AAA Advantage Carting & Demolition Service, LLC v. Capone

• Docket Number: AC 45318
• Decision Date: 22 August 2023
• Citation: 221 Conn.App. 256,301 A.3d 1111
• Parties: AAA ADVANTAGE CARTING & DEMOLITION SERVICE, LLC v. Joseph CAPONE
• Court: Connecticut Court of Appeals

221 Conn.App. 256

301 A.3d 1111

AAA ADVANTAGE CARTING & DEMOLITION SERVICE, LLC v. Joseph CAPONE

AC 45318

Appellate Court of Connecticut.

Argued April 4, 2023

Officially Released August 22, 2023

Richard J. Rapice, with whom, on the brief, was Peter V. Lathouris, Stamford, for the appellant(defendant).

James H. Lee, Fairfield, for the appellee(plaintiff).

Alvord, Prescott and Moll, Js.

MOLL, J.

The defendant, Joseph Capone, appeals from the judgment of the trial court rendered in favor of the plaintiff, AAA Advantage Carting & Demolition Service, LLC, on its amended complaint asserting claims of (1) conversion and (2) statutory theft in violation of General Statutes § 52-564.The defendant claims that the court(1) improperly concluded that two savings statutes, General Statutes § 52-591 and/or General Statutes § 52-592, applied to save the present action from being time barred pursuant to the three year limitation period of General Statutes § 52-577, (2) improperly concluded that the plaintiff's claims were not barred pursuant to the doctrine of res judicata, (3) made a clearly erroneous factual finding in concluding that the defendant had committed statutory theft, and (4) erred in awarding damages, including prejudgment interest pursuant to General Statutes § 37-3a, to the plaintiff.We conclude that the trial court committed error only with respect to its award of damages to the plaintiff and, therefore, we reverse the judgment as to damages only.

The following facts, as found by the trial court, and procedural history are relevant to our resolution of this appeal.Prior to 2012, the defendant and Frank Bongiorno, who are brothers-in-law, each owned a 50 percent membership interest in the plaintiff.In 2012, the defendant and Bongiorno decided to terminate their business relationship as a result of their personal animosity toward one another and their inability to agree on the management of the plaintiff.On August 28, 2012, the defendant and Bongiorno executed a "binding term sheet," which immediately became operative and enforceable and which provided in relevant part that the defendant and Bongiorno would execute a "settlement agreement" no later than September 7, 2012, at which time the defendant would transfer his interest in the plaintiff to Bongiorno in exchange for $200,000.The defendant and Bongiorno understood that, following the execution of the binding term sheet, the defendant's involvement in the management of the plaintiff and his financial interest in the plaintiff would be "suspended," notwithstanding that the defendant would not surrender his membership interest in the plaintiff to Bongiorno until after the execution of the settlement agreement.The defendant and Bongiorno "also understood and agreed that, except for certain personal property of [the defendant] that he was to remove from [the plaintiff's] premises by August 31, 2012, the assets of [the plaintiff] were to remain company assets as of the effective date of the binding term sheet, August 28, 2012."

On the morning of August 29, 2012, without providing notice to or receiving authorization from Bongiorno, the defendant withdrew $17,000 from a corporate checking account belonging to the plaintiff($17,000 withdrawal).Later in the day, the defendant entered the plaintiff's offices to remove his personal items from his desk and to "wipe" his office computer.

On September 7, 2012, the defendant and Bongiorno executed the settlement agreement, which expressly incorporated the terms of the binding term sheet.The defendant further signed an assignment of his membership interest in the plaintiff, transferring his rights, title, and interest in the plaintiff to Bongiorno.At that time, Bongiorno was unaware of the $17,000 withdrawal.After the sale had closed, Bongiorno balanced the plaintiff's checkbook and reviewed its account records, whereupon Bongiorno discovered the $17,000 withdrawal.

On September 28, 2012, Bongiorno commenced a civil action against the defendant.SeeBongiorno v. Capone , Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-12-6015733-S(2012 action).In his operative complaint filed in the 2012 action, Bongiorno asserted claims of (1) breach of contract, (2) conversion, and (3) statutory theft in violation of § 52-564, all of which were predicated on allegations that the defendant had made the $17,000 withdrawal without Bongiorno's permission or consent.¹During the pendency of the 2012 action, the defendant filed a motion to dismiss Bongiorno's operative complaint for lack of subject matter jurisdiction, arguing in relevant part that Bongiorno, having filed the 2012 action in his individual capacity, lacked standing to claim harm stemming from the $17,000 withdrawal.The trial court, Hon. Kevin Tierney , judge trial referee, denied the defendant's motion to dismiss, concluding that Bongiorno had pleaded "a ‘colorable claim of direct injury’ " vis-à-vis the $17,000 withdrawal.

