Opinion
No. CV 99 0171435 S
October 31, 2003
MEMORANDUM OF DECISION
Pursuant to Practice Book § 14-44 et seq., the defendants, William M. Duncan and Patricia M. Duncan have moved for summary judgment with respect to the plaintiff's allegations against them as stated in his April 1, 1999 complaint. The plaintiff has also requested summary judgment. In his complaint, the plaintiff claimed in a condominium unit purchased by the defendants and money damages.
In 1998, the defendants purchased a condominium unit, Unit 1, in the Waterford of Greenwich. They purchased this unit from the developer, B.S.B. Greenwich Mortgage Limited Partnership ("BSB"). BSB had previously acquired the entire condominium complex from the plaintiff by amended stipulated judgment of strict foreclosure ("Judgment"). The defendants paid BSB $1,275,000 for Unit 1 ("Unit 1").
The plaintiff, together with other companies in which he had an interest, or to which he was related, were the former developers of the Waterford. In the late 1980s/early 1990s, because of the plaintiff's financial difficulties, foreclosure actions were commenced on his properties, including the Waterford, and when the lending bank became insolvent, the FDIC was appointed receiver. The FDIC removed the foreclosure actions to the United States District Court for the District of Connecticut. In March of 1995, the Court entered judgment of strict foreclosure in favor of the FDIC on stipulation of the parties.
On the day following entry of judgment, the FDIC sold and assigned its interest in the mortgages to BSB. BSB and Lee then entered into an Amended Stipulated Judgment of strict foreclosure (Judgment) on terms which BSB negotiated with the plaintiff. On April 28, 1995, the Federal District Court (Daly, J.) entered a judgment based upon this stipulation. This Judgment, with some twenty-two pages of substantive provisions, provided the plaintiffs and BSB's respective rights and obligations as to the various properties in the foreclosure cases.
Paragraph 30 of the Judgment provided in part for BSB to transfer to Lee the title to one unit, Unit 12, and for Lee to have conditional future rights to acquire or to be conveyed an unspecified final completed unsold unit. This paragraph was intended to provide Lee with an option to purchase the last unsold unit if the "gross sales proceeds" of the other twenty-one units was less than $26,500,000. If Lee did not exercise this option, BSB could sell the unit and would then be obligated to pay Lee the amount, if any, by which the gross sales proceeds of all the units exceeded $26,500,000. If, however, the gross sales proceeds of the other units exceeded $26,500,000, BSB was required to convey the last unit to Lee for no consideration.
On January 3, 1996, an uncertified copy of the Judgment was recorded on the Greenwich Land Records. The Judgment was incorrectly indexed in both the Grantor and Grantee indices, showing Lee as the Grantor and BSB as the Grantee. It also erroneously identified the property as located on Valley Drive.
Following the entry of the Judgment, BSB's attorneys filed a certificate of foreclosure on the Land Records indicating that BSB acquired "absolute" title to the Waterford properties. The certificate made no mention of the option provided by paragraph 30 of the Judgment.
After the foreclosure, from 1995 through 1998, BSB developed, marketed, and sold the remaining units. On or about January 30, 1998, the defendants entered into a purchase and sale agreement with BSB for the purchase of Unit 1 at a price of $1,275,000 and with a closing date of March 1, 1998. On the date of the contract, there were at least two other unsold units under contract at the Waterford, numbers 23 and 24, which were not to be sold until certificate of occupancies were delivered. Nevertheless, on February 25, 1998, BSB and the purchasers of units 23 and 24 amended the sales contracts to move the closing date for these units to February 26, 1998. Therefore, on or about February 26, the defendants' unit became the last unsold unit, and the closing was delayed at BSB's request until April 17, 1998.
