SIBI v. LLC (2010)

MEMORANDUM OF DECISION

This case involves two separate lawsuits.   HHD CV 08-5022864-S, Sibi Brancifort Construction v. J.V.R. Ridge LLC et al., and HHD CV 09-5030297-S, Sibi Brancifort Construction v. J.V.R. Ridge LLC et al.   These cases have been consolidated and were tried together.   The 2008 case is a foreclosure action in which the plaintiff filed a mechanic's lien and claims non-payment of a debt of $60,197 for materials and labor and construction improvements to the property in West Hartford, Connecticut owned by the defendants in which plaintiffs move to construct a road to a 4-lot, family oriented subdivision.   The defendants filed an answer to this complaint in which they admit all of the basic allegations of the complaint with the exception of the amount involved as to which they deny that the $60,197 is due the plaintiff.   In addition they filed a first special defense in which they claimed that the court lacked personal jurisdiction over the defendants for failing to properly serve them with a true and attested copy of the foreclosure complaint.   This first special defense seems to have been abandoned in the trial.   In addition to this defense, the defendants filed a third amended counterclaim.   The counterclaim contains three counts.   The first count is a breach of contract in which the defendants claim damages of $250.00 a-day for a total of $106,250 for delay in completion of the contract.   The second count is an alleged breach of contract in which defendants admit that they terminated the construction contract and claim damages to the extent the cost to complete the work exceeds the original agreed upon price of $479,830.25.   The third count alleges violation of Connecticut Unfair Trade Practices Act (CUTPA).   This is between J.V.R. Ridge and its seven individual defendants individually versus Brancifort Construction Company, Inc.

The second case which is also between the Brancifort Construction and J.V.R. Ridge LLC et al. consists of an action in three counts.   The first alleges Breach of Contract, claiming a loss of profit on a potential cost of $129,000 to complete the contract which was terminated by the defendants.   Count Two alleges Unjust Enrichment for failure to pay the cost of some processed stone at $18,631.53.   Count Three is brought in Quantum Meruit also alleging failure to pay for the cost of the processed stone in the amount of $18,631.53.   Defendants have filed an answer in which they basically denied owing money pursuant to the contract or any breach of the contract.   As to Count Two, Unjust Enrichment, the defendants deny that they owe the money claimed.   As to Count Three, quantum meruit, they also deny any inference that they owe plaintiff any money under the contract.   They also file a special defense to the effect that the third count fails to state a claim upon which relief can be granted as there can be no quantum meruit where the plaintiff also seeks relief for damages under a written contract.

In addition to the J.V.R. Ridge, LLC., the following members of the Ritoli Family were served as defendants in this case;  Robert P. McGurgan, Elena T. Ritoli, Verneen Ritoli-Paradis, Kris W. Lang, Romely Ritoli-Lang, Richard Bevilacqua, Elena-Lee Bevilacqua and in addition, Blastech, Inc., were served inasmuch as paragraph seven of the complaint indicated that Blastech Inc., claimed an interest in the defendants' premises by virtue of a mechanic's lien for the sum of $15,000 dated January 2, 2008.

The principals in this case were John Brancifort acting as contractor on the job referred to throughout the case as the Ritoli family project and Dorothy Brancifort, President of Sibi Construction Corporation.   Acting for the Ritoli family at first was Dr. Bevilacqua and later Elena Ritoli.

J.V.R. Ridge Inc., and the Sibi Brancifort Construction Company, Inc., entered into a contract on December 18, 2002.   This contract was for the construction, labor, equipment and materials necessary to perform the site work of the Ritoli family subdivision in West Hartford, Connecticut in accordance with plans provided by Buck and Buck Engineers of Hartford, Connecticut.   The contract was subject to “unforseen conditions and/or municipal regulations,” for the lump sum price of:  Four hundred seventeen nine thousand eight hundred thirty dollars and twenty five cents ($479,830.25).   The contract was signed for J.V.R. Ridge Inc., as owner by Doctor Richard Bevilacqua and for the Sibi Brancifort Construction Company by John Brancifort.   The contract had attached to it and made part of it certain exclusions and qualifications as well as a list of items and description of work to be performed.   The contract states that the only exceptions are a requirement of $50,000 in order to adequately commence materials buyouts and equipment mobilization to the site and a payment of $60,000 at the time of ordering certain box culvert supplies.   The contract also recited that the current cost of liquid asphalt was $190 per ton and this was noted so that any increase could be compared against said amount.

In addition to those exceptions the contract contained a paragraph “B” providing that the Branciforts would not perform any work for Arnold Chase or any company of which Mr. Chase or members of his family may own a majority interest for a period of two years after the construction in this contract was completed.

In paragraph C of the contract there was a provision provided by the Branciforts stating that all work to be performed in accordance with the contract would be completed no later than September 15, 2003 and providing for a penalty of $250 per day in the event the work is not completed on or before the said date.

The contract provided that a schedule of values would be provided and that all billing would be on the certain AIA document using the schedule of values and percentage of work completed to date and the billings would be presented for payment every two weeks covering work performed to date with a 2 1/2 percent retainage fee.   Among the exclusions the contract provided “removal and refill for onsite mass or trench rock.   No boring information.”

