Opinion
No. HHD CV X04 07 5026084 S
February 3, 2010
MEMORANDUM OF DECISION ON MOTION FOR PARTIAL SUMMARY JUDGMENT
The court heard argument on November 24, 2009 concerning the plaintiff Shaw's New London, LLC's (SNL) motion for partial summary judgment. After considering the parties' arguments, the court issues this memorandum of decision. For the reasons set forth below, the motion is granted.
At oral argument, SNL withdrew its reply brief.
I BACKGROUND
This matter concerns a note, a mortgage of commercial property located in New London, Connecticut, a guaranty, and related instruments. SNL moves for partial summary judgment, concerning counts one through four of its first amended complaint, dated March 4, 2008 (#116). These counts, respectively, seek the following relief: count one, foreclosure; count two, a declaratory ruling that a breach of covenants under the mortgage has occurred; count three, a declaratory ruling that the mortgage is a full recourse obligation; count four, an order requiring the guarantors to satisfy unpaid amounts under the note, as well as an order permitting SNL to seek a deficiency judgment against the guarantors under General Statutes § 49-14.
The undisputed facts show that, on April 13, 2005, defendant Signature Properties, LLC (Signature) agreed, pursuant to a Fixed Rate Note, to pay to JPMorgan Chase Bank, N.A. (JPMorgan) the principal sum of $8,800,000.00, with interest (Note). To secure the Note, Signature executed a Mortgage And Security Agreement, with respect to commercial property known as 6 Shaw's Cove, New London, Connecticut (Mortgage), a three-story office building. On April 13, 2005, defendants Maureen Julian, Andrew J. Julian, Michael Murray, and Stephanie Lord Drake (Guarantor defendants) executed a Guaranty, in favor of JPMorgan (Guaranty). On July 29, 2005, the Note, Mortgage, and Guaranty were assigned by JPMorgan to LaSalle National Bank Association, as Trustee, which, in October 2007, assigned them to SNL.
Section 10(a)(i) of the Note provides that its obligations are non-recourse as to Signature, limiting SNL's remedy in the event of default to the security interests granted by Signature, with certain exceptions. Section 10(a)(i)(B) states that "in the event . . . of a breach or default under Sections 4.3 or 8.2 of the [Mortgage] . . . the limitations on recourse set forth in this Subsection 10(a) will be null and void and completely inapplicable, and this Note shall be with full recourse to [Signature]." (Emphasis in original.)
In relevant part, Section 4.3(f) of the Mortgage provides that Signature "covenants and agrees that it has not and shall not: . . . commingle its assets with the assets of any of its partner(s), members, shareholders, affiliates, or of any other person or entity or transfer any assets to any such person or entity other than distributions on account of equity interests in [Signature][.]"
Section 8.2(a) of the Mortgage states, in relevant part, that Signature shall not, "without the prior written consent of Lender, Transfer the Property or any part thereof or permit the Property or any part thereof to be Transferred." "Transfer" is defined in the Mortgage, in Section 8.2(b), to mean "any voluntary or involuntary sale, conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment or transfer of all or any part of the Property or any interest therein . . ."
"Property Mortgaged" is defined in the Mortgage in Section 1.1 to include not only the Land (including real property described in Exhibit A to the Mortgage, as well as additional items) and Improvements erected or located thereon, but also "[a]ll agreements, contracts . . ., licenses . . . and other documents, now or hereafter entered into, and all rights therein and thereto, respecting or pertaining to the use, occupation, . . . management or operation of the Property (including any Improvements or respecting any business or activity conducted on the Land and any part thereof) . . ." See Mortgage, Section 1.1(k).
Signature also entered into a Parking License Agreement with 280 Atlantic Street, LLC (280 Atlantic), which was executed on April 9, 2005, but made effective as of January 1, 2002 (Parking Agreement). During the relevant time periods discussed herein, Signature and 280 Atlantic were affiliated by ownership and management, in that defendants Maureen Julian and Andrew J. Julian, together, owned fifty percent (50%) membership interests in both entities. Maureen Julian was Signature's managing member and Andrew J. Julian was 280 Atlantic's managing member. 280 Atlantic's two other members were their sons, Andrew C. Julian and Jason Julian. For ease of reference, the court refers to these individuals as the Julians.
Signature and 280 Atlantic also executed a Notice of Parking License Agreement, pertaining to the Parking Agreement, which was recorded immediately after the Note and Mortgage. Defendant Maureen Julian executed the Parking Agreement, on behalf of Signature, as its managing member (see Signature's answer to Interrogatory 10), and on behalf of 280 Atlantic. Both the Parking Agreement and the Notice of Parking License Agreement are listed on the Legal Closing Checklist for the loan to Signature by JPMorgan, as being among the documents necessary for closing. In answer to interrogatory No. 9, Signature stated that it executed the Notice of Parking License Agreement because it was required by JPMorgan.
