ABNIC INVESTMENTS v. THORNTON, No. CV 06 500464 (Nov. 20, 2006)

ABNIC Investments et al. v. John Thornton.

2006 Ct. Sup. 21399
No. CV 06 500464Connecticut Superior Court, Judicial District of New Haven at Meriden.
November 20, 2006.

[EDITOR’S NOTE: This case is unpublished as indicated by the issuing court.]

MEMORANDUM OF DECISION APPLICATION FOR DISCHARGE OR REDUCTION OF MECHANIC’S LIEN

MARK H. TAYLOR, JUDGE.

I. BACKGROUND
This application for discharge or reduction of mechanic’s lien[1]
was filed on March 17, 2006 and was subsequently heard by the court on August 28, 2006. The dispute between the parties arises from an agreement to remediate water damage to real property owned by the applicant, Abnic Investments, (Abnic) at 29 West Main Street, Meriden, Connecticut, which was caused by a pipe that burst within the property on January 26, 2005. Although the parties attempted to reach a remediation agreement in writing, most if not all of the written offers made by the respondent, John Thornton, (Thornton) were rejected by Abnic through John Abutu. John Abutu testified that he refused to sign Thornton’s written offers because the price and scope of the work performed by Thornton exceeded payments approved by Abnic’s insurance carrier. The remediation work was nonetheless substantially completed by Thornton, who claims that John Abutu’s partner in Abnic, Janice Abutu, orally approved most of the disputed work that was performed on the property.

The court grants the applicant’s application to reduce the mechanic’s lien. For reasons more fully set forth in this decision, the mechanic’s lien is reduced from $61,233.90 to $35,878.09.

II. FACTS
The parties have stipulated that the original, combined estimate of the work to be performed by Thornton, as provided by Abnic’s insurance adjuster, was $146,314.38. Thornton claims to have originally estimated the job differently, however, at $149,405.70.[2] Thornton further claims that Janice Abutu approved the additional estimated costs of approximately $3,000.00.[3] Thornton also claims that Janice Abutu approved additional work, including (1) drying costs totaling CT Page 21400 $28,062.24, (2) the expansion of a conference room costing $1,475.00, and (3) the replacement of an air conditioning motor costing $1,377.75.[4] In addition to these claims, Thornton claims credits for dry-wall removal work performed in the basement of the building, amounting to $1,204.00, and for work performed on the floor of the second story of the building amounting to $2,100.00. These claims by Thornton total $183,624.69.

After demolition work began on the project, mold was discovered in the building which required mold remediation work that was beyond the scope of the project, as originally contemplated by the parties. Thornton claims an additional $17,000 for the mold remediation work that he performed at the property. The mold remediation work was originally estimated to cost $29,261.06 by another contractor. This amount was rejected by Abnic’s insurance carrier, which would only approve $15,000.00 for this additional remediation work.

John Abutu consistently testified at the hearing that any payments made for the mold remediation project would be in amounts approved by his insurance carrier. Although the court heard testimony from Thornton concerning other additional work approved by Janice Abutu, the court heard no evidence of any agreements for work above and beyond the $15,000.00 threshold set by Abnic’s insurance adjuster for mold remediation. Initially, the mold remediation work was performed unsuccessfully by Promaster, a mold remediation contractor recommended by Thornton. Abnic therefore refused to pay Promaster their demand for the remaining balance of $11,500.00 in its mold remediation budget, having expended $3,500.00 of this budget for other purposes. Instead, Abnic paid Promaster $3,000.00 on May 17, 2005 to fully satisfy this claim, leaving $8,500.00 in the mold remediation account. Thornton then agreed to complete the mold remediation project.[5]

Although Thornton also failed to successfully complete the mold remediation project, he has never been paid for the substantial work he performed. During this second attempt to remediate mold on the premises, Abnic paid $1,155.00 to a business by the name of Envirocheck[6] for an environmental inspection showing Thornton’s failure to successfully remediate the mold that was found to continue to exist in the building. In addition, Abnic paid $1,590.00 for “air scrubbers” necessary to successfully complete the project. Thornton claims that he is owed $17,000 for his mold remediation work. Abnic disputes this claim and, instead, claims that Thornton is entitled only to the amount remaining in the mold remediation budget, which is $5,755.00. Further, Thornton disputes the inclusion of environmental inspection costs in the mold remediation budget because they were never itemized in any estimate of CT Page 21401 mold remediation services to be provided.

