Benchmark Mun. Tax Servs., Ltd. v. Greenwood Manor, LLC

• Decision Date: 19 November 2019
• Docket Number: AC 41924
• Citation: 194 Conn.App. 432,221 A.3d 501
• Court: Connecticut Court of Appeals
• Parties: BENCHMARK MUNICIPAL TAX SERVICES, LTD. v. GREENWOOD MANOR, LLC, et al.

194 Conn.App. 432

221 A.3d 501

BENCHMARK MUNICIPAL TAX SERVICES, LTD.

v.GREENWOOD MANOR, LLC, et al.

AC 41924

Appellate Court of Connecticut.

Argued September 13, 2019

Officially released November 19, 2019

Jonathan J. Klein, Bridgeport, for the appellant (substitute defendant-cross claim plaintiff Main Street Business Management, Inc.).

Thomas W. Moyher, Westport, with whom, on the brief, was James M. Nugent, Milford, for the appellee (cross claim defendant Manuel Moutinho).

Juda J. Epstein filed a brief for the appellee (substitute plaintiff city of Bridgeport).

Prescott, Bright and Devlin, Js.

PRESCOTT, J.

In this action to foreclose certain municipal property tax liens on a 9.9 acre parcel of property in Bridgeport (property),¹ the substitute defendant and cross claim plaintiff, Main Street Business Management, Inc. (Main Street),² appeals from the trial court's judgment rendered against it on its cross claim alleging that the cross claim defendant, Manuel Moutinho, tortiously interfered with a business expectancy and violated the Connecticut Unfair Trade Practices Act, General Statutes § 42-110 et seq. (CUTPA), and on its counterclaim alleging that the city engaged in tortious interference with a business expectancy and improperly sought to affect the property's value adversely by interfering with a proposed zone change.³

On appeal, Main Street, as Greenwood's successor in interest, claims that the court improperly determined that (1) Moutinho did not tortiously interfere with a proposed sale of the property by Greenwood to the city, (2) the city did not tortiously interfere with the business relationship between Greenwood and Moutinho, and (3) the city did not tortiously interfere by causing the city's planning and zoning commission (commission) to reject a zoning reclassification that would have benefited Greenwood by increasing the property's marketability. We disagree and affirm the judgment of the trial court.⁴

The following facts, which either were found by the court or are not in dispute, and procedural history are relevant to our disposition of the claims on appeal. In January, 2009, after years of negotiations, Moutinho finalized a sale of the property to Greenwood, exchanging a warranty deed for a purchase money mortgage of $2 million. Greenwood intended to develop the property for use as a multiunit residential complex. Such use, however, was not permitted at the time the sale closed because the property was zoned R-A, or single-family residential, and thus required a zone change to R-C, or multifamily residential, in order to be developed in accordance with Greenwood's plan.

Although Greenwood never filed a zone change application, it was aware that, in 2008, the commission had begun the process of revising the city's master plan of development and was engaged in a comprehensive reevaluation of zoning regulations and zoning districts throughout the city. As part of this process, the commission considered whether to adopt a zone change for the property from R-A to R-C.⁵ Ultimately, the commission decided to leave the zoning classification for the property unchanged.

Both before and after Moutinho finalized his sale of the property to Greenwood, the city expressed an interest in purchasing the property for use in a flood plain control project and for other purposes. The city engaged in negotiations with Moutinho, both during the time he owned the property and later as the holder of an interest in the property by virtue of the mortgage deed received from Greenwood. The city also negotiated with Greenwood to buy the property. The city never entered into a contract for sale with either Moutinho or Greenwood, as there was never a meeting of the minds regarding a sale price.⁶

In August, 2011, Benchmark, which had acquired from the city certain liens for delinquent property taxes assessed against the property in 2008 and 2009, commenced this action to foreclose those liens. At that time, the property was encumbered by a number of other liens and interests that were subsequent in right, including the mortgage held by Moutinho.