The Parking Agreement states, at page 1, that 280 Atlantic owns a certain parcel of land on Bank Street in New London, Connecticut, consisting of approximately 1.175 acres, including a paved parking area (the "Premises"). It also states that Signature "desires to utilize space at the Premises for the purpose of providing parking spaces for certain tenants of [its] office building at [6 Shaw's Cove] to whom [it] may, in its sole discretion, allow to use said space at the Premises from time to time[.]" Section 1 provides that 280 Atlantic "grants [Signature] a license to use the Premises including the surface parking lot on the Premises (the `Parking Lot') to park approximately 120 vehicles . . . and for any and all activities related and/or incidental to [Signature's] use of the Parking Lot."
Section 3(a) provides that the license shall be for a term of seven years, commencing January 1, 2002, and Section 3(b) states that Signature shall have the option to renew the license for two additional terms of five years each. Thus, the Parking Agreement contemplated a potential length of seventeen years. Similarly, the Notice of Parking License Agreement lists a summary of provisions and provides that a copy of the Parking Agreement is on file at Signature's and 280 Atlantic's West Haven, Connecticut office.
In August 2005, less than four months after the closing of the Shaws Cove transaction with JPMorgan, the Julians, through an acquisition entity, Julian Investments, LLC, began negotiations to lease property for a Walgreen's Pharmacy, to be located across the street from 6 Shaw's Cove. In November 2005, Julian Investments, LLC purchased 698 Bank Street. See SNL's Exhibit B-8. In June 2006, 698 Bank Street, LLC, an entity owned by the Julians, entered into a seventy-five year lease with Walgreens, which provides for the proposed pharmacy to be built on a parcel including 698 Bank Street and a significant portion of 280 Atlantic's parking lot.
In October 2006, Signature agreed with 280 Atlantic to terminate the Parking Agreement as of December 31, 2006, two years before the end of the seven-year initial term thereof. 280 Atlantic embodied the understanding of Signature and 280 Atlantic in a Memo, re "Parking Agreement Termination between 280 Atlantic and Shaws 6," dated October 5, 2006 (SNL Exhibit B-12), which stated, in relevant part, that, as a result of Signature's tenant, Electric Boat, vacating 6 Shaw's Cove, "280 Atlantic understands your position that Shaws #6 will no longer have the cash flow or the need to continue with the parking arrangement. 280 Atlantic also understands that Shaws #6 is compliant with the parking required by the City of New London and our lot was only required to satisfy the needs of Electric Boat. As of December 31st 2006, any and all agreements will be terminated and neither party will have any further obligation to each other." Signature did not obtain the prior written consent of its lender to terminate the Parking Agreement.
In March 2007, 698 Bank Street, LLC; 668 Bank Street, LLC (also owned by the Julians); and 280 Atlantic entered into a Boundary Line Agreement in order to facilitate the lease to Walgreens for the Walgreen's Pharmacy. More space was needed to develop the Walgreen's. See deposition of J. Julian, p. 204. The building itself actually is on part of what used to be the parking lot of 280 Atlantic. See deposition of J. Julian, p. 209.
In April 2007, Signature failed to make its monthly interest payment. A notice of default was sent to Signature in May 2007, which provided that, if the default was not cured within thirty days, all amounts due and payable under the loan documents would be accelerated. Signature has not paid the amounts due under the Note for April 2007 and thereafter.
In the Guaranty, paragraph B, the Guarantor defendants acknowledged that "[JPMorgan] is not willing to make the Loan or otherwise extend credit, to [Signature] unless Guarantor unconditionally guarantees payment and performance to [JPMorgan] of the Guaranteed Obligations[.]" In Section 1.1, page 1 thereof, the Guarantors "absolutely, irrevocably and unconditionally guarantee[d] to Lender (and its successors and assigns), jointly and severally, the payment and performance of the Guaranteed Obligations as and when the same shall be due and payable, whether by lapse of time, by acceleration of maturity or otherwise."
Section 1.2 of the Guaranty (page 2) provides that, if the recourse provisions of the Note and Mortgage, quoted above, are triggered, "then the Guaranteed Obligations shall also include the unpaid balance of the Debt," as defined in the Mortgage. Section 1.5 of the Guaranty states that, if any of the Guaranteed Obligations are not paid when due, then, upon demand, the Guarantor Defendants shall pay the amount due.
Additional references to the facts are set forth below.
II STANDARD OF REVIEW
"Summary 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. Practice Book § [17-49]. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . Although the party seeking summary judgment has the burden of showing the nonexistence of any material fact . . . a party opposing summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue . . . It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact . . . are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court [in support of a motion for summary judgment] . . . Requiring the nonmovant to produce such evidence does not shift the burden of proof. Rather, it ensures that the nonmovant has not raised a specious issue for the sole purpose of forcing the case to trial." (Internal quotation marks omitted.) Gold v. Town Of East Haddam, 290 Conn. 668, 677-78, 966 A.2d 684 (2009). "A material fact . . . [is] a fact which will make a difference in the result of the case." (Internal quotation marks omitted.) Deming v. Nationwide Mutual Insurance Co., 279 Conn. 745, 757, 905 A.2d 623 (2006).
