Culhane v. Culhane, Civil Action No. 3:11–CV–1799 (HBF).

• Citation: 969 F.Supp.2d 210
• Decision Date: 28 August 2013
• Docket Number: Civil Action No. 3:11–CV–1799 (HBF).
• Parties: Floyd CULHANE, Plaintiff, v. Janice CULHANE, Defendant.
• Court: U.S. District Court — District of Connecticut

969 F.Supp.2d 210

Floyd CULHANE, Plaintiff,
v.
Janice CULHANE, Defendant.

Civil Action No. 3:11–CV–1799 (HBF).

United States District Court,
D. Connecticut.

Aug. 28, 2013.

[969 F.Supp.2d 213]

Christopher G. Winans, Christopher G. Winans, Esq. PC, Danbury, CT, for Plaintiff.

Conrad O. Seifert, Seifert & Hogan, Old Lyme, CT, for Defendant.

BENCH RULING
HOLLY B. FITZSIMMONS, United States Magistrate Judge.

Plaintiff Floyd Culhane filed this diversity action on November 18, 2011, against defendant Janice Culhane. It arises from a long-drawn and bitter dispute between brother and sister over a residential property

[969 F.Supp.2d 214]

inherited from their deceased mother. Plaintiff seeks a statutory accounting and distribution pursuant to Conn. Gen.Stat. § 52–404(b), and alleges unjust enrichment, and breach of fiduciary responsibility by defendant. Plaintiff also seeks compensatory damages.

Defendant asserts two counterclaims, for statutory accounting and distribution pursuant to Conn. Gen.Stat. § 52–404(b) and for unjust enrichment.

A court trial was held on February 5 and 6, 2013, during which the following witnesses testified: Floyd Culhane; Janice Culhane; attorney Steven Colarassi; and Susan Arnold. All exhibits were entered pursuant to agreement. At the conclusion of plaintiff's case, the defendant moved for a “directed verdict” to strike allegations of damages which the defendant believed to be speculative in nature and/or not supported by evidence presented by plaintiff, such as rent owed by defendant to the co-owner plaintiff, and any damages caused by defendant's alleged neglect of the property. The Court reserved ruling on defendant's motion.¹ The testimony and evidence adduced at the trial are summarized below as necessary to explain the Court's findings and conclusions.

I. Findings of Fact²A. The Property

1. At issue is a residential property located at 16 High Street in Bethel, Connecticut (the “property” or the “home”), which was previously owned by the parties' mother, Edith Culhane. [Def. Exs. 549, 549A, 550, 550A, 551, 551A].

2. In 1982, Edith Culhane equally devised her interest in the property among herself and her three children: plaintiff, defendant, and Michael C. Culhane. [Def. Exs. 549, 549A].

3. In 1996, Michael C. Culhane devised his interest in the property to plaintiff. [Def. Exs. 550, 550A].

4. On November 10, 1999, Edith Culhane quitclaimed her interest in the property to defendant, making the parties fifty percent co-owners. [Def. Exs. 551, 551A].

5. The property consists of a single-family home, with an attached one-bedroom rental apartment (the “apartment”). [Def. Ex. 514]. The home was built in 1900 and has 2,970 square feet of living area. [Def. Ex. 537Z35].

6. The parties' mother died in March 2000. [Jt. Pre–Trial Mem., Doc. # 45, at 13]. Prior thereto, defendant acted as a live-in caretaker for her mother from approximately

[969 F.Supp.2d 215]

February 1999 until October 1999, when Edith Culhane entered a nursing home. During this time, Edith Culhane required twenty-four hour care, which defendant provided while residing in the home with her mother. ³

7. The parties are brother and sister, but have been estranged since their mother's death. The atmosphere between the parties since this time has been acrimonious and rife with dispute.

8. Defendant resided in the home exclusively from approximately 1999 through January 2007. Defendant did not pay plaintiff rent for her use of the home during this time.

9. Plaintiff testified on cross-examination that he expected to receive rent for defendant's use of the property. Plaintiff did not raise this issue with defendant, or the issue of rent from the apartment, until July 2005. [ See also Pl. Ex. 6].

10. Plaintiff did not reside in the home at any point from 1999 to 2010.

11. Plaintiff testified that he did not visit the property until April 2008.

12. During the time period at issue, defendant rented the apartment for one year beginning on April 1, 2002, at a rate of $1,150 per month, for a total of $13,800 annually. [Def. Ex. 544]. Defendant did not share these rental proceeds with plaintiff, but testified that she applied these proceeds to delinquent property taxes.

13. Plaintiff admitted at trial that he did not make any attempts to rent the apartment.

14. The Court credits defendant's testimony that she attempted to rent the apartment at other times without success.

15. The Court further credits defendant's testimony that after she vacated the property, she did not attempt to rent the main house because it did not have heat, as a result of her “winterizing” the home.

