Bozena Fraczek v. Peter Trella et al. (2011)

MEMORANDUM OF DECISION

I.

PROCEDURAL HISTORY

The plaintiff, Bozena Fraczek, has commenced a civil action against Peter and Constance Trella.   The July 9, 2010 amended complaint alleges two causes of action;  count one sounds in breach of contract and count two in unjust enrichment.   The defendants responded to the complaint through their answer, special defenses, and counterclaim.¹

Briefly stated, the dispute concerns the payment of $10,000 by the plaintiff to the defendants.   The issues presented are whether the parties had a contractual arrangement concerning the defendants' residence located at 350 Norwich–Salem Road, East Haddam, Connecticut, and whether any of the parties breached it.

The trial was held on April 17, 2011.   The parties introduced testimony and a number of exhibits.   Thereafter the parties filed post-trial briefs.

II.

DISCUSSIONFacts

From the credible evidence presented at trial, the court finds the following relevant facts.   The plaintiff is an individual residing at 69 Cornish Drive, Newington, Connecticut.   The defendants are owners of a single-family residence located at 350 Norwich–Salem Road, East Haddam, Connecticut, which is the property subject to this dispute.

In the fall of 2008, the plaintiff learned that the defendants' residence was for sale.   The property had been listed with the Prudential real estate company.   The plaintiff learned that the listing agreement had expired.   The parties met at the residence on several occasions to discuss the potential sale of the property.   The defendants indicated that it was their intention to build a new home on a portion of the property.   This required approval from the East Haddam planning and zoning commission.   The defendants' schedule was compatible with the needs of the plaintiff because it was the plaintiff's intention to market her existing home in the spring of 2009.   Final approval and fulfillment of all of the requirements of the planning and zoning commission was not accomplished until January 13, 2009.  (Plaintiff's exhibits 2, 3, 4.)

On November 8, 2008, the parties met at the defendants' residence.   The plaintiff gave the defendants a check in the amount of $10,000 as a deposit on the property.   A document entitled “Agreement to Sell Real Estate” was partially completed by the defendant, Constance Trella.  (Plaintiff's exhibit 1.) The agreement acknowledged receipt of the deposit and specified that the deposit was “to be held in trust by Peter/Constance Trella.”  (Plaintiff's exhibit 1.) In the agreement, the parties agreed that the total purchase price was $260,000 and the balance due was $250,000.   The defendant Peter Trella did not sign the document.  (Plaintiff's exhibit 1.) The document consists of five pages.   On November 8, 2008, the plaintiff did not see or approve the provisions set forth on pages four through five.  (Plaintiff's exhibit 1.) These contractual terms were not discussed.   The document was not executed by witnesses.  (Plaintiff's exhibit 1.)

The November 8, 2008 agreement was not intended by the parties to be a purchase-sale agreement.  (Plaintiff's exhibit 1.) Rather the parties contemplated that it would represent a deposit agreement.   During subsequent discussions, the parties agreed that they would meet at an unspecified date in April of 2009 to execute a formal sales agreement.   A purchase-sale agreement was never executed by the parties.   Thereafter, the defendant Peter Trella contacted the plaintiff demanding more money.   The plaintiff refused.   The parties did not have a verbal agreement which obligated the plaintiff to pay the defendants $10,000 per month.

The defendants cashed the plaintiff's $10,000 check.   The plaintiff has demanded a return of the funds.   The defendants have refused to return the funds.

Plaintiff's Claims

A. Count One—Breach of Contract

The plaintiff alleges that the parties entered into an agreement regarding the defendants' residence.  (Amended complaint, ¶ 4.)   She contends that “[s]aid agreement was in the nature of a deposit agreement and contemplated that the parties would subsequently enter into a complete purchase and sale agreement.” ²  (Amended complaint, ¶ 8.)

The defendants argue that the evidence supports the conclusion that the parties entered into a valid purchase and sale agreement.³  They also contend that the plaintiff failed to pay the entire purchase price and close on the property.   The defendants' position is that the plaintiff forfeited the $10,000 deposit as liquidated damages.

“A contract is to be construed as a whole and all relevant provisions will be considered together.”  (Internal quotation marks omitted.)  HLO Land Ownership Associates Ltd. v. Hartford, 248 Conn. 350, 356, 727 A.2d 1260 (1999).  “[A] contract must be construed to effectuate the intent of the contracting parties ․ The intention of the parties to a contract is to be determined from the language used interpreted in the light of the situation of the parties and the circumstances connected with the transaction.”  (Internal quotation marks omitted.)  Id., 356–57.  “All relevant evidence is admissible on the issue of contract interpretation, and [a]ny determination of the meaning or ambiguity should only be made in the light of the relevant evidence of the situation and relations of the parties, the subject matter of the transaction, preliminary negotiations and statements made therein, usages of trade, and the course of dealing between the parties.”  (Internal quotation marks omitted.)  Foley v. Huntington Company, 42 Conn.App. 712, 733–34, 682 A.2d 1026, cert. denied, 239 Conn. 931, 683 A.2d 397 (1996).

The court finds that the parties did not have a purchase-sale agreement for the residence.   The credible evidence demonstrates that the contract was intended to be a deposit agreement.   The defendants breached the contract by demanding additional payments of $10,000 per month, cashing the check and not returning the deposit.   Accordingly, the court finds that the plaintiff has sustained her burden of proof on count one of the complaint.

