Reiner v. Reiner
210 A.3d 668
Conn. App. Ct.2019Background
- Michael D. Reiner (plaintiff) and Jeffrey A. Reiner (defendant, trustee) were primary beneficiaries of multiple irrevocable trusts that owned several valuable real properties, most encumbered by mortgages.
- The parties executed a comprehensive 2012 settlement agreement resolving tort and related claims; it required defendant to buy out plaintiff’s interests in certain properties after the death of the settlor, Eleanore Reiner.
- §1(a) tied the buyout to the “fair market value of each” trust property multiplied by the plaintiff’s “interests” and reduced by a 10% discount; §2(b) used the same formula (with a 4% discount) for two LLC-owned properties transferred to the parties during the settlement.
- The settlement did not define “interest,” and the attached Trust Property Schedule listed percentage ownerships but not mortgages or net equity.
- After Eleanore’s death, a dispute arose about whether “interests” meant (a) plaintiff’s share of gross fair market value (ignoring mortgages) or (b) plaintiff’s equitable share of net equity (fair market value minus mortgage debt); defendant moved to enforce the settlement under Audubon.
- The trial court conducted an Audubon hearing, concluded the agreement was clear in favor of plaintiff’s interpretation (FMV without deducting mortgages), but denied enforcement; the Appellate Court affirmed on the alternative ground that the buyout provisions are ambiguous and thus not subject to summary enforcement under Audubon.
Issues
| Issue | Plaintiff's Argument (Reiner) | Defendant's Argument (J. Reiner) | Held |
|---|---|---|---|
| Proper interpretation of buyout formula: does “interest” exclude or include mortgage debt? | “Interest” means plaintiff’s ownership percentage of the property’s fair market value; mortgages are irrelevant. | “Interest” means plaintiff’s equitable share of the property’s net equity (FMV minus mortgage debt). | Ambiguous — language susceptible to both reasonable interpretations. |
| Whether settlement was “clear and unambiguous” so as to permit summary enforcement under Audubon | The agreement’s plain words require FMV-based buyouts, so Audubon enforcement is appropriate. | The agreement’s plain words require net-equity-based buyouts; Audubon enforcement is appropriate. | Trial court erred in calling it clear for plaintiff, but denial of Audubon enforcement affirmed because ambiguity precludes summary enforcement. |
| Whether references elsewhere in the agreement (other sections mentioning mortgages) resolve ambiguity | These references show parties intentionally omitted mortgage adjustments from buyout provisions. | Other sections (and mortgage law context) support reading “interest” as equitable (net of debt). | Collateral references do not cure the ambiguity in §§1–2. |
| Consequence of ambiguity on remedies | Enforce per plaintiff’s reading; quick finality. | Enforce per defendant’s reading; avoid absurd windfall. | Ambiguity prevents summary enforcement under Audubon; parties may pursue other procedural routes to resolve dispute. |
Key Cases Cited
- Audubon Parking Assocs. Ltd. P'ship v. Barclay & Stubbs, Inc., 225 Conn. 804 (hearing to determine whether settlement terms are clear enough for summary enforcement)
- Ackerman v. Sobol Family P'ship, LLP, 298 Conn. 495 (settlement agreements treated as contracts; scope of Audubon enforcement)
- Salce v. Wolczek, 314 Conn. 675 (contract interpretation—ownership interest can include legal and equitable interests)
- Gold v. Rowland, 325 Conn. 146 (question of whether contract language is plain and unambiguous is a question of law)
- Mortgage Electronic Registration Sys., Inc. v. White, 278 Conn. 219 (Connecticut follows title theory: mortgage affects legal vs equitable title)
- Matos v. Ortiz, 166 Conn. App. 775 (Audubon balance between judicial economy and trial rights; ambiguous agreements not summarily enforceable)
- Welch v. Stonybrook Gardens Cooperative, Inc., 158 Conn. App. 185 (avoid interpreting contracts to produce absurd results)