During the month of March 1998, BSB and the plaintiff were at odds over what if any rights the plaintiff might have in Unit 1. Neither BSB nor the plaintiff advised the defendants, in any way, of their disagreement. As part of their purchase arrangements for Unit 1, the defendants purchased and procured a title insurance policy from the Chicago Title Insurance Company. Before issuance of the policy, the vice president and general partner of BSB executed and delivered a unit owner's affidavit, representing and confirming that there were no tenants or other persons who had a right to possession of the Unit and that there were no applicable rights of first refusal, as well as an owner's special title and survey report, representing that no one claimed any interest in the Unit which BSB disputed or claimed was invalid.
Moreover, the report of title issued by Key Title Services, Inc. for Chicago Title stated that title to Unit 1 was vested in BSB by certificate of foreclosure. The title commitment sent to the defendants' closing counsel also made no mention of the Judgment or any interest which the plaintiff might claim in the unit. Indeed, the defendants did not learn of the plaintiff's claim until they were served with the complaint in this matter on or about April 1, 1999, nearly a year after they purchased the unit.
On March 30, 1999, the plaintiff commenced this action claiming rights superior to the defendants by virtue of the language of the Judgment. Immediately thereafter, on March 31, 1999, the plaintiff moved in the United States District Court for an order in aid of enforcement of the Judgment against BSB. The District Court, after remand by the Court of Appeals with regard to the calculation of the "gross sales proceeds," entered judgment for the plaintiff against BSB in the amount of $1,275,000 with interest of 10% per year from April 17, 1998, until payment.
In the present action, the plaintiff seeks an order requiring that the defendants convey Unit 1 to him for a discounted price or for no consideration and/or pay him damages.
Discussion
Both the defendants and the plaintiff have moved for summary judgment. The defendants claim the following in their motion for summary judgment: the instrument which the plaintiff alleges grants him an interest in their unit was so indefinite and uncertain that it failed to satisfy the mandates of the common law and the Statute of Frauds; the defendants had no actual knowledge of the plaintiff's claimed interest when they purchased their condominium unit; and recording errors prevented the instrument from affording them constructive notice of the plaintiff's claimed interest in their unit.
1. Instrument Too Indefinite
Paragraph 30 of the Judgment purported to give the plaintiff certain conditional rights to acquire or to have conveyed an unspecified "final completed unsold unit" of the Waterford. Depending on the "gross sales proceeds" of the 21 units in the Waterford condominium complex, the plaintiff was supposed to either have conveyed to him the last unsold unit for no consideration, have the option to purchase the unit, or receive compensation from BSB. The Judgment did not specify the unit subject to this interest or the order in which BSB was to sell the units, or whether BSB was obligated to sell the units at all.
"30. If gross sales proceeds of 21 of the 22 Unsold Units remaining after the transfer to JOHNSON LEE of Unit 12 pursuant to a previous provision herein are less than $26,500,000.00, JOHNSON LEE shall have the option to purchase the remaining completed Unsold Unit for the amount by which the gross sales, proceeds are less than $26,500,000.00. JOHNSON LEE shall have a period of 30 days after notice from BSB of the sale of 21 of the remaining 22 Unsold Units in which to exercise said option and close upon the purchase of said remaining unit, time being of the essence. If the gross proceeds are less than $26,500,000.00 as aforesaid and in the event JOHNSON LEE elects not to exercise said option or otherwise fails to exercise said option, BSB shall sell the final Unsold Unit and pay to JOHNSON LEE the amount by which the gross sales proceeds of all units sold by BSB exceed $26,500,000.00 but in no event shall such payment to JOHNSON LEE exceed $1,000,000.00. In the event that the gross sales proceeds of 21 of the 22 remaining Unsold Units within the Waterford Property equal or exceed $26,500,000.00, BSB shall convey the final completed Unsold Unit to Johnson Lee. During the time that Unsold Units are being marketed, BSB will keep JOHNSON LEE reasonably informed as to marketing and sales."
