Opinion
FA124061259S.
01-03-2013
John ABBATE, Jr. v. Mary Jane ABBATE.
Christine M. Whitehead, Hartford, for Mary Jane Abbate.
UNPUBLISHED OPINION
Christine M. Whitehead, Hartford, for Mary Jane Abbate.
OLEAR, J.
PROCEDURAL HISTORY AND PRELIMINARY FINDINGS OF FACTS
The plaintiff husband filed a complaint for dissolution of marriage having a return date of March 20, 2012 seeking the dissolution of the parties' nine-year marriage. Judgment entered June 25, 2012. The judgment incorporated by reference a Divorce Settlement Agreement of the same date (the agreement).
The agreement provided, inter alia, for a property division pursuant to which the plaintiff husband transferred to the defendant his interest in and to the Inn at Glimmerstone Mansion, LLC and MJA Hospitality, LLC and by so doing he divested himself of all interest in and to the real property known as Glimmerstone Mansion (Glimmerstone) and of all interest in and liability for and to any profits or losses received or incurred in connection therewith. See Article VI of the Agreement entitled Marital Asset Division.
The agreement specifically provides that the defendant wife assumed all obligations relating to Glimmerstone, including all debts related thereto, all taxes " presently owing" and all future taxes.
Subsection 6.1(a) provided further that the defendant wife shall be entitled to all federal and state credits and/or deductions available by law as a result of the historical preservation and any other credits available for the renovation of Glimmerstone commencing tax year 2012.
Article X of the agreement, entitled IRS, provides, inter alia, for the " [t]ax credits incurred in tax year 2011" to be equally shared by the parties and available for their respective future use.
On July 10, 2012 the defendant wife filed a motion seeking an order that tax credits available from the State of Vermont in the approximate amount of $101,000 be determined to be solely the property of the defendant wife.
ADDITIONAL FINDINGS OF FACT AND APPLICABLE LAW
The rule is that language contained in a contract is to be given its ordinary meaning unless a technical or special meaning is clearly intended. Central New Haven Development Corporation v. LaCrepe, Inc., 177 Conn. 212, 214-15, 413 A.2d 840 (1979).
" Contract language is unambiguous when it has a definite and precise meaning about which there is no reasonable basis for a difference of opinion." Paul Revere Life Ins. Co. v. Pastena, 52 Conn.App. 318, 322, 725 A.2d 996, cert. denied, 248 Conn. 917, 734 A.2d 567 (1999), citing Levine v. Advest, Inc., 244 Conn. 732, 746, 714 A.2d 649 (1998). " A court will not torture words to import ambiguity where the ordinary meaning leaves no room for ambiguity, and words do not become ambiguous simply because lawyers or laymen contend for different meanings." (Internal quotation marks omitted.) John M. Glover Agency v. RDB Building, LLC, 60 Conn.App. 640, 645, 760 A.2d 980 (2000).
In the event there is more than one possible interpretation of a contract, courts prefer the more equitable and rational interpretation. Nelson v. Nelson, 13 Conn.App. 355, 536 A.2d 985 (1988).
In July 2011, the parties, jointly, filed an application for Downtown and Village Center tax credits. The application indicates a construction start date of October 21, 2010. The application contains a worksheet that allocates the cost of project over specified categories of work. The form of the application used by the parties states that the credit shall be earned, provided the applicable conditions have been met, in the first tax year in which the project is complete.
Both parties had an expert witness testify as to the applicable Vermont laws. Prior to May 2011 the Vermont tax credits were available only upon completion of a qualifying project. After May 2011 the law changed and credits could be phased and made available in the tax year in which the expense was incurred and the applicable phase of renovation was completed.
In July 2012 a single claim for the Vermont tax credits was filed by the defendant wife based on a fully completed project costing $1,142,793. The Vermont Historic Tax Credit (VHTC) Board issued a credit certificate in the amount of $112,740 to MJA Hospitality, LLC (which at that time was owned solely by the defendant). The tax credit was converted to a Bank Credit Certificate and assigned to Union Bank.
The defendant's expert's opinion is that none of the Vermont tax credits had been earned at any time in tax year 2011 because the project was not completed until 2012. It is his further opinion that the project was completed when the Vermont Department of Public Safety issued a certificate of occupancy (as the Town of Cavendish, where Glimmerstone is located, does not issue Certificates of Occupancy) on May 25, 2012.
The court agrees and finds the defendant wife completed all of the renovations of Glimmerstone in 2012. The court acknowledges that occupancy of guest rooms and use of the dining room was permitted at the end of 2011, but finds, however, the project as a whole was not completed until the pub work was finished and the certificate of occupancy was issued in 2012.
The court accepts the opinion of the expert retained by the defendant. It is within the court's discretion to accept or reject the opinions of expert witnesses. Evans v. Taylor, 67 Conn.App. 108, 113, 786 A.2d 525 (2001).
The plaintiff's expert's report provides that if the parties were aware of the change in the tax law permitting a phased allocation and payment of credits and if they had been inclined to seek a partial credit, then Glimmerstone could have qualified to receive the credits when specified construction phases were completed. The court agrees. However, the court finds the testimony of the defendant to be credible; the parties were unaware of the change in the Vermont tax law that would have allowed them to take the credit in phases when they applied for the credit. The filed application does not seek a phasing of the credit. The plaintiff's expert, in his report, acknowledges the fact that the VHTC board website, even as of the middle of December 2012, continues to suggest that a VHTC may only be claimed upon completion of the project.
Accordingly, the court finds the credit to be first available in 2012.
The court does not find any credible evidence to support the plaintiff's claim that the VHTC was sought by the parties to be made available in phases. The court does not find the plaintiff's testimony that he believed the application was for phased tax credits and that he intended to pursue the availability of the credits after the divorce to be credible.
The court does not find any provision of the agreement that would allocate the tax credit earned and available in the 2012 tax year to the plaintiff. The court does not find any ambiguity created in the agreement due to the language which provides for a sharing of the federal tax credit. The Article heading of the agreement which allocates such credits equally to the parties is " IRS." While a heading or caption is not determinative, the court finds that (i) all of the provisions of said Article deal only with federal income tax matters; (ii) to the extent the language is not clear, the Article heading is instructive of the intention of the parties; and (iii) the provisions in such Article do not by their terms apply to the Vermont tax credits.
Further, even if one were to " torture words" in the agreement and thereby accept the contention of the plaintiff that there is an ambiguity in the contract, the court finds the equities would favor the interpretation that the credit belongs solely to the defendant as she assumed all obligations of Glimmerstone and completed the project. She is the one who in the agreement received the property with its agreed-upon value and assumed all responsibility for the ongoing payment of the cost of the renovations that allowed for the tax credit.
RULING
The defendant's motion for order is granted. The entire amount of the Vermont tax credit is found to be the sole property of the defendant and all proceeds related to and realized therefrom are to be delivered post haste to the defendant wife.
SO ORDERED.