Opinion
No. CV06 500 22 94
May 14, 2008
MEMORANDUM OF DECISION
This matter was tried before the court on the plaintiff, Raymond Tooley, Jr.'s four-count amended complaint against the defendants, Joaquim G. Rodrigues, Hermina Rodrigues, and JR HR, LLC. Count one alleges breach of contract and seeks money damages. Count two seeks specific performance. Counts three and four allege fraudulent conveyance.
The facts, necessary for a resolution of this matter as brought forth at trial, are as follows. In November 2000, the plaintiff and Nicholas J. Cupole, III, entered into an agreement with the defendants to purchase the Star Café from the defendants, a business located at 131 Bridgeport Avenue in the town of Milford. Concurrent with the purchase of the business, the plaintiff and Cupole agreed to lease the premises known as 131 Bridgeport Avenue, the location of the business, from the defendants for a five-year term. The lease included an option to purchase the property for $370,000.
Cupole later assigned his interest in the business and the lease to the plaintiff and is not a party to this action.
On September 17, 2001, the defendants Joaquim Rodrigues and Hermina Rodrigues transferred the property in question to the defendants JR HR, LLC. The Rodrigueses own and are in control of JR HR, LLC.
On October 13, 2005, the plaintiff notified the defendants of his intention to exercise the option to purchase the property. The defendant's claim that he never received the notice was contrary to all of the evidence presented. The defendants refused to complete the sale. The plaintiff now brings suit alleging breach of contract and seeking specific performance. The defendants stipulated at trial that if the court orders specific performance that they will transfer the property from JR HR, LLC to the plaintiff, rendering the plaintiff's fraudulence conveyance counts moot.
The defendants asserted nine special defenses; special defenses one through eight, all of which are premised on the theory of comparative negligence. The defendants' ninth special defense alleges that the option contract is unenforceable as it does not satisfy the Statute of Frauds. The defendants also filed a counterclaim alleging that the plaintiff slandered title on the defendants' property by improperly placing a lis pendens on said property.
The main thrust of the defendants' defense centers on the claim that the Option to Purchase pertained only to the premises that housed the Star Café and identified in the lease as 131 Bridgeport Avenue in the City of Milford. The Star Café stands on one of two contiguous lots owned by the defendants. The Milford Tax Assessor's map identifies these as lots 15 and 16. The Star Café is situated on lot 16 and is a corner lot at the intersection of Bridgeport Avenue (Rte 1) and Spring Street in the Devon section of the City of Milford. A separate structure, a house, stands behind the Star Café on lot 16. Lot 15 is a parking lot which has at all times been used to accommodate patrons of the Star Café and tenants in the separate house.
The plaintiff claims, and so testified, that the parties intended the Option to Purchase to encompass not only the Café, but the house and the parking lot as well. The plaintiff contends that the address of 131 Bridgeport Avenue, Milford, set forth in the lease, was not intended to limit the property to the Café building alone.
Therefore, the first issue before the court is the question of what evidence the court may consider in addressing the claims of the plaintiff.
"The [parol evidence] rule is premised upon the idea that when the parties have deliberately put their engagements into writing, in such terms as import a legal obligation, without any uncertainty as to the object or extent of such engagement, it is conclusively presumed, that the whole engagement of the parties, and the extent and manner of their understanding, was reduced to writing . . . The parol evidence rule does not of itself, therefore, forbid the presentation of parol evidence, that is, evidence outside the four corners of the contract concerning matters governed by an integrated contract, but forbids only the use of such evidence to vary or contradict the terms of such contract. Parol evidence offered solely to vary or contradict the written terms of an integrated contract is, therefore, legally irrelevant. When offered for that purpose, it is inadmissible not because it is parole evidence, but because it is irrelevant. By implication, such evidence may still be admissible if relevant (1) to explain an ambiguity appearing in the instrument; (2) to prove a collateral oral agreement which does not vary the terms of the writing; (3), to add a missing term in a writing which indicates on its face that it does not set forth the complete agreement; or (4) to show mistake or fraud.
These recognized exceptions are, of course, only examples of situations where the evidence (1) does not vary or contradict the contract's terms, or (2) may be considered because the contract has been shown not to be integrated; or (3) tends to show that the contract should be defeated or altered on the equitable ground that relief can be had against any deed or contract in writing founded in mistake or fraud." (Internal quotation marks omitted.) Palozie v. Palozie, 283 Conn. 538, 548 N.8, 927 A.2d 903 (2007).
"The law is clear that a contract includes not only what is expressly stated therein but also what is necessarily implied from the language used . . . No special form of words, but that the promise appears upon a fair interpretation, is the essential. Not only then may promises exist . . . Where the language is in terms that of promise, but also where the agreement shows that the parties . . . have intended an obligation though they failed so to state in clear terms . . . If it can be plainly seen from all the provisions of the instrument taken together, that the obligation in question was within the contemplation of the parties when making their contract, or is necessary to carry their intention into effect — in other words, if it is a necessary implication from the provisions of the instrument — the law will imply the obligation and enforce it." Foley v. Huntington Co., 42 Conn.App. 712, 729-30, 682 A.2d 1006, cert. denied, 239 Conn. 931, 683 A.2d 397 (1996).
