Saphir v. Neustadt

• Decision Date: 03 April 1979
• Citation: 177 Conn. 191,413 A.2d 843
• Court: Connecticut Supreme Court
• Parties: Joel L. SAPHIR et al. v. Egon NEUSTADT et al.

Page 843

413 A.2d 843

177 Conn. 191

Joel L. SAPHIR et al. v. Egon NEUSTADT et al.

Supreme Court of Connecticut.

Argued Nov. 14, 1978.

Decided April 3, 1979.

Peter L. Truebner, Hartford, with whom were Stewart M. Casper and, on the brief, James F. Sullivan, Darien, for appellants-appellees (plaintiffs).

Richard Hanna, Danbury, for appellees-appellants (defendants).

Before COTTER, C. J., and LOISELLE, BOGDANSKI, LONGO and PETERS, JJ.

LONGO, Associate Justice.

Pursuant to the provisions of § 52-105 of the General Statutes, the plaintiffs brought a class action seeking damages and equitable relief, claiming that the defendants, Egon Neustadt and Candlewood Lake Estates Service Corporation, failed to construct and maintain roads in a development owned by the defendant Neustadt, in accordance with the terms contained in deeds from Neustadt to the plaintiffs. The matter was referred to a state referee, who, acting as a judge of the Superior Court, found that the defendants had substantially complied with the obligations imposed by the deeds and denied equitable relief, but rendered judgment awarding damages to the plaintiffs for the defendants' misapplication of certain funds paid by the plaintiffs. ¹

I

The trial court found ² the following pertinent facts: In 1945, the defendant Egon Neustadt, hereinafter the defendant, acquired title to the area known as Candlewood Lake Estates located in the town of Sherman. Prior to the date of acquisition, his predecessor in title had commenced a rustic development with a few houses and narrow dirt roads. The general topography of the area is heavily wooded and mountainous with large rocks, ledges and steep slopes with no paved road. The development of the land continued until about 1969, during which time lots were sold, new roads were constructed and other roads were improved. The defendant designed the development for residential use as a resort area, for seasonal and recreational use. In so doing, he attempted to retain the character of the development and to make the narrowest roads consistent with zoning regulations thereby making as little change in the environment as possible.

Throughout the development of the area, the defendant used a fairly standard form of contract and deed, changing only slightly from time to time. A covenant, typical of the covenants contained in the deeds of all of the plaintiffs in this action, provided that the "(g)rantees (the plaintiffs) shall have the right to the use of road and beach at their own risk and without liability of grantors. Grantees covenant to pay to the grantors, their heirs and assigns, the sum of $25.00 on May 1st of each year in advance, which sum shall be set aside in a road fund to be applied to the maintenance and construction of the roads ; and likewise the sum of $10.00 for beach maintenance; said payments to continue until such time as the roads and beach will have been taken over by a property owners association." (Emphasis added.) The court found that none of the funds collected by the defendant under the provisions of the deeds were ever used by him for the construction of new roads.

In 1966, the defendant conveyed all roads, beaches and open areas in the development to a corporation known as Candlewood Lake Estates Service Corporation, hereinafter CLESCO, and turned over all funds to the corporation. CLESCO's sole source of income was the receipts from the charges made by the development's residents. During the period from 1966 to 1973, inclusive, CLESCO received $96,466.24 from Candlewood property owners, and substantially all funds collected were expended during each year. The financial records indicate that expenditures were broken down into three categories: roads, beaches, and general. Under roads and beaches, all expenditures listed were expended each year for mechanical work and repairs on roads and beaches, such as patching and oiling. In 1974, the defendant, by letter to all the landowners, abandoned his responsibilities for road and beach maintenance.

As we have initially indicated, the trial court, although finding that the road conditions in Candlewood Lake Estates were not completely satisfactory, concluded that the defendants had substantially performed the obligations assumed by them pursuant to the covenant before mentioned in regard to the maintenance of the roads. The court, however, concluded that the defendant Neustadt had wrongfully used and misapplied the sum of $19,835.89 paid to him for road maintenance, and rendered judgment for the plaintiffs. The court instructed counsel for the plaintiffs to file an amendment to their complaint, after trial, to conform to the proof at trial. Thereafter, the defendants were given leave to plead to the plaintiffs' amended complaint, and on January 15, 1976, the defendants were given an opportunity to offer evidence limited to the amount of damages awarded to the plaintiffs in the court's original judgment. In a supplemental judgment, filed March 10, 1976, the court opened and vacated its original judgment, and reduced the amount of the award to the plaintiffs for the defendants' misapplication of funds to $13,412. The court concluded further that the defendant Neustadt and the defendant CLESCO were alter egos, and, accordingly, rendered judgment against both defendants in favor of the plaintiffs. It is from this final judgment that the plaintiffs have appealed and the defendants have cross appealed.

