No. CV-05 4013737 S
April 10, 2008
MEMORANDUM OF DECISION
This is an action by a condominium association to foreclose on a lien against the defendant's condominium unit for allegedly unpaid monthly common charges, as well as two special assessments. The plaintiff, Oronoque Shores Condominium Association No. 1, Inc., is the governing body of a condominium complex located in Stratford, CT. The defendant, Dorothy Smulley, is the owner of a certain unit at the condominium. The defendant denies that she was, at the inception of this action, indebted to the plaintiff for any monthly common charges. She further claims that the two special assessments at issue were not properly adopted in accordance with the condominium association's bylaws, and are therefore unenforceable nullities.
The defendant has also filed a counterclaim against the association for water damage to her unit allegedly caused by a defective roof which is a common element of the condominium complex that plaintiff association is obliged to maintain and repair. The matter was tried to the court, and additional findings of fact will be discussed as they are relevant to the court's analysis.
The Monthly Common Charges
The parties do not dispute the general proposition of law that the plaintiff association is the properly constituted representative of all unit owners acting as a group in accordance with the condominium instruments. Accordingly, the association has the authority to levy assessments and common fees on all unit owners. Section 47-258 grants the plaintiff association a statutory lien on a unit for any assessments levied against the defendant's unit. The court finds that the defendant was the owner of the unit for purposes of assessment and common fee liability during the relevant periods, and that the defendant enjoyed the benefits of condominium ownership.
With respect to the monthly common charges the plaintiff claims the defendant has not paid, the parties disagree over whether there were any outstanding common charges at the commencement of this litigation in 2005. By way of special defenses and counterclaims, the defendant alleges that the plaintiff acted in bad faith and with unclean hands by failing to properly accept and apply payments tendered by the defendant, thereby breaching the implied covenant of good faith and fair dealing.
The court heard conflicting testimony as to whether the defendant owed two months of common charges for the months of June and August 2005, which were the subject of a September 2005 demand letter sent to the defendant by an attorney for the association. Once the complaint was filed in November 2005, further monthly payments tendered by the defendant for common charges were returned to her.
Based on the evidence presented at trial, this court finds that the defendant did not pay the common charges for those two months when they were due and owing. Accordingly, with respect to the common charges, the court enters judgment for the plaintiffs for common charges for the months of June and August 2005, and every month since September 2005 through April 1, 2008 (the month of this decision). Because the defendant did attempt to tender her monthly common charges for subsequent months which were returned because of the pendency of this litigation, this court declines to award late fees or interest. Moreover, the association is not seeking such additional amounts.
The Special Assessments
The court also heard evidence as to the existence of two special assessments levied on all unit owners by the association. Defendant contests the legality and enforceability of both assessments. She also acknowledges nonpayment, but in her counterclaims and special defenses, she advances somewhat different arguments as to the deficiencies of each assessment. As to the special assessment upon unit owners for additional snow removal expenses, defendant claims it was calculated improperly. As to a second assessment for legal expenses to challenge a pending application for a new industrial access road to be constructed near the condominium, the defendant claims the assessment is a nullity, as it was also calculated improperly, and adopted in violation of the notice provisions in the condominium by-laws.
The Special Assessment for Snow Removal
The amount the association originally budgeted for snow removal at the condominium complex for the winter of 2004-05 was found to be inadequate to cover the actual expense. Therefore, the association found it necessary to impose a special assessment upon all unit owners. At first the assessment was improperly calculated according to the bylaws, as it was apportioned equally among all unit owners. This resulted in the defendant initially being billed a higher amount than she was legally obligated to pay. Section 11(a) of the bylaws require such assessments to be imposed upon each unit owner "in proportion to their percentage interests in the common elements [of the condominium]." Recognizing its error, the association later reduced the defendant's assessment by approximately thirty-five dollars to reflect the proper amount.
The defendant has refused to pay the amount of the adjusted assessment, contending at trial that the initial failure of the association to correctly calculate the amount the defendant was obligated to pay makes the assessment itself ultra vires and a nullity. The court does not agree, finding that the revised assessment cured any defect, and also notes that the defendant's posture at trial is at a variance with her earlier admission that she was indeed responsible for payment.
