Opinion
No. CV06-4018253S
March 14, 2008
MEMORANDUM OF DECISION MOTION FOR SUMMARY JUDGMENT (#120)
FACTS
This action arises out of defendant, Scott Altschuler's, alleged non-payment of disputed loans and other funds to the plaintiff, Arleen Bacchiocchi. Mr. Altschuler's mother, claims he agreed to repay to her the alleged loans as well as other funds in exchange for her shares in the family business, Dee Allen Motors, Inc.
This action was commenced by service of process on the defendant on January 17, 2006. Ms. Bacchiocchi filed her amended two-count complaint on March 9, 2007. In count one she alleges that Altschuler failed to repay the $38,000 that she loaned to him on or about June 7, 2001 along with a loan of $8,200 that she made to him on or about October 2, 2001. According to the plaintiff, despite her demand, the defendant has refused to repay the balance.
In count two, Bacchiocchi alleges that she gave Altschuler her outstanding shares of capital stock in Dee Allen Motors, Inc., for a one-time payment from him of $20,000. She also alleges that as part of the stock sale, Altschuler agreed to pay to her a $500 monthly allowance for fifteen years, property taxes up to $6,000 on her home for fifteen years, and certain automobile and utility expenses for life. The plaintiff alleges that the defendant made some sporadic payments, but these payments are incomplete.
On November 2, 2007, the defendant filed a motion for summary judgment as to counts one and two of the plaintiff's amended complaint on the grounds that there are no genuine issues of material fact, that the plaintiff's claims are time-barred under the three-year limitations period of General Statutes § 52-581, and the alleged agreements violate the statute of frauds, General Statutes § 52-550. Altschuler filed a memorandum of law in support of his motion along with his affidavit and discovery responses. On November 29, 2007, Bacchiocchi countered by filing a memorandum of law in opposition to the defendant's motion along with her affidavit and numerous documents. The court then permitted Altschuler to file a supplemental memorandum of law on December 14, 2007, responding to Bacchiocchi's opposition. In his second memorandum, Altschuler raised the additional argument that he is entitled to summary judgment on count two because there is a second agreement requiring him to only pay Bacchiocchi $20,000 for the stock transfer; the agreement Bacchiocchi relies upon is void. Bacchiocchi then replied again with another filed memorandum in opposition on December 18, 2007.
DISCUSSION
"Practice Book § [17-49] provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted 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." (Internal quotation marks omitted.) Larobina v. McDonald, 274 Conn. 394, 399, 876 A.2d 522 (2005). "When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the non-moving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006). "In ruling on a motion for summary judgment, the court's function is not to decide issues of material fact, but rather to determine whether any such issues exist." Nolan v. Borkowski, 206 Conn. 495, 500, 538 A.2d 1031 (1988)."
"Summary judgment may be granted where the claim is barred by the statute of limitations . . . as long as there are no material facts concerning the statute of limitations in dispute." (Citation omitted.) Haggerty v. Williams, 84 Conn.App. 675, 678-79, 855 A.2d 264 (2004). "A summary judgment is proper where the affidavits do not set forth circumstances which would serve to avoid or impede the normal application of the particular limitations period." (Internal quotation marks omitted.) Collum v. Chapin, 40 Conn.App. 449, 453, 671 A.2d 1329 (1996).
The defendant Altschuler first argues that the lack of a written agreement for both of the alleged loans in count one means that the three-year limitation of § 52-581 applies, and this count is barred because the plaintiff Bacchiocchi did not commence this action within three years of the date that she made the loans. The plaintiff Bacchiocchi counters that the six-year limitations period of General Statutes § 52-576 rather than § 52-581 is the applicable statute of limitations because she completed her required performance, making the agreements between the parties "executed" contracts. She also contends that regardless of which limitations period applies, the period did not begin to run on the date of the agreements, but rather when she was injured by the Altschuler's breach of his obligations, or upon his rejection of her demand for payment.
Section 52-581 provides in relevant part: "Action on oral contract to be brought within three years. (a) No action founded upon any express contract or agreement which is not reduced to writing, or of which some note or memorandum is not made in writing and signed by the party to be charged therewith or his agent, shall be brought but within three years after the right of action accrues." Section 52-576 provides in relevant part: "Actions for account or on simple or implied contracts. (a) No action for an account, or on any simple or implied contract, or on any contract in writing, shall be brought but within six years after the right of action accrues . . ."