"Only evidence that would be admissible at trial may be used to support or oppose a motion for summary judgment. See Practice Book [§ 17-46]." (Internal quotation marks omitted.) Home Ins. Co. v. Aetna Life Casualty Co., 235 Conn. 185, 202-03, 663 A.2d 1001 (1995). However, the Supreme Court has stated that parties may "knowingly waive . . . compliance with the procedural provisions of the Practice Book relating to motions for summary judgment." (Footnote omitted.) Krevis v. Bridgeport, 262 Conn. 813, 824, 817 A.2d 628 (2003). Also, the Supreme Court has stated, "[w]e previously have afforded trial courts discretion to overlook violations of the rules of practice and to review claims brought in violation of those rules as long as the opposing party has not raised a timely objection to the procedural deficiency." Schilberg Integrated Metals Corp. v. Continental Casualty Co., 263 Conn. 245, 273, 819 A.2d 773 (2003).
Here, no objection was raised to any exhibit. Accordingly, the court deems such objections to have been waived. In the exercise of its discretion, the court has considered the exhibits which were presented.
III DISCUSSION
"Construction of a mortgage deed is governed by the same rules of interpretation that apply to written instruments or contracts generally, and to deeds particularly. The primary rule of construction is to ascertain the intention of the parties. This is done not only from the face of the instrument, but also from the situation of the parties and the nature and object of their transactions . . . A promissory note and a mortgage deed are deemed parts of one transaction and must be construed together as such." (Internal quotation marks omitted.) Webster Bank v. Oakley, 265 Conn. 539, 547, 830 A.2d 139 (2003), cert. denied, 541 U.S. 903, 124 S.Ct. 1603, 158 L.Ed. 244 (2004).
"Although ordinarily the question of contract interpretation, being a question of the parties' intent, is a question of fact . . . [w]here there is definitive contract language, the determination of what the parties intended by their contractual commitments is a question of law." (Internal quotation marks omitted.) Garcia v. City of Hartford, 292 Conn. 334, 341, 972 A.2d 706 (2009). "[T]he interpretation and construction of a written contract present only questions of law, within the province of the court . . . so long as the contract is unambiguous and the intent of the parties can be determined from the agreement's face." (Internal quotation marks omitted.) Tallmadge Bros., Inc. v. Iroquois Gas Transmission System, L.P., 252 Conn. 479, 495, 746 A.2d 1277 (2000), quoting 11 S. Williston, Contracts (4th Ed. Lord 1999) § 30:6, pp. 77-83.
"[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 . . . Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms. A court will not torture words to import ambiguity where the ordinary meaning leaves no room for ambiguity . . . Similarly, any ambiguity in a contract must emanate from the language used in the contract rather than from one party's subjective perception of the terms." (Internal quotation marks omitted.) Connecticut Light Power Co. v. Lighthouse Landings, Inc., 279 Conn. 90, 109-10, 900 A.2d 1242 (2006). "When the language of a contract is ambiguous, the determination of the parties' intent is a question of fact." (Internal quotation marks omitted.) Isham v. Isham, 292 Conn. 170, 181, 972 A.2d 228 (2009).
A Count One
It is undisputed that SNL is the owner of the Note and Mortgage and that Signature has defaulted in its payment obligations. Signature has presented no argument concerning its two special defenses to count one, in which it is alleged that (1) the Mortgage is void ab initio, unenforceable, and/or voidable; and (2) that the court lacks subject matter jurisdiction because the Mortgage is facially defective. Accordingly, the court deems them to be abandoned. See State v. Orr, 291 Conn. 642, 645 n. 4, 969 A.2d 750 (2009); SKW Real Estate Limited Partnership v. Gallicchio, CT Page 4338 49 Conn.App. 563, 564 n. 2, 716 A.2d 903, cert. denied, 247 Conn. 926, 719 A.2d 1169 (1998).
SNL has proved that Signature is liable on count one of the complaint. The extent of that liability remains to be determined.
B Count Two
SNL claims that Signature breached §§ 8.2(a) and 4.3(f) of the Mortgage, by transferring collateral, without the lender's consent, when it terminated the Parking Agreement. Signature and the Guarantor defendants raise numerous arguments in opposition, including that no transfer of property, as defined in the Mortgage, occurred; the privilege to use the 280 Atlantic Street parking lot lapsed; Signature did not terminate the Parking Agreement; and 280 Atlantic's conveyance of a portion of its property to 698 Bank Street, LLC remained subject to the Parking Agreement, as no notice of termination thereof was recorded on the New London land records.