B. Count Two—Unjust Enrichment

In the second count of the amended complaint, the plaintiff pleads in the alternative that, although there was no enforceable contract, the defendant was paid $10,000 “in anticipation of reaching a formal agreement which never occurred.”  (Amended complaint, ¶ 7.)   Furthermore, the plaintiff claims that she received no consideration and thus the defendants were unjustly enriched.   (Amended complaint, ¶¶ 7–8.)   In the present matter, the court has found the existence of a deposit agreement contract which was breached by the defendants.   Accordingly, unjust enrichment is not available to the plaintiff under these circumstances.

“Unjust enrichment applies wherever justice requires compensation to be given for property or services rendered under a contract, and no remedy is available by an action on the contract ․ A right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another ․ With no other test than what, under a given set of circumstances, is just or unjust, equitable or inequitable, conscionable or unconscionable, it becomes necessary in any case where the benefit of the doctrine is claimed, to examine the circumstances and the conduct of the parties and apply this standard ․ Unjust enrichment is, consistent with the principles of equity, a broad and flexible remedy ․ Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefitted, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment.”  (Citations omitted;  internal quotations marks omitted.)  Hartford Whalers Hockey Club v. Uniroyal Goodrich Tire Co., 231 Conn. 276, 282–83, 649 A.2d 518 (1994).

A lack of remedy under a breach of contract cause of action is essential to allow recovery under the legal theory of unjust enrichment.  Gagne v. Vaccaro, 255 Conn. 390, 401, 766 A.2d 416 (2001);  United Coast Industries v. Clearheart Construction Co., 71 Conn.App. 506, 513, 802 A.2d 901 (2002).   The plaintiff cannot, therefore, recover for unjust enrichment in the present action.

Defendant's Claims

A. Special Defenses

The defendants have asserted two special defenses.   These special defenses are (1) that the plaintiff has failed to demand that the defendants perform their contractual obligations and (2) that the plaintiff is not excused from her obligations by any anticipatory breach or inability to perform.

Based upon the credible evidence presented, the court finds that the defendants have not sustained their burden to prove these special defenses.

B. Counter Claim

The defendants have asserted a counter claim.   They allege that the parties entered into a purchase and sale agreement.   The defendants contend that the plaintiff breached the contract by not paying the $250,000 balance of the purchase price.   They claim damages which are calculated by the diminution in the value of the contract price to its present day value of $200,000 to $225,000, or damages of $35,000 to $60,000 including the $10,000 deposit forfeited as liquidated damages.

The defendants have failed to sustain their burden of proof on this claim.   Accordingly, judgment enters in favor of the plaintiff on the counter claim.

Damages

Having determined that the defendants are liable for breach of contract, the court must calculate and award fair, just and reasonable damages.

“To authorize a recovery of more than nominal damages, facts must exist and be shown by the evidence which affords a reasonable basis for measuring the [plaintiff's] loss.   The [plaintiff has] the burden of proving the nature and extent of loss ․ Mathematical exactitude in the proof of damages is often impossible, but the plaintiff must nevertheless provide sufficient evidence for the trier of fact to make a fair and reasonable estimate.”  (Citation omitted;  internal quotation marks omitted.)  Willow Springs Condominium Assn., Inc. v. Seventh BRT Development Corp., 245 Conn. 1, 58–59, 717 A.2d 77 (1998).

In the present case, the parties entered into a deposit agreement.   The plaintiff paid the defendants $10,000 “to be held in trust.”  (Plaintiff's exhibit 1.) The defendants breached the agreement and wrongfully retained the deposit monies.   The plaintiff has proven her entitlement to damages in the amount of $10,000.

III.

CONCLUSION

The court finds in favor of the plaintiff on count one of the amended complaint.   Judgment shall enter in the amount of $10,000, plus taxable costs.

So ordered.

BY THE COURT,

PETER EMMETT WIESE, JUDGE

FOOTNOTES

FN1. The plaintiff filed a motion dated May 6, 2011 to dismiss the counterclaim.   This motion was denied..  FN1. The plaintiff filed a motion dated May 6, 2011 to dismiss the counterclaim.   This motion was denied.

FN2. The plaintiff maintains that the agreement does not comply with the requirements of General Statutes § 52–550(a)(4).   The court need not address this issue because the parties did not intend to enter into a purchase and sale agreement..  FN2. The plaintiff maintains that the agreement does not comply with the requirements of General Statutes § 52–550(a)(4).   The court need not address this issue because the parties did not intend to enter into a purchase and sale agreement.

FN3. The defendants argue that the plaintiff alleges a purchase and sale agreement in the complaint and the defendants admitted its existence in their answer.   They contend that this is a judicial admission.   This argument ignores other more specific allegations in the complaint which describe the nature of the agreement as follows:  “[s]aid agreement was in the nature of a deposit agreement and contemplated that the parties would subsequently enter into a compete purchase and sale agreement.”  (Amended complaint, ¶ 8.).  FN3. The defendants argue that the plaintiff alleges a purchase and sale agreement in the complaint and the defendants admitted its existence in their answer.   They contend that this is a judicial admission.   This argument ignores other more specific allegations in the complaint which describe the nature of the agreement as follows:  “[s]aid agreement was in the nature of a deposit agreement and contemplated that the parties would subsequently enter into a compete purchase and sale agreement.”  (Amended complaint, ¶ 8.)

Wiese, Peter E., J.