Opinion
No. CV084032668
December 9, 2009
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT (#107)
Bozzutto, Inc. ("Bozzuto"), one of two named defendants, filed the motion for summary judgment before this court, #107, claiming that it is entitled to judgment, as a matter of law. For reasons more fully set forth, the court grants the motion in part, and denies it in part.
This case arises out of a fairly complicated factual and procedural history. CT INDY NH TT, LLC ("CT INDY"), the other of the two named defendants, currently owns three buildings located at 300 Montowese Avenue in North Haven, Connecticut, known respectively as the Grocery Building, the Produce Building and the Transportation Building. PREI North Haven Developers, LLC ("PREI") was the predecessor in interest to CT INDY. On July 7, 2006, the plaintiff, New Breed Logistics, Inc., entered into a commercial lease with PREI for a portion of the Grocery Building. The lease gave the plaintiff an option to lease the remaining portion of the Grocery Building so long as the plaintiff provided PREI with written notice prior to September 1, 2006. In September 2006, the plaintiff exercised its option to lease the remaining portion of the Grocery Building.
On July 15, 2008, Bozzuto took possession of the Produce Building. Bozzuto signed two leases with CT INDY, one on July 15, 2008 and one on July 30, 2008, the latter lease having differing terms. On August 14, 2008, Bozzuto recorded a Notice of Lease with the North Haven Town Hall Clerk's Office pursuant to § 47-19.
General Statutes § 47-19 states: "No lease of any building, land or tenement, for life or for any term exceeding one year or which provides for the renewal thereof or an option to purchase such building, land or tenement, shall be effectual against any persons other than the lessor and lessee and their respective heirs, successors, administrators and executors, unless it is in writing, executed, attested, acknowledged and recorded in the same manner as a deed of land, provided a notice of lease in writing, executed, attested, acknowledged and recorded in the same manner as a deed of land and containing (1) the names and addresses, if any are set forth in the lease, of the parties to the lease, (2) a reference to the lease, with its date of execution, (3) the term of the lease with the date of commencement and the date of termination of such term, (4) a description of the property contained in the lease, (5) a notation if a right of extension or renewal is exercisable, (6) if there is an option to purchase, a notation of the date by which such option must be exercised and (7) a reference to a place where the lease is to be on file shall be sufficient."
On August 8, 2008, the plaintiff filed a verified complaint for injunctive and other relief against CT INDY and Bozzuto alleging that the contract it entered into with PREI provided it with a right of first offer to lease the Produce Building. The plaintiff claims that Bozzuto's agreement with CT INDY deprives it of this right. The plaintiff's complaint contained six counts. Count one sought a temporary and permanent injunction against CT INDY and Bozzuto. Count two sought a declaratory judgment against CT INDY and Bozzuto. Counts three through six alleged respectively, specific performance, breach of contract, breach of implied covenant of good faith and fair dealing, and violation of CUTPA against CT INDY alone.
Bozzuto filed a motion for summary judgment as to counts one and two on September 17, 2008. On November 6, 2008, the plaintiff filed its memorandum in opposition and a request for leave to amend its complaint and an amended complaint. Bozzuto's objection to this request was overruled by the court, Cronan, J., on December 22, 2008. The amended complaint adds three additional counts against Bozzuto. Count seven alleges tortious interference with a contract/business expectancies, count eight alleges constructive trust and count nine alleges violation of CUTPA.
The plaintiff filed a substitute memorandum of law in opposition to Bozzuto's motion for summary judgment on June 10, 2009. On the same date, the plaintiff filed a request to revise its complaint, to which Bozzuto objected. The court (Robinson, J.) sustained the objection on July 8, 2009. Bozzuto then filed its reply on July 8, 2009.
In sustaining Bozzuto's objection to the Request to file a Revised Complaint, the court stated: "However, court will reconsider plaintiff's request following resolution of the pending motion for summary judgment."
"Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Provencher v. Enfield, 284 Conn. 772, 790-91, 936 A.2d 625 (2007). "In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact. The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law. The courts hold the movant to a strict standard. To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact . . . As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent . . . When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue . . . It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17-45]." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006).
Bozzuto first argues that it is entitled to summary judgment because the plaintiff's application for a temporary injunction, alleged in count one of the complaint, does not seek to preserve the status quo. Next, Bozzuto argues that it is entitled to judgment because the plaintiff cannot show any likelihood of success on the merits. In support of these arguments, Bozzuto offered as evidence the Agreement of Lease between PREI and the plaintiff, dated July 7, 2006 and the Notice of Lease between CT INDY and Bozzuto signed on July 30, 2008.