Alternatively, they argue that, even if the Parking Agreement was "Property" and its termination was a "transfer" under the Mortgage, any such violation was immaterial and did not constitute an event of default. Also, they contend that the term of the Parking Agreement has expired and, while SNL appointed a receiver of rents in November 2007, it took no action to exercise the option to renew the Parking Agreement. Further, they assert that the termination of the Parking Agreement is immaterial because the off-site parking did not add any value to 6 Shaw's Cove. Finally, they argue that SNL is not entitled to summary judgment as to their seven special defenses (equitable estoppel, unclean hands, breach of the implied covenant of good faith and fair dealing, laches, duty to mitigate, the Parking Agreement does not run with the land, and foreclosure of the Parking Agreement negates any claim for damages). The court addresses each of these contentions below.
1. Section 8.2 (a)
The "Property Mortgaged" is broadly defined in the Mortgage to include not only the real property at 6 Shaw's Cove and the improvements, but also all agreements, contracts, licenses, and other documents, and all rights therein and thereto, respecting or pertaining to the use, occupation, management or operation of 6 Shaw's Cove. See Mortgage, Section 1.1(k).
In ascertaining the common meaning of terms utilized in a contract where no definition is provided, the Supreme Court has looked to the dictionary definition, as found in Webster's Third New International Dictionary. See Metropolitan Life Insurance Co. v. Aetna Casualty Surety Co., 255 Conn. 295, 307, 765 A.2d 891 (2001); Moore v. Continental Casualty Co., 252 Conn. 405, 410-11, 746 A.2d 1252 (2000).
Webster's, page 1934, in the closest relevant definition, defines "respecting" as meaning "with regard or relation to." Similarly, at page 1688, it defines "pertain" to mean "to have some connection with or relation to something: have reference: RELATE[.]" While the 280 Atlantic parking lot was off-site, across the street from 6 Shaw's Cove, that did not make its use for parking by tenants of 6 Shaw's Cove's commercial office building unrelated to the use, occupation, management or operation of 6 Shaw's Cove. Rather, the terms of the Parking Agreement make it clear that access to such parking was directly related thereto. The use of the parking lot pertained to the business or activity conducted on 6 Shaw's Cove. See Mortgage, Sections 1.1(k) and 1.1(n) (Parking Agreement also was Property since it granted rights to Signature).
As noted above, the Parking Agreement was executed contemporaneously with the other documents which documented the transaction in April 2005, and was made effective retroactively, to January 1, 2002.
Thus, as a license, contract or agreement respecting or pertaining to the use, occupation, management or operation of 6 Shaw's Cove, the Parking Agreement was within the Mortgage's definition of the Property Mortgaged. See Mortgage, Section 1.1, defining the Property which was mortgaged. In addition, it is evident, since the execution of the Parking Agreement was required at the time of the loan, and the Notice of Parking Agreement was recorded with the other loan documents, that the collateral for the loan included Signature's right to have its tenants use 280 Atlantic's parking lot, as provided in the Parking Agreement.
As noted above, the Mortgage, in Section 8.2(a), also broadly defines "Transfer" to mean "any voluntary or involuntary sale, conveyance, mortgage, grant, bargain, encumbrance, pledge, assignment or transfer of all or any part of the Property or any interest therein . . ." Thus, the definition includes a "transfer." "`[T]ransfer' is defined as ` [a]ny mode of disposing of or parting with an asset or an interest in an asset . . . The term embraces every method — direct or indirect, absolute or conditional, voluntary or involuntary — of disposing of or parting with property or with an interest in property . . . To convey . . . from . . . one person to another; to pass or hand over from one to another . . .' Black's Law Dictionary (7th Ed. 1999)." (Emphasis by the Appellate Court.) State v. Myers, 101 Conn.App. 167, 175, 921 A.2d 640 (2007), reversed in part on other grounds, 290 Conn. 278, 963 A.2d 11 (2009).
The Supreme Court also has looked to Black's for definitions. See Brown v. Soh, 280 Conn. 494, 505, 909 A.2d 43 (2006).
The fact that the Parking Agreement created a license only is not material. "[A] license in real property is a mere privilege to act on the land of another, which does not produce an interest in the property . . . [It] does not convey a possessory interest in land. Murphy, Inc. v. Remodeling, Etc., Inc., 62 Conn.App. 517, 522, 772 A.2d 154, cert. denied, 256 Conn. 916, 773 A.2d 945 (2001). That the Parking Agreement gave Signature a license permitting tenants at 6 Shaw's Cove to park at 280 Atlantic's parking lot, and not a possessory interest in 280 Atlantic Street, does not negate the fact that that agreement created enforceable contractual rights. See Shoreline Communications, Inc. v. Norwich Taxi, LLC, 70 Conn.App. 60, 67-8, 71, 797 A.2d 1165 (2002) (license agreement enforceable). "There is nothing inherently unfair in an agreement that unambiguously and unconditionally requires one of the parties to assume the risk that its use of the licensed space might be unprofitable." Id., 73-74.
