Opinion
No. CV 02 0189186
December 19, 2003
MEMORANDUM OF DECISION
This is a motion for summary judgment in which the following facts are undisputed. On September 15, 1998, the plaintiffs, Paul Forman, Stanley Wilker, Norma Wilker and Barbara Agre (sellers), and the defendant, Robert Walpuck (buyer), entered into a contract of sale that contained an option agreement pursuant to which the plaintiffs granted the defendant an option to purchase two separate and adjoining parcels of property owned by the plaintiffs in Wilton. Pursuant to the option agreement the defendant had 120 days to determine whether he intended to purchase the properties. In return for this option, the defendant agreed to pay the plaintiffs a nonrefundable deposit of $7,000.
The agreement provided: "[T]he Buyer shall have up to One Hundred Twenty (120) days to under take any and all tasks he deems necessary in order to assess whether it is feasible to develop said premises by division and/or subdivision. The Buyer shall notify Seller whether he desires to pursue an application for subdivision and move toward the consummation of this transaction." The 120 days expired on January 13, 1999. The agreement also provided that any closing shall not take place any later than August 3, 1999.
The agreement also provided that "[i]n no event shall any closing, as contemplated herein, take place any later than August 31, 1999, except in the event that any appeal is taken from any land use board decision and then, and in that event, as set forth herein." After the 120-day period expired, the plaintiffs' attorney, Kurt Ahlberg, faxed the defendant's attorney, Joseph McKeon, a letter dated April 14, 1999, requesting an additional nonrefundable deposit of $9,000 in order to extend the contract dates by another ninety days, and an additional $3,000 per month for each and every additional extension thereafter.
There is no dispute between the parties that they extended the option period without written amendment and that the defendant paid the initial nonrefundable deposit of $7,000 and $3,000 per month through the month of February 2002.
The plaintiffs subsequently filed this action in which they allege that the defendant has not met the deadlines in the agreement or paid the additional deposit. They also allege that the defendant entered the property without their consent and caused damage to it. They seek a declaratory judgment terminating the agreement and declaring that the property is unencumbered by any obligation to the defendant. The defendant filed an amended answer in which he admits that the parties entered into the initial written agreement and that their subsequent agreement to extend the option period on a monthly basis was not in writing, but denies the remaining allegations in the complaint. He also alleges two special defenses, waiver and lack of good faith, and asserts a two-count counterclaim against the plaintiffs for unjust enrichment and for the return of monies he has expended.
On August 1, 2003, the plaintiffs filed motion #118 for summary judgment based on General Statutes § 47-33a on the ground that there is no genuine issue of material fact and they are entitled to judgment as a matter of law because the contract term had expired and any amendment thereto was not executed in writing or recorded in the land records. The defendant asserts that an issue of material fact exists as to whether the plaintiffs should be estopped from denying the validity of the extension and, based on his special defense of waiver, whether the plaintiffs' acceptance of his monthly payments until February 2002, extended the contract.
"Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted to show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party moving for summary judgment has the burden of showing the absence of any genuine issue of material fact and that the party is therefore, entitled to judgment as a matter of law." (Internal quotation marks omitted.) Webster Bank v. Oakley, 265 Conn. 539, 545, 830 A.2d 139 (2003). "[T]he party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." (Internal quotation marks omitted.) Schilberg Integrated Metal Corp., v. Continental Casualty Co., 263 Conn. 245, 252, 819 A.2d 773 (2003). "A material fact has been defined adequately and simply as a fact which will make a difference in the result of the case." (Internal quotation marks omitted.) Buell Industries, Inc. v. Greater New York Mutual Ins. Co., 259 Conn. 527, 556, 791 A.2d 489 (2002). "Only evidence that would be admissible at trial may be used to support or oppose a motion for summary judgment." (Internal quotation marks omitted.) Great Country Bank v. Pastore, 241 Conn. 423, 436, 696 A.2d 1254 (1997).