There is no doubt that oral contracts fall within the domain of both statutes. "This court has addressed the distinction between §§ 52-581 and 52-576. These two statutes, each establishing a different period of limitation, can both be interpreted to apply to actions on oral contracts. Our Supreme Court has distinguished the statutes, however, by construing § 52-581, the three year statute of limitations, as applying only to executory contracts . . . A contract is executory when neither party has fully performed its contractual obligations and is executed when one party has fully performed its contractual obligations . . . It is well established, therefore, that the issue of whether a contract is oral is not dispositive of which statute applies. Thus, the . . . argument that § 52-581 automatically applies to the oral contract between the parties is incorrect. The determinative question is whether the contract was executed." (Emphasis in original; internal quotation marks omitted.) Bagoly v. Riccio, 102 Conn.App. 792, 799, 927 A.2d 950, cert. denied, 284 Conn. 931 (2007).
Altschuler's affidavit states, "I never received a loan from my mother Arleen Bacchiocchi in the amount of $38,000 on or about June 7, 2001 or at any time. There was never any agreement, written or oral, for me to borrow or repay such sum." The defendant asserts the same thing about the alleged $8,200 loan. Altschuler goes on to assert, "I never made any payments on or prior to October 2, 2002 towards these nonexistent loans, or at any time after said date . . ." In his response to an interrogatory he states, "I did not receive any loans from my [m]other in 2001 or any other time. However, I may have received a gift of money and/or she may have made payments on my behalf unbeknownst to me, if so only she would know when and how such payments were made or whether it was in the nature of a gift. Plaintiff did not tell me about it and certainly did not discuss any such supposed loans with me."
Bacchiocchi states in her affidavit that "[o]n or about June 7, 2001, I loaned to the [d]efendant Scott Altschuler the sum of $38,000 . . ." She also states that on or about October 2, 2001, she loaned the defendant $8,200. She submitted bank statements with notations indicating the money that was deposited into, what she asserts, Altschuler's account. She also submitted cancelled checks indicating that Altschuler made payments to creditors, as evidence that the checks she wrote to Altschuler were loans, meant to help him pay his bills. Moreover, she submitted documents showing that between February 25, 2002 and October 24, 2003, Altschuler, through his business, paid her nine payments of $500 and one payment of $840. In his affidavit, Altschuler claims that "[o]n occasion [p]laintiff would request money from me claiming that she needed it and I would advance it to her and she now must be trying to claim that same were loan repayments which in fact they are not." Based on this evidence, genuine issues of material fact exist as to whether the plaintiff gave the money in question to the defendant in the form of loans, and whether the plaintiff Bacchiocchi completed her part of the alleged agreement.
The question then of whether § 52-581 or § 52-576 applies to the dispute depends upon the resolution of the question as to whether the alleged agreements constitute executory or executed contracts. A genuine issue of material fact remains about what the parties agreed to, and accordingly, the defendant Altschuler's motion for summary judgment on count one, based on § 52-581, is denied.
COUNT TWO
Defendant Altschuler argues that count two is also barred by the three-year limitation period of § 52-581. Bacchiocchi, in her memorandum in opposition to the defendant's motion, argues that her claims "in the second count arise from an agreement that the [p]laintiff alleges was entered into between herself and the [d]efendant, based on an offer contained in a letter dated January 24, 2000 . . ." She attached a letter addressed to her from Mark I. Harrison, which outlines separate discussions Harrison had with each party. In the letter, Harrison called for Bacchiocchi to transfer stock in Dee Allen Motors, Inc., to Altschuler. In return, Altschuler was to pay Bacchiocchi's automobile-related expenses, along with some other bills, for a total value of approximately $6,000 to $6,500 per year for the rest of Bacchiocchi's life. The letter also states that for fifteen years Altschuler was to pay the plaintiff's real estate taxes, in an amount not to exceed $6,000 per year, and pay to her an additional $500 per month.
The plaintiff argues that her claims are not barred by the statute because she completed her performance under the alleged agreement when she transferred her stock in Dee Allen Motors, Inc., to Altschuler. As a result, she argues the contract is executed, not executory, and therefore § 52-576 not § 52-581 applies.
