Nicotra Wieler Inv. Management, Inc. v. Grower, 13240

• Decision Date: 10 May 1988
• Docket Number: No. 13240,13240
• Citation: 207 Conn. 441,541 A.2d 1226
• Court: Connecticut Supreme Court
• Parties: NICOTRA WIELER INVESTMENT MANAGEMENT, INC. v. Melvin GROWER.

Page 1226

541 A.2d 1226

207 Conn. 441

NICOTRA WIELER INVESTMENT MANAGEMENT, INC. v. Melvin GROWER.

No. 13240.

Supreme Court of Connecticut.

Argued March 2, 1988.

Decided May 10, 1988.

Gurdon H. Buck, with whom, on the brief, were Sally S. King and Lori Wilson, Hartford, for appellant (defendant).

Jeffrey J. Mirman, Farmington, with whom were Richard Kuzmak and, on the brief, Matthew N. Perlstein, Hartford, for appellee (plaintiff).

Before PETERS, C.J., and SHEA, GLASS, COVELLO and HULL, JJ.

PETERS, Chief Justice.

The principal issue in this case is whether the tenant of a residential apartment complex that is being converted to common interest ownership has an exclusive right to purchase the apartment that he occupies even though the conversion plan does not make the apartment available for sale as a separate unit. The plaintiff, Nicotra Wieler Investment Management, Inc., brought this summary process action against the defendant, Melvin Grower, alleging the expiration of an oral lease by lapse of time. The defendant refused to vacate the apartment principally because the plaintiff had not complied with General Statutes §§ 47-284 ¹ and 47-285, ² which govern the rights of tenants in the conversion process. The trial court rendered a judgment awarding possession to the plaintiff. We find no error.

There is no dispute about the relevant facts. The defendant occupies an apartment at the Folly Brook Manor complex in Wethersfield, which is managed and operated by the plaintiff. The complex consists of nine separate groups of buildings. Each building contains four apartment units. In August, 1983, the owner of the complex was Creative Real Estate Marketing Investments (CREMI). About August 30, 1983, CREMI designated the complex for development as a planned unit modular complex within the authority conferred by the Connecticut Common Interest Ownership Act (CIOA). General Statutes §§ 47-200 et seq. To initiate this new form of ownership, CREMI filed a "Declaration of Covenants, Easements, Reservations and Tenancies in Common" in the land records of Wethersfield. According to the declaration, CREMI agreed to convey the land and common improvements, such as paved parking areas and concrete walkways, to the newly-created Folly Brook Manor Owners Association, Inc. As for the apartment structures, CREMI declared its intent to sell each of the forty-six buildings to various investors, who in turn would lease the land and common improvements from the owners association. In sum, the units for sale under the declaration consisted of the four-apartment buildings, not the individual dwelling units.

In conjunction with the conversion, CREMI sent a form letter to the defendant describing the change in ownership structure. This letter explained that the "general nature of [Folly Brook] Manor as a rental complex has not been changed" and that rental payments would be due under the terms of existing leases. The defendant was told that "[y]ou may live in your apartment under your existing lease until your lease expires." CREMI further stated that no evictions would occur except for designated causes, including nonpayment of rent, removal of the apartment from the rental market or material noncompliance with the lease. Finally, with respect to purchase rights, the letter stated that "[b]ecause the boundaries of the units have been changed from individual apartments to groups of four (4) apartments, we cannot offer you an exclusive right to purchase your apartment. If you are interested, however, in purchasing a modular group of four (4) apartments, please do not hesitate to call us."

On July 19, 1984, the plaintiff served on the defendant a notice to quit possession of the premises by July 31, 1984. The notice alleged that an oral lease had expired by lapse of time. When the defendant did not vacate the premises, the plaintiff brought the instant summary process action on August 8, 1984. Thereafter, on October 10, 1984, the defendant moved to dismiss the action because the plaintiff had not provided him a proper conversion notice and public offering statement as required by General Statutes §§ 47-284 and 47-285. In particular, the defendant claimed that the letter he had received from CREMI failed to offer him an exclusive right to purchase his apartment for a specified period. ³

