Opinion
FSTCV166029872S
10-11-2019
STONE KEY GROUP, LLC v. Reid TARADASH
UNPUBLISHED OPINION
OPINION
Hon. Charles T. Lee
On August 8, 2019, plaintiff Stone Key, LLC filed the present application for a prejudgment remedy or "PJR" against the defendant Reid Taradash in the amount of $403,917.00 to secure payment of a judgment rendered against the defendant, plus an award of attorneys fees and postjudgment interest pending appeal. As more fully explained below, the court grants the application in full.
Background
On November 2, 2018, following an eight-day trial, post-trial briefing and argument, this court entered judgment against Mr. Taradash in the amount of $250,000 for intentional misrepresentation, among other things. Mr. Taradash filed a notice of appeal on January 28, 2019. On July 25, 2019, the court awarded attorneys fees and costs totaling $117,198.00, for a total judgment, excluding interest, of $367,198.00. D.N. 172.01. The court also awarded postjudgment interest pursuant to General Statutes Section 37-3a at the rate of ten percent. Id. at 9. In the present application for a prejudgment remedy, the plaintiff also seeks to secure $36,719.00 in postjudgment interest pending appeal, bringing the total amount it seeks to attach or garnish to $403,917.00.
On September 13, 2019, the defendant filed his objection, D.N. 195, and the plaintiff filed a reply memorandum on September 24, 2019, D.N. 196. Pursuant to General Statutes Section 52-278d, the court held an evidentiary hearing on September 26, 2019, where it received the testimony of counsel for the parties and various exhibits.
Contentions of the Parties
The defendant does not contest the plaintiff’s claim that the entry of a damages judgment, the award of attorneys fees and the grant of postjudgment interest establish probable cause to support the grant of the prejudgment remedy. However, the defendant contends that the plaintiff, in negotiating a joint case management plan (the "CMP") (D.N. 135), waived the right to bring this application because a provision of that document, at page 2, states, "Stone Key shall withdraw its Application for Prejudgment Remedy (Dkt. No. 102) and each party hereto waives any rights that any of them may otherwise have to seek a prejudgment remedy against any other party for the duration of this Action." The defendant contends that, because this action continues, the parties’ joint submission bars the present application. Further, the defendant argues that this submission to the court results in judicial estoppel of the plaintiff’s ability to act to the contrary.
The plaintiff contends that the parties were solely interested in expediting trial. As a result of the CMP, the prior PJR application was withdrawn and defendant’s application for a stay in favor of arbitration and his motion to strike were also withdrawn. The plaintiff maintains that post-trial proceedings were never discussed, and that the intent of the parties was to streamline proceedings up to trial. As a result, the plaintiff contends that there was no agreement relating to the present application. Further, the plaintiff argues that judicial estoppel should not apply here because the plaintiff did not take an inconsistent position by filing the present application, the court has not ruled previously regarding post-trial motions or applications, and the plaintiff would not derive any unfair advantage if allowed to proceed with the present application.
Findings of Fact
Based on its review of the documentary and testamentary evidence submitted at the hearing on September 26, 2019, the court makes the following finding of facts relevant to the decision before it:
1. The litigation was commenced on or about September 26, 2016.
2. Plaintiff filed an application for PJR on October 19, 2016.
3. After receiving several extensions of time in which to plead, the defendant filed a request to revise on January 6, 2017. After an objection to the request was sustained, the defendant filed a motion to strike portions of the complaint on March 9, 2017.
4. Discovery requests were served, resulting in further disputes and a motion for order of compliance, which was denied on April 11, 2017.
5. On March 13, 2017, the defendant filed a motion to stay the action pending arbitration, with a supporting affidavit and memorandum of law. Opposing briefs and affidavits followed, with permission granted on May 17, 2017 to file a brief in excess of the page limits.
6. Hearings on the PJR and motion for stay were continued at the request of the parties. On May 31, 2017, the parties filed a proposed joint case management plan, which requested a firm trial date in December 2017 or as soon thereafter as possible, with a revised discovery schedule. D.N. 135. The CMP also provided that the defendant would withdraw his motion to stay proceedings pending arbitration and, "[i]n order to expedite proceedings," Mr. Taradash would withdraw his motion to strike. The parties also waived their rights to move for summary judgment prior to trial.