This court will not address Bozzuto's arguments regarding the plaintiff's demand for a temporary injunction because the plaintiff has withdrawn its demand for a temporary injunction pursuant to its request to amend and amended complaint, filed on November 6, 2008. Therefore, the court need only address the plaintiff's demand for a permanent injunction.
The plaintiff argues that Bozzuto cannot satisfy its burden of demonstrating that there are no genuine issues of material fact in dispute. More specifically, the plaintiff claims that there are disputed facts in regard to what was known about the plaintiff's lease and the rights thereunder. The plaintiff also contends that Bozzuto is an indispensable party to the declaratory judgment action. In addition to its memorandum in opposition, the plaintiff also submitted an Agreement of Lease between CT INDY and Bozzuto and the Agreement of Lease between PREI and New Breed Logistics.
In its reply, Bozzuto argues that the plaintiff cannot show a reasonable likelihood of success on the merits because it is undisputed that it had no knowledge of the plaintiff's rights under the lease.
I. Permanent Injunction
A plaintiff seeking the extraordinary remedy of a permanent injunction must establish: (1) the plaintiff has no adequate legal remedy; (2) the plaintiff would suffer irreparable injury absent the injunction; (3) the plaintiff is likely to prevail on the merits; and (4) the balance of the equities favors issuing the injunction. See e.g., Waterbury Teachers Assn. v. Freedom of Information Commission, 230 Conn. 441, 446, 645 A.2d 978 (1994). The plaintiff's claims against Bozzuto are for tortious interference with a contract and/or business expectancy; constructive trust; and violation of CUTPA. The court ultimately finds the plaintiff has failed to show a reasonable probability of success on the merits of each of these claims. Therefore, Bozzuto is entitled to judgment as a matter of law on the plaintiff's claim for a permanent injunction.
Counts seven though nine, respectively, of the plaintiff's amended complaint filed on November 6, 2008.
A
First, the court will address the plaintiff's argument that Bozzuto is liable for tortious interference with a contract and/or business expectancy. "It is well established that the elements of a claim for tortious interference with business expectancies are: (1) a business relationship between the plaintiff and another party; (2) the defendant's intentional interference with the business relationship while knowing of the relationship; and (3) as a result of the interference, the plaintiff suffers actual loss." (Internal quotation marks omitted.) Suffield Development Associates Ltd. Partnership v. National Loan Investors, L.P., 64 Conn.App. 192, 204, 779 A.2d 822 (2001), rev'd on other grounds, 260 Conn. 766, 802 A.2d 44 (2002). "An action for tortious interference with a business expectancy is well established in Connecticut. The plaintiff need not prove that the defendant caused the breach of an actual contract; proof of interference with even an unenforceable promise is enough . . . A cause of action for tortious interference with a business expectancy requires proof that the defendant was guilty of fraud, misrepresentation, intimidation or molestation . . . or that the defendant acted maliciously . . . It is also true, however, that not every act that disturbs a contract or business expectancy is actionable . . . A defendant is guilty of tortious interference if he has engaged in improper conduct . . . Stated simply, to substantiate a claim of tortious interference with a business expectancy, there must be evidence that the interference resulted from the defendant's commission of a tort . . ." (Citations omitted; internal quotation marks omitted.) Id., 204-05.
The court finds that it is undisputed that Bozzuto and CT INDY entered into negotiations in regard to Bozzuto's lease sometime in 2008. It is uncontested that Bozzuto and CT INDY drafted proposals and counter-proposals during June 2008. There is also no dispute that Bozzuto signed a notice of lease and lease as early as July 15, 2008 and that it took possession of the building on or around July 15, 2008.
There is evidence that Bozzuto had access to and that work at the site commenced prior to July 15, 2008.
Upon learning that CT INDY was negotiating or had negotiated a lease agreement with Bozzuto, the plaintiff wrote a letter, dated July 17, 2008, to CT INDY, which stated that it had a right of first offer on the building. The same date, this letter was forwarded to Bozzuto, which, the plaintiff claims, placed it on notice of these alleged rights. Also on July 18, 2008, a string of e-mail conversations reveals that Rafael Santiago, counsel for Bozzuto, was on notice of the agreement between CT INDY and the plaintiff. Sometime between July 15 and July 30, Bozzuto requested a copy of the agreement between the plaintiff and PREI, which request was denied by CT INDY. Additionally, the evidence reflects the fact that Bozzuto conducted a land record search to determine whether the plaintiff had a recorded lease which Bozzuto did not find.
Evidence demonstrated that as early as June 2008, Bozzuto knew that the plaintiff was interested in the space, however, there is no evidence that Bozzuto knew, specifically, of the plaintiff's alleged right of first offer on the subject property until the July 17, 2008 letter.