II

THE PLAINTIFFS' APPEAL

A

In their initial assignments of error, the plaintiffs seek to correct the court's finding to include numerous material facts which they claim were admitted or undisputed, and they also claim that certain conclusions reached by the court were not supported by the facts found. They contend that of the 129 draft findings which they submitted and which addressed the failure of the defendants to maintain the Candlewood roads, the trial court included in its finding only eighteen references to road conditions, the majority of which made no reference to their unsafe or hazardous conditions. The plaintiffs argue that considerable evidence was presented by photographs, expert witnesses and residents to the effect that the roads were in poor condition, dangerous to travel and in need of repairs. The defendant Neustadt admitted on cross-examination that the roads were generally in bad repair. The plaintiffs contend that without the addition of these facts to the finding, this court is prevented from fully considering the merits of their argument concerning the alleged breach by the defendant Neustadt of the covenant to maintain the Candlewood roads.

We have examined the court's finding, and have concluded that the finding as made warrants no corrections. The plaintiffs submitted, via the 129 paragraphs of their draft finding, an extremely detailed description of sixteen roads in Candlewood Lake Estates, the structural deficiencies of the roads, the generally broken-down conditions of the roads and the cost of restoring the roads to an acceptable level of comfort and safety. The trial court found that an overflow of grass and shrubs had encroached on some of the roads causing visual disturbances to motor vehicle operators, that the end of Candlelight Road should be widened, that some of the roads were unpaved gravel, that a hazardous U-turn existed on Sunset Drive, that no guardrail existed on Skyline Drive, and that a steep grade existed thereon. In view of those findings, the court concluded that the road conditions in Candlewood Estates were not completely satisfactory, that numerous road surfaces were broken and rutted, and that storm water lay on the roads in various places.

This court may correct a finding which fails to include admitted or undisputed facts. Morrone v. Jose, 153 Conn. 275, 277, 216 A.2d 196 (1965). The trial court, however, is not required to state its finding in the identical language of an appellant's draft finding. Walsh v. Turlick, 164 Conn. 75, 77, 316 A.2d 759 (1972); Blatt v. Star Paper Co., 160 Conn. 193, 201, 276 A.2d 786 (1970). We are satisfied that in the twenty-one paragraphs of the court's finding and its four paragraphs of conclusions, all dealing with the allegedly defective conditions of the roads, the court sufficiently found the facts posited in the 129 paragraphs of the plaintiffs' draft finding. As those paragraphs of the draft finding are thus implicit in the finding as made, no useful purpose would be served by their addition to the finding. Salvatore v. Milicki, 163 Conn. 275, 277, 303 A.2d 734 (1972).

The plaintiffs also attack the court's conclusion that the defendants had substantially complied with their obligation under the covenant to keep and maintain the Candlewood roads in a reasonably safe condition. That conclusion is tested by the finding and must stand unless it is legally or logically inconsistent with the facts found or unless it involves the application of some erroneous rule of law material to the case. Belford v. New Haven, 170 Conn. 46, 55, 364 A.2d 194 (1975). Only in the clearest circumstances where the conclusion found could not reasonably be reached will the trier's determination be disturbed. McLaughlin v. Chicken Delight, Inc., 164 Conn. 317, 323-24, 321 A.2d 456 (1973).

At the outset, we note that a covenant, by definition, obligates the parties to observe rights and duties in relation to the physical characteristics of the land to which the covenant attaches; the defendants' obligation to maintain the roads must thus be considered in relation to the physical topographical conditions in Candlewood Lake Estates. See 7 Thompson, Real Property, § 3150; 5 Powell, Real Property, § 673. Of particular importance in the court's reaching of the above conclusion is the fact that the state referee made, with the consent of counsel, a personal on site examination of all of the roads in the Candlewood Lake Estates. In view of the mountainous, steeply...