Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Pasco Common Condominium Association, Inc. v. Benson

Court of Appeals of Connecticut

September 10, 2019

PASCO COMMON CONDOMINIUM ASSOCIATION, INC., ET AL.
v.
PAUL D. BENSON ET AL.

          Argued March 7, 2019

         Procedural History

         Action to recover damages for, inter alia, alleged violations of a condominium declaration, brought to the Superior Court in the judicial district of Hartford and tried to the court, Scholl, J.; judgment rendered in part for the plaintiffs, from which the defendants appealed to this court. Reversed in part; judgment directed in part.

          Edward S. Hill, with whom were John F. Harvey, Jr., and P. Jo Anne Burgh, for the appellants (defendants).

          Walter A. Twachtman, Jr., for the appellees (plaintiffs).

          Prescott, Bright and Cobb, Js.

          OPINION

          BRIGHT, J.

         The defendants, Benson Enterprises, Inc. (declarant), and Paul D. Benson, appeal from the judgment of the trial court, rendered after a bench trial, in favor of the plaintiffs, Pasco Common Condominium Association, Inc. (association), and eighteen individual members of the association.[1] On appeal, the defendants claim that (1) the court incorrectly concluded that the statute of limitations governing the plaintiffs' claims was tolled until the commencement of the present action because the period of declarant control had not terminated, (2) the plaintiffs' action was time barred pursuant to General Statutes § 52-577, the three year statute of limitations applicable to tort actions, [2] (3) the court improperly awarded the association damages on the plaintiffs' claim that the defendants improperly assessed common charges, and (4) the court improperly determined that Benson individually was liable.[3] We agree with the defendants' first, third, and fourth claims, but we disagree in part with the defendants' second claim. Accordingly, we affirm in part and reverse in part the judgment of the trial court.

         The record reveals the following relevant facts, found by the trial court or otherwise undisputed, and procedural history. On August 11, 1993, the declarant created Pasco Common, a common interest community, pursuant to the Common Interest Ownership Act (act), General Statutes § 47-200 et seq., by recording the Declaration of Pasco Common on the land records. Pasco Common is a condominium complex located in East Windsor and is comprised of dozens of residential and commercial units, one of which is occupied by a restaurant.

         On August 12, 1998, the declarant recorded the operative, Amended and Restated Declaration of Pasco Common (declaration). The declaration provides for the creation of the association as a Connecticut nonstock corporation. The members of the association are the unit owners at Pasco Common, and the association is governed by an executive board. The executive board has the powers and duties to act on behalf, and manage the affairs, of the association. These powers and duties include, among other things, to adopt and amend bylaws and budgets, to collect common charges from unit owners, and to expend the funds of the association. The declaration also provides the declarant with developmental rights, [4] special declarant rights, [5] and the right to control the association.[6] The declaration provides specific time periods during which the declarant had the authority to exercise these rights. In particular, the special declarant rights expired no later than ten years after the declaration was recorded. Despite these limitations, between October 5, 1998, and March 19, 2013, the declarant recorded twenty-one amendments to the declaration, primarily to add units to Pasco Common.

         Since the inception of Pasco Common, Benson was in complete control of the declarant because he was its president and chief operating officer, and he owned almost all of its stock. Between 1993 and 2009, Benson owned a majority of the units at Pasco Common, [7] and, thus, he was in complete control of the association. Prior to 2009, Benson, on behalf of the declarant, appointed the executive board members, who were his wife, Ann M. Benson, his son, Paul D. Benson, Jr., and himself. Until at least 2009, Benson, on behalf of the executive board, created the annual budgets for the association, determined the monthly common charges, decided what expenses the association would pay, decided who was responsible for repairs to the units, and conducted the business of the association without regard to whether his actions were in conformance with the terms of the declaration or the act.

         For instance, Benson, on behalf of the executive board, assessed common charges to the unit owners on the basis of the square footage of each unit; these assessments, however, were improper because, inter alia, many of the square footage figures conflicted with the East Windsor land records. Further, unbeknownst to the residential unit owners, Benson and the unit owner of the restaurant, located at Pasco Common, made a special arrangement in which they agreed that the restaurant was exempt from paying common charges. Benson also improperly expended the association's funds to finance repairs he made to units, for management fees, for vehicle expenses, and for paving expenses.

