Linden Condominium Assn., Inc. v. McKenna, (SC 15971)

• Court: Supreme Court of Connecticut
• Writing for the Court: KATZ, J.
• Citation: 247 Conn. 575,726 A.2d 502
• Parties: LINDEN CONDOMINIUM ASSOCIATION, INC. v. R. RICHARD MCKENNA
• Docket Number: (SC 15971)
• Decision Date: 02 February 1999

247 Conn. 575
726 A.2d 502

LINDEN CONDOMINIUM ASSOCIATION, INC.
v.
R. RICHARD MCKENNA

(SC 15971)

Supreme Court of Connecticut.

Argued November 6, 1998.

Officially released February 2, 1999.

Callahan, C. J., and Borden, Katz, McDonald and Peters, JS.

247 Conn. 576

Patricia A. Ayars, for the appellant (plaintiff)

Nathan A. Schatz, with whom was Richard P. Weinstein, for the appellee (defendant).

Opinion

KATZ, J.

The two principal issues in this appeal are: (1) whether a condominium owners' association may seek a deficiency judgment under General Statutes § 49-14¹ as part of an action to foreclose a common charges

247 Conn. 577

lien pursuant to General Statutes § 47-258,² when the

247 Conn. 578

first mortgagee has redeemed the units being foreclosed

247 Conn. 579

by paying the statutory superpriority to the association; and (2) whether such an association may thereafter bring a separate action for breach of contract to recover the remaining unpaid common charges. The plaintiff, Linden Condominium Association, Inc., a condominium owners' association, brought this action against the defendant, R. Richard McKenna, the owner of twelve condominium units, in order to collect unpaid condominium common charges, attorney's fees, and costs based on the defendant's personal liability. Following the judgment of the trial court limiting the plaintiff's right to damages, the plaintiff appealed to the Appellate Court. We transferred this appeal to this court pursuant to Practice Book § 65-1 and General Statutes § 51-199 (c)

The parties have stipulated to the following facts. Prior to bringing the present action, pursuant to the Common Interest Ownership Act (act), General Statutes § 47-200 et seq., specifically § 47-258, the plaintiff brought a foreclosure action against the defendant to foreclose its statutory lien for unpaid common charges. The trial court rendered a judgment of strict foreclosure, determined that the defendant's total debt secured by the lien was $74,596.01, awarded $1500 in attorney's fees and $1653.60 in costs, and set law days.³ On its law day, Shawmut Bank Connecticut, N.A. (Shawmut), the holder of the first mortgage on the condominiums in question, redeemed the units by paying the plaintiff the six month superpriority lien plus attorney's fees and costs. Specifically, Shawmut paid the plaintiff $15,000 for six months of common charges, plus $1500 in attorney's fees and $1653.60 in costs. Consequently, $59,596.01 remained as an unpaid debt for common charges. Seven days later, the plaintiff moved for a deficiency judgment pursuant to § 49-14, but the court denied the motion as untimely.⁴

247 Conn. 580

On November 16, 1995, the plaintiff filed the present action for breach of contract and failure to comply with General Statutes § 47-257, which sets forth the law regarding assessments for common charges.⁵ The plaintiff seeks: (1) the remaining common charges of $59,596.01 not recovered in the prior foreclosure action; (2) $11,556 plus 18 percent interest per annum for the common charges and late fees that had accrued in May and June of 1995, the months between the date of judgment and the date of redemption; and (3) costs and attorney's fees incurred in connection with the collection of the debt

The defendant responded by filing a motion for summary judgment, claiming that the present action was barred by res judicata because the plaintiff unsuccessfully had sought a deficiency judgment in the prior foreclosure action. The defendant claimed that, even if the plaintiff had not been required to seek a deficiency judgment pursuant to § 49-14, it chose to do so, and therefore, the trial court's denial of the plaintiffs deficiency judgment motion precluded any further litigation to collect the same debt. The defendant further argued that the debt itself no longer existed because it had merged into the foreclosure judgment. In a pretrial memorandum of decision dated November 1, 1996, Hon. Jerry Wagner, judge trial referee, denied the motion for summary judgment, concluding that the present action

247 Conn. 581

was not barred because the plaintiff could not have maintained a deficiency judgment claim pursuant to § 49-14. The trial court added that § 47-258 (f) does not prohibit a postforeclosure action on the debt against a unit owner.⁶ Therefore, the case was tried to the court, Freed, J.

