192 Conn.App. 479
Conn. App. Ct.2019Background
- Pasco Common condominium created by Benson Enterprises; Paul D. Benson (Benson) controlled the declarant and owned most units; Amended declaration recorded August 12, 1998.
- Declaration granted special declarant rights and a ten‑year limit on those rights; declaration and amendments governed allocation of unit interests and common charges.
- Alleged misconduct: Benson/decl arant used an improper formula for common charges, secretly exempted a restaurant unit from charges, charged association for repairs/vehicle/paving/management fees, and recorded incorrect unit square footage.
- Control formally transferred to unit‑owner directors in 2009; plaintiffs (association + 18 unit owners) sued in July 2013 for breaches of the declaration, statutory claims, CUTPA, and to pierce the corporate veil.
- Trial court tolled statutes of limitation until 2013, awarded various damages, and pierced the corporate veil to hold Benson individually liable; appellate court reviewed and reversed parts of that judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether statute‑of‑limitations tolling under §47‑253(d) continued until 2013 because declarant kept exercising rights | Tolling continued because declarant engaged in conduct and continued exercising special rights through 2013 | Declaration set a ten‑year maximum; declarant control — and tolling — ended Aug 12, 2008 | Tolling ended no later than Aug 12, 2008; declaration’s 10‑year limit controls regardless of later conduct |
| Which SOL applies (3‑year tort §52‑577 v. 6‑year contract §52‑576) to counts 1–8 | Declaration is a contract among parties; longer contract SOL governs | Many duties arise from statute/ fiduciary law and are torts subject to 3‑year SOL | Mixed: self‑dealing and vehicle expense claims sound only in tort and are time‑barred; other claims sound in both tort and contract so the 6‑year contract SOL applies and are not time‑barred |
| Whether association could recover damages for common charges that should have been charged to the restaurant | Association entitled to damages for restaurant’s unpaid share | Association collected 100% of common charges overall, so the association suffered no loss (unit owners, not association, were harmed) | Trial court’s award to the association was inconsistent with its finding that the association had collected 100% and is reversed; individual owners (who did not sue) bore the loss |
| Whether court properly pierced corporate veil to hold Benson personally liable under instrumentality rule | Benson’s complete domination and conduct justified piercing | Plaintiffs failed to show that Benson used the corporate form to perpetrate wrong or that such control proximately caused the association’s injuries | Reversed as to Benson: trial court made findings on control but not that Benson used corporate form to commit the wrongs or that such use proximately caused harm; judgment for Benson directed on veil‑piercing count |
Key Cases Cited
- Commissioner of Emergency Services & Public Protection v. Freedom of Information Commission, 330 Conn. 372 (2018) (plenary review of statutory interpretation)
- Harbour Pointe, LLC v. Harbour Landing Condominium Assn., Inc., 300 Conn. 254 (2011) (interpretation of condominium declaration is a question of law)
- Cantonbury Heights Condominium Assn., Inc. v. Local Land Development, LLC, 273 Conn. 724 (2005) (declaration limitations can operate as limits on related rights)
- Bellemare v. Wachovia Mortgage Corp., 284 Conn. 193 (2007) (analysis on selecting tort v. contract statute of limitations)
- Meyers v. Livingston, Adler, Pulda, Meiklejohn & Kelly, P.C., 311 Conn. 282 (2014) (tests for distinguishing tort and contract claims; piercing pleading labels)
- Naples v. Keystone Building & Development Corp., 295 Conn. 214 (2010) (instrumentality rule and elements for piercing corporate veil)
- Wheelabrator Bridgeport, L.P. v. Bridgeport, 320 Conn. 332 (2016) (construction and interpretation of judgments)