         In 2009, shortly after the period of declarant control provided for in the declaration ended, control of the association transitioned from the executive board that included Benson, his wife, and his son to an executive board that consisted of three directors: Benson, Steven Fowler, and Rene Dupuis. Fowler and Dupuis are unit owners and plaintiffs. At the same time, management of the association transitioned from the declarant to Advance Property Management and then, in 2011, to Elite Property Management. Nevertheless, Benson directed the new management of the association to continue to assess common charges pursuant to his own methodology, as opposed to the method prescribed by the declaration. Furthermore, the declarant continued to amend the declaration and exercise development rights through 2013.

         In July, 2013, the plaintiffs commenced the present action against the defendants. The plaintiffs' operative, amended complaint contains ten counts. In counts one through eight, the plaintiffs allege that the declarant violated the declaration as well as certain provisions of the act[8] by assessing common charges against unit owners on the basis of a formula that deviated from the terms of the declaration; issuing an inadequate, incorrect, and misleading public offering statement; failing to keep adequate records of the association's finances; modifying and creating units without the approval or notice to the executive board; failing to pay its correct proportion of the common charges; misrepresenting the true nature and composition of Pasco Common by failing to disclose that the restaurant was a unit and that the declarant would maintain total control over the association; amending the declaration without notice or approval by the executive board; and creating a garage unit. In count nine, the plaintiffs allege that the declarant violated the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. In count ten, the plaintiffs allege a piercing of the corporate veil count against Benson. In response, the defendants filed their operative answer and special defenses in which they allege, inter alia, that all of the plaintiffs' claims were time barred pursuant to § 52-577, the three year statute of limitations applicable to tort actions, and/or General Statutes § 52-576, the six year statute of limitations applicable to contract actions.[9]

         On October 25, 2016, after a ten day bench trial, the court issued a memorandum of decision in which it rendered judgment for the plaintiffs against the declarant on counts one through eight, for the declarant on count nine, and for the plaintiffs against Benson individually on count ten.[10]

         With respect to the defendants' statute of limitations special defense, the court held that the statute of limitations had been tolled, pursuant to General Statutes § 47-253 (d), [11] until 2013, because the period of declarant control, as defined by General Statutes § 47-245 (d), [12]had not terminated as result of the defendants' continued misconduct. As a result, the court held that the plaintiffs' action was not time barred, except for count nine, the CUTPA claim, which the court determined was time barred by the three year statute of limitations because the plaintiffs had not raised their tolling claim as to that count until after trial.[13] As to the plaintiffs' other claims, the court, in light of its conclusion that any statute of limitations was tolled, did not make a determination as to whether the tort, contract, or some other statute of limitations was applicable. Consequently, the court awarded the association compensatory damages and ordered the defendants to take certain remedial actions. This appeal followed. Additional facts will be set forth as necessary.

         On appeal, the defendants claim that (1) the court incorrectly concluded that the statute of limitations governing the plaintiffs' claims was tolled until the commencement of the present action because the period of declarant control had not terminated, (2) the plaintiffs' action was time barred pursuant to § 52-577, (3) the court improperly awarded the association damages on the plaintiffs' claim that the defendants improperly assessed common charges, and (4) the court improperly determined that Benson individually was liable.

         I

         The defendants first claim that the court incorrectly concluded that the statute of limitations governing the plaintiffs' claims was tolled until the commencement of the present action because the period of declarant control had not terminated. The defendants argue that the declaration set a ten year limit on the period of declarant control, and, thus, the statute of limitations was tolled only until 2008. They also argue that the tolling provision, § 47-253 (d), applies only to toll claims against the declarant, not Benson individually. The plaintiffs counter that the court properly determined that, notwithstanding the period provided by the declaration, the period of declarant control, in fact, continued until 2013 because the declarant continued to exercise special declarant rights through 2013. We agree with the defendants.

         We begin by setting forth the applicable standard of review and relevant legal principles governing our resolution of the defendants' first claim. The interpretation of the relevant provisions of the act and the definitive language of the declaration are pure questions of law over which we exercise plenary review. See Commissioner of Emergency Services & Public Protection v. Freedom of Information Commission, 330 Conn. 372, 380, 194 A.3d 759 (2018) (interpretation of statute is question of law); Harbour Pointe, LLC v. Harbour Landing Condominium Assn., Inc., 300 Conn. 254, 259, 14 A.3d 284 (2011) (interpretation of definitive language in condominium declaration, which operates as contract, is question of law).