The parties have stipulated that Abnic has paid Thornton $122,500.00 to date. Further, although the parties agree that certain work identified in the original estimate has not been performed by Thornton, the parties dispute $311.10 of the total value of that work. Abnic claims the value of the unperformed work to be $32,156.60 and Thornton concedes only $31,845.50 of that amount.

Thornton claims a credit of $1,204.00 for dry-wall removal work he performed in the basement of the building. During the course of the hearing, John Abutu conceded that Thornton deserved a credit for this dry-wall removal work.[7] In addition, Thornton claims a credit of $2,100.00 for work performed on the second floor, not previously credited to him in the “unperformed work” figure of approximately $30,000.00, discussed above. Although John Abutu originally claimed that Thornton had done no work on the second story of the building, he conceded that work on the conference room and some other work had been performed on the second floor. In addition, Thornton showed photographic evidence of repairs done to the floor, although, according to the original plans, this floor was to be replaced. Since Abnic has apparently been credited for Thornton’s failure to “replace” the floor, Thornton should be credited with the “repair,” which he claims should be valued at $2,100.00. Since the court heard no other evidence of the value of this work, Thornton’s figures are accepted by the court for the purpose of establishing probable cause that they are owed by Abnic

III. DISCUSSION
“In an action to dissolve a mechanics lien, the lienor must first establish that there is probable cause to sustain the validity of the lien established. General Statute § 49-35(b)(a); Sikora v. Rosado Builders, Inc., Docket #CV040409493S, judicial district of Fairfield at Bridgeport (March 18, 2004) (Karazin, J.). Upon doing so the burden of proof then shifts to the party whose property has been liened (defendant) to establish by clear and convincing evidence that the lien should be dissolved or reduced. Id. Should the defendant meet its burden, the court has the authority to order the lien discharged, reduce the amount of the lien, or substitute a bond in place of the lien in an amount deemed appropriate for the protection of the lienor. General Statute § 49-35b(b).” Northeast Tank Services, Inc. v. 570 Main St, LLC, Superior Court, judicial district of New Britain, Docket No. CV 05 4008098 (February 6, 2006, Shaban, J.)[8]

In meeting the test of probable cause, the court must find that there CT Page 21402 “is a bona fide belief in the existence of the facts essential under the law for the action and such as would warrant a [person] of ordinary caution, prudence and judgment, under the circumstances, in entertaining . . . Probable cause is a flexible common sense standard. It does not demand that a belief be correct or more likely true than false . . .”Morris v. Cee Dee, LLC, 90 Conn.App. 403, 411, 877 A.2d, 899 (2005). Once probable cause is established in a mechanic’s lien case, the burden then shifts to the respondent to establish by clear and convincing evidence that the claim should be rejected by the court. “To satisfy the standard for clear and convincing evidence, the defendant [has] to prove that the evidence induces in the mind of the trier a reasonable belief that the facts asserted are highly probably true, that the probability that they are true or exist is substantially greater than the probability that they are false or do not exist. Our Supreme Court has defined `clear and convincing’ as a very demanding standard that should operate as a weighty caution upon the minds of all judges, and it forbids relief whenever the evidence is loose, equivocal or contradictory.” (Citations omitted; internal quotation marks omitted.)Durso v. Vessichio, 79 Conn.App. 112, 123, 828 A.2d 1280 (2003).

The mold remediation claim was the subject of extensive and conflicting evidence by the parties. Although Thornton claimed $17,000.00 for this work, it was established by clear and convincing evidence that the budget of $15,000.00 was the maximum amount available for mold remediation work. It was also established by clear and convincing evidence that the work performed by Thornton and his predecessor, Promaster, resulted in failed environmental tests for the existence of mold. However, Abnic has failed to prove by clear and convincing evidence that environmental testing costs were to be included in either the estimated or the adjuster approved costs for mold remediation, although it may be logical to assume that they would be included in such costs. At the time that Thornton took over the mold remediation project from Promaster, the mold remediation budget had been depleted to $8,500.00. After Thornton failed to pass the mold remediation inspection, Abnic has shown by clear and convincing evidence that it was required to expend $1,590.00 for “air scrubbers” necessary to successfully complete the mold remediation project. This leaves a balance of $6,910.00 to pay Thornton for mold remediation services, which is $10,090.00 less than Thornton’s claim of $17,000.00.