Deposition testimony submitted in this action, attests that CT INDY had represented to Bozzuto that there was no right of first offer. This assertion was made on or around July 28, 2008, days prior to its execution of the July 30, 2008 lease. A notice of lease was signed by Bozzuto and CT INDY on July 30, 2008 and additionally, on the same date, Bozzuto and CT INDY entered into a lease with some additional and differing terms than those agreed upon in the July 15, 2008 lease. The varying terms reflected CT INDY's concerns regarding the plaintiff, but did not acknowledge that the plaintiff had a right of first offer. It appears that CT INDY gave repeated assurances to Bozzuto that the plaintiff did not have a right of first offer and furthermore, that any claim the plaintiff did have to the subject property would be addressed by it and was not of concern to Bozzuto.
In light of these facts, the court concludes that the plaintiff cannot show a reasonable probability of success on its tortious interference claim. There is no evidence, contradicted or otherwise, to support a conclusion that Bozzuto did not learn of the plaintiff's alleged right of first offer until July 17, 2008. At this point, Bozzuto and CT INDY had already been engaged in negotiations and Bozzuto had signed a lease, dated July 15, 2008. Although the final lease was not executed until July 30, 2008, the court was presented with uncontradicted evidence that CT INDY had assured Bozzuto that the plaintiff did not have a right of first offer. Given this, the plaintiff cannot prevail on its claim requiring proof that Bozzuto engaged in improper conduct, acted maliciously, or was guilty of fraud, misrepresentation, intimidation or molestation.
B
Next, the plaintiff argues that it is entitled to a constructive trust. "A constructive trust arises when the legal title to property is obtained by a person in violation, express or implied, of some duty owed to the one who is equitably entitled, and when the property thus obtained is held in hostility to his beneficial rights of ownership . . . The specific instances in which equity impresses a constructive trust are numberless-as numberless as the modes by which property may be obtained through bad faith and unconscientious acts." (Internal quotation marks omitted.) Jarvis v. Lieder, 117 Conn.App. 129, 131 (2009). "[T]he basis of such trusts may be found in fraud, misrepresentation, imposition, circumvention, artifice or concealment, or abuse of confidential relations." (Internal quotation marks omitted.) Id., 142. Thus, "[b]efore a constructive trust can be created . . . there must be a duty owed, or a fiduciary or other special relationship between the parties." Filosi v. Hawkins, 1 Conn.App. 634, 639, 474 A.2d 1261 (1984). "A fiduciary or confidential relationship is characterized by a unique degree of trust and confidence between the parties, one of whom has superior knowledge, skill or expertise and is under a duty to represent the interest of the other . . . The superior position of the fiduciary or dominant party affords him great opportunity for abuse of the confidence reposed in him." (Internal quotation marks omitted.) Jarvis v. Lieder, supra, 144. Furthermore, "[t]o impose a constructive trust, there must also be a finding that the [defendant] was unjustly enriched . . . Two elements must be demonstrated: that the [defendant] was benefitted and that the benefit was unjust." (Citation omitted.) Filosi v. Hawkins, supra, 639.
The court finds that the plaintiff is unlikely to prevail on its constructive trust claim because it has failed to plead any facts indicating that Bozzuto owed a duty to the plaintiff or that a confidential or fiduciary relationship existed between it and Bozzuto. As discussed above, the plaintiff has also failed to present evidence demonstrating Bozzuto's fraud, misrepresentation, imposition, circumvention, artifice, concealment, or abuse.
C
Finally, the plaintiff claims that Bozzuto's conduct violated CUTPA. The elements of a CUTPA claim have been articulated in numerous cases and broken down into three elements which include: (1) whether the practice without necessarily having been previously considered unlawful, offends public policy as has been established by statutes, common law, or otherwise; (2) whether it is immoral, unethical, oppressive, or unscrupulous; and (3) whether it causes substantial injury to consumers, competitors, or to businessmen. See e.g., Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 19, 938 A.2d 576 (2008).
The plaintiff does not have a reasonable probability of success on its claim that Bozzuto's actions were in violation of CUTPA. Bozzuto's lack of knowledge of the plaintiff's alleged right of first offer, prior to July 15, 2008, and CT INDY's assurances to it, between that date and the execution of the lease on July 30, 2008, militate against a finding that Bozzuto acted unlawfully, immorally, unethically, oppressively, or unscrupulously and decrease the likelihood that the plaintiff will prevail on its CUTPA claim.
In sum, the court finds that Bozzuto has met its burden of showing that the plaintiff is unlikely to prevail on its claims for tortious interference with a contract, constructive trust and violation of CUTPA. As a result, the court finds that Bozzuto is entitled to judgment as a matter of law as to the plaintiff's claim for a permanent injunction.