In the present case, the defendants argue that the phrase "131 Bridgeport Avenue" only applies to the lot that actually houses the Star Café building and that the parking lot should, for the purposes of construing this contract, be considered a separate lot, as it is described on the Milford zoning map. The defendants, at the same time, maintain the somewhat inconsistent position that the phrase "131 Bridgeport Avenue" does not include other structures on the same lot. The plaintiff, conversely, argues that the term "131 Bridgeport Avenue" covers both the lot that the Star Café building sits upon and all the structures on that lot and the attached parking lot.
The facts of Foley v. Huntington Co., supra, 42 Conn.App. 712, are strikingly similar to the present case. Foley dealt with the sale of a business and the property on which the business operated. While the present case deals with the sale of a cafe and the lease with an option to buy of the associated property, Huntington dealt with the sale of a nursing home.
The contract in Huntington specified that the nursing home and a 3.74-acre parcel that the nursing home sat upon would be transferred to the buyer. The 3.74-acre tract of land was however, in violation of the town of Fairfield's zoning requirements for the operation of nursing homes. The fact that the parcel specified in the contract would make it impossible to operate a nursing home created the question of fact "[w]hether the parties intended to contract for the sale on 3.74 acres or the sale of an operable nursing home Foley v. Huntington Co., supra, 42 Conn.App. 730. The Foley court then went on to find that it was appropriate for the finder of fact to consider evidence outside the four corners of the contract in determining the intent of the parties. Both the plaintiff and the defendant offered parol evidence to aid the court in interpreting exactly what real estate was contemplated to be included in the Option to Purchase.
"The evidence admitted in the present case was not used to vary the terms of the contract, but to ascertain the meaning of the terms. The evidence was used to aid in the interpretation of the contract and to determine the intent of the parties. The parol evidence rule does not prevent the introduction of evidence to show the facts and circumstances existing at the time of execution . . . and parol evidence is admissible to explain an ambiguity in a contract or to prove a collateral oral agreement that does not vary the terms of the contract." Foley v. Huntington Co., supra, 42 Conn.App. 734. Thus, it is appropriate in the present case for the court to consider parol evidence when determining the intent of the parties and the meaning of contested terms in the contract.
The defendant has failed to introduce any evidence to indicate that the two lots were ever treated separately by the parties; in other words, all the relevant evidence submitted to the court suggests that the two lots were treated as a single, unitary parcel prior to the sale of the business and after the sale of the business.
"[A]ll buildings and uses [are to be] provided with a sufficient amount of off-street parking and loading space to meet the needs of persons employed at or making use of such buildings or uses." Milford Zoning Regs., § 5.1.1 (April 1999 revision). "Adequate off street parking spaces, open or enclosed, shall be provided for any building or use in accordance with the minimum requirements of this section. Any land which is developed as a united under single ownership and control shall be considered a single lot for the purposes of these parking regulations." Id., § 5.1.4 (April 1999 revision).
Milford zoning regulations prohibit the operation of a business without adequate off-street parking. In the present case, the parking lot attached to the Star Café is essential to its legal operation; without the parking provided by the parking lot, the Café would be forced to shut down. If the court construed the term "131 Bridgeport Avenue" to exclude the parking lot, as the defendant submits, the plaintiff would be unable to legally operate the business due to lack of off-street parking. It is axiomatic that contracts are to be construed to give effect to every provision; thus, in order to avoid frustrating the contract for the sale of the Café, the term "131 Bridgeport Avenue" is construed to include the Café, the house, and the parking lot.
The court finds that the testimony of the defendant, Joaquim G. Rodrigues, as to what property was contemplated as the subject of the Option to Purchase, was less than credible and therefore credits the testimony of the plaintiff on this issue.
"Specific performance is an equitable remedy permitting courts to compel the performance of contracts for the sale of real property, and certain other contracts, pursuant to the principles of equity . . . Every complaint asking for specific performance of a contract to convey real estate is addressed to the discretion of the court, and will not be granted unless the contract is made according to the requirements of law, and is fair, equitable, reasonable, certain, mutual, on good consideration, consistent with policy and free from fraud, surprise or mistake . . . [t]he granting of specific performance of a contract to sell land is a remedy which rests in the broad discretion of the trial court depending on all of the facts and circumstances when viewed in light of the settled principles of equity . . . 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." (Citations omitted; internal quotation marks omitted.) Jaramillo v. Case, 100 Conn.App. 815, 828-29, 919 A.2d 1061, cert. denied, 283 Conn. 902, 926 A.2d 670 (2007). "The availability of specific performance is not a matter of right, but depends rather upon an evaluation of equitable considerations." Kakalik v. Bernardo, 184 Conn. 386, 395, 439 A.2d 1016 (1981). "In balancing the equities, the court is not bound by a formula but is free to fashion relief molded to the needs of justice." Gager v. Gager Gager, LLP, 76 Conn.App. 552, 560-61, 820 A.2d 1063 (2003).
