Michael Marinelli v. Estate of Anthony Marinelli, Jr. et al. (2011)

MEMORANDUM OF DECISION

The plaintiff, Michael Marinelli, sues Joanne Marinelli, both in her capacity as executrix for the estate of her former husband, Anthony V. Marinelli, Jr., and as trustee of the Anthony V. Marinelli, Jr., Revocable Trust (Trust).   The plaintiff alleges that his late brother, Anthony V. Marinelli, Jr., fraudulently induced the plaintiff to believe that he would eventually receive one-half ownership interest in real property, upon which a family-owned car repair business was situated, and that a constructive trust ought to be imposed involving that same property.   Before the court is an application for a prejudgment remedy against the estate and the Trust.   On June 13 and July 12, 2011, the court heard the evidence and arguments on this application.

A prejudgment remedy hearing is limited to a determination of whether there is probable cause to believe that a judgment of at least the amount sought by the application will be rendered in the applicant's favor, General Statutes § 52–278d.   The hearing “is not a full-scale trial on the merits.”  Chen v. Bernadel, 101 Conn.App. 658, 661–62 (2007).   Under § 52–278d(a), a prejudgment remedy shall be granted if, upon consideration of the facts before the court and taking into account any defenses, countervailing claims, set-offs, exemptions, and the adequacy of insurance, probable cause exists that judgment will be rendered in the applicant's favor.  Cahaly v. Benistar Property Exchange Trust Co., Inc., 268 Conn. 264, 271–72 (2004).   The court must gauge the applicant's future success or failure by weighing the probabilities surrounding both factual and legal issues.  Doe v. Rapaport, 80 Conn.App. 111, 116–17 (2003).

Probable cause is “a bona fide belief in the existence of the facts essential under the law for the action and such as would warrant a [person] of ordinary caution, prudence and judgment, under the circumstances, in entertaining it.”   J.K. Scanlon v. Construction Group, Inc., 80 Conn.App. 345, 350 (2003).   The concept of probable cause embraces a “flexible common sense standard” which demands neither that a belief be “correct [n]or more likely true than false,” Id.

Anthony V. Marinelli, Sr., father of Michael and Anthony, Jr. owned and operated a car repair shop located at 878 Hartford Road, Manchester, Connecticut.   The business incurred heavy indebtedness, and in 1991, the father obtained a $260,000 mortgage on the secondary mortgage market which bore a very high interest rate.   The monthly payments consisted of interest only with a large, balloon payment due after five years.   To avoid financial ruin, the father enlisted the assistance of his sons and formed a three-member partnership with them in 1993.   The father retained around six percent interest in the business, and the two sons obtained forty-six percent each.   In 1994 the father became an inactive partner and retained only two percent of the business with his sons sharing the remainder.

In 1997, the partnership refinanced through Rockville Bank with a loan of $260,000 which was secured by mortgages on the garage property and the father's residence.   Also, the father, his wife, and the two sons guaranteed repayment of the loan.   The loan payments were made from income generated by the repair shop.

Anthony, Sr., executed a will in 1998 which contained an article devising the garage property to his sons in equal shares along with his remaining partnership interest.   However, in May 1999, Anthony, Sr., quitclaimed title to the garage property to Anthony, Jr., only.

The purpose of the transfer was to divest Anthony, Sr., of ownership to eliminate any liability to contribute to his wife's medical expenses which were being reimbursed through Medicare.   The state Department of Social Services approved of this transfer because, at the time, there was no equity in the property which was encumbered by the Rockville Bank mortgage and delinquent real estate tax liens.

Anthony, Sr., died in 2003, and Anthony, Jr., was appointed executor of his father's estate.   The probate of that estate is still open.   As executor, Anthony, Jr., never listed the garage property as an estate asset.

Anthony, Jr., also became gravely ill.   In 2010, he conveyed title to the garage property to the Trust whose only beneficiary is the son of Anthony, Jr. In November 2010, Anthony, Jr. died.   In his will, he provided a bequest of $20,000 to his brother, the plaintiff.

The plaintiff asserts that he first learned that his father had, in 1999, quitclaimed the garage property to his brother only after his father passed in 2003.   The plaintiff was aware that his father's will, executed in 1998, devised that same land to himself and his brother in equal shares.   He further avers that both his father and his brother consistently assured him that when his father died he would be “taken care of.”   The plaintiff infers that they meant that he would eventually receive one-half interest in the garage property despite the 1999 conveyance to his brother alone.

The plaintiff contends that these assurances and the provision in his father's 1998 will demonstrate that the quitclaim deed to his brother ought to impose a constructive trust on that property now held by the Trust.   He alleges that Anthony, Jr., wrongfully and fraudulently retained sole ownership of the land and interfered with the plaintiff's interest in that property by transferring it to the Trust whose sole beneficiary is Anthony, Jr.'s son.

These claims are, of course, premised on the theory that a constructive trust should be imposed and the 1999 quitclaim to Anthony, Jr., should be legally ignored.

