LLC v. LLC (2013)

Memorandum of Decision on Plaintiff's Objection to Jury Claim (No. 108) (Following Reconsideration)

Procedural/Factual Background

This is a commercial landlord-tenant dispute involving premises known as stores 4 and 5, 130 New Canaan Avenue, Norwalk, Connecticut.   The plaintiff/landlord claims that the limited liability company tenant Thomas Deli, LLC and the personal guarantors of the tenant are more than $200,000 in arrears, having paid but only three months of rent or use and occupancy charges in the sixteen months prior to commencement of this action in the Housing Session of the Superior Court at Norwalk.   The defendants filed a claim for trial by jury on May 16, 2013 which resulted in the case being transferred here to the civil docket at Stamford on May 22, 2013.   On May 28, 2013 the plaintiff filed the subject objection to that jury claim, based on a waivers of the right to jury trial by the tenant and the personal guarantors contained in a written Lease and a Guaranty of October 2, 2003.¹  The objection came up before the undersigned on the non-arguable short calendar of July 8, 2013.   On July 3, 2013 the defendants Thomas Deli, LLC and Maria Karagiorgos had filed their Reply to Plaintiff's Objection to Defendants' Jury Claim in which they each directed the court to their Answers and to the Special Defense of Maria Karagiorgos which had been filed May 16 in the Housing Court.   The court reviewed all the pleadings and defendants' “Reply” to the objection to the jury claim, and ruled on July 16 (Order, No. 108.86) that:

The objection to jury claim was sustained as to the defendant Thomas Deli, LLC which had admitted in its answer that it had entered into the Lease and Guaranty which contained the jury waivers.

The objection to jury claim was marked “off” (without prejudice) as to the defendant Thomas Karagiorgos because he had been defaulted for failure to plead.

The objection to jury claim was overruled as to the defendant Maria Karagiorgos (now known as Maria Sophia Savvids) who had denied in her Answer that she had entered into the Lease and Guaranty that contained the jury waivers, and had filed a Special Defense alleging that she did not sign either the Lease or the Guaranty and that her printed name on those documents was inserted without her knowledge or authorization by her ex-husband the defendant Thomas Karagiorgos.   The court held that she was entitled to have the issue of her entering into the Lease and Guaranty and the forgery issue raised by her Special Defense determined by a jury.

On July 20, 2013 the plaintiff moved to reargue the ruling of July 16 as to the defendant Maria Karagiorgos because her “Reply” to the objection to jury claim had been filed late,² thereby depriving the plaintiff of an opportunity to respond to the Reply.   The court granted the Motion to Reconsider on August 8, 2013 by vacating the order of July 16, and giving the plaintiff an opportunity until August 29 to file a memorandum in opposition to the arguments made by defendant Maria Karagiorgos in the July 3 “Reply.”   That memorandum was filed on August 26 (No. 113) and has been reviewed by the court on reconsideration, and this is the court's decision of the matter, following reconsideration.

Discussion

Plaintiff asks the court to sustain the objection to Maria Karagiorgos' jury claim even though she has denied in her Answer and Special Defense entering into the Lease and Guaranty documents which include express written waivers of trial by jury, on two grounds:  (1) because “Defendant Maria Karagiorgos has made several inescapable judicial admissions that she is bound by the lease”;  and (2) because “[t]he egregious nature of the Defendant [Maria Karagiorgos'] shifting and contradictory representations to the tribunal also calls out for the application of Judicial Estoppel.”   For the reasons which follow, the court overrules the Objection to Jury Claim on grounds of judicial admissions, but sustains the Objection to Jury Claim on grounds of Judicial Estoppel.

A. Judicial Admissions

“Judicial admissions are voluntary and knowing concessions of fact by a party or a party's attorney occurring during judicial proceedings.”  Macy v. Lukas, 72 Conn.App. 142, 153, cert. denied, 262 Conn. 905 (2002).   They excuse the other party from the necessity of presenting evidence on the fact admitted and are conclusive on the party making them.  Southington v. Commercial Union Insurance Company, 71 Conn.App. 715, 742 (2002).   But not all concessions made during judicial proceedings have preclusive effect in all settings.   There are common-law limitations which prevent the admissions made by Maria Karagiorgos from having the preclusive effect claimed by the plaintiff.