"It is well settled that a buyer seeking specific performance has the burden of proving that he or she is ready, willing and able to purchase the premises, even when a seller refuses to participate in or attend a closing, or has failed to satisfy a condition of the contract . . . Whether a buyer is ready, willing and able to make a purchase is a question of fact." Jaramillo v. Case, 100 Conn.App. 815, 829, 919 A.2d 1061, cert. denied, 283 Conn. 902, 926 A.2d 670 (2007).
"It is settled law, however, that in an action for specific performance the plaintiff has the burden of proving all of the essential elements of his cause of action and the burden is primarily on him to show his right in equity and good conscience to the relief sought." Cutter Development Corp. v. Peluso, 212 Conn. 107, 114-15, 561 A.2d 926 (1989). "[T]he primary purpose of a decree of specific performance, which is always an equitable remedy, is to place an injured [party] in a position that replicates, as nearly as possible, that which it would have enjoyed but for the [other party's] unexcused breach." State v. Lex Associates, 248 Conn. 612, 631, 730 A.2d 38 (1999).
The plaintiff produced evidence, by way of his own testimony and that of a William Rosadini, a business banking manager for J.P. Morgan Chase Bank, which satisfied the court that the plaintiff had the wherewithal to finance the purchase and was ready, willing and able to make the purchase at the time the Option to Purchase was exercised.
The defendant argued that the plaintiff was not able to make the purchase of the property as the plaintiff was unable to provide to his lender a purchase and sales agreement between the plaintiff and the defendants. Axomatic principles of equity suggest that the defendant should be estopped from making this claim, as it was the defendants' own actions that prevented the plaintiff from providing a purchase and sales agreement to his lender.
The defendants' first eight special defenses all sound in comparative negligence and are not available as defenses to a breach of contract action. The defendants did not present argument regarding their merit, nor did they raise them in their trial brief. The court therefore will only consider the ninth special defense of the Statute of Frauds.
To satisfy the Statute of Frauds, a contract "must state the contract between the parties with such certainty that the essentials of the contract can be determined from the memorandum itself without the aid of parol proof, either by direct statement or by reference therein to some other writing or thing certain; and these essentials must at least consist of the subject of the sale, the terms of it and the parties to it, so as to furnish evidence of a complete agreement." Gabriele v. Brino, 85 Conn.App. 503, 507, 858 A.2d 273 (2004). "The primary purpose of the statute of frauds is to provide reliable evidence of the existence and the terms of the contract, the requirements of the statute can be met either by a single document or . . . by a series of related writings which, taken together, describe the essential terms and conditions of the contract . . . The memorandum required by the statute is sufficient if it states the contract between the parties with such certainty that the essentials of the contract can be determined from the memorandum itself without the aid of parol proof, either by direct statement or by reference therein to some other writing or thing certain . . . The memorandum of the contract need not be the contract itself . . . The memorandum need not be made at the time of the contract; it may be made and signed afterward . . . The moment written evidence of the contract under his hand, in whatever form, exists, the contract is taken out of the statute . . . Cross references to the agreement in documents can adequately demonstrate their interconnection." (Citations omitted; internal quotation marks omitted.) Killion v. Davis, 69 Conn.App. 366, 372, 793 A.2d 1237, cert. denied, 260 Conn. 931, 799 A.2d 295 (2002). The "essentials [of a real estate contract] must at least consist of the subject of the sale, the terms of it and the parties to it, so as to furnish evidence of a complete agreement." Lynch v. Davis, 181 Conn. 434, 438, 435 A.2d 977 (1980).
In the present case, the written contract does contain all the essentials of the contract and thus escapes from the Statute of Frauds.
As to Count One, no substantial evidence was presented whereby the court could make an award of money damages, even in the face of a breach of contract. The only evidence of plaintiff's expenditures from the time of the defendant's refusal to honor the Option to Purchase offer to the present time, is the amount of rental set forth in the lease, which expenditure the plaintiff suggests in his brief, constitutes damages. The court notes that the plaintiff continued on with his business at the Star Café throughout this period of time and also was not obligated to pay on any financing that would have been in place had the conveyance been accomplished. Consequently, the court finds that while there was a breach of contract, no damages were proven and none are awarded on the First Count.
As to Count Two, for the reasons herein before stated, the court finds that the Option Contract was a valid contract and that the term "131 Bridgeport Avenue" is construed to refer to both lots 15 and 16 on the Milford Tax Assessor's map, comprising the premises of the Star Café, the house, and the abutting parking lot.
Consequently, the court finds in favor of the plaintiff on the Second Count and grants him the equitable relief of specific performance.
Relative to Counts Three and Four of the plaintiff's complaint, the parties stipulated in open court that in the event the court ordered specific performance, the defendant would transfer the property to the plaintiff and the plaintiff would not pursue Counts Three and Four. The court therefore considers them abandoned and withdrawn.
Relative to the defendant's counterclaim of slander of title, the court finds no merit to it in light of its rulings in favor of the plaintiff on his complaint. Accordingly, the counterclaim fails and judgment for the plaintiff is ordered thereon.
The plaintiff is entitled to costs of suit.