         ‘‘When construing a statute, [o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature. . . . In other words, we seek to determine, in a reasoned manner, the meaning of the statutory language as applied to the facts of [the] case, including the question of whether the language actually does apply. . . . In seeking to determine that meaning, General Statutes § 1-2z directs us first to consider the text of the statute itself and its relationship to other statutes. If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered. . . . When a statute is not plain and unambiguous, we also look for interpretive guidance to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation and common law principles governing the same general subject matter . . . . The test to determine ambiguity is whether the statute, when read in context, is susceptible to more than one reason- able interpretation.'' (Internal quotation marks omitted.) Hynes v. Jones, 331 Conn. 385, 392-93, 204 A.3d 1128 (2019).

         ‘‘It is a basic tenet of statutory construction that the legislature [does] not intend to enact meaningless provisions. . . . [I]n construing statutes, we presume that there is a purpose behind every sentence, clause, or phrase used in an act and that no part of a statute is superfluous. . . . Because [e]very word and phrase [of a statute] is presumed to have meaning . . . [the statute] must be construed, if possible, such that no clause, sentence or word shall be superfluous, void or insignificant.'' (Citations omitted; internal quotation marks omitted.) American Promotional Events, Inc. v. Blumenthal, 285 Conn. 192, 203, 937 A.2d 1184 (2008). ‘‘We are not in the business of writing statutes; that is the province of the legislature. Our role is to interpret statutes as they are written. . . . [We] cannot, by [judicial] construction, read into statutes provisions [that] are not clearly stated.'' (Internal quotation marks omitted.) Thomas v. Dept. of Developmental Services, 297 Conn. 391, 412, 999 A.2d 682 (2010).

         ‘‘When construing a contract, we seek to determine the intent of the parties from the language used interpreted in the light of the situation of the parties and the circumstances connected with the transaction. . . . [T]he intent of the parties is to be ascertained by a fair and reasonable construction of the written words and . . . the language used must be accorded its common, natural, and ordinary meaning and usage where it can be sensibly applied to the subject matter of the contract. . . . 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.'' (Internal quotation marks omitted.) Gabriel v. Gabriel, 324 Conn. 324, 341, 152 A.3d 1230 (2016). ‘‘[Additionally], in construing contracts, we give effect to all the language included therein, as the law of contract interpretation . . . militates against interpreting a contract in a way that renders a provision superfluous.'' (Internal quotation marks omitted.) Awdziewicz v. Meriden, 317 Conn. 122, 130, 115 A.3d 1084 (2015).

         We next turn to the relevant provisions of the act. ‘‘The act is a comprehensive legislative scheme regulating all forms of common interest ownership that is largely modeled on the Uniform Common Interest Ownership Act. . . . The act addresses the creation, organization and management of common interest communities and contemplates the voluntary participation of the owners. It entails the drafting and filing of a declaration describing the location and configuration of the real property, development rights, and restrictions on its use, occupancy and alienation . . . the enactment of bylaws . . . the establishment of a unit owners' association . . . and an executive board to act on . . . behalf [of the association]. . . . It anticipates group decision-making relating to the development of a budget, the maintenance and repair of the common elements, the placement of insurance, and the provision for common expenses and common liabilities.'' (Internal quotation marks omitted.) Grovenburg v. Rustle Meadow Associates, LLC, 174 Conn.App. 18, 22-23 n.2, 165 A.3d 193 (2017); see also Fruin v. Colonnade One at Old Greenwich Ltd. Partnership, 237 Conn. 123, 130-31, 676 A.2d 369 (1996) (outlining five major parts of the act).

         The act specifies who may bring an action to enforce its provisions. General Statutes § 47-278 (a) provides in relevant part: ‘‘A declarant, association, unit owner or any other person subject to this chapter may bring an action to enforce a right granted or obligation imposed by this chapter, the declaration or the bylaws. . . .'' The act makes the declarant liable to the association. Section 47-253 (c) provides: ‘‘The declarant is liable to the association for all funds of the association collected during the period of declarant control which were not properly expended.'' The act also provides that the statute of limitations applicable to such action brought against a declarant is tolled while the declarant is in control of the association. Section 47-253 (d) provides in relevant part: ‘‘Any statute of limitation affecting the association's right of action against a declarant under this chapter is tolled until the period of declarant control terminates.''

