169 OLIVE STREET, LLC v. D’URSO, No. NNH CV 09 5029796 (Jun. 24, 2011)


2011 Ct. Sup. 14071
No. NNH CV 09 5029796Connecticut Superior Court Judicial District of New Haven at New Haven
June 24, 2011

[EDITOR’S NOTE: This case is unpublished as indicated by the issuing court.]


The parties appeared before the court during a three-day bench trial in a matter involving a lease agreement between the parties who were married at the inception of the lease. During the lease term the marriage dissolved and the parties sued and counterclaimed for monies allegedly due.

The court considered evidence with respect to claims by Oreste Speciale of breach of a lease and conversion against his former spouse, Sharon D’Urso.[1] D’Urso, on her part, proffered evidence as to various special defenses and a counterclaim alleging, fraud, negligent misrepresentation, breach of contract and unjust enrichment.

Preliminarily, an issue was raised by D’Urso in her post-trial memorandum as to whether the court lacks subject matter jurisdiction over Speciale’s claims because they were disposed of in the form of a stipulated agreement between Speciale and D’Urso subsequent to their divorce. Specifically, D’Urso avers that Speciale’s claims are barred by the doctrines of res judicata and collateral estoppel and that Speciale “is attempting to relitigate a financial issue previously decided by the court in the divorce proceedings.” This issue, however, was adjudicated when the court, Wilson, J., denied D’Urso’s motion to dismiss on July 23, 2010 [50 Conn. L. Rptr. 394]. “Where a matter has previously been ruled upon interlocutorily, the court in a subsequent proceeding in the case may treat that decision as the law of the case, if it is of the opinion that the issue was correctly decided, in the absence of some new or overriding circumstance.” Breen v. Phelps, 186 Conn. 86, 99, 439 A.2d 1066 (1982). Because the court’s decision was correctly reached and no new circumstances have been presented, it is the law of the case and the court will rule on the claims tried before it. CT Page 14072

I THE COMPLAINT A Count One: Breach of Lease
In count one of the complaint, Speciale alleges that he is owed, in accordance with a written lease agreement, rent and utilities for D’Urso’s use and occupancy of the first floor of 169 Olive Street in New Haven. In particular, Speciale alleges that he is owed $4,856 for her use of the utilities between November 2007 and March 15, 2009, as well as $900 for unpaid rent.

“A lease is a contract and questions concerning it are determined in accordance with usual contract law.” Amwax Corp. v. Chadwick, 28 Conn.App. 739, 741, 612 A.2d 127 (1992). “The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages.” (Internal quotation marks omitted.)Keller v. Beckenstein, 117 Conn.App. 550, 558, 979 A.2d 1055, cert. denied, 294 Conn. 913, 983 A.2d 274 (2009).

The court finds that Speciale and D’Urso entered into a valid written lease agreement on December 1, 2006. The pertinent terms of the lease are as follows. Paragraph one provides that “Tenant rents from Landlord an area of approximately 1300 square feet of space on the first floor of 169 Olive Street, said space consisting of three rooms and 1 bathroom.” Paragraph two provides that “[t]he term of this Lease shall commence on January 1, 2007 and continue for a period of two (2) years, renewable thereafter, by agreement between Landlord and Tenant.” Paragraph three provides that “[t]he Tenant agrees to pay as rent to Landlord during each month of the lease term the sum of One thousand eight hundred (1,800) per month which amount is due on the first day of each month in advance (1,800).” Finally, paragraph four provides that “Tenant shall, during the term of this lease, pay for 100% the cost of the heat for the area leased [and] is also responsible for electricity for the first floor of Premises, which is on a separate meter. Water and sewer . . . charges are included with the monthly rent. Tenant agrees to pay one third (1/3) cost of hot water for the building.” The court finds that the marriage between Speciale and D’Urso was dissolved during CT Page 14073 the lease term, that the lease agreement was not renewed and that D’Urso did not vacate the premises until March 15, 2009, two and a half months after the expiration of the lease.