At common law, "[r]easonable certainty in the description is an indispensable prerequisite for enforcement . . . of a contract to convey land." McMahon v. Plumb, 88 Conn. 547, 551 (1914). See also Mrahunec v. Faersti, 121 A.2d 878 (Pa. 1956) (property described as "said property" in a purchase option contained in a lease was too vague and uncertain to be enforceable). The Statute of Frauds also requires that an instrument or agreement purporting to convey an interest in property describe the agreement between the parties with such certainty that the essentials of the agreement can be known from the memorandum itself and the essentials include the subject matter of the sale. See Pigeon v. Hatheway, 156 Conn. 175 (1968), Fruin v. Colonnade One at Old Greenwich Ltd. Partnership, 38 Conn. App. 420 (1995), aff'd., 237 Conn. 123 (1996).
The identity of the property must be reasonably certain from the document itself or must be capable of being made certain through reference to record, contract, map or by resort to other evidence, see Levesque Builders, Inc. v. Hoerle, 49 Conn. App. 751 (1998), but if addition of a term to the description is required, that is not permitted. DeForest Hotchkiss Co. v. Chauser, 1 Conn. Sup. 61 (1935). When a description of real estate hinges on future events, real estate is not sufficiently described to satisfy the statute of frauds. Montanaro Brothers v. Snow, 190 Conn. 481, 487 (1983) (no meeting of minds as to what acreage the seller was to retain).
See also Pigeon v. Hatheway, 156 Conn. 175 (1968) (excepted property described as the houselot of about one acre together with house and garage thereon was too uncertain and indefinite); Mansour v. Clark, 5 Conn. Cir. 439 (1968) (agreement to convey property too indefinite when described as generally southerly and westerly of buyer's property, with exact dividing line between conveyed and retained property to be determined and deed delivered when location of seller's to be constructed paddle tennis court on retained land is determined).
Here, paragraph 30 of the Judgment itself fails to identify which condominium unit was the subject of the option. Therefore, at the time of its creation, the identity of the unit subject to the option could not possibly be determined from the Judgment because by its terms, no particular unit was designated to be set aside for the plaintiff. Furthermore, the identity of the unit subject to the option also could not be determined by reference to any record, map, or other evidence.
BSB and the plaintiff agreed in the Judgment to leave the precise unit number, in other words, the description of the property subject to the option, contingent upon future events, which were within the control and at the discretion of BSB, the seller. For example, BSB had discretion and control over decisions such as whether to sign a contract of sale, the terms of a contract, and the dates for closings. Thus, only BSB had the ability to comply with any obligations of the Judgment to save and identify the last unit for the plaintiff; neither the plaintiff nor the Duncans had access to information regarding which units were under contract for sale and/or which unit sales had been closed but had unrecorded deeds. Until the deeds for units subject to completed sales were recorded, neither the plaintiff nor the Duncans would be able to determine from the land records which units had actually been sold. In fact, BSB did not keep the plaintiff advised as to the status of its sales even though BSB had contracted for the sale of all of the units before communications began with the plaintiff as to his claim of contract rights resulting from these sales. At the time of the Judgment's creation, there were 22 unsold units, any one of which might have become the final completed unsold unit. These units could have been sold in any order, or not sold at all. The Judgment left to BSB the determination of which, if any, unit would be the final completed unsold unit, and no one other than BSB could determine and ascertain, which unit would be the last to be sold. This imprecision and uncertainty rendered paragraph 30 of the Judgment unenforceable. The defendant is therefore entitled to Summary Judgment because paragraph 30 did not provide the plaintiff with an enforceable right to Unit 1.
2. Defendants Did Not Have Actual or Constructive Notice
The plaintiff claims that the defendants had actual and constructive knowledge of his rights as provided in the Judgment. The court does not agree.
