Charles Viscardi, Jr. v. Silvia Duncko et al.
FSTCV115013730S
Decided: January 17, 2012
This matter came before the court at a special proceedings calendar. ? The plaintiff Viscardi applies for a prejudgment remedy against the defendants Silvia and Milos Duncko who are husband and wife each representing themselves without the assistance of an attorney. ? A hearing on the plaintiff’s application took place on December 12, 2011, December 15, 2012, and January 10, 2012.
Viscardi makes claims in his proposed complaint of breach of contract, conversion, civil theft (presumably pursuant to General Statutes ??52?564) and fraud. ? The claims arise out of a written agreement dated October 12, 2009 between Viscardi and Laura Marino (who executed the agreement as Sellers) and Silvia Duncko (Buyer) and Miles Duncko (executing the agreement as ?Guarantor for Buyer?). ? This agreement (Agreement) is entitled ?Membership Interest Purchase Agreement? and purports to transfer to Silvia Duncko all the membership interests in Solaia, LLC, a Connecticut limited liability company (Solaia) which owned the assets of, and operated, a restaurant and wine bar business on leased premises at 363 Greenwich Avenue, Greenwich, Connecticut known as Solaia Enoteca & Ristorante.
The Agreement (Exhibit 1) acknowledged in several places that Solaia was not in compliance with the requirements of its lease. ? Exhibit 1, (2nd ?whereas? clause, ??6, ??7c, ??10). ? The gist of the Agreement was that the Buyer would take responsibility over the operation and financial condition of the restaurant on the signing of the Agreement (Execution Date) which was October 12, 2009. ? Exhibit 1, ??9, 5th ?whereas? clause. ? The final closing date was contemplated to be the fifteenth business day after Silvia Duncko was issued a Liquor Permit. ? Exhibit 1, ??11. ? The Agreement was contingent on Solaia and the landlord signing a lease restructuring agreement satisfactory to the Buyer. ? Viscardi testified he had reached a lease restructuring agreement with the landlord, and the terms of the agreement were spelled out in Paragraph 6, of the October 12 Agreement. ? That paragraph states that Buyer will assume the LLC with liabilities of approximately $42,139.57 in unpaid rent and $147,644.59 for the cost of restructuring. ? The lessor was identified as ?GFC?FAWCETT, LLC (c/o The HB Nitkin Group)? hereafter referred to as Nitkin.
General Statutes ??52?278(a)(1) authorizes the grant of a prejudgment remedy (PJR) when ?there is probable cause that a judgment in the amount of the prejudgment remedy sought, or in an amount greater than the amount of prejudgment remedy sought, taking into account any defenses, counterclaims or set-offs, will be rendered in the matter in favor of the plaintiff ?? ?Probable cause? has been regularly defined by Connecticut courts as ?a bona fide belief in the existence of the facts essential under the law for the action, and as such as would warrant a man of ordinary caution, prudence and judgment, under the circumstances in entertaining it.? ? See e.g. TES Franchising, LLC v. Feldman, 286 Conn. 577, 584 (1977); ?Ledgebrook Condominium Association, Inc. v. Lusk Corporation, 172 Conn. 577, 584 (1977); ?Wall v. Toomey, 52 Conn. 35, 36 (1884). ? This rather distended definition has been held to mean that the burden of proof required for a PJR is less than proof by a preponderance of the evidence. ?TES Franchising, supra, 286 Conn. 137; ?CC Cromwell Ltd. Partnership v. Adames, 124 Conn.App. 191, 194 (2010). ? Probable cause must be established both as to the merits of the case and the amount of the PJR. CC Cromwell, supra, 124 Conn.App. 196 (quoting TES Franchising, emphasis in the original.)
The evidence in this proceeding comes from the testimony of the two protagonists: ?Viscardi and Milos Duncko and written exhibits. ? On certain major points, the testimony was conflicting although there were areas of agreement and some conflicts appear to be generated by the perspective of the witness. ? The exhibits, with the exception of the Agreement were sometimes incomplete and confusing. ? Both Milos Duncko and Viscardi testified that initially after the Agreement was executed, the transfer of control went reasonably smoothly. ? Viscardi continued to work at the restaurant (without pay) and was available for advice. ? Milos Dunko was generally in charge of the restaurant operations and agrees that Viscardi was not an interference. ? Nevertheless, the transition went slower than expected at first because the transfer of the liquor permit took much longer than the four to six weeks contemplated and was not accomplished until April 2010. ? There was some, but not overwhelming, evidence that this delay may have been the fault of a lack of proper paperwork by Viscardi and the other member of Solaia LLC, Marino.1
More importantly, no progress was made in effectuating the lease restructuring agreement with Nitkin. ? Viscardi testified that Milos Duncko repeatedly assured him that everything was going well with meetings he was having with Nitkin personnel. ? Milos Duncko denies this and testified he was not aware that eviction proceedings were underway, and that an order of eviction had been entered. ? The testimony on this subject differed greatly. ? The lease status, however, was critical. ? Viscardi testified that he had reached an agreement with Nitkin to reduce the rent by $4,000.00 per month in return for the existing arrears being paid promptly, and a payment to Nitkin of around $147,000.00. ? From Viscardi’s perspective, the payment of the arrears and the restructuring charge by the Buyer resulted in the reduction of his selling price by about $200,000.00 to $100,000.00.