General Statutes § 47-33a provides in relevant part: "(a) No interest in real property existing under an executory agreement . . . or under an option to purchase real property shall survive longer than one year after the date provided in the agreement for the performance of it . . . unless the interest is extended as provided herein . . . (b) The interest may be extended only by reexecution of the written agreement or by execution of a new written agreement, provided the agreement, whether reexecuted or newly executed, shall be recorded as directed by sections § 47-10 and § 47-17. The period provided by this section shall not otherwise be extended, whether because of death, disability or absence from the state or for any other reason." The plaintiffs argue that they are entitled to a declaratory judgment pursuant to § 47-33a in that their agreement with the defendant is null and void because more than one year has passed since the closing date specified in the agreement and the parties did not enter into a written amendment or newly recorded reexecution of the original option agreement as required by § 47-33a(b). The plaintiffs do not address the defendant's special defenses or counterclaims.
General Statute § 47-33a provides in relevant part:
(a) No interest in real property existing under an executory agreement for the sale of property or for the sale of an interest in real property or under an option to purchase real property shall survive longer than one year after the date provided in the agreement for the performance of it . . . unless the interest is extended as provided herein.
(b) The interest may be executed only by reexecution of the written agreement or by execution of a new written agreement, provided the agreement, whether reexecuted or newly executed, shall be recorded as directed by sections 47-10 and 47-17. The period provided by this section shall not otherwise be extended, whether because of death, disability or absence from the state or for any other reason. Upon the expiration of an interest the title of property affected by the interest shall not thereafter be considered unmarketable because of the expired interest.
(c) Nothing in this section shall be construed to limit or deny any legal or equitable rights a party may have under the agreement except the right to have the agreement specifically enforced.
The plaintiffs submitted the following in support of their motion for summary judgment: (1) the affidavit of their attorney, Kurt Ahlberg, (2) the contract of sale, (3) a fax from Ahlberg to Forman confirming that the 120th day was January 13, 1999, (4) a fax Ahlberg sent to defendants attorney, Joseph McKeon, offering to extend the option contract for a nonrefundable deposit $9,000 and $3,000 per month thereafter, (5) Ahlberg's letter to McKeon dated February 26, 2002, demanding to terminate the contract and (6) a letter dated November 2, 1999, from McKeon to Ahlberg requesting that the plaintiffs sign a boundary settlement map.
The defendant argues that the plaintiffs are estopped from using General Statutes § 47-33a to avoid their agreement to extend the option period because they accepted his monthly payments of $3,000 until March of 2002. The defendant, in opposition to the motion for summary judgment, submitted: (1) the fax Ahlberg sent to McKeon offering to extend the option contract, (2) the affidavit of the defendant in which he attests that he paid $3,000 per month until March 2002, to extend the option agreement, and (3) the affidavit of McKeon.
"Pursuant to § 47-33a(b), the interest in real estate may be extended only by `reexecution of the written agreement or by execution of a new written agreement . . .'" McNeil v. Riccio, 45 Conn. App. 466, 471, 696 A.2d 1050 (1997). "Once the time limitation passes in an option contract, the authority to accept the offer and to establish a binding purchase and sale agreement no longer exists. Thus, upon expiration of an option contract, the offeree no longer possesses any legal right to accept the offer to purchase the land and therefore has no interest in the property." Bethlehem Christian Fellowship, Inc. v. Planning Zoning Commission, 58 Conn. App. 441, 445, 755 A.2d 249 (2000).
In his amended answer, the defendant admits that the option period was not extended by a written amendment. An admission in the defendant's answer is "a judicial admission conclusive on the defendant, and the matter admitted is not in issue." Jones Destruction, Inc. v. Upjohn. 161 Conn. 191, 199, 286 A.2d 308 (1971). Furthermore, because the defendant does not submit evidence that the parties entered into a written or recorded reexecution of the original agreement, he has not met his burden of showing a genuine issue of material fact exists as to whether the option period was extended in compliance with General Statutes § 47-33a.
