Darien Financial Services, Inc. v. Phil Jeffrey Louis (2010)

MEMORANDUM OF DECISION RE Motion To Confirm Fact-Finder's Report (119.00) And Objection Thereto (120.00)

This matter comes before the court by way of a motion to confirm, and an objection to, the report of a fact-finder to which this case had been referred pursuant to General Statutes § 52-549n.   In its complaint the plaintiff alleges the defendant asked to borrow $30,678.05 from the defendant to be able to close on the purchase of real estate the defendant had contracted to purchase.   The plaintiff agreed to lend the money sought which the defendant agreed to repay after the closing.   It is alleged that the plaintiff gave a check payable to the real estate seller's attorney in the amount of $30,678.05 which was deposited and credited toward the purchase price of the real estate.   It is alleged that the defendant refused to sign a promissory note, and has refused to pay the plaintiff $30,678.05.   The plaintiff seeks money damages for breach of contract, and on a theory of unjust enrichment.

In his answer the defendant Louis denied that he asked to borrow the money, denied that he agreed to repay the money and alleged as a special defense that any proceeds loaned to the defendant were made without his authorization or approval.

The case was heard before a fact-finder over two days.   There was testimony from the president of the plaintiff Darien Financial, Greco, and the defendant Louis and two attorneys involved in the closing, and numerous exhibits were introduced into evidence.   The fact-finder subsequently issued the following report:

1.  That the Defendant, PHIL JEFFREY LOUIS, JR. Was an individual residing in West Hartford, CT and in the business of providing real estate services and familiar with real estate transactions.

2. That Plaintiff, DARIEN FINANCIAL SERVICES, INC., is a Connecticut corporation doing business in Darien, CT and in the business of providing financing for real estate transactions.

3. That in the month of July 2005 the Defendant did contract to purchase property at 279 Noroton Avenue, Darien, CT and did purchase said property on July 22, 2005.

4. That the Defendant did obtain the primary funding in the form of a first and second mortgage loan for the purchase of said property from the Plaintiff.

5. That prior to the closing it was established, as evidenced by the HUD-1, that there was a “cash-to-balance” required to close in the amount of $30,678.05.

6. That prior to the closing and transfer of title the Plaintiff did provide additional funding in a check in the amount of $30,678.05 on behalf of the Defendant and the Defendant did take title to the property aforesaid.

7. That the purchase of the property was made possible by the additional funds paid by the Plaintiff to the Defendant and that the Defendant accepted and benefitted by said payment.

8. That there was no promissory note or other instrument executed by either party which defined the terms of the loan of $30,678.05 or secured said loan.

9. That defenses raised by the Defendant are found to be unsupported and not credible.

10. That the debt is $30,678.05 as of December 2005 when repeated requests were made by the Plaintiff for repayment after the Defendant sold or terminated his interest in the property.

8. That I have reviewed all testimony and evidence presented to me.   That having received and reviewed the evidence and testimony and having heard the arguments of counsel, I find the following:

The Plaintiff should be awarded the sum of $30,678.05 as principal of the loan but without interest or loan fees.   The Clerk shall assess costs of suit and add to this finding.

THEREFORE, based on the evidence and testimony I find the Plaintiff should be entitled to a final award of $30,678.05 plus costs of suit.

The standard of review the court applies when considering objections to an attorney trial referee's report is clear error.  Meadows v. Higgins, 249 Conn. 155, 162, 733 A.2d 172 (1999);  Elgar v. Elgar, 238 Conn. 839, 848-49, 679 A.2d 937 (1996).

It is axiomatic that a reviewing authority may not substitute its findings for those of the trier of facts.   This principle applies no matter whether the reviewing authority is the Supreme Court ․ the Appellate Court ․ or the Superior Court reviewing the findings of attorney trial referees.   See Practice Book § 443 [now § 19-17]․  This court has articulated that attorney trial referees and fact-finders share the same function ․ whose determination of the facts is reviewable in accordance with well established procedures prior to the rendition of judgment by the court ․ The factual findings of a [trial referee] on any issue are reversible only if they are clearly erroneous ․ [a reviewing court] cannot retry the facts or pass upon the credibility of the witnesses ․ A finding of fact is clearly erroneous when there is no evidence in the record to support it ․ or when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.  (Brackets in original;  citations omitted;  internal quotations omitted.)

Meadows v. Higgins, supra, 162.

The court has read the transcripts of the hearings and reviewed the exhibits.   The facts found by the fact-finder are amply supported by the record, with one inconsequential correction.   As to Finding No. 4, the evidence shows that the plaintiff, as a mortgage broker, arranged for first and second mortgage loans to the defendant from third-party lenders.

In the two memoranda of law opposing the fact-finder's report, the defendant finds much to object to, in many cases simply contending that the fact-finder was wrong.   However, from this court's perspective there is more than enough evidence on which to conclude the report should be upheld.   It appears that the defendant's primary contention is that an individual associated with the defendant, one John Cocomo, called Darien Resources' president, Greco, identified himself as the defendant Louis and asked for a loan in the precise amount needed to close the real estate purchase.   There is no evidence to support this-only supposition.   Even if that occurred, Louis had to know that somehow $30,678.05 had been paid to his benefit to allow the closing to take place, and allow Louis to take title to the property.   Louis knew of the cash shortfall prior to the closing (Tr. Jan. 22, 2010, 65-66), and cannot, with any veracity, claim that he would not have allowed any more borrowing to take place when, with eyes wide open, he found at the closing there was no cash shortage, and he was able to take sole title to the property hours thereafter.

There was no other testimony to support Louis' contention, and not a shred of physical evidence.   The court accepts the fact-finder's finding that Louis' defenses were “unsupported and not credible.”

The court concludes on the basis of the facts found that the plaintiff is entitled to judgment on both the contract and unjust enrichment counts.   Because there was concededly no agreement of the parties on the terms of the loan, no interest should be included in the judgment.

Conclusion and Order

The motion to confirm is granted, and the objection is overruled.   Judgment shall enter in the amount of $30,678.05, plus costs for the plaintiff

TAGGART D. ADAMS

SUPERIOR COURT JUDGE

Adams, Taggart D., J.