According to Milos Duncko he continued to try to negotiate the deal arranged by Viscardi. ? Specifically, Milos Duncko testified wanted the lease extended by five years (there was conflicting evidence about the existing lease as to whether it had four or seven years to run) and he refused to provide his personal guarantee on the lease. ? It is apparent that Nitkin did not agree to these terms. ? The eviction proceeding in the Norwalk Housing Court had been commenced by Nitkin against Solaia in August 2009. ? Exhibit 4. A stipulation to a judgment of eviction was entered and ordered on October 15, 2009 with a stay of execution until December 31, 2009. ?Id. A motion to open and modify the judgment was filed on December 31, 2009, but never acted upon. ? Nevertheless, Nitkin took no steps to execute on the order until April 2010, six months after the Agreement was executed. ? Finally, execution of the eviction judgment was ordered on May 13, 2010. ? At that time the restaurant was closed down and all parties to this action lost access to inventory, furnishings and equipment.
Although the evidence is mixed and there are key facts yet unknown without discovery, the court determines that the plaintiff has established probable cause that he will prevail on one or more of his legal claims, and is entitled to some PJR. While Milos Duncko claims he did not know of the eviction proceeding until after execution of the Agreement, the terms of the Agreement were notice that money needed to be paid to the landlord soon. ? The Buyer did not do so, but rather attempted to negotiate better terms. ? This effort failed, and the defendants failed to pay the arrears or the restructuring fee. ? The failure to pay resulted in the consummation of the eviction process, a significant cause of the damages incurred.
The amount of the appropriate PJR is difficult to ascertain because the evidence before the court is very incomplete. ? Viscardi seeks a PJR in the amount of $140,000.00. ? In support of this claim, Viscardi claims that the defendants left Solaia with debts incurred while operating the business including sales and use taxes, and did not pay for expenses charged to a Solaia credit card account and transferred to themselves assets and inventory of Solaia. ? The evidence presented in support of these claims was the quite imprecise testimony of Viscardi, a series of Bank of America monthly statement (Exhibit 2) and a handwritten statement of what the plaintiff believes is owed by the defendants without back-up documentation that Viscardi has been damaged by the Dunckos’ failure to pay.
The court accepts Viscardi’s testimony that he paid sales and use taxes for two months based on the operation of the restaurant prior to its going out of business. ? These taxes amount to $6,979.20. ? Exhibit 3. The remainder of Exhibit 3 is a compilation of ?bills? owed by Milos Duncko. ? Most of these appear to be restaurant related, but there is no evidence before the court that the plaintiff paid these bills.
The Bank of America monthly statements (Exhibit 2) reflect transactions on a Solaia credit card which was issued to Milos Duncko when he took over restaurant operations in October 2009. ? Milos Duncko testified that his use of the card for whatever purposes after October 12, 2009 was authorized since the money in the Bank of America account were funds he was responsible for and entitled to after he took over the restaurant. ? He also testified that he was using a debit card, not a credit card. ? Viscardi testified that it was a credit card and as the primary obligor on the account there were about $9,000.00 of unpaid charges that he has been paying off over time.
Finally, there was testimony from Viscardi that equipment, inventory and furniture lost in the eviction process had a value of ?maybe? $250,000.00. ? There was no documentary support for this assertion and no list of items lost. ? While further discovery may develop more information, the court will only value this loss at $40,000.00. ? Based on the foregoing, the court will order a prejudgment remedy in the amount of $60,000.00.
Simultaneous with the filing of this memorandum, the court grants the plaintiff’s motion for disclosure of assets.
TAGGART D. ADAMS
JUDGE TRIAL REFEREE
FOOTNOTES
FN1.?Marino is not a party to this case. ? What happened to her membership interest in Solaia is unknown..??FN1.?Marino is not a party to this case. ? What happened to her membership interest in Solaia is unknown.
Adams, Taggart D., J.T.R.