8. The CMP provided that, as quoted above, "Stone Key shall withdraw with prejudice its Application for Prejudgment Remedy (Dkt. No. 102) and each party hereto waives any rights that any of them may otherwise have to seek a prejudgment remedy against any other party for the duration of this Action."
9. The court accepted the CMP on June 20, 2017. D.N. 135.02. Shortly thereafter, the plaintiff withdrew its application for a PJR, and the defendant withdrew his motion to strike and for a stay pending arbitration.
10. At the September 26, 2019 hearing on the present application, the court reviewed exhibits reflecting the negotiations on the CMP. Initially, counsel for the defendant proposed expedited discovery and no PJR application, among other things. Counsel for the plaintiff responded saying, "Stone Key is interested in moving this matter to a final verdict in an expeditious manner," and counter-proposed various terms, saying "Since this case does not appear likely to settle we think it makes sense to bring it to trial as quickly and expeditiously as possible. Otherwise, each party may incur very significant attorneys fees before we ever get to trial."
11. Correspondence between the parties continued in a similar vein, with the plaintiff proposing a draft CMP on May 9, 2017, which included the phrase, "Stone Key will withdraw with prejudice its Application for Prejudgment Remedy (Dkt. No 102)."
12. On May 22, 2017, counsel for the defendant sent a revised draft to plaintiff’s counsel, which provided, "Stone Key will withdraw with prejudice its Application for Prejudgment Remedy and each party hereto waives any rights that any of them may otherwise have to seek a prejudgment remedy against any other party for the duration of the Action. (Dkt. No. 102)." Although several modified drafts were subsequently exchanged, this formulation appeared virtually unchanged in the final CMP as accepted by the court.
13. After a status conference on June 20, 2017, the court issued its order on that date accepting the CMP. The order said, "The Joint Proposed Case Management Plan, dated May 31, 2017, is accepted. The application for a prejudgment remedy, the motion for a stay in favor of arbitration, and the motion to strike will be withdrawn as provided among the other elements of the Plan. Caseflow will notify the parties of a date for a bench trial in December 2017 or January 2018." D.N. 135.02.
14. Nowhere in the submitted correspondence between counsel was there a reference to the filing of a postjudgment PJR.
15. At the evidentiary hearing, counsel for the defendant stated that he was "really not thinking about this," referring to the filing of a postjudgment PJR. Counsel for the plaintiff stated that they did not consider the issue and that "the purpose was to get the case ready for trial."
Discussion
A. Standard of Review
Connecticut General Statutes Section 52-278d provides the standard for the consideration of an application for a prejudgment remedy of attachment or garnishment:
(a) The defendant shall have the right to appear and be heard at the hearing. The hearing shall be limited to a determination of (1) whether or not there is probable cause that a judgment in the amount of the prejudgment remedy sought, or in an amount greater than the amount of the prejudgment remedy sought, taking into account any defenses, counterclaims or set-offs, will be rendered in the matter in favor of the plaintiff, (2) whether payment of any judgment that may be rendered against the defendant is adequately secured by insurance, (3) whether the property sought to be subjected to the prejudgment remedy is exempt from execution, and (4) if the court finds that the application for the prejudgment remedy should be granted, whether the plaintiff should be required to post a bond to secure the defendant against damages that may result from the prejudgment remedy or whether the defendant should be allowed to substitute a bond for the prejudgment remedy. If the court, upon consideration of the facts before it and taking into account any defenses, counterclaims or set-offs, claims of exemption and claims of adequate insurance, finds that the plaintiff has shown probable cause that such a judgment will be rendered in the matter in the plaintiff’s favor in the amount of the prejudgment remedy sought and finds that a prejudgment remedy securing the judgment should be granted, the prejudgment remedy applied for shall be granted as requested or as modified by the court.