16. Both plaintiff and defendant testified at length regarding the condition of the property. Pictures taken by realtor Jay Streaman depict the home in a general condition of disrepair. [Pl. Ex. 2]. However, the Court credits defendant's testimony that these pictures do not fairly and accurately represent the overall condition of the home. Indeed, pictures in a real estate advertisement depict the home in better condition, which defendant testified is a fair and accurate depiction of the home in early May 2007. [ See Def. Ex. 514, 514A]. The Court further credits defendant's testimony that damage depicted in plaintiff's exhibit 2 either existed at the time the parties inherited the property and/or occurred as a result of winterizing the home. The Court gives more weight to defendant's testimony, given that she continuously lived at the home from 2000 through 2007, and because plaintiff testified he did not inspect the property until April 2008.

17. Testimony of an uninvolved witness, Susan Arnold, lends further credence to defendant's testimony concerning the condition of the home. Ms. Arnold, who lives next door to the property and has known defendant since 1949, testified that she visited the home in early 2007 and that the home resembled the pictures in defendant's exhibits 14 and 14A. Ms. Arnold further testified that defendant maintained the home, and was working room by room to repair or rehabilitate the home to its former condition.

[969 F.Supp.2d 216]

B. 1999 Mortgage

18. In February 1999, the parties obtained a $70,000 mortgage for the purposes of making repairs to the home, including replacing the roof (the “1999 loan”).

19. The proceeds from the 1999 loan were placed in a joint account held by the parties. Defendant drew on this account to make repairs to the property. The Court credits plaintiff's testimony that he did not receive any disbursements from, or personal use of, the 1999 loan proceeds.

20. Defendant testified that she applied the 1999 loan proceeds to property repairs, and that the loan proceeds were exhausted by 2000.

21. Defendant paid the monthly mortgage payments on the 1999 loan from April 2, 1999 through February 13, 2004, in the amount of $648.65 per month. [Def. Exs. 542, 542A–N]. Plaintiff did not contribute to the mortgage payments during this time.

C. 2004 Mortgage

22. In February 2004, the parties refinanced the property with GMAC Mortgage, LLC in the amount of $110,000 to take advantage of lower interest rates (the “2004 loan”). [Pl. Ex. 24].

23. Plaintiff executed the mortgage instrument, but testified that he did not execute the related promissory note. [ Id.].⁴

24. The proceeds of the 2004 loan were distributed as follows: $56,000 to Chase Bank to satisfy the 1999 loan; $14,239.52 to the Town of Bethel for property taxes; $2,000 to Sears to satisfy a lien for financed kitchen cabinets; and $22,481.33 to pay off defendant's car loan. [ See Def. Ex. 556].

25. After deducting the settlement costs and disbursements to third parties, $14,477.31 was disbursed directly to defendant from the 2004 loan proceeds. [ Id.] The Court credits plaintiff's testimony that he did not receive any disbursements from, or personal use of, the 2004 loan proceeds.

26. The parties agreed that defendant would make the monthly mortgage payments on the 2004 loan.

27. Defendant made the monthly mortgage payments on the 2004 loan from March 2004 through June 2008, in the amount of $650.70 per month. [ See Def. Exs. 539, 539A–D; 543, 543A–C; Pl. Ex. 10]. Defendant testified that she ceased making these mortgage payments due to her inability to pay. Defendant did not advise plaintiff that she had ceased paying the 2004 loan.

28. The parties understood that defendant would eventually repay the 2004 loan in its entirety. The Court further credits defendant's testimony that she applied part of the 2004 loan proceeds to repay her car loan because it was her understanding that she would eventually acquire plaintiff's share of the property.⁵

D. Foreclosure Actions and Reinstatement of the 2004 Loan

29. On or about July 2008, the parties defaulted on the 2004 loan as a result of non-payment. [ See Pl. Ex. 10].

[969 F.Supp.2d 217]

30. On October 10, 2008, GMAC Mortgage sued the parties in Connecticut Superior Court to foreclose the 2004 mortgage. [Def. Exs. 552, 552A–L].

31. In November 2008, plaintiff reinstated the 2004 loan by making payment to GMAC Mortgage in the amount of $6,123.42, for past-due payments, interest, attorney's fees, and other incurred costs. [Pl. Ex. 10].

32. On or about March 2009, the bank sued to foreclose the property a second time. Plaintiff testified that he stopped paying the 2004 loan on the basis that defendant solely executed the promissory note. Plaintiff hired Attorney Jerome Mayer to defend against the second foreclosure action on this basis, and paid his attorney's fees. Defendant did not contribute towards Attorney Mayer's fees.

33. Plaintiff testified that Attorney Mayer successfully defended against the second foreclosure action, and reached a settlement with GMAC Mortgage wherein the 2004 Loan was, inter alia, reinstated without penalties. [ See Def. Ex. 515].

E. Sale of the Property

34. Sometime in May 2007, the parties listed the property for sale with a realtor, Mary Nagle, at $485,000. [ See Def. Exs. 506, 506A–D, 514]. The...