         The period of declarant control is defined by § 47-245 (d), which provides in relevant part: ‘‘[T]he declaration may provide for a period of declarant control of the association, during which a declarant, or persons designated by the declarant, may appoint and remove the officers and members of the executive board. A declarant may voluntarily surrender the right to appoint and remove officers and members of the executive board before the period ends. In that event, the declarant may require, during the remainder of the period, that specified actions of the association or executive board, as described in a recorded instrument executed by the declarant, be approved by the declarant before they become effective. Regardless of the period provided in the declaration, a period of declarant control terminates no later than the earlier of: (1) Sixty days after conveyance of sixty per cent of the units that may be created to unit owners other than a declarant . . . or, if no such number is specified, after conveyance to unit owners other than the declarant of three hundred units; (2) two years after all declarants have ceased to offer units for sale in the ordinary course of business; (3) two years after any right to add new units was last exercised; or (4) the date the declarant, after giving notice in a record to unit owners, records an instrument voluntarily surrendering all rights to control activities of the association.''

         The plain and unambiguous language of § 47-245 (d) demonstrates that the legislature intended that the period of declarant control terminate on the occurrence of one of the terminating events or, at the latest, at the end of the period set by the declaration. The first sentence of the subsection permits a declaration to set a period of time for declarant control. The second and third sentences permit a declarant to voluntarily surrender his control over the association before the period ends, and to reserve its right of approval. The fourth sentence then provides that the first occurrence of any four terminating events would end the period of declarant control regardless of the time period set by the declaration. To give effect to both the first and fourth sentences of § 47-245 (d), the period of declarant control set by a declaration must serve as the maximum time period, which can be shortened only by the first occurrence of any of the four terminating events. The first sentence permitting a declaration to set a period of declarant control has meaning only if it serves as the outer limit of declarant control because, otherwise, the statute would permit a declaration to set a period of time that necessarily would have no effect if the period of declarant control ended only on the earliest of the four terminating events. Thus, § 47-245 (d) permits a declaration to set a specific period of declarant control, which can be shortened only by the declarant voluntarily surrendering control or by the occurrence of any of the four terminating events outlined in subdivisions (1) through (4).

         Because, pursuant to § 47-245 (d), the declaration can set forth the period of declarant control, we turn to the language of the declaration at issue in the present case. Article VIII of the declaration, titled ‘‘Development Rights and Other Special Declarant Rights, '' specifically provides a ten year period of declarant control. Section 8.10 of the declaration, titled ‘‘Limitations on Special Declarant Rights, '' provides: ‘‘Unless sooner terminated by a recorded instrument executed by the [d]eclarant, any [s]pecial [d]eclarant [r]ight may be exercised by the [d]eclarant during such period of time as the [d]eclarant is obligated under any warranty or obligation, holds a [d]evelopment [r]ight to create additional [u]nits or [c]ommon [e]lements, owns any [u]nit, or holds any [s]ecurity [i]nterest in any [u]nit, or for 10 years after recording this [d]eclaration, whichever is earliest. Earlier termination of certain rights may occur by statute.'' Section 8.4 of the declaration, titled ‘‘Special Declarant Rights, '' defines the special declarant rights subject to the limitations in § 8.10. Section 8.4 provides in relevant part: ‘‘The [d]eclarant reserves the following [s]pecial [d]eclarant [r]ights, to the maximum extent permitted by law, which may be exercised, where applicable, anywhere within [Pasco Common] . . . . (e) To appoint or remove any officer of the [a]ssociation or any [e]xecutvie [b]oard member during any period of [d]eclarant control subject to the provisions of [§] 8.9 of this [d]eclaration.''

         Section 8.9 of the declaration, titled ‘‘Declarant Control of Association, '' provides in relevant part: ‘‘There shall be a period of [d]eclarant control of the [a]ssociation, during which the [d]eclarant, or persons designated by it, may appoint and remove the officers and members of the [e]xecutive [b]oard. The period of [d]eclarant control shall terminate no later than the earlier of:

‘‘(i) sixty (60) days after conveyance of sixty percent . . . of the [u]nits [that] may be created to [u]nit [o]wners other than a [d]eclarant, a shareholder thereof, or his or her spouse, or other member of the immediate family;
‘‘(ii) two (2) years after all [d]eclarants have ceased to offer [u]nits for sale in the ordinary course of business; or
‘‘(iii) [e]ight (8) years after any right to add new [u]nits was last exercised.
‘‘A [d]eclarant may voluntarily surrender the right to appoint and remove officers and members of the [e]xecutive [b]oard before termination of that period, but in that event the [d]eclarant may require, for the duration of the period of [d]eclarant control, that specified actions of the [a]ssociation or [e]xecutive [b]oard as described in a recorded instrument executed by the [d]eclarant be approved by the [d]eclarant before they become effective.''