The court is unpersuaded by the defendants' assertion that Signature did not terminate the Parking Agreement. Unambiguous documentation contradicts this contention. 280 Atlantic's October 5, 2006 memo to Signature concerning the Parking Agreement noted Signature's request that 280 Atlantic "continue to collect rent from Signature . . . for the over flow parking, located next door, through December 2006." It recited Signature's position that, as a result of Electric Boat's departure from 6 Shaw's Cove, that 6 Shaw's Cove "will no longer have the cash flow or the need to continue with the parking arrangement." The memo embodied the agreement between Signature and 280 Atlantic that, "[a]s of December 31st 2006, any and all agreements will be terminated and neither party will have any further obligation to each other." Thus, Signature and 280 Atlantic mutually terminated the Parking Agreement.
Signature's termination of the Parking Agreement, as of December 31, 2006, prior to the expiration of the initial seven-year term, disposed of its asset, its contractual rights therein. In advance of the termination, Signature possessed the right to have tenants of 6 Shaw's Cove use 280 Atlantic's parking lot for twelve more years. After terminating the Parking Agreement, it no longer had that right. By agreeing to the early termination of the Parking Agreement, it effectively transferred or conveyed its rights under the Parking Agreement back to 280 Atlantic. It is undisputed that the lender did not consent to the termination.
Webster's, page 499, includes "the transfer of ownership" in its definition of "conveyance."
The court is also unpersuaded either that Signature's rights under the Parking Agreement were assigned to Signature's tenant, Electric Boat, or that the privilege to use the 280 Atlantic parking lot lapsed when Electric Boat terminated its lease at 6 Shaw's Cove. As discussed above, the October 5, 2006 memo acknowledged that the Parking Agreement had not lapsed.
In addition, the Parking Agreement, paragraph 1, provided that Signature "may, in its sole and absolute discretion, allocate or assign any or all of the rights granted to [Signature] hereunder to any of [Signature's] Tenants without [280 Atlantic's] further consent, and [280 Atlantic Street] hereby agrees to recognize all such rights of [Signature's] Tenants as if exercised by [Signature] itself." While the defendants argue that all of Signature's rights under the Parking Agreement already had been assigned by Signature to Electric Boat in accordance with Section 37 of the lease with Electric Boat, review of that provision shows that it provides no support for the contention. Although it was made effective as of January 1, 2002, the Parking Agreement was executed in April 2005, long after the Electric Boat lease, which was dated as of January 1, 2002.
Paragraph 37 of the Electric Boat lease stated that "the Landlord agrees to provide 120 Off-Site parking spaces located on Parcel L as depicted on Exhibit G. The cost of off-site parking is an enumerated item of `Additional Rent' as set forth in Section 5 of the Lease." See defendants' Exhibit 13, 37. While this provision of the lease allocated parking spaces to Electric Boat, it did not assign the contractual rights under the Parking Agreement to Electric Boat.
Similarly unpersuasive is the defendant's argument that the Parking Agreement was not a loan document. In defendants Andrew Julian and Michael Murray's memorandum in opposition, page 7, they agree that JPMorgan required Signature to enter into the Parking Agreement at the time of the loan transaction. Also, the opinion letter provided by Signature's counsel, dated April 13, 2005, which lists loan documents, also states, at page 4, that "[w]e express no opinion as to any other documents executed in connection with the Loan." See defendants' Exhibit 6. The separate list of loan documents (defendants' Exhibit 14) is likewise unavailing to create a genuine issue of material fact.
That Electric Boat no longer needed the parking spaces does not change the fact that the Parking Agreement was part of the collateral, nor did Electric Boat's departure cause the Parking Agreement to lapse. Likewise, the fact that Electric Boat was no longer paying additional rent to Signature for the parking spaces at 280 Atlantic's parking lot did not cause the Parking Agreement to terminate because the license fee provided for in Section 4 thereof was no longer being paid by Signature to 280 Atlantic. That Electric Boat no longer needed to use the additional parking spaces did not change the terms of the Parking Agreement or the Mortgage. Statements to the effect that the purpose of the Parking Agreement was to provide parking for Electric Boat also do not change the terms of the documents.
It is also immaterial that 6 Shaw's Cove had sufficient parking for zoning purposes and, therefore, the Parking Agreement was not required to legally use and operate the commercial office building. Clearly, Signature did not enter into the loan transaction with a municipal zoning authority. Rather, it did so with a commercial lender.
The court is unpersuaded by the defendants' contention that the Parking Agreement was revoked by its own provisions. They cite no provision concerning revocation. In contrast to an oral license without a specific duration, the Parking Agreement provided for the length of its initial and potential additional terms. While, in Connecticut, a license to enter property is, in general, revocable at any time, the Parking Agreement does not so provide.