The 2012 action was referred to an attorney trial referee, who tried the matter in 2015.On February 27, 2017, the court accepted a second revised report ² filed by the attorney trial referee, adopted the attorney trial referee's findings, and rendered judgment in accordance with the report.The court concluded that the attorney trial referee's findings, including that the defendant withdrew $17,000 from the plaintiff's checking account (1) without advising Bongiorno of his intention to withdraw said amount, (2) with the intent to deprive Bongiorno of said amount, and (3) without a legitimate basis, established that the defendant had breached the binding term sheet and had committed statutory theft.³Ostensibly in support of its adjudication of Bongiorno's statutory theft count, the court further found that "[t]he binding term sheet and [the] settlement agreement were entered into by [Bongiorno] and the defendant, and [those documents] passed title to the [plaintiff's] business assets from the defendant to [Bongiorno]."

As relief, the court awarded Bongiorno a total of $58,659, exclusive of postjudgment interest and attorney's fees, which comprised (1) $17,000, plus prejudgment interest in the amount of $7659, as to his breach of contract count, and (2) $34,000 as to his statutory theft count.⁴

The defendant appealed from the judgment rendered in the 2012 action to this court.SeeBongiorno v. Capone , 185 Conn. App. 176, 196 A.3d 1212, cert. denied, 330 Conn. 943, 195 A.3d 1134(2018).On appeal, the defendant claimed that the trial court improperly had determined that Bongiorno had standing, in his individual capacity, to assert his breach of contract and statutory theft counts against the defendant.⁵Id., at 194, 196 A.3d 1212.This court concluded that Bongiorno (1) had standing to assert his breach of contract count insofar as he alleged that the $17,000 withdrawal harmed him personally because of the diminution in value of the 50 percent interest in the plaintiff that the defendant had agreed to sell to him;⁶id., at 180, 196 A.3d 1212; but (2) lacked standing to pursue his statutory theft claim.

Id., at 194, 196 A.3d 1212.Regarding Bongiorno's statutory theft count, this court stated that it "has repeatedly held that damages suffered by a limited liability company cannot be recovered by a member of the limited liability company bringing the case in an individual capacity. ...In the present case, the statutory theft count is based entirely on the defendant's withdrawal of $17,000 from the [plaintiff's] checking account.The facts demonstrate that it is the [plaintiff], and not [Bongiorno], that would have standing to assert a statutory theft claim on the basis of the defendant's conduct.[Bongiorno] has not demonstrated a specific, personal and legal interest in the money separate from that of the [plaintiff].The [plaintiff] owned the checking account from which the money was taken.The trial court's finding that the [binding] term sheet and the settlement agreement passed title to the [plaintiff's] business assets from the defendant to [Bongiorno] is incorrect; only the defendant's membership interest in the [plaintiff] was thereby transferred.Under these allegations, the only injuries resulting from the defendant's conduct, as stated in [Bongiorno's] statutory theft count, were suffered by the [plaintiff], not by [Bongiorno] personally.The [plaintiff] is a limited liability company and is, therefore, a distinct legal entity from [Bongiorno], who is simply a member of that entity.Even after [Bongiorno] became the sole member of the [plaintiff], the [plaintiff] remained a distinct legal entity.Because a member of a limited liability company cannot recover for an injury allegedly suffered by the limited liability company, we conclude that [Bongiorno] lacked standing to pursue a claim of statutory theft in this case.Accordingly, we conclude that the trial court lacked subject matter jurisdiction over [Bongiorno's] statutory theft claim."(Citations omitted.)Id., at 200–202, 196 A.3d 1212.Accordingly, this court reversed the judgment rendered in Bongiorno's favor on his statutory theft count and directed the trial court on remand to render judgment dismissing that count for lack of subject matter jurisdiction.Id., at 203, 196 A.3d 1212.

On remand, the trial court, Genuario, J. , (1) dismissed Bongiorno's statutory theft count and (2) rendered judgment in Bongiorno's favor on his breach of contract count, awarding him $13,055.06 in damages, comprising $8500 plus prejudgment interest in the amount of $4555.06.⁷In addition, on remand, the plaintiff filed a motion to join the 2012 action because it asserted that it was a necessary party.The court denied that motion on February 7, 2019, on the basis that such relief was outside of the scope of this court's remand order.

On May 14, 2019, the plaintiff commenced the present action against the defendant.In its original complaint, in...