The first admission claimed by the plaintiff to be a binding judicial admission occurred in the early stages of this action when on October 23, 2012 defendants Thomas Deli, LLC and Maria Karagiorgos filed in the Housing Court a Motion to Stay Proceedings Pending Arbitration in which they ask for a stay pending an arbitration pursuant to an arbitration clause in the very Lease and Guaranty which Maria now denies that she ever entered into, saying (in that motion) “As the parties have expressly agreed to submit any and all disputes to arbitration, the matter must be resolved through arbitration and the instant action stayed for the sole purpose of effectuating any order or judgment rendered by the arbitrator.”  (Emphasis by underline in original motion;  emphasis by italics added.)   This would be a judicial admission but for the fact that those defendants withdrew the stay for arbitration motion before it was acted on by the court and before it was claimed to be a judicial admission.

When the court has allowed a party in a civil case to withdraw, amend, or supercede a pleading, the pleading ceases to be usable as a conclusive judicial admission, but is usable as an evidentiary admission.  Schenck v. Pelkey, 176 Conn 245, 258, 405 A.2d 665 (1978), (withdrawn pleading erroneously labeled a judicial admission.)  Nichols v. Nichols, 143 Conn. 372, 380, 122 A.2d 734 (1956).   Colin C. Tait, and Hon. Eliot D. Prescott, Tait's Handbook of Connecticut Evidence, (Fourth Ed.2008) § 8.16.5(c), page 488.

All the other claimed judicial admissions occurred in the related summary process actions in the Housing Court between the exact same parties involving the same premises.³  Some of the admissions or concessions made by the defendant Maria Karagiorgos or her counsel in seeking dismissals of one or more of those summary process actions, claimed by the plaintiff to be judicial admissions contrary to her present position in this collection action that she never signed the Lease or the Guaranty and her name on those documents is a forgery, are:

“There is no question that, at one point in time, the relationship between the parties was been (sic) governed by a written lease.   The original dispute between the parties concerned certain additional rental ⁴ charges that were overpaid by the defendants and for which the plaintiff was to, but did not, give the defendants credit.”  (February 15, 2013 Memorandum of Law in Support of Motion to Dismiss [the Fifth Summary Process Action] p. 1.) (Also made in 2012 motions to dismiss earlier summary process actions.)

“While the plaintiff asserts four counts against Maria Karagiorgos and Thomas Deli, LLC each is predicated upon an allegation that these defendants failed to either pay rent or other charges defined as rent under a written lease.   As the only lease that existed between the parties was terminated on or about April 13, 2012 [by service of a Notice to Quit], thus, as there was no lease between the parties, neither defendant had a duty to pay rent to the plaintiff, or any other charge under the lease.”  (Motion to Dismiss [the Fifth Summary Process Action], February 14, 2013, p. 1.)

These claimed admissions all fail to qualify as binding and conclusive judicial admissions for the same reason.

Judicial admissions are conclusive only in the judicial proceeding in which made.  Perry v. Simpson Manufacturing Co., 40 Conn. 313, 317 (1873).   In subsequent proceedings such prior judicial admissions are merely evidential admissions, to be used as evidence to prove a matter in dispute in the subsequent trial.  Bredow v. Woll, 111 Conn. 261, 263–64, 149 A. 772 (1930);  Fengar v. Brown, 57 Conn. 60, 64, 17A. 321 (1889).

Tait and Prescott, supra, § 8.16.3, p. 482.

These claimed admissions, all made in connection with one or more of the related summary process actions brought by the plaintiff against these same defendants as separate earlier proceedings in the Housing Court, cannot be used as conclusive judicial admissions in this collection action.   They are evidentiary admissions which, unless otherwise barred, may be offered to controvert the denial of the existence of a lease and the Special Defense of forged signature which defendant Maria Karagiorgos has filed in this action.   They go to the “credibility and candor issues” mentioned in plaintiff's Motion to Reargue, (p. 5), which must be resolved by the finder of fact at trial.