With respect to Speciale’s claim for unpaid rent, D’Urso stipulated at trial that she did indeed owe Speciale the claimed $900. Accordingly, the court renders judgment for Speciale in the amount of $900 on this portion of his claim. With respect to Speciale’s allegation that D’Urso failed to pay $4,856 for her use of the utilities, the only relevant testimony offered at trial was Speciale’s testimony that D’Urso failed to pay certain gas bills. His testimony, however, was vague and he did not specify when or the amount D’Urso allegedly failed to pay. Speciale did reference in his testimony an exhibit consisting of monthly gas bills from January 4, 2007 through January 4, 2008, but most of these bills are beyond the scope of the complaint because the alleged dates of breach occurred between November 2007 and March 15, 2009. “It is fundamental in our law that the right of a plaintiff to recover is limited to the allegations of his complaint.” (Internal quotation marks omitted.)Matthews v. F.M.C. Corp., 190 Conn. 700, 705, 462 A.2d 376 (1983). Accordingly, although the court finds that D’Urso did fail to pay for some of her use of the utilities, it will consider only the gas bills dated December 5, 2007 and January 4, 2008, totaling $927.43, as evidence supporting Speciale’s allegations of breach.

Speciale argues, as to damages, that D’Urso owes one-third of each gas bill because she leased one of the three occupied floors at 169 Olive Street. D’Urso, pursuant to her first two special defenses, offered evidence that she occupied only half of the first floor. “When damages are claimed they are an essential element of the plaintiff’s proof and must be proved with reasonable certainty . . . Damages are recoverable only to the extent that the evidence affords a sufficient basis for estimating their amount in money with reasonable certainty . . . Although damages often are not susceptible of exact pecuniary computation and must be left largely to the sound judgment of the trier . . . this situation does not invalidate a damage award as long as the evidence afforded a basis for a reasonable estimate by the [trier] of that amount.” (Emphasis added; internal quotation marks omitted.) Lawson v. Whitey’s Frame Shop, 241 Conn. 678, 689-90, 697 A.2d 1137 (1997). In addition, “[t]he defendant may, without notice, offer evidence to reduce the amount of damages claimed.” Practice Book § 17-49. Because the lease expressly provides that the tenant is to pay for CT Page 14074 heat only to the extent of the area leased, and the court finds that D’Urso leased only one-half of the first floor, the court concludes that a reasonable estimate of Speciale’s damages is one-sixth of $927.43, or $154.57. Consequently, with respect to Speciale’s claim that D’Urso failed to pay for her portion of the utilities, the court renders judgment in favor of Speciale in the amount of $154.57.

B Count Two: Conversion
In count two, Speciale sues in conversion and seeks $6,287 that he alleges was “fraudulently” given to D’Urso by his former secretary and deposited in a retirement account belonging to D’Urso. “[C]onversion is an unauthorized assumption and exercise of the right of ownership over goods belonging to another, to the exclusion of the owner’s rights.” Howard v. MacDonald, 270 Conn. 111, 129 n. 8, 851 A.2d 1142 (2004).

Speciale testified at trial that D’Urso inappropriately obtained and cashed a $6,287 check when his secretary forged his signature and cosigned the check with D’Urso. Doubt and uncertainty is attributed to his testimony because he initially admitted that his handwriting is on the check but that he did not know how it got there; later, he contradicted himself by saying that his handwriting is not on the check. By comparison, D’Urso’s evidence is credible. In her special defense, D’Urso alleges that the check was a gift from Speciale. She testified at trial that, based on tax advice from her accountant, Speciale gave her the check to put in her retirement account. During the course of the trial, D’Urso was detailed and consistent in reciting the facts and circumstances surrounding her receipt of the check and the court credits her convincing testimony. In contrast, Speciale was evasive, unclear and contradictory in his account of the facts. Therefore, the court finds that D’Urso did not misappropriate the check. Rather, Speciale authorized her to receive it as a gift. Thus, the court renders judgment in favor of D’Urso on the conversion claim.

C Count Three: Unjust Enrichment
In count three, Speciale incorporates the allegations of count two and further alleges that D’Urso was unjustly enriched by receiving CT Page 14075 the $6,287 check. “Our Supreme Court has described unjust enrichment as a very broad and flexible equitable doctrine . . . That doctrine is based upon the principle that one should not be permitted unjustly to enrich himself at the expense of another but should be required to make restitution of or for property received, retained or appropriated . . . The question is: Did [the party liable], to the detriment of someone else, obtain something of value to which [the party liable] was not entitled?” (Internal quotation marks omitted.) Stewart v. King, 121 Conn.App. 64, 71, 994 A.2d 308 (2010). The court applies the same reasoning as its ruling on count two and finds that D’Urso is entitled to the $6,287 because it was a gift from her then husband. Consequently, as in count two, the court renders judgment in favor of D’Urso.

