Opinion
FSTCV166029248S
06-30-2017
Lanphier Day Spa, Inc. v. Urstadt Biddle Properties, Inc.
UNPUBLISHED OPINION
MEMORANDUM OF DECISION re MOTION TO REARGUE (#127.00)
Kenneth B. Povodator, J.
The defendant, Spa Thea, LLC d/b/a Andrew Stefanou d/b/a Andrew Stefanou Salon and Spa (hereafter, Stefanou) has moved to reargue (or for reconsideration) with respect to the court's decision on its motion for summary judgment, granting the motion only in part. The defendant contends that the applicable principles of law required the granting of the motion with respect to all claims directed to it. In light of the moderately detailed recitation of the factual background in the memorandum of decision on the motions for summary judgment (#113.01 as modified by #113.02), the court will only briefly/minimally recite the history and context.
For many years, pursuant to a lease, the plaintiff operated a salon/spa on premises owned by codefendant Urstadt Biddle Properties, Inc. The plaintiff's lease was not renewed or extended when it expired, effective the end of November 2011. An eviction proceeding was commenced against the plaintiff in December 2011, resulting in a stipulated judgment in January 2012 in the Housing Session. Pursuant to that stipulated judgment, the plaintiff was given approximately six months in which to vacate the premises and relocate to a new location, at which time (or shortly thereafter) defendant Stefanou opened and began operating a similar business at the same location.
In 2016, this action was commenced. The claims against defendant Stefanou were tortious interference with contractual relationships, conversion, unjust enrichment, and fraudulent concealment/misrepresentation. Defendant Stefanou, as well as all but one of the other defendants, moved for summary judgment. With respect to this defendant, the court granted summary judgment except as to the claim of unjust enrichment.
In seeking reargument, the defendant contends that the court did not adequately discuss and apply the claim being advanced that the unjust enrichment claim was barred by the statute of limitations because the conversion claim, asserted in the same count, was barred by the statute of limitations. At the outset, the court notes that while the defendant did cite a case for the proposition that a disposition of a legal claim based on the statute of limitations should control the disposition of an equitable claim arising from the same facts, on a similar basis, there was no real discussion as to why that principle/contention was applicable in this case. As discussed below, the court does not believe that it applies under these circumstances.
The court will assume broad applicability of Certain Underwriters at Lloyd's, London v. Cooperman, 289 Conn. 383, 957 A.2d 836 (2008) as cited by the defendant. However, the court must note that there necessarily are limits, as broad applicability would be inconsistent with the language of prior (and subsequent) cases, relating to the option of the trial court to follow a legal statute of limitations in connection with similar or related equitable claims.
The fallacy in the defendant's argument is his assumption that a court, acting under its equitable powers, is bound to apply the statute of limitations that governs the underlying cause of action. In fact, in an equitable proceeding, a court may provide a remedy even though the governing statute of limitations has expired, just as it has discretion to dismiss for laches an action initiated within the period of the statute. Although courts in equitable proceedings often look by analogy to the statute of limitations to determine whether, in the interests of justice, a particular action should be heard, they are by no means obliged to adhere to those time limitations. (Internal quotation marks and citations, omitted.) Rossman v. Morasco, 115 Conn.App. 234, 974 A.2d 1 (2009).
To be sure, Rossman is an Appellate Court decision, but in the decision, the court cited and relied upon numerous Supreme Court decisions which, for brevity, this court has omitted from the quoted passage. (Note that Certain Underwriters was a 2008 decision that had been released the year prior to Rossman .)
Indeed, Certain Underwriters relied explicitly on Dowling v. Finley Associates, Inc., 49 Conn.App. 330, 714 A.2d 694 (1998); overruled on other grounds, 248 Conn. 364, 727 A.2d 1245 (2009), but that case involved a single statutory cause of action allowing for both legal and equitable remedies. The trial court in Certain Underwriters quoted the relevant language from Dowling in the final substantive paragraph of its decision: " Where a party seeks equitable relief pursuant to a cause of action that would allow the party to seek legal relief concurrent legal and equitable jurisdiction exists, and the statute of limitations that would be applicable to bar the legal claim also applies to bar the equitable claim." Certain Underwriters at Lloyd's, London v. Cooperman, J.D. Hartford, X03 CV 03 4022302 S, (October 27, 2006). In other words, the underlying decision relied upon the totally unremarkable proposition that the statute of limitations was not relief-oriented but rather governed by the nature of the cause of action.
In the present case, although advanced in a single count, the situation is clearly distinct from that situation--two distinct causes of action, one equitable and one statutory, and not actually relying on identical facts. To the contrary, it is not clear that any facts were alleged that might have supported the conversion claim, such that it is questionable whether it can be said with any confidence that the claims rely upon the same facts.
Paragraph 113 of the fifth count appears to state the key operative facts for purposes of the claims in that count: " The defendants URSTADT and or UB and STEFANOU, without authorization assumed the space of LANPHIER, taking its business, goodwill and fixtures without paying a fair and reasonable price." Paragraph 114 goes on to assert injury " as a direct and proximate result of the conversion [by the defendant] who [has] been unjustly enriched."