B. Judicial Estoppel

Plaintiff argues:  “Having argued over and over again for her own litigation delays and objectives that she was a party to the Lease, the defendant is now estopped from changing her position and disavowing the Lease under the well-recognized doctrine of judicial estoppel.”  (Plaintiff's reply in Support of Objection to Jury Claim (No. 113) at p. 12.)   The court agrees.

Our Supreme Court in Association Resources, Inc. v. Wall, 298 Conn. 145, 169 (2010), has recently set forth the rationale and the elements of the primarily federal court equitable and discretionary doctrine, of judicial estoppel as it is to be applied in Connecticut.

[J]udicial Estoppel prevents a party in a legal proceeding from taking a position contrary to a position the party has taken in an earlier proceeding ․ Judicial estoppel serves interests different from those served by equitable estoppel, which is designed to ensure fairness in the relationship between parties ․ The courts invoke judicial estoppel as a means to preserve the sanctity of the oath or to protect judicial integrity by avoiding the risk of inconsistent results in two proceedings.  [J]udicial estoppel protects the integrity of the judicial process ․ by prohibiting parties from deliberately changing positions according to the exigencies of the moment ․ Typically, judicial estoppel will apply id. 1) a party's later position is clearly inconsistent with its earlier position;  2) the party's former position has been adopted in some way by the court in the earlier proceeding;  and 3) the party asserting the two positions would derive an unfair advantage against the party seeking estoppel ․ We further limit judicial estoppel to situations where the risk of inconsistent results with its impact on judicial integrity is certain ․ Thus, courts generally will not apply the doctrine if the first statement or omission was the result of a good faith mistake or an unintentional error.  (Citations and internal quotation marks omitted.)

All the elements apply here.   The defendant Maria Karagiorgos' present position is that she never entered into the October 2, 2003 Lease and Guaranty and that her purported signatures thereon are forgeries.   Her earlier positions through five summary process actions was that the relationship of the parties as landlord and tenant was at one time governed by the written lease but the lease had terminated in April 2012 by service of a Notice to Quit, thereby terminating the prior obligation to pay rent since the tenant in those circumstances would only be liable for use and occupancy charges.   These are totally inconsistent positions.   The earlier position was adopted by the Housing Court in dismissing at least two of the summary process actions, affording the defendant considerable advantage of delay during which she continued to occupy the premises without paying rent or use and occupancy charges.   Having finally lost on that argument when the Motion to Dismiss the Fifth Summary Process Action was denied earlier this year, defendant Maria Karagiorgos reacted to the exigencies of the situation by claiming, for the very first time, that she never entered into any lease or guaranty at all, which, if proved, might excuse her from liability from paying either rent or use and occupancy charges.   The risk of inconsistent results on liability for use and occupancy charges is certain.   And, the court finds from the repeated use of the “lease at one time but terminated” position to the belated position “no lease ever entered into/forged signature” position was not the result of a good faith mistake or an unintentional error.   It was a calculated change in position according to the exigencies of the moment.   The egregiousness of this strategy is graphically evident by looking at a five-day period in May of 2013.   On May 21, defendant Maria Karagiorgos, through her counsel, argued in her brief to the Housing Court in support of her Motion to Dismiss the Fifth Summary Process Action that there “is no question that, in one point in time, the relationship of the parties was been (sic.) governed by a written lease” which was later terminated when plaintiff served a Notice to Quit. Just five days earlier, on May 16, she had filed in this court, through her counsel, her Answer and Special Defense (No. 105), denying that she had ever entered into a lease with the plaintiff for these premises, and alleging that her signature on the purported Lease and Guaranty was a forgery.

To protect the integrity of the judicial process the court finds it appropriate to invoke the doctrine of judicial estoppel to prevent any advantage from being gained by this duplicitous inequitable change of position.   Accordingly, it is ordered that the defendant Maria Karagiorgos is estopped from disavowing her entering into the October 2, 2003 Lease and Guaranty, and from claiming that her signatures on that document were forged.   Since Maria Karagiorgos is now barred from denying that she entered into the Lease and the Guaranty each of which include an admittedly enforceable waiver of the right to trial by jury, and since her only argument in opposition to the plaintiff's Objection to Defendant's Jury Claim was premised on her claimed right to a jury trial as to the issues raised by her Answer and Special Defense, the Objection to Defendant's Jury Claim is sustained as to the defendant Maria Karagiorgos, and, given that the plaintiff's Objection to Jury Claim of defendant Thomas Deli, LLC was previously sustained on July 16, 2013 and the defendant Thomas Karagiorgos was defaulted for failure to plead on June 11, 2013, this case is stricken from the jury docket of the court.

