125 Conn. App. 678
Conn. App. Ct.2010Background
- Chung Family Realty Partnership, LLC purchased property at 311-349 New Britain Ave., Plainville, with environmental remediation costs projected; property was its sole asset.
- Two purchase agreements were executed: first on Jan. 4, 2005, and a superseding second on June 30, 2005, which placed escrow of net proceeds and Landmark with unilateral default-withholding rights.
- Remediation estimates escalated to $1,314,006.82 by June 2005, prompting brownfields funding discussions under General Statutes § 32-9kk.
- Landmark sought to obtain brownfields funding to cover remediation; defendant failed to timely produce an action plan, delaying funding agency applications.
- Town of Plainville intervened to secure funding, later reconfirming reduced remediation estimates to $265,000, affecting the perceived need for brownfields funding.
- Calco Construction submitted a competing offer in Sept. 2006, depositing $250,000; defendant terminated the Landmark contract Oct. 27, 2006 and later contracted with Calco in Mar. 2007; Landmark sued for breach, among other claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mutual mistake regarding brownfields funding | Landmark argues no mutual mistake; terms showed funding was not guaranteed | Contract depended on brownfields funding; lack of funding voids performance | Mutual mistake not proven; contract viable without guaranteed funding |
| Termination right and notice requirement | Defendant breached by terminating without 30 days' default notice | Termination due to impossibility of performance | Terminating party breached; 30-days notice required by contract remained applicable |
| Calco offer as motive for termination | Terminating to pursue Calco offer showed bad faith | Termination was not intended to block Calco; no bad faith | Court found termination motivated by bad faith to favor Calco |
| Specific performance award | Specific performance appropriate to enforce definite contract terms | Contract terms too complex and speculative to compel performance | Affirmed; contract amenable to specific performance given definite terms and funding structure |
| CUTPA liability | Defendant engaged in unfair or deceptive acts; agency can be imputed | CUTPA not applicable to transactional conduct; agency arguments weak | CUTPA violation upheld due to bad-faith conduct and agency imputations |
Key Cases Cited
- BRJM, LLC v. Output Systems, Inc., 100 Conn.App. 143 (2007) (mutual mistake and contract interpretation standards; deference to trial court findings)
- McBurney v. Cirillo, 276 Conn. 782 (2006) (mutual mistake standard; materiality and factual questions retained by trial court)
- Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1 (2008) (bad faith standard for implied covenant of good faith and fair dealing)
- Hill v. Raffone, 103 Conn.App. 737 (2007) (specific performance limits when terms are indefinite or uncertain)
- Jaramillo v. Case, 100 Conn.App. 815 (2007) (standard for specific performance; readiness and ability to perform)
- Frumento v. Mezzanotte, 192 Conn. 606 (1984) (financial ability to perform; imputation of assets in specific performance context)
- O'Sullivan v. Bergenty, 214 Conn. 641 (1990) (readiness and ability to perform; financing considerations in real property setting)
- Suffield Development Associates Ltd. Partnership v. National Loan Investors, L.P., 260 Conn. 766 (2002) (agency and vicarious liability principles in CUTPA context)
- Naples v. Keystone Building & Development Corp., 295 Conn. 214 (2010) (CUTPA standards; aggravating circumstances not always required for violation)
- Lydall, Inc. v. Ruschmeyer, 282 Conn. 209 (2007) (unfair trade practices; factors for determining unfairness under CUTPA)