A. Actual Notice
The evidence presented by both sides clearly demonstrates that the defendants were not aware of any of the rights claimed by the plaintiff at the time they closed on Unit 1. The seller of the unit, BSB, failed to tell them of any claim by the plaintiff and, in fact provided them with affidavits affirmatively representing that there were no other persons who had a right to possession, a right of first refusal, or any interest in the unit which they disputed or claimed was invalid. See Defendants' Motion for Summary Judgment, Exhibits 1(C) (D). Affidavit of William M. Duncan, Exhibit 1, Patricia M. Duncan's affidavit, May 2, 2003, paragraphs 5 and 6 and Affidavit of Attorney Cameron F. Hopper, April 29, 2003, paragraph 3, attached to Defendants' Motion For Summary Judgment. See also, deposition testimony of Roderick O'Connor, Vice President of Brickroc, BSB's general partner, pp. 101-05 122-23, (attached as Exhibits B and C Defendants' Supplemental Memorandum dated October 7, 2003) and responses to Defendants' interrogatories of third-party defendants BSB, Bruce S. Brickman and Roderick O'Connor attached as Exhibit C to Defendants' Supplemental Memorandum of October 7, 2003. In fact, they were unaware of any claim by the plaintiff until they were served with papers in the present action.
2. Constructive Notice
General Statutes § 47-36 provides in relevant part:
If the United States of America, or any official or agent on its behalf, claims any lien or encumbrance on, or interest in, land situated in this state, whether or not as a lien referred to in Section 49-32a, or if any judgment, order or decree of any United States court . . . concerning land situated in this state, the instrument evidencing or describing that claim or a certified copy of that judgment, order or decree . . . may be recorded in the land records of the town in which the land is situated and may be indexed and released in the same manner as other claims, judgments, orders or decrees.
Until so recorded, that claim, judgment, order or lis pendens shall not be effective against the land or constitute constructive notice thereof.
(Emphasis added.)
The parties do not dispute that a certified copy of the Judgment was never filed and indexed in the Greenwich land records as required under § 47-36. The language of the statute is clear that until a certified copy of such a judgment is recorded on the land records, such a judgment "shall not be effective against the land or constitute constructive notice" of any of the rights which the plaintiff claims were afforded him by the provisions of the Judgment.
Additionally, the Judgment is not within the defendants' chain of title. The Judgment was not indexed on the land records to reflect the interest that the plaintiff claims in this case. Defendants' Motion for Summary Judgment Exhibit 2(b). The land records' indices list the plaintiff as a grantor, not grantee, and BSB as grantee, not grantor. These records report the plaintiff as grantor and BSB as grantee of a "JDGL," presumably an abbreviation of a judgment lien, not a judgment. Moreover, the property location listed for this JDGL is shown as "Valley Drive" which is not the location of the "Waterford" condominium project containing Unit 1 at issue here. The land records, therefore, do not show, and a title search would not have revealed, any interest, option or otherwise, granted by BSB to the plaintiff on Unit 1 but rather, a judgment lien in favor of BSB on a different property, located on Valley Road.
In Connecticut, it is the land records that determine what title or interest in property one acquires. "It has always been the policy of our law that the land records should be the authentic oracle of title on which a bona fide purchaser for value takes title to real property free and clear of prior encumbrances of which he has no actual or constructive notice. See, e.g., Prudent Projects v. Travelers Insurance Co., 3 Conn. App. 429, 431 (1985). Here, the defendants cannot be charged with constructive knowledge of any possible claim by the plaintiff because of the errors in the way the judgment was recorded, the errors in indexing and description, and the failure of the recorded document to comply with the requirements of General Statutes § 47-36.
The plaintiff claims that because the title company from which the defendants purchased title insurance for their closing may have had knowledge concerning the Judgment from prior searches for the sale of other units, the defendants are charged with this knowledge because they purchased title insurance from the same company. However, the plaintiff has not presented any facts to demonstrate an agency relationship between the defendants and the title company, has not shown any incidents of a fiduciary duty, and has shown no right to control by defendants, and no control which is inherent in an agency relationship. See Hallas v. Boehmke Bobosz, Inc., 239 Conn. 658, 673 (1997); Gateway Co. v. DiNoia, 232 Conn. 232, 239-40 (1995). The defendants had no right, and made no effort, to control Chicago Title's efforts to fulfill their contractual duty to provide title insurance. In fact, the defendant's agreement to purchase Unit 1 from BSB provided that the defendants "shall accept such title to the Unit as [Chicago Title] would be willing to approve and insure . . ." Defendant's Motion for Summary Judgment, Exhibit 1(A). Nothing more was involved than the purchase of a title insurance policy by the defendants. The policy purchased provided no indication of any right of or claim of rights by the plaintiff and nothing related to the search or policy would be sufficient to charge the defendants with constructive knowledge of any claim by the plaintiff to their unit.