"Generally a license to enter [a] premises is revocable at any time by the licensor . . . [A] license must be exercised only in the manner and for the special purpose for which consent was given." (Citation omitted; internal quotation marks omitted.) Christensen v. Reed, 105 Conn.App. 578, 588, 941 A.2d 333, cert. denied, 286 Conn. 912, 944 A.2d 982 (2008) (no written agreement; access to landlocked property provided by neighbors might have created a license to do so on five separate occasions), citing Walton v. New Hartford, 223 Conn. 155, 163, 612 A.2d 1153 (1992) (oral license) and Miller v. Grossman Shoes, Inc., 186 Conn. 229, 237, 440 A.2d 302 (1982) (implied license). See Bland v. Bregman, 123 Conn. 61, 65, 192 A. 703 (1937) (oral license is revocable).
As discussed above, rather than provide, for example, that it was revocable at any time if there was a failure to pay rent to Signature by its tenant, the Parking Agreement provided for an initial seven-year term, and a potential of two additional five-year terms. Also, the Parking Agreement was not limited by the presence or absence of Electric Boat as a tenant of 6 Shaw's Cove. In essence, this aspect of the defendants' argument seeks to add terms to the Parking Agreement, making it revocable if Signature was not being paid by Electric Boat, which are not contained therein. "[I]n interpreting a contract courts cannot add new or different terms." (Internal quotation marks omitted.) Levine v. Massey, 232 Conn. 272, 279, 654 A.2d 737 (1995).
In direct contradiction to their previous arguments concerning the revocation of the Parking Agreement, the defendants then argue that, since neither Signature nor 280 Atlantic recorded a termination of the Notice of Parking License Agreement, when 280 Atlantic conveyed a portion of its property by means of the Boundary Line Agreement in conjunction with 698 Bank Street, LLC's development of the Walgreen's, the property conveyed by 280 Atlantic remained subject to the Parking Agreement. This argument is unsupported by citation to legal authority.
"We repeatedly have stated that [w]e are not required to review issues that have been improperly presented to this court through an inadequate brief . . . Analysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly . . . Where a claim is asserted in the statement of issues but thereafter receives only cursory attention in the brief without substantive discussion or citation of authorities, it is deemed to be abandoned." (Internal quotation marks omitted.) Taylor v. Mucci, 288 Conn. 379, 383 n. 4, 952 A.2d 776 (2008). As to this argument, the defendants do not cite any legal authority or provide an analysis of legal authority to support their position. The court therefore deems this argument to be abandoned.
The defendants also do not explain, if the property was still subject to the Parking Agreement after the conveyance by 280 Atlantic, where tenants from 6 Shaw's Cove would be able to park on 280 Atlantic's property under the new boundaries.
The defendants also argue that the rights to use 280 Atlantic's parking lot were not assigned to JPMorgan as collateral for the loan. The Parking Agreement provides, in Section 16, that "[e]xcept as set forth herein, this Agreement and its benefits may not be assigned by either party hereto without the prior written consent of the other party." SNL does not allege such as assignment. Rather, Signature was required to enter into the Parking Agreement as part of the loan transaction and, in the Mortgage, was prohibited from making a transfer of any part of the Property without the prior written consent of the lender. See Mortgage, Section 8.2(a). While "a license does not run with the land to bind a subsequent purchaser," Clean Corp. v. Foston, 33 Conn.App. 197, 203, 634 A.2d 1200 (1993), under the Mortgage, Signature was not permitted to give up the right to use the parking lot without the lender's consent.
2. Section 4.3(f)
SNL also contends that the termination of the Parking Agreement violated Section 4.3(f) of the Mortgage, since by doing so, Signature transferred its asset, its right to use 280 Atlantic's parking lot, back to 280 Atlantic, Signature's affiliate or "other person or entity." As discussed above, Section 4.3(f) provides that Signature may not "commingle its assets with the assets of any of its partner(s), members, shareholders, affiliates, or of any other person or entity or transfer any assets to any such person or entity . . ."
The defendants do not dispute the fact that Signature's rights in the Parking Agreement were an asset. An enforceable contract right is an asset. See Jewett v. Jewett, 265 Conn. 669, 684, 830 A.2d 193 (2003); Bentz v. Halsey, 54 Conn.App. 609, 611 n. 3, 736 A.2d 931 (1999) (assets consisted of licenses); Foley v. Huntington Co., 42 Conn.App. 712, 731, 682 A.2d 1026, cert. denied, 239 Conn. 931, 683 A.2d 397 (1996) (assets necessary for operating business included licenses).
