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O'Sullivan v. Bergenty

Supreme Court of Connecticut

April 24, 1990

William S. BERGENTY.

Argued Jan. 30, 1990.

[214 Conn. 642] William J. Sweeney, Jr., New Britain, for appellant (defendant).

T.J. Donohue, Jr., with whom was Charles M. Rice, Jr., Hartford, for appellee (plaintiff).


GLASS, Associate Justice.

The plaintiff, Kevin C. O'Sullivan, brought this action against the defendant, William S. Bergenty, in two counts, the first seeking specific performance of a contract to convey real estate, and the second seeking money damages. The trial court rendered judgment [214 Conn. 643] of specific performance in favor of the plaintiff, but denied money damages. We find no error.

The facts found by the trial court, as reflected in the record, are essentially as follows. The real estate involved in this action is commercial property that is owned by Bergenty, and located at 433 Farmington Avenue in Plainville. O'Sullivan had leased the property from Bergenty for approximately eight years, and during that time O'Sullivan had owned and operated several automobile sales businesses on the property. The rental payments for the property ranged from $1000 to $1300 per month.

Throughout the course of the eight year landlord-tenant relationship, there had been continuous negotiations between the parties for the purchase of the property by O'Sullivan. In the spring or summer of 1984, the negotiations resulted in a proposed draft agreement which, on December 20, 1984, became a signed and witnessed buy-sell agreement. Neither O'Sullivan nor Bergenty, nor any witness to the agreement, denied the execution of the written agreement. The written agreement consisted of two parts,

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a written contract [1] and [214 Conn. 644] a promissory note. [2] The written contract provided, in part, that payment was to be made: "By tendering seller at time of closing a properly executed purchase money mortgage in the principal amount of $175,000 payable over of (sic) 180 consecutive months commencing 30 days after closing in equal monthly installments of $2,100.30 each until said mortgage note is fully paid. Said principal[214 Conn. 645] amount shall bear interest at the rate of 12% per annum. The A.P.R. may vary at option of buyer." The promissory note, which was for $25,000, was executed by O'Sullivan on December 20, 1984, and was made payable to Bergenty. It was tied to the agreement by providing that it "shall be paid in full on or Before the date of closing for property described in the Buy-Sell Agreement dated December 20, 1984 between said KEVIN C. O'SULLIVAN and WILLIAM BERGENTY." The date set in the contract for the closing or transfer of title was January 10, 1986, which was approximately thirteen months after the date of execution of the agreement. The reason

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for the delay was to accommodate Bergenty for income tax purposes. O'Sullivan and Bergenty further testified that the two documents taken together comprised the entire agreement, that the agreement had been understood by them, that it had been properly executed, and that it was fair when made. Bergenty also testified that it was his understanding that a condition precedent to the completion of the transaction was for O'Sullivan to continue to pay monthly rent up to the date of the closing. The trial court found that, in reliance on the agreement, O'Sullivan continued his tenancy on the property, made monthly rental payments, and maintained[214 Conn. 646] and improved the property with renovations, including a roof repair and a change in the door opening to the garage. In further reliance on the agreement, on June 10, 1985, O'Sullivan entered into a five year sublease of the premises in connection with a buy-sell agreement for a portion of the property with a sublessee. Bergenty was aware of the sublease, and at the time of the trial, the sublessee continued to occupy a substantial portion of the premises. In sum, the trial court found that "[a]fter the execution of the contract and his signing of the $25,000.00 promissory note, [plaintiff]--O'Sullivan was clearly acting in reliance upon the expectation that the agreement would be consummated in January of 1986."

The trial court found further that, at trial, Bergenty confirmed his belief that he had been obligated to proceed with the conveyance at all times up to and including January 10, 1986. O'Sullivan testified that several times prior to January 10, 1986, and twice between January 10 and January 20, 1986, he called Bergenty to request a closing on the property. At trial, however, Bergenty did not recall these telephone calls. Specifically, Bergenty and his attorney testified that neither one had done anything in furtherance of any closing prior to February, 1986. O'Sullivan additionally testified that he had engaged in conversations with Bergenty "half a dozen times" during December, 1985, and at no time did Bergenty lead him to believe that he would not sell him the property. Both O'Sullivan and Bergenty testified, however, that on January 20, 1986, O'Sullivan called Bergenty requesting a closing of the transaction. Bergenty, in confirming the call, admitted at trial, that he renounced the contract at that time, stating: "We have no deal." Bergenty testified that the reason for his election not to close at that time was that O'Sullivan had missed the January 10, 1986 closing date.

[214 Conn. 647] At trial, Bergenty asserted that O'Sullivan's claims for specific performance of the contract and for money damages were unfounded because: (1) the contract was not enforceable because it was not in accordance with the requirements of the statute of frauds; (2) the contract term "A.P.R." was not defined with reasonable certainty and therefore there was no enforceable agreement; (3) O'Sullivan was never ready, willing and able to perform in accordance with the terms of the contract; and (4) O'Sullivan had failed to establish the applicability of the doctrine of part performance. The trial court found, however, that Bergenty's conduct made it impossible for O'Sullivan to establish a closing date, and on the basis of the facts found, the trial court concluded "that the plaintiff--O'Sullivan ha[d] established the applicability of the doctrines of equitable estoppel and of detrimental reliance." As a result, the trial court held that Bergenty was estopped from asserting his statute of frauds defense. In addition, the trial court held that O'Sullivan had met his burden of proving that he was ready, willing and able at all times to purchase the property, and thus was entitled to specific performance. In view of these conclusions, the trial court held that it was unnecessary for it to consider Bergenty's arguments concerning the "A.P.R." clause and part performance. Consequently, a judgment was rendered in favor of O'Sullivan and specific performance of the contract was ordered. This appeal then followed.

On appeal, Bergenty claims that the trial court erred in concluding: (1) that O'Sullivan had established the applicability of the doctrines of equitable estoppel and detrimental reliance; (2) that an enforceable

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agreement existed between the parties; and (3) that O'Sullivan was ready, willing and able to close, and thus had established ...

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