3. Election of Remedy Bars Recovery
The doctrine of election of remedies is based on the general judicial prohibition of double recovery. See Treglia v. Zanesky, 67 Conn. App. 447, 456, 788 A.2d 1263 (2001). "The doctrine of election of remedies is equitable in nature, and its purpose is not to prevent recourse to any remedy, but to prevent double redress for a single wrong." Delucia v. Burns, 11 Conn. App. 439, 447, 527 A.2d 1234, cert. denied, 205 Conn. 803, 531 A.2d 935 (1987). In addition to preventing double recoveries, the doctrine prevents a plaintiff from obtaining inconsistent remedies on inconsistent views of the same evidence. See Dotolo v. Petrucelli, 5 Conn. Cir. Ct. 274, 281 (App.Div. 1968).
Here, the plaintiff commenced this action seeking possession of the Duncans' condominium unit and damages after obtaining a judgment in federal court against BSB for damages in the amount of $1.275 million plus 10% interest per year for BSB's breach of paragraph 30 of the Judgment. After obtaining this federal judgment for damages, the plaintiff cannot now also obtain title to the Duncans' unit by seeking specific performance of paragraph 30 of the Judgment, as the defendants purchased their unit from BSB without actual or constructive notice of any claim or interest of the plaintiff. Berman v. Apter, 95 Conn. 66 (1920). "It is clear that a recovery by a seller [of land] of damages representing the loss of benefit of the bargain of the contract, is an inconsistent remedy with specific performance of the same contract." Foley v. Huntington Co., Superior Court, judicial district of Fairfield at Bridgeport, Docket No. 246145 (Mar. 16, 1994, Fuller, J.). "Once having made his election and pursued to judgment one remedy, he is to be regarded as having abandoned all other remedies inconsistent therewith." Feroleto v. Dolan Steel Co., 21 Conn. Sup. 170, 171 (1958). (Emphasis added.) See also Berman v. Apter, 95 Conn. 66, 68-69 (1920) (party barred from pursuing any claim to property pursuant to a contract to convey because that party had already pursued contract damages and obtained a judgment for damages for the breach).
Here, in the federal action, the plaintiff conceded that he could not get title to the unit; therefore he desired monetary damages to make up for his loss. The plaintiff now asserts that though the Judgment he obtained rights to the last unit, which are superior to the rights of any subsequent purchaser from BSB. These two positions are inconsistent with each other. Furthermore, it would be inequitable to allow the plaintiff to obtain both a judgment for damages for a breach of Section 30 of the Judgment, as well as title to the unit, from the Duncans, who are bona fide purchasers for value. See, Foley v. Huntington Co., supra. By pursuing his claim for damages and obtaining a judgment against BSB, the plaintiff elected to abandon his claim to the unit's title. Berman v. Apter, 95 Conn. 66 (1920).
"So we believe that Mr. Lee has been damaged. That he was entitled to that unit. He can't get the unit now. But the Court can award him $1,275,000 which is what the unit was worth." Transcript of trial before Honorable Holly B. Fitzsimmons, U.S. Magistrate, April 18, 2000 contained in Affidavit of Aaron Singer, Ex. A to Defendants' Objection to Plaintiff's Motion for Summary Judgment, August 1, 2003. (Emphasis added.)
Conclusion
For the reasons stated herein, the defendants' motion for summary judgment is granted.
HILLER, J.