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Advance Release Opinions - Review and Analysis

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Condemnation

Advance Release Opinions – June 8

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Reviews of Connecticut Appellate Court advance release opinions about breach of contract, condemnation, professional negligence (legal malpractice), and reformation.

Breach of Contract

Murallo v. United Builders Supply Co., Inc. – Parties testified that they had a telephone conversation in which they reached an agreement resolving a dispute they were having over construction materials. Defendant confirmed the terms in a follow up email. Plaintiff later alleged that defendant refused to honor the agreement. After a courtside trial, trial court concluded that defendant’s email was not a contract but an unaccepted offer, and found for defendant. Appellate Court reversed, finding the unaccepted-offer conclusion clearly erroneous as defendant had admitted that the email memorialized the telephonic agreement.

Condemnation

Gartrell v. Hartford – Not technically condemnation, but close. Doesn’t really matter because the issue was not preserved for appeal, so Appellate Court declined to review it. After a fire at Gantrell’s building, Hartford tore it down. Gantrell sued. Jury trial. After the close of evidence, Hartford moved for a directed verdict. Court reserved decision, pending jury’s answer to a single interrogatory asking whether Hartford could have believed there was an imminent danger allowing it to tear down the building. Jury answered “Yes.” Court then asked parties if they had anything to add to the motion for directed verdict. When they said “No,” court directed verdict for Hartford. On appeal, Gantrell argued that jury’s finding that Hartford could have believed there was imminent danger did not support directed verdict; jury would have had to have found that Hartford did believe there was imminent danger. Appellate Court affirmed, finding that Gantrell failed to preserve the issue for appellate review since he “failed to raise the issue to the trial court on the record, either before or after the jury was charged, or as a basis for denying the city’s motion for a directed verdict.”

Professional Negligence (Legal Malpractice)

Kuehl v. Koskoff – Mr. Kuehl had car accident on his way from his home office to a business meeting. He later discovered an injury that he believed was tied to the car accident. He filed a worker’s comp claim, but the employer and insurer contested whether the accident happened in the scope of employment. Mr. Kuehl signed up with Koskoff to pursue claims against the other driver. Mrs. Kuehl signed up with Koskoff to pursue any claims arising out of the accident. Mr. Kuehl then died, and Koskoff and Mrs. Kuehl believed it was a result of the accident. Mrs. Kuehl missed the deadline for filing a claim for worker’s comp survivor benefits, and the commissioner would not let her proceed. She blamed Koskoff and started a legal malpractice action. Jury found for Mrs. Kuehl. Though there was no expert testimony as to causation, trial court denied Koskoff’s motion to set aside the verdict. Appellate Court reversed, finding that expert testimony was necessary to establish causation, i.e. that it was more likely than not that Mrs. Kuehl would have been awarded survivor’s benefits if she had made her claim on time. Since Mrs. Kuehl failed to present that testimony, trial court should have set aside the verdict.

Reformation

Kaplan v. Scheer – Kaplan has owned her home since 1970. The Scheers became her neighbors in 1999. The Scheers’ house stands between Kaplan’s house and the Long Island Sound. The Scheers have a walkway and stairs that provide access to the water, which Kaplan had a right to use under a water easement granted in an 1882 deed. Kaplan and the Scheers had a contentious relationship and ended up in a dispute about whether Kaplan’s driveway was on the Scheers’ property. They settled that dispute with a written agreement calling for two quitclaim deeds and an easement. One deed, labelled “A” in the settlement agreement, conveyed to the Scheers any interest that Kaplan had in the Scheers’ property. The other deed, labelled “B” in the settlement agreement, conveyed to Kaplan any interest the Scheers had in Kaplan’s property. The easement, labeled “C” in the settlement agreement, gave Kaplan an easement over Scheers’ property – but only as necessary for Scheer to access her property. The documents were recorded in reverse order of their letter designations: Easement first, Scheer-to-Kaplan deed second, and Kaplan-to-Scheer deed third. Sometime after that, the Scheers made their walkway and stairs off limits to Kaplan. Kaplan sued, claiming that (1) the letter designations dictated the recording order, and she would still have her water easement if they had been recorded in that order; and (2) her deed to the Scheers should be reformed to reserve the water easement. Trial court found that (1) the letter designations were a matter of convenience and not intended to specify a recording order (there was also expert testimony that the recording order did not matter); and (2) Kaplan failed to prove a basis for reformation by clear and convincing evidence. Appellate Court affirmed.

 

City Can Demolish Building in Emergency

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demolished buildingA city can demolish a building in an emergency without paying compensation, according to a Connecticut appeal to be officially released on February 23, 2016.