In a memorandum of decision dated December 16, 1985, the trial court denied the motion to dismiss. It was uncontested that the defendant had not been provided a conversion notice and a public offering statement. Whether the defendant was thereby protected from an eviction depended, according to the trial court, on a threshold question: did the conversion provisions of CIOA require the plaintiff to provide such documents in this case? After examining the relevant statutory provisions, the trial court decided that the tenant in this case stood outside the intended scope of CIOA. The trial court appears to have rested its decision on two alternate grounds. The court first held that the defendant was not a "conversion tenant" for whom the provisions of CIOA afford protection. In the alternative, the court also denied relief because § 47-285(a) contains an exception that applies when the unit for sale does not "substantially conform to the dimensions of the unit before conversion." Of particular significance to the trial court in both holdings were the provisions of CIOA that give to developers latitude in declaring and defining the "units" that are for sale in a newly-declared common interest community. General Statutes §§ 47-202(31) and 47-224(a)(5). ⁴ This freedom to characterize as a "unit" whatever portion of the development is to be sold separately could not, the trial court reasoned, be squared with the defendant's claim of the right to purchase his dwelling unit. Under the defendant's view, the court believed that "the result would be difficult and unfathomable. How could each of four tenants have exclusive right to purchase the building which, not the individual apartments, was the only item available for conversion/sale?" ⁵

Subsequent to this decision, the defendant filed his answer and special defenses. The defenses essentially recounted the grounds for dismissal under CIOA that had already been rejected by the trial court in its prior memorandum. ⁶ In its final judgment rendered on August 18, 1987, the trial court found for the plaintiff on the special defenses and on the question of possession for lapse of an oral lease. As its rationale for denying the special defenses, the trial court expressly incorporated its prior memorandum on the motion to dismiss.

On appeal, the defendant claims that his eviction is improper because the trial court erred in: (1) holding that a proper conversion notice, with its attendant exclusive purchase right, was not required in this case; and (2) not requiring the plaintiff to provide a public offering statement to him. We find no error.

I

In order properly to review these claims of error, we must briefly survey the conversion provisions of CIOA in the context of the act as a whole. The Common Interest Ownership Act is a comprehensive legislative scheme regulating all forms of common interest ownership that is largely modeled on the Uniform Common Interest Ownership Act. Public Acts 1983, No. 83-474. A "common interest community" is defined chiefly by the fact that each unit owner is obligated to pay certain charges, such as taxes and insurance premiums, attributable to common property held jointly by the owners through their association. General Statutes § 47-202(7). ⁷ Part V ⁸ of the act sets forth special rules for the protection of tenants who occupy apartments in existing structures that are being converted to common interest communities. General Statutes §§ 47-282 through 47-293. In a statement of policy, the legislature declared the need for statewide action to preserve the stock of leased dwelling units in the face of the quickening tempo of conversions. General Statutes § 47-282. Because tenants who occupy buildings undergoing conversions often bear a disproportionate burden in this process, the legislature has established a regime of both substantive and procedural rights that must be respected by developers in this state. Three principal rights are: the exclusive right to purchase one's apartment for a specified period of time, a relocation payment of up to one thousand dollars and a guarantee against rent increases during the transition period. See General Statutes §§ 47-285, 47-287 and 47-289.

A

CIOA affords its panoply of protection to a special type of person known under the act as a "conversion tenant." This term is defined as "a tenant who occupies a dwelling unit both before and after it becomes a converted unit." General Statutes § 47-283(3). The preliminary question in this case is whether the defendant is a "conversion tenant." Only if this status has attached to the defendant as a consequence of the conversion in this case do the rights available under CIOA become enforceable.

The defendant in this case meets the statutory requirement for a "conversion tenant." The definition of this term in § 47-283(3) essentially ties the status of being a "conversion tenant" to the occupancy of an apartment that "becomes a converted unit." A "converted unit" is defined as "a dwelling unit that (A) was not in a common interest community when originally leased to its current tenant and (B) is now in a common interest community or is located in a building in which a unit is being offered for sale as part of a common interest community." General Statutes § 47-283(2).

Applying these criteria in this case, we are persuaded that the evidence adduced at trial shows that the defendant fits the definition of a "conversion tenant." It is undisputed that the defendant resided at Folly Brook Manor prior to its conversion to a common interest community. The defendant attested, in an undisputed...