In count one, D’Urso alleges that Speciale committed fraud with respect to the lease agreement. D’Urso alleges that Speciale “willfully” misrepresented on the lease the square footage of the space leased to her. D’Urso also alleges that: (1) she and Speciale initially agreed to a five-year lease; (2) Speciale instead drafted a two-year lease; (3) Speciale did not inform her of this change prior to her moving into 169 Olive Street; and (4) she would not have leased the premises “had she been given the lease to review in advance.”

“Our Supreme Court repeatedly has held that the essential elements of an action in common-law fraud are that: (1) a false representation was made as a statement of fact; (2) it was untrue and known to be untrue by the party making it; (3) it was made to induce the other party to act upon it; and (4) the other party did so act upon that false representation to his injury . . . Under a fraud claim of this type, the party to whom the false representation was made claims to have relied on that representation and to have suffered harm as a result of the reliance.” (Internal quotation marks omitted.) Coss v. Steward, 126 Conn.App. 30, 49-50, 10 A.3d 539 (2011).

CT Page 14076 The lease agreement signed by the parties provides that the space leased to D’Urso consists of “approximately 1300 square feet.” D’Urso testified that she measured the unit and determined that it was only 1000 square feet. The court finds this self-serving testimony insufficient. D’Urso did not authenticate her claim with the testimony of an expert or with any formal documentation describing the actual measurements of the space. As a result, the court concludes that D’Urso’s testimony does not satisfy her burden of proof with respect to the element that Speciale falsely represented the actual square footage of the space leased.

The court also finds that Speciale did not make a false statement of fact with respect to the duration of the lease. The operative lease, on which D’Urso’s signature appears, clearly states that it is for a period of two years. D’Urso testified that she knew and understood that she was signing a two-year lease. D’Urso, who is an attorney and who has prepared leases in the past, clearly realized the ramification of her act. It is not credible that D’Urso would have signed this lease upon realizing that she had been defrauded by Speciale. Moreover, even if Speciale did in fact tell D’Urso that he would sign a five-year lease, the fact that she did not seek to reduce such an agreement to a writing and subsequently entered into an agreement of an entirely different duration, informs the court that she could not have moved in reliance on Speciale’s alleged misrepresentation. Accordingly, judgment is rendered in favor of Speciale with respect to D’Urso’s claims of fraud.

B Count Two: Negligent Misrepresentation
The second count of the counterclaim is a mirror image of the first except that D’Urso alleges negligent misrepresentation. “Our Supreme Court has long recognized liability for negligent misrepresentation . . . The governing principles [of negligent misrepresentation] are set forth in similar terms in § 552 of the Restatement (Second) of Torts (1977): One who, in the course of his business, profession or employment . . . supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.” (Internal quotation marks omitted.) Rafalko v. University of New Haven, 129 Conn.App. 44, 52 (2011). For the same reasons as set forth by the court in deciding count one, the CT Page 14077 court finds that D’Urso has not proven that Speciale supplied any false information to her or that she relied on any false information. Therefore, D’Urso cannot prevail in her negligent misrepresentation claim and judgment is rendered for Speciale.

C Count Three: Breach of Contract
In count three, D’Urso alleges that Speciale breached a number of terms in the lease agreement. D’Urso’s first claim that Speciale breached the lease agreement as it pertains to the square footage of the leased premises and the lease duration fails for the same reasons given by the court in ruling on the first two counts of the counterclaim. Judgment may therefore enter for Speciale on this part of the third count.

D’Urso also claims that Speciale breached his obligations under the lease when he refused to accept the delivery of a carpet that she ordered and caused the seller to charge her a $450 “reshelving fee.” Paragraph ten of the lease provides in relevant part: “Landlord further agrees to remove existing carpeting and replace with new carpeting and under mat of Tenant’s choice of fabric and color. All work to be completed before Tenant’s occupancy.” Nothing in this paragraph or in the remainder of the lease required Speciale to accept delivery of a carpet. Rather, Speciale was required to (1) install new carpeting (2) of D’Urso’s choice of fabric and color (3) before she occupied the premises. D’Urso offered no testimony or other evidence at trial demonstrating that Speciale failed with respect to any of those obligations. Because D’Urso failed to prove that Speciale breached his duties under the lease agreement, the court renders judgment in favor of Speciale on this claim.

D’Urso further claims that Speciale breached the terms of the lease when he refused to repair the air conditioning system after it failed to work and she was forced to hire a contractor at her own expense. Paragraph seven of the lease provides in relevant part: “Tenant shall at its own cost and expense, maintain the Premises and make any necessary repairs to the interior of the Premises, the fixture and equipment therein and appurtenances thereto, including the . . . air conditioning . . . Landlord warrants that heating, air conditioning . . . electrical and plumbing systems are in good working condition at the time of occupancy.” (Emphasis added.)