         The court determined that § 47-253 (d) tolled any statute of limitations until 2013 because none of the events listed in § 8.9 and § 47-245 (d) (1) through (4) had occurred earlier to terminate the period of declarant control.[14] The court concluded that the ten year limit on the exercise of the special declarant rights set forth in § 8.10 of the declaration was not applicable to its analysis because ‘‘[t]he plain meaning of the declaration, which defines what special declarant rights may be exercised during the period of declarant control, is that the term of declarant control may be longer than the time in which the declarant may exercise special declarant rights.'' We disagree.

         When §§ 8.4, 8.9, and 8.10 are read together, it is clear that the declaration set a ten year limit on the period of declarant control. Section 8.9, in relevant part, defines the period of declarant control as the time ‘‘during which the [d]eclarant . . . may appoint and remove the officers or members of the [e]xecutive [b]oard.'' Section 8.4 defines one of the declarant's special declarant rights as the right ‘‘[t]o appoint or remove any officer of the [a]ssociation or any [e]xecutive [b]oard member during any period of [d]eclarant control subject to the provisions of [§] 8.9 of this [d]eclaration.'' Finally, § 8.10 provides that the special declarant rights terminate no later than ten years after the recording of the declaration. Thus, the declarant's right to appoint and remove board members terminated no later than ten years after the recording of the declaration. Because the right to appoint and remove executive board members is the definition of declarant control under § 8.9, the loss of that right necessarily meant the end of declarant control. See Cantonbury Heights Condominium Assn., Inc. v. Local Land Development, LLC, 273 Conn. 724, 734, 873 A.2d 898 (2005) (interpreting declaration to determine that limitation on authority to exercise special declarant rights effectively operated as limitation on developmental rights, where declaration provides that developmental right is special declarant right). Consequently, declarant control under the declaration necessarily ended no later than ten years after the recording of the declaration, regardless of whether any of the events in § 8.9 of the declaration or § 47-245 (d) had occurred.

         The court's construction of the declaration does not take into account the interplay of §§ 8.4, 8.9, and 8.10. The court, therefore, improperly interpreted the declaration and the applicable statutes to conclude that the period of declarant control could continue beyond the ten year limit in § 8.10 as long as one of the events in § 47-245 (d) and § 8.9 had not occurred. Such a conclusion ignores the fact that, regardless of the occurrence of those events, the declarant's right to appoint and remove executive board members, which is what gave the declarant control, expired no later than ten years after the recording of the declaration. Although the declarant may have engaged in conduct through 2013 consistent with control, its period of control legally ended on August 12, 2008, ten years after the declaration was recorded. Thus, we agree with the defendants that any statute of limitations for claims by the association against the declarant was tolled, pursuant to §§ 47-245 (d) and 47-253 (d), only until August 12, 2008.[15]

         This conclusion is not only required by the clear language of the declaration, it is also consistent with the language of § 47-245 (d). The first sentence of § 47-245 (d) explicitly sets forth the option to include a specific period of declarant control in the declaration. It would contravene the legislature's intent to permit the declarant to set a specific period of declarant control if that period could continue beyond its set expiration as a result of the declarant's own conduct. If the legislature intended to terminate the period of declarant control only on the occurrence of one of the four terminating events in the fourth sentence of § 47-245 (d), it would not have included the option for the declarant to select a different date for the termination of declarant control. Instead, this subsection expressly permits a declarant to set a specific period of declarant control that serves as the maximum time, which can be shortened only by the occurrence of any of the four terminating events.

         Finally, our conclusion is consistent with the purpose of the tolling provision of § 47-253 (d). Tolling the statute of limitations applicable to claims against the declarant while it is in control of the association allows the association and its unit members sufficient time after the termination of the period of declarant control to know whether the declarant has engaged in any wrongful conduct. When the period of declarant control ends, that control is transitioned to the individual members of the association. See § 47-245 (f) and (h). In the present case, an executive board took over legal control of the association in 2009, shortly after the period of declarant control ended. That board, which included two unit owners in addition to Benson, had the legal right to control the affairs of the association, as well as the right to ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.