The plaintiff in Edgewood Street Garden Apartments, LLC v. Hartford owned a building that was constructed in 1925. Plaintiff was renovating the building with the intent of leasing out apartments. On a Sunday in February 2011, the fire department responded to a report that the building’s roof had collapsed. A certified building inspector, who works in the city’s department of licenses and inspections, also responded to the report. The inspector “saw cracks at some areas in the sidewalls of the subject property and above two windows. He determined that the roof had collapsed, which was causing the cracks in the side walls as well as bowing of the walls, and he was concerned that due to the snow load on the roof, the building could come down at any minute, endangering the adjoining property.” The inspector informed plaintiff’s principals that he order the property immediately demolished. The principals wanted their structural engineer and insurance adjuster to inspect the property before demolition but there were unavailable on Sunday. The inspector declined to postpone demolition: the building was 75% demolished that Sunday.

“The plaintiff filed a six count complaint alleging the following: (1) denial of equal protection under § 1983; (2) denial of substantive due process under § 1983; (3) denial of procedural due process under §1983; (4) inverse condemnation under §1983; (5) inverse condemnation under the fifth amendment to the United States constitution; and (6) inverse condemnation under article first, § 11, of the Connecticut constitution.”

The trial court found for defendants on all six counts. Plaintiff appealed. The Appellate Court affirmed.

Plaintiff’s Main Arguments on Appeal

“On appeal, the plaintiff claims that the court erred when it (1) made various findings of fact that were unsupported by the evidence introduced at trial, (2) did not find that provisions of the municipal and state building codes that the defendant violated constituted a ‘policy’ supporting a claim of municipal liability under 42 U.S.C. § 1983, (3) concluded that the defendant’s actions did not constitute a taking of property for which the plaintiff was entitled to just compensation, (4) placed the burden of proof on the plaintiff, and (5) did not draw an inference in the plaintiff’s favor on account of the defendant’s failure to preserve evidence critical to the plaintiff’s case.”

Appellate Court Concludes City can Demolish Building in an Emergency

Plaintiff’s first argument essentially was that the trial court should have given certain evidence more weight than other evidence. The Appellate Court concluded that, although there may have been conflicting evidence as to some issues, the conflict did not render the trial court’s findings unsupported.

As to plaintiff’s second argument, the court noted that “‘it is not enough for a § 1983 plaintiff merely to identify conduct properly attributable to the municipality. The plaintiff must also demonstrate that, through its deliberate conduct, the municipality was the moving force behind the injury alleged.'” The state and city building codes, which gave the inspector discretion to demolish a building determined to be unsafe, do constitute a municipal policy in respect of such buildings. But, that policy itself was not unconstitutional because it was not the moving force behind the demolition of plaintiff’s building. Rather, the moving force was the inspector’s exercise of his discretion in favor of demolition.

“‘Where … a plaintiff claims that the municipality has not directly inflicted an injury, but nonetheless has caused an employee to do so, rigorous standards of culpability and causation must be applied to ensure that the municipality is not held liable solely for the actions of its employee.’ … ‘[W]here the policy relied upon is not itself unconstitutional, considerably more proof than [a] single incident [of unconstitutional activity] will be necessary in every case to establish both the requisite fault on the part of the municipality, and the causal connection between the ‘policy’ and the constitutional deprivation.'” The court concluded that “[b]ecause the identified municipal policy itself is not unconstitutional, the plaintiff was required to prove more than a single exercise of [the inspector’s] discretion to impose liability on the defendant.” The court rejected the claim because the incident involved only a single exercise of the inspector’s discretion.

With respect to plaintiff’s “taking” argument, the court noted that the demolition was a valid exercise of police power, which would require compensation only if “no reasonable use may be made of the property and it becomes of little or no value to the owner.” It concluded that “[t]here was no testimony or other evidence indicating that ‘’no reasonable use may be made of the [subject] property’; … such as evidence that the plaintiff was prevented from rebuilding. In light of the dearth of evidence tending to show that the defendant’s exercise of its police power was unreasonable or confiscatory, the trial court properly concluded that there was no taking when it ruled in the defendant’s favor on the plaintiff’s inverse condemnation claims in counts five and six.”

Plaintiff’s fourth argument was a contention that the Superior Court action was a substitute for the administrative hearing that it never received and the agency would have had the burden of proof in such a hearing. The court rejected this argument because there was no supporting authority for the “substitution” claim.

Plaintiff’s fifth argument was “that the court erred when it did not draw an inference in the plaintiff’s favor on account of the defendant’s failure to preserve evidence critical to the plaintiff’s case—namely, the defendant’s demolition of the building without taking any measurements or detailed photographs.” The court noted that “the trier of fact may [but is not obligated to] draw an inference from the intentional spoliation of evidence that the destroyed evidence would have been unfavorable to the party that destroyed it.” The court rejected the argument because “[t]here was sufficient evidence in the record, in the form of [the inspector’s] testimony regarding his predemolition assessment of the building and his determination that it posed an imminent danger, to support the court’s decision not to draw an adverse inference.”