Probable cause has been defined as a bona fide belief in facts essential under the law for the action and such as would lead a reasonable, prudent person to entertain such belief. Dufraine v. CHRO, 236 Conn. 250, 261 (1996). The probable cause hearing is not to become a full hearing on the merits, but defenses, counterclaims and setoffs must be considered. See Rafferty v. Noto Bros. Construction, LLC, 68 Conn.App. 685, 693 (2002). "The plaintiff does not have to establish that he will prevail, only that there is probable cause to sustain the validity of the claim ... The court’s role in such a hearing is to determine probable cause by weighing the probabilities." Canty v. Otto, 304 Conn. 546, 565 (2012). Probable cause must exist as to both the merits and damages. Kosiorek v. Smigelski, 112 Conn.App. 315, 322-23, cert. denied, 291 Conn. 903 (2009). A valid defense will defeat a finding of probable cause. Valencis v. Nyberg, 160 Conn.App. 777, 785 n.7 (2015).
B. Plaintiff’s Prima Facie Demonstration of Probable Cause
Although labeled a prejudgment remedy, a PJR of attachment or garnishment is available pending appeal of a judgment. In Gagne v. Vaccaro, 80 Conn.App. 436, 454 (2003), the Appellate Court stated, "It is as necessary to protect a plaintiff who has won at the trial level, when the final disposition of the case awaits appellate proceedings. as it is to protect that same plaintiff before trial ... We therefore hold that a prejudgment remedy is available to a party who has prevailed at the trial level and whose case is on appeal." (Internal quotation marks and citations omitted.)
As set forth above, on November 2, 2018, judgment was entered against Mr. Taradash in the amount of $250,000. On July 25, 2019, the court awarded attorneys fees and costs of $117,198.00, for a total of $367,198.00. The court also awarded postjudgment interest at the rate of ten percent. The court finds the plaintiff’s request for $36,719.00 for interest during the pendency of the appeal filed on January 28, 2019, and amended on September 30, 2019, to be reasonable and conservative. Because the amount sought in the prejudgment remedy is based on a judgment and prior rulings of this court, the court finds that the plaintiff has demonstrated probable cause in support of its application.
With respect to the other considerations mandated by § 52-578d(a), the court finds (1) no evidence that payment of a judgment ultimately rendered against the defendant is adequately secured by insurance, (2) no showing at this time of any exemption pertaining to property of the defendant, and (3) no showing justifying the requirement of a bond. As a result, the court finds that the plaintiff has established its prima facie case in support of the application for a prejudgment remedy.
C. The Defendant Has Failed to Establish the Defenses of Waiver and Judicial Estoppel
1. Waiver
In his opposition, the defendant claims that the application should be denied because the plaintiff waived the right to make any future applications for a PJR by operation of the language of the joint case management plan adopted by the court on June 20, 2017. The court disagrees.
As our Supreme Court held in the leading case of Perricone v. Perricone, 292 Conn. 187 (2009), "A waiver is ordinarily an intentional relinquishment or abandonment of a known right or privilege." Here, the parties are in complete agreement that they never discussed the topic of an application for a PJR pending appeal, as shown by counsels’ testimony at the hearing and by the relevant correspondence submitted as exhibits. Upon a review of the evidence, the court concludes that it was the plaintiff’s intent to waive the right to seek a PJR only before trial in connection with the parties’ agreement to follow an expedited schedule to obtain a determination on the merits more quickly.
On the one hand, it might be said that there was no meeting of the minds on the issue, which would be fatal to the contention of a binding agreement between the parties. Duplissie v. Devino, 96 Conn.App. 673, 688, cert. denied, 280 Conn. 916 (2006) ("If the minds of the parties have not truly met, no enforceable contract exists ..."). On the other hand, the defendant admits that the issue was never considered by his counsel, either. Under these circumstances, the court will not impute additional terms to the CMP. As our Supreme Court stated in Salce v. Wolczek, 314 Conn. 675, 694 (2014), "[W]e must discern the parties’ intent, in the first instance, from the language they used and not the language we think they might have chosen if confronted with this particular issue. See Tallmadge Bros., Inc. v. Iroquois Gas Transmission System, L.P., [ 252 Conn. 479, 500, 506 (2000)]; see also Williams v. Lilley, 67 Conn. 50, 59, 34 A. 765 (1895) (‘[w]e assume no right to add a new term to a contract, though it were clear that had the attention of the parties been called to it in all probability it would have been inserted’)."