II Declaratory Judgment
The plaintiff claims that Bozzuto is a necessary and indispensable party to its declaratory judgment action. Both Connecticut General Statutes and the Practice Book authorize an action for declaratory judgment. See General Statutes § 52-29; Practice Book § 17-54 et seq. "A declaratory judgment action may be maintained if all of the following conditions have been met: (1) The party seeking the declaratory judgment has an interest, legal or equitable, by reason of danger of loss or of uncertainty as to the party's rights or other jural relations; (2) There is an actual bona fide and substantial question or issue in dispute or substantial uncertainty of legal relations which requires settlement between the parties; and (3) In the event that there is another form of proceeding that can provide the party seeking the declaratory judgment immediate redress, the court is of the opinion that such party should be allowed to proceed with the claim for declaratory judgment despite the existence of such alternate procedure." Practice Book § 17-55.
First, the court will address the issue of whether Bozzuto is an indispensable party to the plaintiff's request for a declaratory judgment. Practice Book § 17-56(b), provides, in relevant part: "All persons who have an interest in the subject matter of the requested declaratory judgment that is direct, immediate and adverse to the interest of one or more of the plaintiffs or defendants in the action shall be made parties to the action or shall be given reasonable notice thereof." Furthermore, the Supreme Court stated: "Joinder of indispensable parties is mandated because due process principles make it essential that [such parties] be given notice and an opportunity to protect [their] interests by making [them] a party to the [action]." (Internal quotation marks omitted.) Hilton v. New Haven, 233 Conn. 701, 722-23, 661 A.2d 973 (1995).
In Sturman v. Socha, 191 Conn. 1, 6-7, 463 A.2d 527 (1983), the court noted the distinction between indispensable and necessary parties. "Parties have been characterized as `indispensable' when they not only have an interest in the controversy, but an interest of such a nature that a final decree cannot be made without either affecting that interest, or leaving the controversy in such condition that its final termination may be wholly inconsistent with equity and good conscience . . . Necessary parties, however, have been described as [p]ersons having an interest in the controversy, and who ought to be made parties, in order that the court may act on that rule which requires it to decide on, and finally determine the entire controversy, and do complete justice, by adjusting all the rights involved . . . [B]ut if their interests are separable from those of the parties before the court, so that the court can proceed to a decree, and do complete and final justice, without affecting other persons not before the court, the latter are not indispensable parties." (Citations omitted; internal quotation marks omitted.) Id.
The court finds that Bozzuto is an indispensable party to this action. It took possession of the subject property on July 15, 2008, and continues to be in possession of it. A declaratory judgment in this action, as the plaintiff requests, could result in the interruption of a multi-million dollar contract between Bozzuto and CT INDY. Additionally, if Bozzuto is forced to leave the subject property, its multi-million dollar contracts with Big Y supermarkets and other customers which it services from the North Haven facility would be affected. Therefore, far from being only casually aware and concerned with this action, Bozzuto's rights, and interests are inextricably intertwined with the legal and factual issues in this case. Bozzuto has more than just a mere interest in the outcome of this litigation and its non-involvement in this action would be wholly inconsistent with the principles of equity.
Furthermore, the court takes notice of Practice Book § 9-18, which states: "The judicial authority may determine the controversy as between the parties before it, if it can do so without prejudice to the rights of others; but, if a complete determination cannot be had without the presence of other parties, the judicial authority may direct that they be brought in. If a person not a party has an interest or title which the judgment will affect, the judicial authority, on its motion, shall direct that person to be made a party."
Resolution of this action depends on whether the contract between PREI and the plaintiff gave the plaintiff a right of first offer to lease the subject building. If this issue is not resolved by CT INDY's motion for summary judgment, which is still pending before the court, then a trial on the merits will be required. As such, there is a genuine issue of material fact as to whether the plaintiff is entitled to the declaratory judgment that it requests, which would be direct, immediate and adverse to the interests of Bozzuto, an indispensable party to this action. Bozzuto's motion for summary judgment as to the plaintiff's claim for a declaratory judgment is therefore, denied.
Conclusion
Bozzuto's motion for summary judgment on the plaintiff's claim for a permanent injunction is granted because there are no genuine issues of material fact that the plaintiff is unlikely to prevail on its predicate claims against Bozzuto. Its motion for summary judgment as to the plaintiff's claim for a declaratory judgment is hereby denied. Bozzuto is an indispensable party to this action; there exists genuine issues of material fact as to whether the plaintiff is entitled to its alleged right of first offer.