SO ORDERED.

Alfred J. Jennings, Jr.

Judge Trial Referee

FOOTNOTES

FN1. The Lease provides at ¶ 6:  “Tenant and Guarantor, if any, hereby waives, and agrees that it will waive, all rights to trial by jury in any and all legal proceedings arising under this lease, out of the termination of this lease, or with respect to the Demised Premises or the use thereof.”The Guaranty provides at ¶ 16 in capital letters:  “THE GUARDIAN HEREBY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION MAY BE COMMENCED ARISING OUT OF THIS GUARANTY OR ANY ASSIGNMENT THEREOF, OR BY REASON OF ANY OTHER CAUSE OR DISPUTE BETWEEN A GUARANTOR AND THE LANDLORD.”.  FN1. The Lease provides at ¶ 6:  “Tenant and Guarantor, if any, hereby waives, and agrees that it will waive, all rights to trial by jury in any and all legal proceedings arising under this lease, out of the termination of this lease, or with respect to the Demised Premises or the use thereof.”The Guaranty provides at ¶ 16 in capital letters:  “THE GUARDIAN HEREBY WAIVES THE RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING OF ANY KIND OR NATURE IN ANY COURT IN WHICH AN ACTION MAY BE COMMENCED ARISING OUT OF THIS GUARANTY OR ANY ASSIGNMENT THEREOF, OR BY REASON OF ANY OTHER CAUSE OR DISPUTE BETWEEN A GUARANTOR AND THE LANDLORD.”

FN2. Practice Book § 11–15 provides that “No such matters [to be placed on short calendar] shall be so assigned [by the clerk] unless filed at least five days before the opening of court.”   This matter was on the non-arguable calendar for July 8, 2013.   No actual appearance in a courtroom was scheduled, but court opened generally for short calendar matters at 9:30 A.M. The “Reply” was filed electronically at 3:05 P.M. on July 3, therefore less than five full days before the opening of court on July 8. Since both the objection to jury claim and the defendants' “Reply” were printed that day on the short calendar, there was a tardy filing which deprived the plaintiff of an opportunity to respond, which is obviously one of the purposes of § 11–15..  FN2. Practice Book § 11–15 provides that “No such matters [to be placed on short calendar] shall be so assigned [by the clerk] unless filed at least five days before the opening of court.”   This matter was on the non-arguable calendar for July 8, 2013.   No actual appearance in a courtroom was scheduled, but court opened generally for short calendar matters at 9:30 A.M. The “Reply” was filed electronically at 3:05 P.M. on July 3, therefore less than five full days before the opening of court on July 8. Since both the objection to jury claim and the defendants' “Reply” were printed that day on the short calendar, there was a tardy filing which deprived the plaintiff of an opportunity to respond, which is obviously one of the purposes of § 11–15.

FN3. There have been five summary process actions in all, starting in April 2012.   The first four actions were either dismissed or voluntarily withdrawn.   The fifth summary process action, Kim's Center, LLC v. Thomas Deli, LLC et al., Docket No. SNSP–041194, has gone to judgment in favor of the plaintiff with a stay of execution expiring on October 31, 2013..  FN3. There have been five summary process actions in all, starting in April 2012.   The first four actions were either dismissed or voluntarily withdrawn.   The fifth summary process action, Kim's Center, LLC v. Thomas Deli, LLC et al., Docket No. SNSP–041194, has gone to judgment in favor of the plaintiff with a stay of execution expiring on October 31, 2013.

FN4. Plaintiff points out that, “[T]his additional rent is quintessentially a charge that a tenant is obligated to pay under a lease.”.  FN4. Plaintiff points out that, “[T]his additional rent is quintessentially a charge that a tenant is obligated to pay under a lease.”

Jennings, Alfred J., J.T.R.