Keating v. Matusik

• Decision Date: 29 January 2020
• Docket Number: HHDCV186087070S
• Court: Superior Court of Connecticut
• Parties: Joyce M. Keating v. Krzysztof Matusik

Joyce M. Keating v. Krzysztof Matusik

No. HHDCV186087070S

Superior Court of Connecticut, Judicial District of Hartford, Hartford

January 29, 2020

UNPUBLISHED OPINION

Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Shapiro, Robert B., J.T.R.

MEMORANDUM OF DECISION

ROBERT B. SHAPIRO JUDGE TRIAL REFEREE.

On January 21, 2020, the plaintiff’s motion for partial summary judgment (#119) as to liability and as to the defendant’s special defenses appeared as a take papers matter on the Short Calendar. The defendant filed an objection (#121). After consideration, the court issues this memorandum of decision.

I Background

The plaintiff seeks to recover a claimed balance due on a promissory note executed by the defendant in October 2011 for the principal sum of $330, 000.00 (Plff. Exh. A) (note). The note provides, in relevant part, that the defendant promised to pay the principal sum with interest "together with all taxes levied or assessed on said sum or this note against the payee or holder hereof and together with all costs and attorneys fees incurred ..."

The note further provides, "Upon default in the payment of principal when due and/or interest under this note or the aforesaid taxes, or any other monies due hereunder, for a period of ten (10) days after the same shall be due and payable, or upon default in the performance of any further covenants and agreements of the Maker contained in the mortgage securing this note or in related documents for a period of thirty (30) days after written notice of any such default has been given ... then and in every such event the unpaid balance of this note shall at the option of the Holder hereof, become due and payable on demand." (Emphasis added.)

The note was secured by a mortgage on real property located in Enfield, Connecticut (Premises). See Plaintiff’s Exh. B (mortgage). Paragraph 3 of the mortgage states that the defendant, referred to therein as Borrower, "shall pay all taxes, assessments, charges, fines and impositions attributed to the Premises which could obtain a priority over this Mortgage Deed."

In her amended complaint (#103) (complaint), paragraph 4, the plaintiff alleges that the defendant failed to pay real estate taxes to the Town of Enfield (Town), which constitutes a default of the defendant’s obligations under the note and mortgage. The plaintiff alleges that, as a result, she paid the sum of $25, 970.80 to the Town for the real estate taxes which should have been paid by the defendant.

The plaintiff also alleges that, in an effort to mitigate her damages, the premises were sold in October 2017 and the buyers executed a Note and Mortgage in the amount of $254 000.00 in favor of the plaintiff. She alleges that the defendant owes her $78, 366.49, for which she has made demand, plus attorneys fees and costs pursuant to the terms of the note.

The plaintiff seeks summary judgment as to liability only and as to the defendant’s six special defenses. In opposition, citing the terms of the note, the defendant argues that the plaintiff has failed to demonstrate that he breached the note. He also argues that the plaintiff’s presentation in support of the motion has done nothing to overcome his Third, Fourth or Fifth Special Defenses. See Amended Answer and Special Defenses (#115). Respectively, these are based on allegations concerning failure to mitigate damages, payment, and accord and satisfaction. He claims that the plaintiff caused and/or allowed the Premises to be sold for less than fair market value and accepted the sale in full satisfaction of the defendant’s debt.

II Standard of Review

"In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact. The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle[s] him to a judgment as a matter of law. The courts hold the movant to a strict standard. To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact ... As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent ... When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue ... Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue ... It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact ... are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § 380 [now § 17-45]." (Internal quotation marks omitted.) Fiano v. Old Saybrook Fire Co. No. 1, Inc., 332 Conn. 93, 101, 209 A.3d 629 (2019).

Since "any valid special defense raised by the defendant ultimately would prevent the court from rendering judgment for the plaintiff, a motion for summary judgment should be denied when any [special] defense presents significant fact issues that should be tried." (Internal quotation marks omitted.) Cadle Co. v. Ogalin, 175 Conn.App. 1, 10, 167 A.3d 402, cert. denied, 327 Conn. 930, 171 A.3d 454 (2017).

III Discussion

A Liability

As noted above, the plaintiff alleges that the defendant’s default stems from his failure to pay real estate taxes to the Town. In his deposition testimony (Exhibit H), page 38, the defendant admitted that the plaintiff made demands that he pay the real estate taxes and that he did not pay them.

The defendant presents argument concerning the terms of the note, referring to the term "aforesaid taxes," quoted above and arguing that the note does not include a provision for payment of real estate taxes. He asserts that reliance on nonpayment of real estate taxes for alleging a breach of the note is misplaced and that this is the premise of his first and second special defenses, which allege, respectively, that the damages the plaintiff seeks to recover are not allowed under the terms of the note and that the plaintiff failed to make demand.

The defendant’s argument concerning the note’s terms ignore those quoted above, which also define an event of default as including "default in the performance of any further covenants and agreements of the Maker contained in the mortgage." (Emphasis added.) The terms of the mortgage obligated the defendant to "pay all taxes, assessments, charges, fines and impositions attributed to the Premises which could obtain a priority over this Mortgage Deed." See mortgage. Thus, the defendant’s acknowledged failure to pay real estate taxes was a default under the note.

As to the second special defense, which alleges that the plaintiff failed to make demand, demand was expressly waived in the note, page 2, and, as set forth above it is undisputed that the plaintiff made demand. See Plaintiff’s Exhibit D.

B Mitigation of Damages

In the complaint, paragraph 8, the plaintiff alleges that she agreed to the October 2017 note and mortgage signed by the buyers of the Premises "in an effort to mitigate her damages." In the third special defense, the defendant alleges that the Premises were not sold for fair market value, that he is entitled to a credit of the actual market value as of said date, and the plaintiff’s claim is barred, in whole or in part, by her failure to mitigate her damages.

In his deposition testimony, page 35, the defendant stated that, other than the fact that no appraisal was conducted, he had no other reason to believe that the property was not sold for fair value. He also stated that he had no idea what the fair market value was in October 2017. He acknowledged also that he is not aware of any documentation which would support the third special defense.

"To claim successfully that the plaintiff failed to mitigate damages, the defendant must show that the injured party failed to take reasonable action to lessen the damages; that the damages were in fact enhanced by such failure; and that the damages which could have been avoided can be measured with reasonable certainty." (Internal quotation marks omitted.) Sun Val, LLC v. Comm’r of Transportation, 330 Conn. 316, 334, 193 A.3d 1192 (2018). "What constitutes a reasonable effort under the circumstances of a particular case is a question of fact for the trier ... [T]he breaching party bears the burden of proving that the nonbreaching party has failed to mitigate damages ... The defendant thus bears the burden of proving that the plaintiff failed to make reasonable efforts to mitigate the amount of damages." (Internal quotation marks omitted.) Webster Bank, N.A. v. GFI Groton, LLC, 157 Conn.App. 409, 424, 116 A.3d 376 (2015).

Here, the plaintiff has pleaded that she agreed to the sale of the Premises in an effort to mitigate damages. She argues that the defendant agreed to the sale price, and if it was for less than fair market value, that was his choice; and he has no idea what the fair market value was in 2017. As stated above, the defendant testified that there was no appraisal when the Premises were sold.

Superior Court decisions differ on whether mitigation of damages is a valid special defense. "Some courts have held that [m]itigation of damages is not a valid special defense because it does not allege that a plaintiff has no cause of action ... but...