In reference to the letter from Harrison, the defendant stated in his affidavit that the proposed forms of payment to Bacchiocchi "were discussed between [p]laintiff and attorney Mark Harrison, the lawyer for my late father's estate. He was never authorized by me to make any binding proposals nor enter into any such agreements and he did not do so to the best of my knowledge." Altschuler denies that he ever agreed to make any payments to Bacchiocchi. He does not, however, dispute Bacchiocchi's contention that she transferred the shares of stock to him. In John H. Kolb Sons, Inc. v. G L Excavating, Inc., 76 Conn.App. 599, 821 A.2d 774, cert. denied, 264 Conn. 919, 828 A.2d 617, (2003), the court held that "the plaintiff had performed all of its contractual obligations fully by obtaining the insurance on behalf of the defendant. All that remained was for the defendant to provide payment for the plaintiff's services. As a result, the contract was not executory in nature, and the six year statute of limitations in § 52-576 applied." John H. Kolb Sons, Inc. v. G L Excavating, Inc., supra, 76 Conn.App. 610.
Further, in both his answer and his affidavit, the defendant specifically states that he never agreed to pay $20,000 to the plaintiff on or about January of 2000, or at any time. He also attests in his affidavit that "there is no written agreement in existence to substantiate any of [p]laintiff's claims and that any allegations by [p]laintiff that such agreements exist are false. Regardless, it is my understanding that she is time barred pursuant to the applicable statutes from pursuing these supposed claims in the absence of any written agreement executed by both me and her." In his supplemental memorandum of law, the defendant Altschuler argues that a January 31, 2000 written agreement regarding the transfer of stock supersedes the letter from Harrison. The defendant attached a copy of the agreement to his memorandum. Paragraphs two and three of the agreement state, "[t]he purchase price for the Shares (the "Purchase Price") shall be Twenty Thousand ($20,000) Dollars. The Twenty Thousand ($20,000) Dollars shall be paid by Purchaser [defendant] to Seller [plaintiff] with lawful money at the closing . . . The closing date shall be February 4, 2000 and shall take place at the offices of Mark I. Harrison, P.C. commencing at 10:00 a.m. on the closing date . . ."
Thus, genuine issues of material fact regarding the nature of the parties' agreement, whether it was written or oral, and whether the plaintiff completed her performance based upon the claims in count two remain. Again, the issue of whether § 52-581 or § 52-576 applies depends on the resolution of these issues. Accordingly, the defendant's motion on count two is denied.
Bacchiocchi argues that even if the court holds that it can decide which statute to apply, summary judgment should still fail because she filed suit within the time allowed. She claims that if the statute of limitations began to run on both counts at the time of the agreements, the lawsuit, filed on January 11, 2006, commenced within the amount of time allowed under § 52-576 since the alleged loans in count one were purportedly agreed to in June and October of 2001, and the alleged agreements related to the stock sale in count two occurred on either January 24, 2000, or January 31, 2000. Were the court to hold that § 52-581 applies, then the plaintiff claims the moment she made her demand for payment is the moment the statute began to run. Attached to Altschuler's motion is an August 1, 2005 letter, from the plaintiff's attorney to him, demanding he pay to Bacchiocchi the funds presently in dispute. The date of the letter falls within three years of the date of the plaintiff's lawsuit. Nevertheless, defendant Altschuler claims that if the court applies § 52-581 to an accrual point from the time of the agreements, then that would place the lawsuit outside of the three-year time period the statute allows.
"In an action for breach of contract . . . the cause of action is complete at the time the breach of contract occurs, that is, when the injury has been inflicted . . . If a plaintiff seeking to collect on a promissory note exercises his option to accelerate, the cause of action accrues at the time of the demand . . ." (Citation omitted; internal quotation marks omitted.) Premier Capital, Inc. v. Grossman, 82 Conn.App. 390, 394, 845 A.2d 442, cert. denied, 271 Conn. 901, 859 A.2d 564 (2004). "The fact that a cause of action may have accrued with respect to an installment in default does not necessarily mean that a cause of action has also accrued against future installments that are not even due . . . When acceleration of the total unpaid debt is optional on the part of the holder of a note, and the holder has given no indication to the debtor that the entire balance is presently due, the cause of action does not accrue until that balance is due pursuant to the particular note or the holder has notified the debtor of an earlier date." (Internal quotation marks omitted.) Florian v. Lenge, 91 Conn.App. 268, 280, 880 A.2d 985 (2005).
There exists a genuine issue of material fact. Altschuler's second argument is that the plaintiff's claims are barred due to General Statutes § 52-550, providing in relevant part: "Statute of frauds; written agreement or memorandum. (a) No civil action may be maintained in the following cases unless the agreement, or a memorandum of the agreement, is made in writing and signed by the party, or the agent of the party, to be charged . . . (5) upon any agreement that is not to be performed within one year from the making thereof . . ."
