145 Conn. App. 696
Conn. App. Ct.2013Background
- Parties: Howard‑Arnold, Inc. (plaintiff/lessee) and T.N.T. Realty, Inc. (defendant/lessor). Lease granted lessee and guarantor an option to purchase the premises for $223,500 plus mortgage balance (with a fixed post‑2010 price). Lease required defendant to perform environmental remediation and repair the rear addition roof/structural defects.
- Ownership history: defendant purchased the property in 1989; Capobianco (lessee guarantor) and D’Alto split interests in 2000; defendant then leased the property to plaintiff for a 10‑year term ending April 2010.
- In 2007 plaintiff notified defendant it had “elected to exercise” the option but conditioned closing on defendant’s completion of remediation and roof repairs; plaintiff never tendered payment or secured financing.
- Trial court findings: plaintiff did not properly exercise the option because it failed to tender payment; defendant breached the lease by failing to complete environmental remediation but was excused from roof repairs under the doctrine of impossibility (applied sua sponte); court denied specific performance of the option and roof repairs, awarded defendant rental/use and occupancy for four months when plaintiff paid partial rent.
- Procedural posture: bench trial; plaintiff appealed, arguing error in refusing specific performance of the option and roof repairs, failure to award damages in lieu of specific performance for environmental breach, and error in awarding rental/use and occupancy payments. Appellate court affirmed in part, reversed in part (reversed the roof repair ruling and remanded).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Specific performance of option to purchase | Plaintiff properly exercised option by notice and was excused from tender due to defendant’s breaches; was ready, willing and able to close | Option requires payment/tender; plaintiff never tendered or secured financing | Court: Option required tender/payment; plaintiff did not tender; notice was conditional; no specific performance — affirmed |
| Specific performance of roof repairs | Defendant breached roof‑repair covenant; court should order specific performance | Roof defect was caused by structural movement making complete repair impossible | Appellate court: Trial court improperly applied unpleaded impossibility defense sua sponte; reversal as to roof claim and remand for further proceedings |
| Damages in lieu of specific performance for environmental remediation | Having found breach, court should have awarded money damages (plaintiff had alleged damages) | Plaintiff abandoned damages claim at trial/posttrial and sought only specific performance | Court: Plaintiff abandoned/did not preserve damages request; appellate court will not review — claim not considered |
| Rental and use & occupancy payments | Plaintiff argued defendant was not entitled because partial payments equaled mortgage obligation or plaintiff became equitable owner by (attempted) exercise | Defendant sought four months rent; court awarded rental/use & occupancy | Court: Award sustained; appellate court found trial court’s factual statement that plaintiff raised no defense was clearly erroneous but plaintiff failed to show the award was unreasonable — affirmed |
Key Cases Cited
- Bayer v. Showmotion, Inc., 292 Conn. 381, 973 A.2d 1229 (Conn. 2009) (option acceptance must be unequivocal, unconditional, and in exact accord with option terms)
- Mayron’s Bake Shops, Inc. v. Arrow Stores, Inc., 149 Conn. 149, 176 A.2d 574 (Conn. 1961) (tender requires actual production/placing of money in power of payee; formal production excused only on unequivocal refusal)
- Gager v. Gager & Peterson, LLP, 76 Conn. App. 552, 820 A.2d 1063 (Conn. App. 2003) (specific performance is equitable remedy reviewable for abuse of discretion)
- Willow Springs Condominium Assn., Inc. v. Seventh BRT Development Corp., 245 Conn. 1, 717 A.2d 77 (Conn. 1998) (issues not raised at trial ordinarily will not be considered on appeal; preservation rule)
- Cue Associates, LLC v. Cast Iron Associates, LLC, 111 Conn. App. 107, 958 A.2d 772 (Conn. App. 2008) (special defenses that negate relief must be specially pleaded; court may not apply unpleaded special defense sua sponte)
- LeBlanc v. Tri‑Town Shelter Services, Inc., 110 Conn. App. 118, 955 A.2d 55 (Conn. App. 2008) (rental/use & occupancy award treated as damages; trial court has broad discretion)