The parties entered into a second contract bearing the date of September 17, 2003.   This contract took the form of a letter from John Brancifort to Dr. Bevilacqua indicating “we now know after site clearing and site investigations that there will be rock removal.”   This contract contained estimates as to the amount of the removal and indicated the cost of removing on a per cubic yard basis.   Although dated September 17, 2003 it was not signed by Dr. Bevalicqua until October 7, 2003.

The object of this contract was to build a road over undeveloped land on the south side of Albany Avenue, West Hartford (route 44) into a small subdivision containing four lots.   One for Mrs. Elena Ritoli and one each for her three daughters to build a home.   While the work began soon after the signing of the contract and it was anticipated that it would be finished in 10 months, it was in fact not completed by plaintiff in December of 2007.   Work was extended over such a long period of time because of two long delays in construction.   While discussions regarding the rock took place as early as August of 2003 due to the delay in signing the contract the plaintiff was not able to hire Raviza Brothers to perform the blasting and they were not able to begin the blasting until November 2003 and it continued until May of 2004.   A considerable amount of time was spent removing stone from the blasting area.   Much of it was used to fill a sink-hole which was discovered in the interior section of which the road was to be constructed.   This part of the project was unanticipated and caused changes in the contractor's plans as well as delays in construction.   The first of numerous change orders was submitted to the plaintiff as a consequence of the blasting.   The first in the amount of $223,329.60 and the second in the amount of $103,370.   These were paid without question.

The second long delay was caused by the Chase lawsuit.   Apparently the proscription against work for Chase which was placed in the contract by the defendants was because they were aware that Arnold Chase, the owner of adjoining land, had a right-of-way over their property.   In January of 2004 he commenced a lawsuit seeking an injunction to prevent the defendants from continuing with construction of the road.   A lis pendens was filed on the defendants' property and in May the plaintiff was forced to stop work on the project because of the lawsuit.   The Chase lawsuit was settled by a stipulation for judgment dated September 21, 2004.   It contained an agreement that the defendants' roadway was to be widened from 22 feet to 26 feet and was to be built in such a way that it would be accepted as a public road by the town of West Hartford.

Subsequent to the Chase lawsuit the defendant's and Chase's engineers worked out the details of the redesign of the road.   The lis pendens was removed from the property in May of 2005 but the plaintiff was not able to resume work on the project until March of 2006.   When the defendant indicated that he might resume work on the project the plaintiff indicated that he would be ready to resume work after the two-year delay but that he would require compensation for cost increases that were going to occur because of the delay and that there would be additional engineering work to be completed before he could begin.   Work resumed in the summer of 2006.

It is important to note that the defendants recognized that the delays in the construction of this project were not the fault of the plaintiff.   In a letter dated May 11, 2004 Dr. Bevilacqua states “in addition because of the extreme increase in the cost of this project, at no fault of yours, a request that no blasting be performed ․” In its October 23, 2008 special defense, the defendant noted “as a result of delays caused by third party lawsuits, the parties were not in a position to resume work on the road until March 8, 2006.   During the course of performing the work in a manner in which the plaintiff, an experienced contractor, deemed most prudent by Mrs. Ritoli who wished to have the work completed from the road into where her home was to be built, constantly protested.   While road construction was proceeding an access was provided to Mrs. Ritoli's lot over an old wood road which existed on the property.   Mrs. Ritoli's home was completed by her builders in October of 2007 and shortly thereafter, on December 2007, the defendants ordered the plaintiff to cease further work on the project.   Apparently in the light of two other long delays in the project the plaintiff kept three pieces of equipment on the property while he sought to return to the job.   There is no evidence that it caused any problem and they were removed after a year.

During the course of the construction the plaintiff in accordance with the terms of the contract submitted applications for payment approximately every two weeks.   These applications for payment showed in addition to the percentage of the work done the change orders for work that was not covered in the contract but had to take place.

The plaintiff submitted applications for payment to the defendant dated December 16, 2002, June 2, 2003, January 29, 2004, April 13, 2004, May 18, 2006, May 14, 2007, July 22, 2007, August 22, 2007 and October 3, 2007 with a final bill on November 7, 2007.   There were also a number of letters from Mrs. Brancifort explaining costs and increased costs and seeking payment of unpaid bills.   Each of these applications for payment contained the original contract sum, and that changed by change orders showing in other words the increases in the costs, detailed what the changes were and explained any increases in costs on contract items.   A final application for payment was submitted on August 13, 2008 explaining the sum of $18,631.53 which was due but not in the mechanic's lien thus indicating that there was a balance unpaid on work performed of $78,829.49.   The original contract sum was $479,830.25.   The change orders amounted to $561,169.05.   Doctor Bevilacqua and Mrs. Ritoli questioned each and every one of the change orders and each was paid.   At the time of the termination of the contract by the defendants the defendant owed $78,828.53 on work performed in accordance with the terms of the contract.