He argues that both the alleged agreement involving the two loans and the alleged agreement involving his payments to the plaintiff Bacchiocchi of a monthly stipend for fifteen years, automobile expenses for life, and real estate taxes for fifteen years, could not be completed within one year of the agreement. "It is the law of this state, as it is elsewhere, that a contract is not within this clause of the statute unless its terms are so drawn that it cannot by any possibility be performed fully within one year." Burkle v. Superflow Mfg. Co., 137 Conn. 488, 492, 78 A.2d 698 (1951).
Nevertheless, "[i]t is axiomatic that [w]here the time for performance is definitely fixed at more than one year, the contract is, of course, within the statute . . . Our most apposite precedent, however, comports with the majority view that a contact of indefinite duration is not subject to the one year provision of the statute of frauds . . . Under the prevailing interpretation, the enforceability of a contract under the one year provision does not turn on the actual course of subsequent events, nor on the expectations of the parties as to the probabilities. Contracts of uncertain duration are simply excluded; the provision covers only those contracts whose performance cannot possibly be completed within a year." (Citations omitted; emphasis in original; internal quotation marks omitted.) Jacobs v. Thomas, 26 Conn.App. 305, 311-12, 600 A.2d 1378 (1991), cert. denied, 221 Conn. 914, 603 A.2d 404 (1992).
It was possible for Altschuler to have paid Bacchiocchi for the alleged loans referred to in count one within one year. There is no evidence that the parties reached an agreement about the repayment time frame. As a result, the statute of frauds does not apply to the disputed loans in count one.
According to Altschuler, if the conditions outlined in the letter from Harrison were found to be valid, they would be barred by the statute of frauds because they are to be performed for specified time periods that are longer than a year. Bacchiocchi counters that her performance along with the defendant's partial performance of the alleged agreement means that the statute of frauds does not apply.
"[A] contract is enforceable, despite the statute [of frauds], when, subsequent to the making of the contract, there has been conduct that amounts to part performance . . . Generally, issues involving motive and intent are not properly resolved on a motion for summary judgment . . . Even with respect to questions of motive and intent, however, the party opposing summary judgment must present a factual predicate for his argument in order to raise a genuine issue of fact." (Citations omitted; internal quotation marks omitted.) Union Trust Co. v. Jackson, 42 Conn.App. 413, 419-20, 679 A.2d 421 (1996). "As stated in the Restatement, Contract, Second § 130(2): When one party to a contract has completed his performance, the one year provision of the Statute does not prevent enforcement of the promises of the other parties." (Internal quotation marks omitted.) Altus Group v. Building Technology Engineers, Inc., Superior Court, judicial district of Hartford, Docket No. CV 04 4000029 (February 6, 2007, Satter, J.T.R.). "The elements required for part performance are: (1) statements, acts or omissions that lead a party to act to his detriment in reliance on the contract; (2) knowledge or assent to the party's actions in reliance on the contract; and (3) acts that unmistakably point to the contract . . . Under this test, two separate but related criteria are met that warrant precluding a party from asserting the statute of frauds . . . First, part performance satisfies the evidentiary function of the statute of frauds by providing proof of the contract itself . . . Second, the inducement of reliance on the oral agreement implicates the equitable principle underlying estoppel because repudiation of the contract by the other party would amount to the perpetration of a fraud," (Citations omitted; internal quotation marks omitted.) Glazer v. Dress Barn, Inc., 274 Conn. 33, 62-63, 873 A.2d 929 (2005).
Bacchiocchi provided evidence that Altschuler paid monthly payments and real estate tax payments. The parties provided contradictory evidence regarding the issue of partial performance. In such circumstances, "[t]he determination of whether any acts by [a party] occurred that amounted to part performance requires a factual finding properly submitted to the jury." Fleet Bank N.A. v. Galluzzo, 33 Conn.App. 662, 666, 637 A.2d 803, cert. denied, 229 Conn. 910, 642 A.2d 1206 (1994).
In fact, "[m]uch of our case law relating to the doctrine of part performance includes either cases tried to the trial court, in which the court may properly make findings of fact, or cases sustaining a party's demurrer or motion to strike, a circumstance in which the trial court is required to decide whether the party's actions constitute part performance as a matter of law. Confronted with a motion for summary judgment, a trial court may not conclude the nature of a party's conduct in the area of contract law." Fleet Bank, N.A. v. Galluzzo, supra, 33 Conn.App. 666 n. 5. Uncertainty regarding the parties' conduct means the motion for summary judgment based on § 52-550 should be denied, and that the matter should be brought before the fact finder.
CONCLUSION
Based on the foregoing, Altschuler's motion for summary judgment is denied as there remains genuine issues of material fact in both counts one and two.