In a June 23, 2005 letter to the president of the association which was received into evidence, the defendant writes of the snow removal assessment, " This is unpaid as of this date. I acknowledge that this amount is due and owing. My inability to make this current is more of a financial timing issue than anything else. I will endeavor to make monthly payments of $50 each until the assessment is paid in full."(Emphasis added.)
The Special Assessment for Litigation Expenses: The Environmental Protection Fund
The condominium complex in this case is in close proximity to the Sikorsky Aircraft facilities in Stratford, CT. By letter dated April 27, 2005, an engineering firm retained by Sikorsky notified the president of the condominium association of an application pending before the Stratford Board of Zoning Appeals for a variance to construct a new delivery access road for the benefit of Sikorsky. As proposed, this paved roadway would lie within fifty feet of a tidal wetland. Such a new access road would also involve truck traffic passing adjacent to a portion of the condominium complex, specifically the building housing the defendant's unit. The letter also advised that a hearing on the application for the variance would be held at Stratford Town Hall on June 7, 2005.
On May 24, 2005, notice of a meeting was distributed to all condominium unit owners, including the defendant. The opening line of the notice stated, "ALL Unit Owners are invited and URGED to attend a very important meeting to be held on TUESDAY, MAY 31, 2005 at 7:00 PM in the clubhouse." (Emphasis in original.) The notice described the circumstances surrounding the receipt of the letter, some additional facts gleaned from Sikorsky's application and conversations with its engineering firm, and spelled out the potentially adverse effects that approval of such a road would have on the quality of life of unit owners in the condominium. The notice ended with the following, "Please plan to attend. If your community is to make a reasoned, coherent presentation to Planning Zoning on June 7th, it is imperative that we have the facts. It is important that all unit owners are informed and united in our response."
The defendant attended the unit owners' meeting. The minutes of the meeting reflect that, "No one was denied an opportunity to speak." Following a presentation by representatives from Sikorsky, minutes of the meeting also show that a resolution to retain legal counsel to oppose the Sikorsky application was unanimously approved by voice vote, as was a second resolution to assess each unit owner the sum of $500 to cover some of the anticipated costs. Defendant has not paid this assessment.
The defendant correctly contends that the meeting notice does not explicitly state that a special assessment would be voted upon at the meeting. The association bylaws provide that notices of special meetings are to state "the purpose thereof. No business shall be transacted at a special meeting except as stated in the notice." Therefore, the notice provision of the condominium bylaws was not strictly adhered to in this case. The Defendant asks this court to treat that fact as dispositive, trumping all other considerations. A lack of notice, however, is not the end of the court's inquiry.
It is clear from a reading of the notice sent to unit owners that the association intended to take action in response to Sikorsky's application. In Twenty-Four Merrill Street Condominium Association v. Murray, 96 Conn.App. 616, 902 A.2d 24 (2006), the Appellate Court addressed another case involving a failure of a condominium association to strictly comply with the notice provision of its bylaws. In an opinion authored by Judge (now Chief Justice) Rogers, the Appellate Court observed: "The concept of notice concerns notions of fundamental fairness, affording parties the opportunity to be apprised when their interests are implicated in a given matter . . . Notice is not a rigid concept . . . [T]he modern approach to notice-giving attaches primary importance to actual notice and treats technical compliance with notice procedures as a secondary consideration . . . To invalidate the notice simply because it is irregular is to protect no worthwhile interest of the party who has raised the objection. He has had his due. An objection to the notice on his part serves only to induce concern for punctilious adherence to formality." (Citations omitted; internal quotation marks omitted.) Id. at 622-23.
A review of the circumstances surrounding the unit owners' meeting in this case, and the reasonable inferences drawn therefrom, persuade this court to adopt a similar conclusion here. Time was of the essence on this issue, and defendant would have this court focus only on a punctilious adherence to the bylaws and invalidate this special assessment, despite the information about the meeting that was provided, despite her attendance at the meeting wherein such assessment was approved, despite the opportunity afforded her to be heard, despite the minutes of that meeting reflecting a unanimous approval of such an expenditure, and despite her letter to the president of the association wherein she explicitly acknowledged her responsibility to pay it. Moreover, the court finds that the defendant is not an unsophisticated person, having worked as a risk management consultant for Fortune 500 corporations.