Nevertheless, the defendant has demonstrated that he may have valid rights under subsection (c) of General Statutes § 47-33a pursuant to the doctrine of equitable estoppel and under his special defenses of wavier and lack of good faith. "Subsection (c) provides that `nothing in section 47-33a shall be construed to limit or deny any legal or equitable rights a party may have under the agreement except the right to have the agreement specifically enforced.' The statute must be read as a whole . . . Subsection (c) preserves other rights that [the buyer] had under the agreement with [the seller] . . ." (Internal quotation marks omitted.) Columbia Federal Savings Bank v. International Site Consultants Inc., Superior Court Judicial district of Danbury, Docket No. CV 300606 (May 13, 1992, Fuller, J.) ( 6 Conn. L. Rptr. 844).
The Supreme Court has indicated that the eighteen-month limitation period of General Statutes § 47-33a governing executory agreements for the purchase of an interest in land may be tolled by the doctrine of equitable estoppel pursuant to subsection (c) if the plaintiff's words or actions are evasive or misleading and encourage the defendant to rely on the plaintiff's conduct to his or her detriment. Celentano v. Condominium Assn., 265 Conn. 579, 613-15, 830 A.2d 164 (2003). "Estoppel has its roots in equity and stems from the voluntary conduct of a party whereby he is absolutely precluded, both at law and in equity, from asserting rights which might perhaps existed . . . as against another person, who has is good faith relied upon such conduct, and has been led thereby to change his position for the worse." (Internal quotation marks omitted.) Boyce v. Allstate Ins., 236 Conn. 375, 383-84, 673 A.2d 77 (1996). "[I]n Connecticut, the doctrine of equitable estoppel . . . requires proof of two essential elements: [First] the party against whom estoppel is claimed must do or say something calculated or intended to induce another party to believe that certain facts exist and to act on that belief and [second] the other party must change its position in reliance on those facts, thereby incurring some injury." (Internal quotation marks omitted.) Celentano v. Oaks Condominium Assn., supra, 265 Conn. 614-15.
"Waiver is the intentional relinquishment of a known right." (Internal quotation marks omitted.) Majernicek v. Hartford Casualty Ins. Co., 240 Conn. 86, 96, 688 A.2d 1330 (1997). "Wavier does not have to be express, but may consist of acts or conduct from which waiver may be implied . . . In other words, waiver may be inferred from the circumstances if it is reasonable to do so." (Internal quotation marks omitted.) Schreck v. Stamford, 72 Conn. App. 497, 500, 805 A.2d 776 (2002).
"Every contract carries an implied covenant of good faith and fair dealing requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement." Habetz v. Condon, 224 Conn. 231, 238, 618 A.2d 601 (1992). "A bad faith exception is designed to prevent a party's disavowal of previous conduct if such repudiation would not be responsive to demands of justice and good conscience. The law does not permit the exercise of a right to repudiate a contract when the exercise of such a right in bad faith would work an injustice." Id.
The defendant submitted an affidavit in which he attests that the plaintiffs agreed to extend the closing date on the contract if the defendant paid them $3,000 a month and that he paid the $3,000 a month until February 2002. In addition, he states that he would not have continued to make these payments if he knew that the plaintiffs did not intend to allow him to exercise his option to purchase the property. Furthermore, in their complaint, the plaintiffs admit that the parties agreed to extend the option period and that they accepted the defendant's payments of $3,000 a month for approximately two years. Thus, genuine issues of material fact exist as to the defenses of estoppel, waiver, and breach of covenant of good faith. Because the defendant's defenses are legally valid and genuine issues of fact exist as to those defenses, the court is precluded from granting the plaintiffs' motion for summary judgment. See Reilly v. Panaroni, Superior Court, judicial district of New Haven, Docket No. CV 000439030 (December 3, 2001, Silbert, J.) ( 31 Conn. L. Rptr. 104).
The plaintiffs' motion for summary judgment is denied on the ground that the plaintiffs are not entitled to judgment as a matter of law because General Statutes § 47-33a(c) allows the defendant to pursue the equitable defenses he may have in these circumstances and genuine issues of material fact exist as to these defenses.
So Ordered.
WILLIAM B. LEWIS, JUDGE TRIAL REFEREE.