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Aircastle Advisor, LLC v. ESRT First Stamford Place SPE, LLC

Superior Court of Connecticut, Judicial District of Stamford-Norwalk, Stamford

September 6, 2017

Aircastle Advisor, LLC
v.
ESRT First Stamford Place SPE, LLC

          MEMORANDUM OF DECISION PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT #114 DEFENDANT'S MOTION FOR SUMMARY JUDGMENT #120

          Irene P. Jacobs, J.

         BACKGROUND

         This action arises out of a lease between a tenant plaintiff and landlord defendant. In the first count of its October 31, 2016 complaint, the plaintiff seeks declaratory judgments that it effectively terminated the lease pursuant to the terms of the operative lease and that said lease expires on December 31, 2017. In the second count, the plaintiff alleges the defendant's breach of contract for failing to accept the plaintiff's notice of termination. In its December 14, 2016 answer and counterclaim [#103], the defendant seeks a declaratory judgment that the plaintiff has not effectively exercised the termination option. The defendant also alleges that the plaintiff's attempted termination constitutes breach of contract and default of its obligations under the lease.

         On January 11, 2017, the plaintiff filed its answer and special defenses [#106], alleging that the defendant had failed to mitigate damages with respect to its breach of contract claim. On January 12, 2017, the defendant filed its reply [#107].

         On April 7, 2017, both parties filed the instant motions for summary judgment. The plaintiff moves for summary judgment as to liability on both counts of the complaint. The defendant moves for summary judgment on the complaint and on the plaintiff's counterclaim. Both parties submitted numerous affidavits and exhibits in support of their motions. On April 28, 2017, both parties filed objections to the opposing party's motion, with supporting memoranda of law [#124, #126]. On May 8, 2017, both parties filed reply memoranda [#128, #129]. The matter was heard at short calendar on May 15, 2017.

         In its complaint, the plaintiff alleges the following facts, which facts are undisputed by the defendant. On July 28, 2005, the plaintiff entered into a lease agreement with the predecessor in interest of the defendant for space on the fifth floor of 300 First Stamford Place in Stamford for a term of eight years. On August 9, 2007, the plaintiff entered into a lease modification agreement with the then landlord which expanded the space available to the plaintiff. On January 30, 2012, the plaintiff entered into a second lease modification agreement with a successor landlord, which extended the term of the lease until December 31, 2022, and which included a termination option whereby the plaintiff could cancel the lease effective December 31, 2017, provided that sufficient notice is given to the defendant, that the plaintiff remained a tenant under the lease, and the plaintiff remain in occupancy of the entire premises. On July 29, 2013, the plaintiff entered into a sublease agreement with Marubeni American Corporation (Marubeni), as well as a consent agreement to the sublease between the plaintiff, the landlord, and Marubeni. Pursuant to the sublease, the plaintiff sublet a portion of the office space to Marubeni. Subsequently, the defendant acquired the building and became the successor in interest to the previous landlords. On September 28, 2016, the plaintiff gave notice to the defendant that it was exercising the termination option as set forth in the second modification of the lease. On October 7, 2016, the defendant sent a rejection notice to the plaintiff, stating that the plaintiff was not in occupancy of the entire premises as a result of the sublease. On October 14, 2016, the plaintiff sent a reply notice to the defendant, in which it stated that it remained in occupancy of the entire premises, notwithstanding the sublease, and requested that the defendant withdraw its rejection notice. The defendant did not withdraw its rejection notice.

         DISCUSSION

         " [S]ummary 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.) Cefaratti v. Aranow, 321 Conn. 637, 138 A.3d 837 (2016).

         " [T]he genuine issue aspect of summary judgment requires the parties to bring forward before trial evidentiary facts, or substantial evidence outside the pleadings, from which the material facts alleged in the pleadings can warrantably be inferred . . . A material fact has been defined adequately and simply as a fact which will make a difference in the result of the case." (Citation omitted; internal quotation marks omitted.) Buell Industries, Inc. v. Greater New York Mutual Ins. Co., 259 Conn. 527, 791 A.2d 489 (2002). " A genuine issue has been variously described as a triable, substantial or real issue of fact . . . and has been defined as one which can be maintained by substantial evidence." (Citation omitted; internal quotation marks omitted.) United Oil Co. v. Urban Redevelopment Commission, 158 Conn. 364, 260 A.2d 596 (1969) . 'Issue of fact' encompasses not only evidentiary facts in issue but also questions as to how the trier would characterize such evidentiary facts and what inferences and conclusions it would draw from them." Id., 379.