Greenwood filed an answer and special defenses to the foreclosure complaint. It subsequently also filed cross claims against the city and Moutinho.⁷ The gravamen of the allegations underlying Greenwood's cross claims was that Moutinho and the city had participated in a scheme to prevent a sale of the subject property from Greenwood to the city with the intent that Moutinho would foreclose on his mortgage and, after reacquiring title, sell the property to the city himself at a price lower than that proposed by Greenwood. Greenwood further alleged that the city had somehow interfered with the sale of the property from Moutinho to Greenwood and, hoping to diminish the property's value to Greenwood's detriment, also interfered by meddling in the commission's consideration of a zone change affecting the property.

On May 8, 2018, in accordance with a stipulation by the parties, the trial court, Radcliffe, J. , rendered a partial judgment as to liability on the foreclosure complaint, determining that the amount of debt owed by Main Street to the city was $84,345.52. The trial court did not determine at that time either the fair market value of the property or whether the foreclosure of the property should be a strict foreclosure or a foreclosure by sale.⁸

The court then conducted a two day trial on the cross claim and counterclaim. On May 11, 2018, the trial court rendered a judgment in favor of Moutinho on the cross claim and in favor of the city on the counterclaim. With respect to Moutinho, the court found that he had never interfered with any business relationship that existed between the city and Greenwood. Although the court found that Moutinho and his attorney had met with city officials regarding the property, including with Bill Finch, the city's mayor at the time, the court found that Finch never directed city officials to cease negotiations with Greenwood regarding a sale price or to negotiate exclusively with Moutinho. With respect to the counterclaim against the city, the court found that the city properly was entitled to negotiate with both Moutinho and Greenwood about acquiring the property and that it never engaged in any fraud or other improper action that would support a cause of action for tortious interference. The court further found that there was no improper action taken by the city with respect to the comprehensive rezoning of city property, including the decision not to change the zoning classification for the subject property. This appeal followed.⁹ Additional facts will be set forth as necessary.

I

Main Street first claims that the court improperly found that Moutinho did not tortiously interfere with a proposed sale of the property by Greenwood to the city. Moutinho counters that the court correctly determined that Main Street failed to meet its burden of proving that any contract or other business expectancy existed between the city and Greenwood or, in the alternative, that he ever engaged in any tortious conduct intended to interfere with any business expectancy even if one existed. We agree that Main Street failed to establish any tortious action by Moutinho and, accordingly, the court properly ruled in his favor.¹⁰

"It is well established that the elements of a claim for tortious interference with business expectancies are: (1) a business relationship between the plaintiff and another party; (2) the defendant's intentional interference with the business relationship while knowing of the relationship; and (3) as a result of the interference, the plaintiff suffers actual loss.... The plaintiff need not prove that the defendant caused the breach of an actual contract; proof of interference with even an unenforceable promise is enough.... A cause of action for tortious interference with a business expectancy requires proof that the defendant was guilty of fraud, misrepresentation, intimidation or molestation ... or that the defendant acted maliciously.... It is also true, however, that not every act that disturbs a contract or business expectancy is actionable .... A defendant is guilty of tortious interference if he has engaged in improper conduct.... [T]he plaintiff [is required] to plead and prove at least some improper motive or improper means." (Citation omitted; emphasis added; internal quotation marks omitted.) Brown v. Otake , 164 Conn. App. 686, 709–10, 138 A.3d 951 (2016). "Stated simply, to substantiate a claim of tortious interference with a business expectancy, there must be evidence that the interference resulted from the defendant's commission of a tort." (Internal quotation marks omitted.) Id., at 710, 138 A.3d 951.

Whether a party intended tortiously to interfere with a business expectancy is a question of fact. Loiselle v. Browning & Browning Real Estate, LLC , 147 Conn. App. 246, 259, 83 A.3d 608 (2013). If a "claim challenges the accuracy of the court's factual findings, our review is limited to the clearly erroneous standard. In a case tried before a court, the trial judge is the sole arbiter of the credibility of the witnesses and the weight to be given specific testimony.... On appeal, we will give the evidence the most favorable reasonable construction in support of the [judgment] to which it is entitled.... A finding of fact is clearly erroneous when there is no evidence in the record to support it ... or when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.... [A] finding of fact must stand if, on the basis of the evidence before the court and the reasonable inferences to be drawn from that evidence, a trier of fact reasonably could have found as it did." (Internal quotation marks omitted.) Id. As a reviewing court, "[w]e cannot act as a factfinder or draw conclusions of facts from the primary facts found, but can...