Perhaps in a literal sense, the defendant is correct in stating that the facts alleged as to each cause of action are identical because the allegations are in a single count. However, the focus necessarily must be on the facts provable or proven rather than simple allegations, or else the outcome is likely to be dictated by the precision of pleading practice rather than substance. (The court notes the common practice of virtually identical allegations for breach of contract and unjust enrichment, pleading in the alternative, with the inability to prove existence of a contract typically the factor that would lead to consideration of the unjust enrichment claim.) Under the defendant's interpretation, the exception would swallow the rule.
Here, the claim of conversion and the claim of unjust enrichment would depend on proof of different facts, and it is questionable whether any of the facts alleged might support a claim of conversion. The court cannot ignore the fact that in alleging the " taking [of] its business, goodwill and fixtures, " it is uncertain whether the plaintiff has asserted a viable cause of conversion, and it is clear that at least some of the allegations cannot be part of a valid claim of conversion under current law. The court rejects the notion that a defective claim of conversion must preclude, on a statute of limitations basis, a claim of unjust enrichment that may not be similarly defective. In other words, the rule relied upon by the defendant presumes potentially valid causes of action that are duplicative if not congruent, and that is not the situation here.
The tort of conversion requires a chattel, something tangible (personal property), as having been taken or misappropriated. See, e.g. Aetna Life and Casualty Co. v. Union Trust Co., 230 Conn. 779, 790-91, 646 A.2d 799 (1994) (and also footnote 6 therein). Generally, a fixture is deemed part of the realty. ATC Partnership v. Town of Windham, 268 Conn. 463, 472, 845 A.2d 389 (2004). Conversion does not apply to realty. See, Barretta v. Barretta, J.D. Ansonia/Milford at Milford, CV095009664S (August 18, 2011) [52 Conn.L.Rptr. 456, ], discussing cases claimed to create exception to rule that conversion only applies to tangible personal property. Further, even if fixtures were deemed personal property for purposes of conversion, there would remain the claims of the taking of the plaintiff's business and good will. The taking of the business appears not to be a claim of taking of something tangible but rather something in the nature of a going concern value, and it would appear to be indisputable that the claim of a taking of good will relates to a wholly-intangible right.
In short, the claims set forth in the fifth count are legally distinct, notwithstanding the pleading structure of a single count, and it is far from clear--perhaps more accurately, doubtful--that there is a duplication of provable facts relating to conversion and unjust enrichment. Note that for purposes of the underlying motion for summary judgment and this subsequent motion to reargue, the court need not determine these issues conclusively but only needs to note that the moving party did not establish its entitlement to judgment, notwithstanding these substantial concerns.
The fact that the defendant chose to attack the entire count on the basis of the statute of limitations did not require the court to treat the count as a unitary cause of action, and as articulated in its earlier decision, the court treated the two separate claims as distinct (because they are). Further, the fact that the defendant chose to attack the count, and especially the conversion claim, on the basis of a statute of limitations defense, in no way interferes with or controls the court's treatment of the unjust enrichment claim. In other words, the fact that the conversion claim was potentially defective on a number of levels, and the defendant's choice to rely on the most straightforward and perhaps simplest attack, does not preclude the court's analysis of the count as implicating distinct causes of action relying upon at least partially distinct factual predicates (or perhaps more accurately, not necessarily relying on the same facts). This perhaps can be emphasized by noting that if the defendant had moved for summary judgment on the conversion claim based on the contention that the alleged conduct did not constitute conversion (due to the lack of any personal property claimed to have been taken/appropriated), that would not affect a possible claim of unjust enrichment based on the allegations in the complaint, to the extent that the facts alleged might support a claim of unjust enrichment.
The court recognizes that there might be required consideration of principles articulated in Larobina v. McDonald, 274 Conn. 394, 404-05, 876 A.2d 522 (2005), were the defendant to have moved for summary judgment effectively based on legal insufficiency of the complaint.
None of the motions for summary judgment required the court to consider the actual merits of the claims of conversion or unjust enrichment. Just as in its early decision the court was not concerned with whether the plaintiff could prove conversion based on an alleged taking of the business, goodwill, and fixtures, so too the court is not concerned with the ability of the plaintiff to prove its claims under a theory of unjust enrichment, e.g. how fixtures left behind when leaving leased premises might amount to unjust enrichment to a new tenant; the court is required to decide the motion based on the issues raised by the moving parties. Unjust enrichment is an equitable claim, and while the court might look to " legal" statutes of limitation for guidance, only in limited circumstances might the court be compelled to apply a statutory limitation period in connection with a free-standing equitable claim such as unjust enrichment. The defendant has not established why any " legal" statute of limitations applies as a matter of law, and especially a three-year tort statute of limitations.
Conclusion
The defendant has identified an area that the court did not address with specificity, in part because it was not discussed in any detail by this defendant. To the extent that that might justify allowing reargument or reconsideration, the court has reconsidered the issue in more detail, but has concluded that the situation involving this defendant does not mandate utilization of the tort statute of limitations with respect to the claim of unjust enrichment. As discussed in Rossman, equitable claims generally may be guided but not controlled by an explicit statute of limitations. Some limited situations might warrant direct application of the applicable statute of limitations, but this case is not such a case. The defendant has not demonstrated that the facts are the same; there is a duplication of allegations, but that is a matter of pleading style, not necessarily facts.
Accordingly, the court has granted the motion for the limited purpose of reconsideration (or from an alternate perspective, has treated it as a motion for articulation), but denies any relief in the nature of a substantive change to the court's earlier decision-the defendant has not established a right to judgment based on a right to have the tort limitation period applied to the equitable claim of unjust enrichment.