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Texaco Refining and Marketing, Inc. v. Samowitz

Supreme Court of Connecticut

February 13, 1990

TEXACO REFINING AND MARKETING, INC.
v.
Jack SAMOWITZ et al.

Argued Jan. 3, 1990.

Walter R. Hampton, Jr., Hartford, with whom were Donald L. Mackie, Canton, and, on the brief, Lawrence H. Lissitzyn, Hartford, for appellants (defendants).

Jerome A. Mayer, with whom was Kim E. Nolan, Bethel, for appellee (plaintiff).

Before PETERS, C.J., and ARTHUR H. HEALEY, SHEA, GLASS and HULL, JJ.

[213 Conn. 677] PETERS, Chief Justice.

This appeal concerns the validity, under General Statutes § 47-33a and the common law rule against perpetuities, of an option to purchase real property contained in a long-term commercial lease. The named plaintiff, Texaco Refining and Marketing, Inc., [1] brought an action for specific performance

Page 171

of an [213 Conn. 678] option contract against the defendants, Jack Samowitz, Alex Klein, Sheila Klein, Gloria Walkoff and Marilyn Moss, as successors in interest to the lessor of a lease executed and recorded in 1964. The trial court rendered judgment for the plaintiff, and the defendants have appealed. We transferred their appeal here in accordance with Practice Book § 4023. We find no reversible error.

The trial court relied on a stipulation between the parties for its finding of facts. On June 3, 1964, the named plaintiff and Kay Realty Corporation, the predecessor in interest of the defendants, [2] executed a lease for property in Southington. The term of the leasehold was fifteen years, subject to renewal by the lessee, the plaintiff, for three additional five year periods. The plaintiff exercised two of these options for renewal. [3]

The provision of the lease at issue in this appeal granted the plaintiff "the exclusive right, at lessee's option, to purchase the demised premises ... at any time during the term of this lease or an extension or renewal thereof, from and after the 14th year of the initial term for the sum of $125,000." On August 14, 1987, during the second renewal period under the lease, the plaintiff gave notification, by certified mail, of its exercise of its option to purchase. When the defendants[213 Conn. 679] refused to transfer the property, the plaintiff brought this action, on December 30, 1987, for a judicial order of specific performance.

The trial court found that the plaintiff had demonstrated that it was ready, willing and able to perform its obligations under the contract, and that the option contained in its lease was supported by consideration. Noting that the terms of the lease had originally been negotiated by two corporations bargaining at arm's length, the court concluded that the option was enforceable. The court expressly considered and rejected both the statutory and the common law defenses that the defendants reassert in this appeal. Although we do not necessarily subscribe to the trial court's reasoning, we concur in its judgment on alternate grounds. Bernstein v. Nemeyer, 213 Conn. 665, 669, 570 A.2d 164 (1990); Favorite v. Miller, 176 Conn. 310, 317, 407 A.2d 974 (1978).

I

The defendants base their statutory challenge to the timeliness of the plaintiff's exercise of its option on General Statutes § 47-33a(a). That subsection provides: "No interest in real property existing under an executory agreement for the sale of real 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 or, if the date is not so provided, longer than eighteen months after the date on which the agreement was executed, unless the interest is extended as provided herein or unless action is commenced within the period to enforce the agreement and notice of lis pendens is filed as directed by section 52-325." [4]

[213 Conn. 680]

Page 172

The defendants construe § 47-33a(a) as a statute of limitations under which the plaintiff's option to purchase did not "survive" to December 30, 1987, the date when the plaintiff brought its action for specific performance. Their principal argument is that the option to purchase contained in the June 3, 1964 lease provided no date for its exercise. They maintain, therefore, that § 47-33a(a) caused this option to expire in December, 1965, eighteen months after its execution. Alternatively, if some meaning must be assigned to the lease provision postponing the plaintiff's right to exercise its option for fourteen years after the execution of the lease, the defendants contend that, in order to comply with the mandate of § 47-33a(a), the plaintiff would have had to act within eighteen months of June 3, 1978. [5]

[213 Conn. 681] The trial court rejected the defendants' claims, concluding that the lease agreement could be construed to avoid conflict with § 47-33a(a). Since the lease permitted the plaintiff to exercise its option at any time between June 3, 1978, and June 3, 1994, it specified dates for performance that invoked the provision of § 47-33a(a) that allowed an "interest in real property ... [to] survive ... one year after the date provided in the agreement for the performance of it...." On that theory, the plaintiff was timely in filing its law suit on December 30, 1987. Any other construction of the lease, the court felt, would raise serious questions about the retroactive application ...


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