CT Page 14078 Our Supreme Court has instructed that “in construing contracts, we give effect to all the language included therein, as the law of contract interpretation . . . militates against interpreting a contract in a way that renders a provision superfluous . . . Therefore, [w]hen interpreting a contract, we must look at the contract as a whole, consider all relevant portions together and, if possible, give operative effect to every provision in order to reach a reasonable overall result.” (Emphasis added; internal quotation marks omitted.) Connecticut National Bank v. Rehab Associates, 300 Conn. 314, 322, 12 A.3d 995 (2011). Following the guidance of our Supreme Court, paragraph seven of the lease must be construed to mean that (1) the landlord expressly warrants that the air conditioning system is in good working order at the time of occupancy but that (2) if the air conditioning becomes damage during the occupancy the tenant must repair it at his or her own cost and expense. This construction is reasonable because it protects the landlord from having to repair damages to the premises that are caused by the tenant and it also protects the tenant from occupying a premises that, at the outset, is in need of repair.

The evidence presented at trial demonstrates that the air conditioning system was defective at the time of occupancy because it drew too much electricity. Nevertheless, although D’Urso proved that Speciale breached the express warranty contained in paragraph seven of the lease, she has submitted no evidence that the court may use to arrive at a reasonable estimate of her damages. Although D’Urso testified that her electricity bills were too high, she presented no evidence of what her bill would have been with a properly working air conditioning system. Her testimony as to her mere belief that $150 is a reasonable monthly bill is unsupported and without consequence. Because D’Urso has not proven her claim as to her damages, and indeed, has not presented any evidence in this regard, the court renders judgment in favor of Speciale.

D Count Four: Unjust Enrichment
In the fourth count, D’Urso alleges that Speciale was unjustly enriched in a variety of ways. “A right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another . . . With no other test than what, under a given CT Page 14079 set of circumstances, is just or unjust, equitable or inequitable, conscionable or unconscionable, it becomes necessary in any case where the benefit of the doctrine is claimed, to examine the circumstances and the conduct of the parties and apply this standard . . . Plaintiffs seeking recovery for unjust enrichment must prove (1) that the defendants were benefited, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs’ detriment.” (Internal quotation marks omitted.) Breen v. Judge, 124 Conn.App. 147, 158-59, 4 A.3d 326 (2010).

D’Urso first claims that Speciale was unjustly enriched because he misrepresented the square footage of the leased premises and the duration of the lease term. As previously discussed in this memorandum of decision, D’Urso has not proved that Speciale conveyed any false information with respect to the lease. Accordingly, D’Urso also cannot prove that Speciale benefited, unjustly, from the lease transaction.

D’Urso next claims that Speciale was unjustly enriched because (1) she rewired the leased premises for computers, high speed internet and phone line service, thereby improving it; (2) she contemplated recouping her expenditures for these improvements over a five-year period rather than over a span of two years; and (3) Speciale asked her to wire the internet cable to his office on the second floor and he used the internet for his benefit. The evidence adduced at trial demonstrates that, rather than suffering any detriment, D’Urso performed the rewiring for her own benefit in order to establish a functioning law office. No evidence was presented as to any agreement, express or implied, that Speciale would compensate D’Urso for such improvements. Although D’Urso testified that she hoped to remain in the building for five years, the court has found that she signed a two-year lease and understood the legal implications of that contract. Due to this knowledge, D’Urso, in improving the premises for her benefit, assumed the risk that she may not remain past the lease period. Therefore, she cannot be said to have suffered any detriment as a result of her expenditures. Moreover, although D’Urso granted Speciale access to her internet, she presented no evidence that she expected any form of compensation in exchange for this gratuitous allowance. Accordingly, the court does not find that D’Urso suffered any equitable detriment or that Speciale unjustly failed to pay for any benefit that he received. The court therefore renders judgment in favor of Speciale on the fourth count of the counterclaim.

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[1] The plaintiffs in this case are 169 Olive Street, LLC and Oesse Foods, Inc. Both entities are owned and managed by Speciale. Nevertheless, the pleadings, in addressing the plaintiffs, frequently refer only to Speciale. For the purpose of clarity and consistency, both plaintiffs will be referred to in this memorandum as “Speciale.” For similar reasons, both defendants, Law Office of Sharyn D’Urso and Sharyn D’Urso, will be referred to as “D’Urso.”

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