping which total $94,042.15. The defendant also gave the plaintiff the sum of $500.00 per month as an allowance toward household expenses, some of which the plaintiff used to hire a cleaning person and to pay the telephone and cable television bills.
The total submitted by the defendant is $100,832.25. The defendant's company, however paid $6,790.10 of the claimed total. Items that were removed from the property prior to sale were not included in the defendant's claim, as he retained possession of those items.
On December 9, 2005, the plaintiff and the defendant sold the subject real estate for a sales price of $1,090,000.00. This represents an increase of $234,000.00 from the purchase price paid by the plaintiff and the defendant on July 22, 1999, which was $856,000. After the usual and customary buyer-seller closing adjustments and the closing costs, which included payoff of the Emigrant mortgage in the amount of $825,381.39, the plaintiff and the defendant received net sales proceeds totaling $192,065.09. This amount has been held in an escrow account pending the outcome of the present case.
There was no agreement between the parties, either oral or in writing as to what would occur regarding the defendant's contributions including payments for the purchase of the property, payments to the mortgage, improvements to the property and the expenses of maintaining the property, if the parties were to later separate. See Oswald v. Giallombardo, Superior Court, judicial district of New London at New London, No. CV05-4003382 (Jun. 20, 2006, Leuba, JTR). However, there was an agreement and understanding between the parties during their relationship, prior to separation, that the defendant was to pay for these expenses without reimbursement from the plaintiff.
II Discussion
The present action came to the court as an action for a partition and sale of the subject property with a division of the net proceeds between the plaintiff and the defendant "according to their respective rights in the real estate." See General Statutes § 52-502(b). A partition action, although a creature of statute, is an equitable action, which invokes the court's equity jurisdiction. Fernandes v. Rodriguez, 255 Conn. 47, 59, 761 A.2d 1283 (2000). "The determination of what equity requires in a particular case, the balancing of the equities, is a matter for the discretion of the trial court." (Internal quotation marks omitted.) May v. Retarides, 83 Conn.App. 286, 295, 848 A.2d 1222, cert. denied, 271 Conn. 908, 859 A.2d 562 (2004).
Sec. 52-502(b) reads as follows:
On any such complaint, the court may appoint a committee to make the sale, who shall pay into court the proceeds therefrom. The proceeds from the sale, after deducting such reasonable costs and expenses as the court directs, shall be distributed by order of court among all persons interested in the property, in proportion to their interests.
"As we have stated on other occasions, it is not always true that each tenant in common or joint tenant is entitled to equal shares in the real estate. Levay v. Levay, 137 Conn. 92, 96, 75 A.2d 400 (1950) (Although each party was the owner of an undivided one-half interest in the property, it does not follow that he or she will necessarily be entitled to equal shares of the moneys obtained from the sale. Equities must be considered and, if established, must be liquidated before distribution is ordered.); see also Hackett v. Hackett, 42 Conn.Sup. 36, 40, 598 A.2d 1112 (1990), aff'd, 26 Conn.App. 149, 598 A.2d 1103 (1991), cert. denied, 221 Conn. 905, 600 A.2d 1359 (1992). Accordingly . . . the trial court may distribute the proceeds of the sale in accordance with the equitable interest of each party." (Internal quotation marks omitted.) Fernandes v. Rodriguez, 90 Conn.App. 601, 610, 879 A.2d 897 (2005), quoting Fernandes v. Rodriguez, supra, 255 Conn. 60.
"It is settled law that where one spouse purchases property entirely with his or her own funds and takes title in the names of both spouses jointly, a rebuttable presumption arises that a gift was intended to the other spouse of a one-half interest in the property . . . This is the rule whether the person who pays the purchase price is the husband or the wife." (Citations omitted.) Hackett v. Hackett, 42 Conn.Sup. 3641 (1990) 598 A.2d 1112 (1990), aff'd. Per curiam, 26 Conn.App. 149 (1991).
However, the subject case presents a situation where the plaintiff and the defendant were not spouses, but rather, were parties who cohabited together. "Cohabitation is a dwelling together of man and woman in the same place in the manner of husband and wife." Wolk v. Wolk, 191 Conn. 328, 332, 464 A.2d 780 (1983). "Although other jurisdictions may recognize common-law marriage or accord legal consequences to informal marriage relationships, Connecticut definitely does not . . . It follows that although two persons cohabit and conduct themselves as a married couple, our law neither grants to nor imposes upon them marital status" McAnerney v. McAnerney, 165 Conn. 277, 285, 334 A.2d 437 (1973). "[C]ohabitation alone does not create any contractual relationship or, unlike marriage, impose other legal duties upon the parties." Boland v. Catalano, 202 Conn. 333, 339, 521 A.2d 142 (1987).