Other Things to Note

In footnote 4, the court addressed the possibility that the appeal was moot. More specifically,”[w]e raised the issue of mootness to consider whether the [trial] court’s finding that the plaintiff failed to prove damages, which the plaintiff does not challenge, is an independent basis for the judgment, which would prevent this court from providing practical relief on appeal.” The court “conclude[d] that the [trial] court’s finding regarding damages did not independently support the judgment because proof of actual damages was not a necessary element of the plaintiff’s causes of action. Notwithstanding its failure to prove actual damages, the plaintiff could have prevailed and received nominal damages.”

Inverse Condemnation: Taking Parking Lot Takes Building

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parking lotA city inversely condemned a commercial building when it took the parking lot that served it, according to the Connecticut Appellate Court in Barton v. Norwalk, to be officially released on February 23, 2016.

In this appeal, plaintiff had purchased an office building in 1981. The city said the building had insufficient parking, so plaintiff constructed a lot across the street to serve it. Years later, the city condemned the parking lot in connection with its construction of a new police station. Plaintiff challenged the city’s just compensation for the lot, claiming that the “highest and best” use for the property was mixed development. Plaintiff also “twice tried to amend his pleadings in that case to add a claim for losses to [the commercial building] as a result of the taking of [the parking lot].” The city successfully objected to both amendments.  Superior Court found that the highest and best use was mixed development and awarded plaintiff additional compensation.

Plaintiff then commenced a separate action to recover for losses to the commercial building on a theory of inverse condemnation. “The [trial] court found that the lack of parking, caused by the taking of 65 South Main by eminent domain, ‘ha[d] substantially destroyed the [plaintiff’s] ability to operate the property as a leasable facility and enjoy even a modicum of financial success. The evidence shows the lack of parking, which the [city] initially insisted upon, reduced the . . . [property’s] chances of commercial success to negligible or nonexistent’ and amounted to ‘a substantial destruction of the [plaintiff’s] ability to enjoy or use the property . . . .’ As such, the plaintiff ‘proved [his] claim of inverse condemnation.'”

Defendant appealed. The Appellate Court affirmed.

City’s Main Arguments on Appeal

“The [city] appealed … , arguing that: (1) judicial estoppel barred the plaintiff’s recovery for losses to 70 South Main; and (2) in any case, the interference with the plaintiff’s use of [the commercial building] was not so substantial as to be an inverse condemnation.”

The thrust of the city’s judicial estoppel argument was that plaintiff had obtained additional compensation for the parking lot by asserting that its highest and best use was mixed development. Plaintiff could not now be heard to say that he needed it to be a parking lot.

Appellate Court Concludes Taking Parking Lot Inversely Condemned Building

The Appellate Court noted that “[t]ypically, judicial estoppel will apply if: 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.”

The court concluded that the first prong failed. Plaintiff’s “parking lot as mixed use” position in the first action was not “clearly inconsistent” with its “parking lot as parking lot” position in the second action because the law does not require the owner actually to put the property to its highest and best use. In other words, “highest and best use” determines just compensation. Actual use is irrelevant to just compensation.

Moreover, plaintiff’s claim that the best use for the parking lot, standing alone, was mixed development did not contradict his argument that the best use for the building and the lot, standing together, was as an office building with a parking lot to serve it.

The court also concluded that the third prong failed: “[T]he question is whether a party gained more by taking inconsistent positions than it would have by taking consistent positions…. [P]laintiff’s two positions allowed him to recover once for [the lot] and once for [the building], the same as if he had valued [the lot] as a parking lot instead of as a mixed use development. He gained no advantage, let alone an unfair one.” In other words, plaintiff was entitled to recover twice and did recover twice so he did not gain anything extra.

As to the city’s second argument on appeal, the court noted that “inverse condemnation requires either: (1) total destruction of the property’s economic value; or (2) substantial destruction of the owner’s ability to use and enjoy the property.” The facts showed substantial destruction. Plaintiff had been unable to lease roughly 90% of the building’s space because there was no parking. One tenant, a church, remained, at a below market rent, solely because the city allowed church members to park for free on city property. Plaintiff’s expert testified without contradiction that the land might be worth more than the land and building.

Other Things to Note

In the trial court, plaintiff claimed that he was entitled to offer of compromise interest because the city rejected his offer of compromise. “The court denied the plaintiff offer of compromise interest on the ground that he failed to meet two requirements of § 52-192a: (1) that a plaintiff offer to settle his action ‘for a sum certain’; and (2) that, after the defendant rejects the offer, the plaintiff recover ‘an amount equal to or greater than the sum certain’ he requested.”

Plaintiff cross-appealed. The Appellate Court concluded that plaintiff’s offer was not for a sum certain. It included not a certain dollar amount but an amount for fees and costs “up to $20,000” and permits and approvals to renovate the buildings. “Up to” is not a sum certain, nor is permits/approvals.