         General Statutes § 52-29(a) states: " [t]he Superior Court in any action or proceeding may declare rights and other legal relations on request for such a declaration, whether or not further relief is or could be claimed. The declaration shall have the force of a final judgment." Trial Courts are afforded wide discretion in rendering declaratory judgment. Leoni v. Water Pollution Control Authority, 21 Conn.App. 77, 571 A.2d 153 (1990). " The purpose of a declaratory judgment action . . . is to secure an adjudication of rights where there is a substantial question in dispute or a substantial uncertainty of legal relations between the parties." Bysiewicz v. DiNardo, 298 Conn. 748, 6 A.3d 726 (2010). Practice Book § 17-55 states: " A declaratory judgment action may be maintained if all of the following conditions have been met: (1) [t]he party seeking the declaratory judgment has an interest, legal or equitable, by reason of danger of loss or of uncertainty as to the party's rights or other jural relations; (2) [t]here is an actual bona fide and substantial question or issue in dispute or substantial uncertainty of legal relations which requires settlement between the parties; and (3) [i]n the event that there is another form of proceeding that can provide the party seeking the declaratory judgment immediate redress, the court is of the opinion that such party should be allowed to proceed with the claim for declaratory judgment despite the existence of such alternate procedure." The court finds that the conditions set forth in Practice Book § 17-55 have been met in the instant case and that consideration of the issuance of declaratory judgments is appropriate. Bishop's Corner 247 Conn. 192 (1998).

         Termination Option of the Lease

         " [A] lease is a contract . . . As a contract, a lease is subject to the same rules of construction as other contracts." (Citation omitted; internal quotation marks omitted.) David Caron Chrysler Motors, LLC v. Goodhall's, Inc., 304 Conn. 738, 43 A.3d 164 (2012). " In construing a written lease, which constitutes a written contract, three elementary principles must be kept constantly in mind: (1) The intention of the parties is controlling and must be gathered from the language of the lease in the light of the circumstances surrounding the parties at the execution of the instrument; (2) the language must be given its ordinary meaning unless a technical or special meaning is clearly intended; [and] (3) the lease must be construed as a whole and in such a manner as to give effect to every provision, if reasonably possible." Middlesex Mutual Assurance Co. v. Vaszil, 279 Conn. 28, 900 A.2d 513 (2006).

         " When the language of a contract is ambiguous, the determination of the parties' intent is a question of fact . . . [W]here there is definitive contract language, [however] the determination of what the parties intended by their contractual commitments is a question of law." (Citation omitted; internal quotation marks omitted.) Cruz v. Visual Perceptions, LLC, 311 Conn. 93, 84 A.3d 828 (2014). " In determining whether a contract is ambiguous, the words of the contract must be given their natural and ordinary meaning . . . A contract is unambiguous when the language is clear and conveys a definite and precise intent . . . The court will not torture words to impart ambiguity where ordinary meaning leaves no room for ambiguity . . . Moreover, the mere fact that the parties advance different interpretations of the language in question does not necessitate a conclusion that the language is ambiguous." Id., 102-03. " In contrast, a contract is ambiguous if the intent of the parties is not clear and certain from the language of the contract itself . . . [A]ny ambiguity in a contract must emanate from the language used by the parties . . . The contract must be viewed in its entirety, with each provision read in light of the other provisions . . . and every provision must be given effect if it is possible to do so . . . If the language of the contract is susceptible to more than one reasonable interpretation, the contract is ambiguous." (Citation omitted; internal quotation marks omitted.) Id. " Furthermore, a presumption that the language used is definitive arises when, as in the present case, the contract at issue is between sophisticated parties and is commercial in nature." United Illuminating Co. v. Wisvest-Connecticut, LLC, 259 Conn. 665, 791 A.2d 546, (2002). In his affidavit in the instant case, Jeffrey Newman, senior vice president of the defendant corporation, averred that the parties were represented by counsel [#115]. The court regards the operative lease as a commercial transaction between sophisticated parties, and applies a presumption of definiteness from the language used in the 2012 modification agreement.

         The 2012 modification agreement [plaintiff's Exhibit C], states that the lease can be terminated on December 31, 2017, provided there is compliance with conditions as set forth in Section 8C of the agreement. Section 8C states, " The provisions of this Article are intended to be personal to the named tenant hereunder (i.e., Aircastle Advisor LLC or any successor by operation of law, merger or sale of all or substantially all of such party's assets, collectively, the 'Named Tenant') and may only be exercised by such Named Tenant if and so long it is the tenant under ...


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