"Rather, where the parties have established an unmarried, cohabiting relationship, it is the specific conduct of the parties within that relationship that determines their respective rights and obligations, including the treatment of their individual property." Herring v. Daniels, 70 Conn.App. 649, 656, 805 A.2d 718 (2002); see also Boland v. Catalano, supra, 340-41. "Any such finding must be determined by reference to the unique circumstances and arrangements between the parties present in each case. Those matters are questions of fact that are within the singular province of the trial court, and can only be determined by evaluating the credibility of the witnesses and weighing conflicting evidence." Id.; see also, Vesce v. Lee, 185 Conn. 328, 335, 441 A.2d 556 (1981). The court is not bound as a matter of law to find that the parties treated the subject property as a "marital asset" simply on the basis of the parties being "unmarried, cohabiting lovers." Id.
A review of the trial testimony reveals that it was the defendant's idea that the parties would have joint ownership of the subject real estate. When the plaintiff voiced her concern regarding her ability to assume the financial obligations of a home costing $856,000, the defendant agreed that he would pay the mortgage and the major expenses of maintaining the home. To allay the fears of the plaintiff that she would be unable to maintain the home in the event of the defendant's death, the defendant included a sum of money in his Last Will and Testament to provide for the expenses of the home until the plaintiff could sell the property. The defendant was aware that in the event of his death that the plaintiff would be the sole title owner of the property by virtue of the rights of survivorship included in the warranty deed. The plaintiff testified that the parties were in a relationship that she assumed would result in marriage and that the plan was that they would be married. The defendant told the plaintiff that he eventually wished to marry her. From 1998 until September 2004, the parties lived together as husband and wife, first at the plaintiff's condominium in Norwalk and then at the subject premises commencing in July 1999. The defendant himself, testified that at the time of the purchase of the real estate, he was in love with the plaintiff and wanted her to have half of the house. He also testified "I wanted her to have half the house, in case I died, that she would have something . . ." He further stated, "If I died and we were together, yes, she would end up with half the house, or end up with the whole house," because it was in survivorship. He also admitted that he was to pay for everything, nor did he ask her to pay for anything. While he stated that he expected to be reimbursed for his contribution upon the sale of the house, he admitted that he never spoke to the defendant to inform her of this demand. The defendant's first claims for reimbursement are the result of this action for partition. See. Seidel v. Seidel, 110 Conn. 651, 657-58, 149 A. 394 (1930) ("There was no agreement or understanding on the part of the [plaintiff] that she should make these improvements or pay for a half of the expenditures of [the defendant] on this [real estate]. The [defendant], when he made them, did not expect payment for these from her. Not until this action . . . did he make such claim . . ."); see also, Vesce v. Lee, supra, 185 Conn. 337, ("There was no agreement or understanding on the part of the [plaintiff] that he should make these improvements or pay for a half of the expenditures of [the defendant] on this real estate]. The [defendant], when he made them, did not expect payment for these from her. Not until this action . . . did he make such claim . . .").
The court is cognizant that when the parties jointly purchased the subject real estate, the plaintiff sold her condominium and retained the total proceeds of that sale. No portion of the proceeds of the sale of her condominium were contributed toward the purchase of the subject real estate. This is an indication that at the time of the purchase of the subject real estate, the parties intended to keep their finances separate and apart, despite their cohabiting relationship. It is also an indication that at the time of the purchase of the real estate the relationship was not being treated as one that anticipated marriage soon after. However, as time passed, the court finds that the relationship grew to the point that both parties ultimately treated it as a marital relationship and both expected that the relationship would progress to the point of marriage. The defendant eventually expected that the plaintiff would share equally in the real estate asset.
Accordingly, the court has taken this progression of the development of the relationship into consideration in dividing the proceeds of the sale, as follows. The total escrow amount is $192,065.09. From this sum the court awards the defendant the sum of $119,835.28 and awards the plaintiff the sum $72,229.81.
In arriving at these amounts, the court has awarded the defendant a reimbursement for his initial expenditure of $47,605.48 for the purchase of the subject property on July 22, 1999. When this sum is subtracted from the total escrow amount of $192,065.09, the sum of $144,459.61 remains. The court awards each party one-half of this remaining sum. The plaintiff shall receive $72,229.81 and the defendant shall receive $72,229.80. The total awards are, therefore, $119,835.28 to the defendant and $72,229.81 to the plaintiff.