"Webster's . . . defines `affiliate' as `a company effectively controlled by another or associated with others under common ownership or control . . .' Black's Law Dictionary (7th Ed. 1999) defines `affiliate' as `[a] corporation that is related to another corporation by shareholdings or other means of control; a subsidiary, parent, or sibling corporation.' `Control' as a noun is defined as `[t]he direct or indirect power to direct the management and policies of a person or entity, whether through ownership of voting securities, by contract, or otherwise; the power or authority to manage, direct, or oversee . . .' Id. As a verb, control is defined as `[t]o have a controlling interest in . . .' Id." Lombardo's Ravioli Kitchen, Inc. v. Ryan, 268 Conn. 222, 232-33, 842 A.2d 1089 (2004).
As discussed above, at the relevant times, Signature and 280 Atlantic both were fifty percent (50%) owned by defendants Andrew J. Julian and Maureen Julian. Their children, Andrew C. Julian and Jason Julian owned the other 50% interest in 280 Atlantic. While Maureen Julian was the managing member of Signature, Andrew J. Julian was the managing member of 280 Atlantic. The two entities are related to one another by ownership and managerial control. Signature and 280 Atlantic are affiliates of each other.
By the summer of 2005, just a few months after the April 2005 loan transaction, the Julians were negotiating with Walgreens to place a Walgreens pharmacy on land which included a significant part of 280 Atlantic's parking lot. The Walgreens lease was entered into in June 2006. Termination of the Parking Agreement soon followed, after which the portion of the parking lot needed for the Walgreens project was acquired by 698 Bank Street, LLC, another related entity.
The defendants do not dispute the facts showing that this trade-off occurred. The evidence is clear that Signature transferred its rights to use 280 Atlantic's parking lot, which was part of the collateral for the loan, to benefit an affiliated entity in securing the Walgreens lease. SNL has proved that Signature violated Sections 8.2 (a) and 4.3(f) of the Mortgage.
The defendants argue, in the alternative, that even if the Parking Agreement was "property" and its "revocation" was a transfer, any related violation of Sections 4.3 and/or 8.2 of the Mortgage did not constitute an event of default, as it is immaterial. Thus, they contend that such a violation does not trigger recourse obligations. In support, they refer to Section 9.1(b) of the Mortgage, which provides that an event of default occurs if Signature "does not comply in all material respects with any of the provisions of Article 8 . . ." (Initial emphasis added.)
This argument is unfounded, since the undisputed event of default which occurred was the nonpayment of the debt, see Section 9.1(a) of the Mortgage (event of default occurs if any portion of the Debt is not paid prior to the seventh day after the same is due), which began in April 2007. The breach of the Mortgage by violating Sections 8.2(a) and 4.3(f) thereof triggered the recourse provisions of Section 10(a) of the Note in the event of default. As quoted above, Section 10(a)(i)(B) states that "in the event . . . of a breach or default under Sections 4.3 or 8.2 of the [Mortgage] . . . the limitations on recourse set forth in this Subsection 10(a) will be null and void and completely inapplicable, and this Note shall be with full recourse to [Signature]." (Emphasis in original.)
While the defendants contend that the violation was immaterial because the initial term of the Parking Agreement expired on December 31, 2008, the undisputed facts show that the Parking Agreement was terminated by Signature and 280 Atlantic two years before that, as of December 31, 2006. Signature was provided with notice of default due to nonpayment soon thereafter, in May 2007. The expiration of the initial term of the Parking Agreement thereafter does not render immaterial a violation which pre-dated it.
The defendants' argument that the Parking Agreement expired because the license fee was not being paid or 280 Atlantic's parking lot was not being used by Signature's tenants as of December 31, 2006 is contradicted by the undisputed facts. These facts show that the Parking Agreement was terminated by agreement between Signature and 280 Atlantic before the initial term expired, and that neither non-payment of the license fee nor non-use by a tenant were bases on which its terms expired.
Similarly unpersuasive is the defendants' argument that the termination of the Parking Agreement was not effective against SNL, since any transfer made in contravention of Section 8 of the Mortgage was null and void and of no force and effect. See Mortgage, Section 8.4. As discussed above, the lease with Walgreens was entered into in June 2006. The lender's awareness of the nonpayment of the license fee provided in the Parking Agreement and the nonuse of the parking lot by Signature's tenants did not cause the termination of the Parking Agreement in October 2006. The undisputed facts show that the Boundary Line Agreement was entered into in March 2007, and that SNL learned of the termination of the Parking Agreement in the spring or summer of 2007. See affidavit of Michael F. Cocanougher, paragraph 28. By then, 280 Atlantic no longer even owned a significant portion of the parking lot, on which the Walgreens building was built. The termination of the Parking Agreement was not immaterial; rather, it was part of a series of events by which, to the detriment of 6 Shaw's Cove, the Julians traded the right to use the parking spaces for a new deal with Walgreens. The defendants' arguments that the termination of the Parking Agreement was of no force and effect as to SNL and SNL took no action to renew the Parking Agreement or to pay the license fee, are tantamount to saying that SNL had the obligation to "lock . . . the barn door after the proverbial horse has taken its exit." Falconi v. Falconi, Superior Court, judicial district of New London at Norwich, Docket KNO FA 03 0128833 (January 13, 2009, Boland, J.) ( 47 Conn. L. Rptr. 91).