In the same letter to the president of the association referenced in footnote one of this opinion, the defendant writes of this assessment, " This is unpaid as of this date. I acknowledge that this amount is due and owing. My inability to make this current is more of a financial timing issue than anything else. I will endeavor to make partial payments until this is paid in full."(Emphasis added.)
While the court refuses to invalidate this special assessment on the grounds of defective notice, it is exercising its equitable jurisdiction to adjust the amount the defendant owes. As the court noted in its earlier discussion of the snow removal assessment, the bylaws require such assessments to be imposed upon each unit owner in proportion to their respective interest in the common elements of the condominium. Therefore, the plaintiff is ordered to recalculate the defendant's share of the special assessment to litigate the Sikorsky application to reflect her proportional share.
The defendant has filed a counterclaim for water damages from an exterior leak into her unit. She alleges that the plaintiff has failed to meet its obligation to maintain the common elements of the condominium. The defendant introduced testimony from an expert roofing contractor, but he only testified as to the cost of repairing exterior elements of the condominium, which are the sole responsibility of the plaintiff. Moreover, the evidence shows that when the plaintiff made efforts in 2007 to mitigate the situation by having its own contractor fix the possible cause of any water damage to defendant's unit by replacing shingles, the defendant emailed plaintiff's counsel stating that this area was not to be repaired until the litigation was resolved.
The defendant introduced photographs purporting to show water damage in some areas around certain windows in her unit. However, she presented no evidence, speculative or otherwise, as to the cost to repair, replace or repaint these interior surfaces belonging to her. The defendant has thus failed to establish a cognizable claim for damages.
CT Page 6189
ConclusionAs this is a foreclosure proceeding, both parties have acknowledged that the trial court acts as a court of equity with respect to the complaint, if not the counterclaim. "The balancing of the equities and the determination of what is required by equity in a particular case are matters of discretion for the trial court." Dime Savings Bank of New York v. Grisel, 36 Conn.App 313, 320, 650 A.2d 1246 (1995). As Justice Benjamin Cardozo once observed, "Equity fashions a trust with flexible adaptation to the call of the occasion." Adams v. Champion, 294 U.S. 231, 237 55 S.Ct. 399, 79 L.Ed. 880 (1935). This point was later echoed by Justice Felix Frankfurter, who noted, "Equity eschews mechanical rules; it depends on flexibility." Holmberg v. Armbrecht, 327 U.S. 392, 396, 66 S.Ct. 582, 90 L.Ed. 743 (1946).
In Bella Vista Condominium Ass'n. v. Byars, 102 Conn.App 245, 925 A.2d 365 (2007), the Appellate Court found one of the statutory purposes of the Condominium Act to be the ability of a condominium association to collect fees. While this does not mean that an association may act arbitrarily in imposing fees and assessments upon condominium unit owners, the Appellate Court adopted the view that, in cases of doubt, ambiguities should be interpreted in favor of finding that a condominium association has the authority to levy and collect fees, which includes the ability to collect those fees by resorting to court when other means prove fruitless. Id. at 251.
Based on the foregoing, judgment shall enter for the plaintiff on the complaint and on the counterclaim. Pursuant to General Statutes § 49-25, it is the judgment of the court that a foreclosure by sale shall enter.
The parties are directed to appear before the court on Wednesday, April 23, 2008 at 9:30 a.m. for a hearing to set a sale date and to fix the amount of the debt owed, including the special assessments and unpaid common charges accruing through April 1, 2008. While interest and penalties on the amount of the debt are disallowed, reasonable costs and attorneys fees are also awarded, in an amount to be determined at the hearing.
Following that hearing, the court hereby directs the clerk of this court to appoint a committee to implement this judgment. The standing orders of the Superior Court for foreclosure by sale are to be observed. The clerk is also directed to appoint a disinterested appraiser who shall, under oath, appraise the condominium unit owned by the defendant, and make return of such appraisal to the court. Potential bidders will be required to deposit ten percent (10%) of such appraised value.