Mrs. Brancifort, president of the defendant corporation, did all of the bookkeeping herself.   She kept detailed accounting of all of the work done by the company on the project and all the bills incurred under the contract and for all changes as they occurred.   In a few instances lack of communication occurred between John and his mother such as billing for a crane when in fact John substituted a jack-hammer and his men.   However in the long run the bills covered work that was actually performed and were as accurate as can be expected considering a project so complex and so fraught with delays, changes and price increases over a five-year period.   The Court also found the testimony of Mrs. Brancifort and John to be very credible.   While the defendant, Mrs. Ritoli, may not have expertise in construction she knew enough as a business women to question the charges, seek documentation if she thought they were unreasonable and withheld payment if she did not agree with them.

The court is of the opinion that none of the three counts in the counterclaim has any merit.

Count One attempts to resurrect the long deceased penalty of $250 a day.   This item of the contract was waived by both parties.   It was never mentioned by the decedents until after the plaintiff brought suit for the unpaid balance of its work.   In the opinion of the court it was also unenforceable once the parties signed the contract for the blasting and the removal of stone which contract by its very nature extended the period of time in which the contract would be completed.

The Second Count alleged a breach of contract between the defendant and the plaintiff claiming damages to the extent the cost to complete the work exceeded the original agreed upon price plus any valid change orders.

In the opinion of the court the plaintiff stayed within the agreed upon price for anticipated work under the contract and substantiated all change orders both as to necessity and cost.   The change orders were all paid for by the decedent after ample time to question and in some cases were questioned.   Going through each change order in detail at trial only substantiated the court's belief that they were properly incurred.

In the opinion of the court the defendant has waived the right to object to the change orders which were previously paid for.   Waiver is the intentional relinquishment of a known right.   If the defendant had a dispute or a question about the change orders it would not have paid them.   Chase Orchards v. Gerber Construction, CV 0596922-S, Beach, J. (August 22, 2002).   The defendant breached the contract not the plaintiff.

In the third count the defendant has charged the plaintiff with violation of the Connecticut Unfair Trade Practices Act. “The parties seeking to recover damages under CUTPA must meet two threshold requirements.   First, he must establish that the conduct at issue constitutes an unfair or deceptive trade practice ․ second, he must present evidence providing the court with a basis for a reasonable estimate of the damages suffered.”  MacMillan v. Higgins, 76 Conn.App. 261, 2003.   See also C.G.S. § 42-110g.  “CUTPA provides in relevant part that [n]o person shall engage in unfair methods of competition in unfair or deceptive acts or practices in the conduct of any trade or commerce.”

“Connecticut courts when determining whether a practice has violated its CUTPA will consider (1) whether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise-whether, in other words, it is within at least the penumbra of some common-law, statutory or other established concept of unfairness;  (2) whether it is immoral, unethical, oppressive or unscrupulous;  (3) whether it causes substantial injury to consumers (or competitors or other businessmen) ․ Thus a violation of CUTPA may be established by showing either an actual deceptive practice ․ or a practice amounting to a violation of public policy ․”

“An act or practice is deceptive if three conditions are met.”   First, there must be a representation, omission, or other practice likely to mislead consumers.   Second, the consumers must interpret the message reasonably under the circumstances.   Third, misleading representation, omission, or practice must be material-that is likely to affect consumer decisions or conduct ․” Miller v. Guimares, 78 Conn.App. 775.

In the opinion of the court the defendant has failed to prove any of the elements necessary to establish a cause of action under CUTPA.

The court finds the plaintiff has a valid mechanic's lien in the amount of $60,897.96.   The court enters judgment of foreclosure of the mechanic's lien as to liability only.   The plaintiff shall obtain an appraisal of the property and claim the case to the foreclosure short calendar so the court can make findings as to the fair market value of the property and set the appropriate law day or sale date.   Judgment may enter for the plaintiff on each of the three counts of the counterclaim.

The 2009 file i.e., 095030297 contains two counts.   The fist count is Breach of Contract.   In the opinion of the court the defendants breached the original contract by terminating the plaintiff in December 2007 without just cause.   While the defendants attempted to explain the breach in their brief as dissatisfaction plaintiffs billing practices and the delays.   As pointed out above, the defendants admitted the delays were their fault.   Just prior to the termination Mrs. Brancifort was seeking payments from the defendants.   The evidence at trial produced no satisfactory answer as to defendants' reason for the breach.

The plaintiff claims loss profits of $23,000 on the unfinished work under the contract which amounted to $129,000.   This is a profit of 18% which is the average profit which the company has been collecting over its many years of service.   Connecticut Supreme Court has clarified that loss profits are considered an element of compensatory damages.  Ambrogio v. Beaver Road Associates, 267 Conn. 148, 155 (2003).

The Second Count alleges Unjust Enrichment claiming that the plaintiff had delivered 1,459 tons of processed stone necessary for the construction of the Ritoli family subdivision to the premises and had not been paid for same.   This was an error discovered by Mrs. Brancifort after the Mechanic's Lien as filed.   In the opinion of the court it is a legitimate expense and is unpaid.

Judgment may enter for the plaintiff as to Count One and Count Two of the complaint in the 2009 case CV 095030297.   As to Count Three the Special Defense is correct and judgment may enter for the defendant as to that count.

Hale, JTR

Hale, Robert J., J.T.R.