In his posttrial memorandum of decision, however, Judge Freed concluded otherwise. Specifically, the court held that, in the foreclosure action, after the trial court had established the amount due the plaintiff, and after Shawmut had redeemed the condominium units, the plaintiff had a choice either to pursue a deficiency judgment pursuant to § 49-14 or to bring a separate action to collect the remaining debt. The court further reasoned, however, that because the plaintiff by motion had pursued a deficiency judgment, which was denied as untimely, the doctrine of res judicata barred the plaintiff from subsequently bringing an action to collect the unrecovered sum from the prior foreclosure action. Accordingly, the trial court rendered judgment for the plaintiff for only $19,070.06, which sum consisted of $11,556 that the parties had stipulated represented the common charges for May and June of 1995, plus $5026.66 in interest and $2487.40 in attorney's fees incurred in the present action.

On appeal, the plaintiff's principal claim is that, pursuant to § 47-258, a condominium association can bring an action for unpaid common charges following a foreclosure action for whatever debt remained unsatisfied after judgment in the foreclosure action. Additionally, as part of this action, the plaintiff seeks common charges that accrued between the dates of judgment and redemption, and costs and attorney's fees incurred in connection with the collection of the debt.⁷ In support

247 Conn. 582

of its claim, the plaintiff argues that § 49-14 does not permit a deficiency judgment when the foreclosing party does not obtain title to the property, and that neither General Statutes § 49-1⁸ nor the doctrine of res judicata bars further action on a debt after a judgment of foreclosure has been rendered.⁹ Conversely, the defendant maintains that the plaintiff had the legal right to pursue a deficiency judgment in the foreclosure action and that § 49-1 is a bar against further actions on the debt, such as the present one. The defendant further asserts that even if § 49-1 were not a bar, the doctrine of res judicata bars the plaintiff from bringing this claim because the plaintiff unsuccessfully had pursued a deficiency judgment as a part of the prior foreclosure action. Finally, the defendant contends that collateral estoppel prevents the plaintiff from requesting the attorney's fees and costs that had accrued in connection with the foreclosure action, and which had been requested, but denied, in that action

We agree with the plaintiff that § 49-14 did not provide a remedy available to the plaintiff and we reverse the

247 Conn. 583

judgment of the trial court. We also conclude, however, that the doctrine of collateral estoppel precludes the plaintiff from recovering the attorney's fees and costs that had been denied in the foreclosure action.

I

We first address the plaintiff's claim that the trial court improperly determined that the plaintiff could have obtained a deficiency judgment pursuant to § 49-14 in an action to foreclose a common charges lien created by § 47-258 in which a first mortgagee had redeemed by paying the plaintiff's statutory superpriority. We agree with the plaintiff.

Whether the plaintiff, under the circumstances of this case, could seek a deficiency judgment is a matter of statutory interpretation and is an issue of first impression for this court. Statutory interpretation is a matter of law, and, therefore, the trial court's judgment is subject to plenary review. See Shawmut Mortgage Co. v. Wheat, 245 Conn. 744, 748, 717 A.2d 664 (1998). Well settled principles govern such a review. When we construe a statute, "[o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature.... In seeking to discern that intent, we look to the words of the statute itself, to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation and common law principles governing the same general subject matter.... Furthermore, [w]e presume that laws are enacted in view of existing relevant statutes ... because the legislature is presumed to have created a consistent body of law." (Citations omitted; internal quotation marks omitted.) Conway v. Wilton, 238 Conn. 653, 663-64, 680 A.2d 242 (1996). We construe each sentence, clause or phrase to have a purpose behind it. State v. Ayala, 222 Conn. 331, 346, 610 A.2d 1162

247 Conn. 584

(1992). In addition, we presume that the legislature intends sensible results from the statutes it enacts. State v. Parmalee, 197 Conn. 158, 165, 496 A.2d 186 (1985). Therefore, we read each statute "in a manner that will not thwart its intended purpose or lead to absurd results." (Internal quotation marks omitted.) Coley v. Camden Associates, Inc., 243 Conn. 311, 319, 702 A.2d 1180 (1997).

Regarding the act specifically, we have stated that, "[i]n determining whether [the act] affords the relief that the [plaintiff] seeks, it is axiomatic that we strive to ascertain and give effect to the apparent intent of the legislature.... In addition, we consider the statute as a whole with a view toward reconciling its parts in order to obtain a sensible and rational overall interpretation." (Citations omitted; internal quotation marks omitted.) Nicotra Wieler Investment Management, Inc. v. Grower, 207 Conn. 441, 451, 541 A.2d 1226 (1988).

The act, which is largely modeled after the Uniform Common Interest Ownership Act, was created in order to provide unit...