“A constructive trust arises contrary to intention and invitum, against one who, by fraud, actual or constructive, by duress or abuse of confidence, by commission of wrongs, or by any form of unconscionable conduct, artifice, concealment, or questionable means, or who in any way against equity and good conscience, either has obtained or holds the legal right to property which he ought not, in equity and good conscience, hold and enjoy.”  Trevorrow v. Maruccio, 125 Conn.App. 141, 146–47 (2010).   It “arises ․ when a person who holds title to property is subject to an equitable duty to convey it to another on the ground that [he] would be unjustly enriched if [he] were permitted to retain it.”  Id. The essence of a claim for imposition of a constructive trust is that the party holding the property “has committed actual or constructive fraud or ․ has been unjustly enriched.”  Id.

At the prejudgment remedy hearing, the plaintiff withdrew any claim that Anthony, Jr., obtained title to the garage property through fraud, duress, or undue influence.   Thus, the plaintiff presently asserts that the property was retained and alienated by Anthony, Jr., wrongfully.   The following additional facts are necessary to evaluate the plaintiff prospects for prevailing on this claim.

As noted above, by 1994 Anthony, Sr., had ceased participation in the day-to-day car repair operation, and Anthony, Jr., was managing the business.   The plaintiff, on the other hand, had no interest in management and served the partnership as its chief mechanic.

Attorney Michael Darby drafted the 1998 will for Anthony, Sr., and also prepared the 1999 quitclaim deed which transferred title of the realty to Anthony, Jr. Attorney Darby testified that, at the time of the transfer, Anthony, Sr., never expressed a desire that Anthony, Jr., should share ownership of the land with the plaintiff, despite the provision in the will, executed the year before, for such division.

In 2001, the plaintiff was distraught over a domestic breakup and decided to sell his residence and leave the area.   Attorney Darby also drew up the document which, on December 21, 2000, relinquished all of the plaintiff's interest in the partnership to his brother.   This document unequivocally and unconditionally states that the plaintiff intended to “transfer, convey and assign any and all partnership interest.”   Also, the executed document was accompanied by a cover letter sent to Anthony, Jr., suggesting that Anthony, Jr., refinance so as to relieve the plaintiff from any obligations on the debts encumbering the property.   Anthony, Jr., accomplished this refinance and assumption of sole liability by way of a new mortgage in 2006.

Nine months after signing the transfer, the plaintiff decided to return and was hired as an employee of the garage at a $600 per week salary which was identical to the compensation he had received before his departure.   Previous to his leaving, the plaintiff received compensation as a draw reflected through K–1 tax forms.   Subsequently, his income was reflected as wages via W–2 forms.

Throughout the period since the plaintiff left in 2001, Anthony, Jr., or his estate, made all the mortgage payments and reduced that indebtedness to $157,000 on a first mortgage and $7,500 on a second mortgage.   Around $8,000 remains unpaid in real estate taxes.   It should be noted that the garage ceased operation as of July 8, 2011.

The plaintiff contends that he never really intended to give up his interest in the partnership despite the unambiguous language of the document he executed in 2001 to the contrary.   Instead, he avers that it was always “understood” that his departure was temporary so that he might resolve the stress caused by his breakup with his longtime companion.   He accounts for the signing of the December 21, 2000 transfer as merely a convenience for Anthony, Jr., when conducting partnership business in the plaintiff's absence.

In the court's estimation, it is highly improbable that a finder-of-fact would agree with the plaintiff's version.   The document clearly divests the plaintiff of any future interest in the partnership.   The fact that the plaintiff contemporaneously sold his private residence belies his testimony.   Anthony, Jr.'s, conduct after this transfer in assuming sole responsibility for the debts of the business confirms the opposite conclusion.   It should be noted that the plaintiff stopped working at the garage in 2004.   Anthony, Jr., ran the business without any assistance from the plaintiff from 2004 to Anthony, Jr.'s death in November 2010.

Also, if Anthony, Sr., had contemplated, at the time he executed the quitclaim deed, that both sons should share title to the property equally, it is incomprehensible why the father simply did not transfer title to both sons at that time.   This would have accomplished the goal of avoiding the issues regarding Medicare and fulfilling the supposed wish that both sons share ownership of the land equally.   The failure to do so strongly supports the contrary conclusion.

The plaintiff's interpretation of the assurances of his late father and late brother that he would be “taken care of” by receiving one-half interest in the garage property has little persuasive value.   It is not the plaintiff's expectations which bear on the significance of the statements of others.   To reiterate, Anthony, Jr., made a bequest of $20,000 to the plaintiff in his will.   The plaintiff's disappointment with his inheritance will play little role in advancing his claim for a constructive trust.

Therefore, there is no evidence of any wrongdoing on the part of Anthony, Jr. in retaining title to the garage nor that he was unjustly enriched thereby.   Given the evidence of an unequivocal transfer of title from Anthony, Sr. to Anthony, Jr., alone, in 1999;  the efforts of Anthony, Jr. to maintain the garage and assume all liability for its debts;  the plaintiff's voluntary relinquishment of any interest in the partnership in 2001;  and the imprecise nature of any assurances by the plaintiff's father and brother, the court finds an absence of probable cause to believe the plaintiff will prevail on his claims.   The application for prejudgment remedy is, therefore, denied.

Sferrazza, J.

Sferrazza, Samuel J., J.