Contrary to the defendant’s contention, the relevant language of the CMP is not determinative of the issue of plaintiff’s waiver. As set forth above, that language reads, "Stone Key shall withdraw with prejudice its Application for Prejudgment Remedy (Dkt. No. 102) and each party hereto waives any rights that any of them may otherwise have to seek a prejudgment remedy against any other party for the duration of this Action." This language contains two clauses: the first relating to the withdrawal of the plaintiff’s then pending PJR application against Mr. Taradash, and the second relating to the waiver of any right "of each party hereto" to seek a prejudgment remedy "against any other party for the duration of the Action." Because the first clause relates to the PJR pending between Stone Key and Mr. Taradash, the second clause must relate to something else, i.e., to PJR applications against other entities. As a result, it is not relevant to this dispute between the plaintiff Stone Key and the defendant Mr. Taradash.
To the extent that the meaning of the second clause is ambiguous, it may be interpreted by various maxims of construction. First, as our Supreme Court stated in Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 13-14 (2008), "Where the language is ambiguous ... we must construe those ambiguities against the drafter ..." In this case, the language of the second clause was supplied by the defendant’s counsel, and so would be construed against his position. Second, "Extrinsic evidence is always admissible ... to explain an ambiguity appearing in the instrument ... When the language of a contract is ambiguous, the determination of the parties’ intent is a question of fact ..." Casablanca v. Casablanca, 190 Conn.App. 606, 618 (2019). In this case, the extrinsic evidence is unequivocal, as discussed above, that there was no meeting of the minds as to the availability of a PJR pending appeal. As such, the CMP language cannot be held to establish an intentional waiver by the plaintiff of such a right.
As a result of the evidence presented and applicable law, the court finds that the defendant has not satisfied his burden of proving that the plaintiff waived its right to seek a PJR pending appeal.
2. Judicial Estoppel
The defendant also argues that plaintiff’s application is barred by the doctrine of judicial estoppel. The court disagrees. The Appellate Court in DePietro v. Dep’t of Pub. Safety, 126 Conn.App. 414, 420 n.2 (2011), stated "Our Supreme Court recently recognized that ‘[j]udicial estoppel prevents a party in a legal proceeding from taking a position contrary to a position the party has taken in an earlier proceeding ... [J]udicial estoppel serves interests different from those served by equitable estoppel, which is designed to ensure fairness in the relationship between parties ... The courts invoke judicial estoppel as a means to preserve the sanctity of the oath or to protect judicial integrity by avoiding the risk of inconsistent results in two proceedings ... Typically, judicial estoppel will apply if: (1) a party’s later position is clearly inconsistent with its earlier position; (2) the party’s former position has been adopted in some way by the court in the earlier proceeding; and (3) the party asserting the two positions would derive an unfair advantage against the party seeking estoppel ... We further limit judicial estoppel to situations where the risk of inconsistent results with its impact on judicial integrity is certain.’ (Citations omitted; internal quotation marks omitted.) Assn. Resources, Inc. v. Wall, 298 Conn. 145, 169-70, 2 A.3d 873 (2010)."
Defendant satisfies none of the above criteria. Plaintiff’s current application is not clearly inconsistent with the CMP, the CMP as accepted by the court applied to scheduling up to trial and no further, and the defendant does not demonstrate any unfair advantage accruing to plaintiff. Finally, defendant has demonstrated no impact on the judicial system as a result of allowing this PJR application to be made. As a result, the court holds that the defendant has failed to establish his defense of judicial estoppel.
Conclusion
As a result of the foregoing, and upon consideration of the facts before it and taking into account the defenses raised by the defendant, the court finds that the plaintiff has shown probable cause that a judgment will be rendered or sustained in the matter in its favor in the amount of the prejudgment remedy sought, and the court finds that a prejudgment remedy securing the judgment should be granted against the assets of the defendant in the amount of $403,917.00.
In a footnote at the end of his objection, the defendant requests that, if the court grants the motion for discovery of his assets, the plaintiff be required to first serve interrogatories for that purpose before requiring the defendant to travel from his current residence in the Philippines to Connecticut for a deposition. In a separate order, the court grants plaintiff’s motion for asset discovery and also grants defendant’s request that he first be served with asset interrogatories, which might eliminate the need for his deposition.