Thornton’s claims total to $200,624.69. The court finds that Thornton has established these claims by the applicable standard of probable cause, as set forth in General Statutes § 49-35b(a). This figure must be reduced by the stipulated amount of $122,500.00, previously paid by Abnic, totaling $78,124.69. This figure must be reduced further by work CT Page 21403 that was not performed by Thornton, which Abnic has shown by clear and convincing evidence to be valued in the amount of $32,156.60, further reducing the total to $45,968.09. The mold remediation claim has been reduced by $10,090.00, thereby further reducing Thornton’s verified total claim to $35,878.09. See General Statutes § 49-35b(b)(3).

The other costs claimed by the respondent, established by probable cause, were not sufficiently rebutted by clear and convincing evidence.[9]

IV. CONCLUSION
The court grants the application to reduce the mechanic’s lien from $61,233.90 to $35,878.09.

[1] The original mechanic’s lien was filed in the amount of $61,233.90. Based upon evidence presented to the court at the hearing on this matter on August 28, 2006, the defendant has acknowledged that the lien should be reduced to $46,279.19.

[2] At the hearing in this case, Thornton claimed that he estimated the cost of the job to be approximately $138,000.00 and that this was $3,000.00 higher than the amount approved by the insurance adjuster. He also stated that there was additional work that was required and that the insurance adjuster estimated all of this work to cost $146,314.38. He further testified that his estimate was still approximately $3,000.00 higher than the adjuster’s figure and that Janice Abutu agreed to pay this additional amount from the proceeds of the lost wage portion of the insurance claim. Although no corresponding documentary evidence was produced at the hearing to specifically support Thornton’s numbers, the Defendant’s summary of claims, dated September 18, 2006 provides two estimates; one for 138,691.14 and the other for $10,711.56, totaling $149,405.70. These figures, however, are consistent with Thornton’s oral testimony that his original, combined estimates were $3,000.00 higher than the adjuster’s figure.

[3] John Abutu testified consistently that he would enter into a contract only if the charges to be paid under the contract were consistent with the specific approvals of his insurance carrier. Thornton, however, testified that Janice Abutu agreed to pay the additional estimated cost of $3,000.00 for remediation work from a separate “lost wage” claim covered by Abnic’s insurance carrier.

[4] Thornton testified that he primarily worked with Janice Abutu on this project. He also testified that “Abnic” approved this work and that CT Page 21404 “she” ordered the motor. The court takes this to mean Janice Abutu. This work was performed by a subcontractor, who was doing other work for Thornton at the job site. Although Thornton saw the bill for this motor, addressed to Abnic, he had no direct knowledge of whether or not it had been paid. No evidence was presented to the court that the bill had been paid. It is unclear whether this bill is the responsibility of Thornton as the general contractor for the project. No proof or legal arguments were presented that Thornton would or would not be responsible for this bill. For the purpose of this probable cause hearing, therefore, the court will allow the claim.

[5] On May 18th, 2005, one day after the $3,000.00 payment from Abnic, Thornton also paid Promaster an additional $3,000.00 to leave the job. This payment was made for other, general remediation work performed by Promaster.

[6] An additional $3,500.00 had been paid to Envirocheck previously, which had reduced the originally approved mold remediation budget from $15,000 to the remaining $11,500.00 in dispute between the parties.

[7] It is unclear whether this dry-wall removal work was a part of mold remediation work for which Thornton has not been paid.

[8] General Statues § 49-35b provides “(a) Upon the hearing held on the application or motion set forth in section 49-35a, the lienor shall first be required to establish that there is probable cause to sustain the validity of his lien. Any person entitled to notice under section 49-35a may appear, be heard and prove by clear and convincing evidence that the validity of the lien should not be sustained or the amount of the lien claimed is excessive and should be reduced.

(b) Upon consideration of the facts before it, the court or judge may: (1) Deny the application or motion if probable cause to sustain the validity of the lien is established; or (2) order the lien discharged if (A) probable cause to sustain its validity is not established, or (B) by clear and convincing evidence its invalidity is established; or (3) reduce the amount of the lien if the amount is found to be excessive by clear and convincing evidence; or (4) order the lien discharged or reduce the amount of the lien conditioned upon the posting of a bond, with surety, in a sum deemed sufficient by the judge to indemnify the lienor for any damage which may occur by the discharge or the reduction of amount.

[9] Although the $28,062.24 claimed by Thornton for drying costs may be viewed by a finder of fact as related to mold remediation, it was CT Page 21405 instead characterized by Thornton as critical to mol prevention. Therefore, since Janice Abutu allegedly approved the work without an estimate, Thornton has met his burden for the purpose of maintaining a mechanic’s lien that includes this amount.

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