Likewise, the defendants' references to appraisals to show that the Parking Agreement never added value to 6 Shaw's Cove are unpersuasive. The March 3, 2005 appraisal by CBRE (defendants' Exhibit 3), pages 22-23, notes additional 125 spaces at the 280 Atlantic parking lot and states that the income generated is offset by payment to 280 Atlantic "and is not included in this analysis." That the amount of parking spaces which existed on-site at 6 Shaw's Cove conformed to zoning requirements and that there were no observed physical constraints that adversely effected the existing use does not provide evidence that the additional spaces were of immaterial value. The fact that Electric Boat's departure was a contemplated risk does not prove that the Parking Agreement added no value.
The CBRE appraisal does not provide a valuation of the Parking Agreement. At the time it was prepared, about one month before the loan transaction, it noted that "a parking lease or license is currently not in place." See defendants' Exhibit 3, p. 23.
The Miner Silverstein, LLP appraisal, dated September 24, 2008 (defendants' Exhibit 2), which was prepared for J.E. Robert Company, Inc., but cited by the defendants, page 7, states that a tenant rented the third floor, but "this same tenant would not take the second floor because of a parking shortage. Accordingly, the market for the second floor is limited to low density whole-floor space users, or must remain partially vacant for lack of parking." The second floor had been leased by Electric Boat. This provides evidence that having additional parking off-site would help attract tenants, showing the importance and materiality of the Parking Agreement to 6 Shaw's Cove. The fact that, in September 2008, this appraisal did not consider "any potential deals for additional parking as this is speculative and may well cost as much as the value added by the extra occupancy potential," see Exhibit 2, page 7, does not provide evidence that the Parking Agreement, which had been in place, but no longer was when the appraisal was prepared more than twenty months after its termination, provided no value.
The later comments, at page 11, that the "lease" with 280 Atlantic had been "divested and is no longer an unnecessary expense" and the recommendation that lighting the parking lot across the street be discontinued since the property receives no benefit from the expense, do not make it immaterial that the Parking Agreement had been terminated and the payments discontinued by agreement between Signature and 280 Atlantic years before. They do not provide evidence that the termination of the Parking Agreement was of immaterial significance. Also, the appraisal's characterization of events has no legal significance; it did not alter the terms of the documents related to the loan.
The defendants also contend that SNL essentially argues that Signature should have continued to pay the license fee to 280 Atlantic even after Electric Boat vacated the premises. As discussed above, Signature and 280 Atlantic terminated the Parking Agreement effective as of December 31, 2006, which coincided with the termination of the Electric Boat tenancy. See defendants' Exhibit 12. The Parking Agreement required Signature to continue to pay the licensing fee, whether it had a tenant for all of the space occupied by Electric Boat or not. Paying that fee was an obligation which Signature incurred in order to get the loan from JPMorgan.
The defendants' argument that, if Signature had continued to pay the license fee to 280 Atlantic, SNL potentially could have claimed that such payment was a transfer of Property in violation of the Mortgage, calls for speculation. Speculation is not competent evidence. See Dzienkiewicz v. Department of Correction, 291 Conn. 214, 223-4, 967 A.2d 1183 (2009). Similarly, defendant Maureen Julian's argument that, by continuing to pay this expense, Signature would have been dissipating and impairing the value of the collaterized assets, is speculative also. By eliminating the availability of the additional parking spaces, a transfer occurred. Once that happened, no prospective tenant of 6 Shaw's Cove could utilize them.
As stated above, the use of parking spaces owned by 280 Atlantic was not tied to Electric Boat's tenancy; any tenant of 6 Shaw's Cove, including a prospective tenant for the space formerly occupied by Electric Boat, could have utilized those spaces, had they remained available, as they were at the loan's inception. That the Parking Agreement added value is also reflected in its definition of 6 Shaw's Cove as the "Benefited Property." See Parking Agreement, p. 1. Similarly, as the terms of the loan reflect, the lender was willing to make the loan on a non-recourse basis, provided that the property remained intact. As discussed above, the Parking Agreement was part of what the parties defined as the property, which could not be transferred without consent.
As discussed below, Signature and the guarantor defendants have raised various special defenses to counts two, three, and four. For the reasons stated below in part E, SNL is entitled to judgment on the special defenses.
Accordingly, since Signature breached Sections 4.3 and 8.2 of the Mortgage, SNL has proved that it is entitled to summary judgment as to Count Two.
C Count Three
Since Signature breached Sections 4.3 and 8.2 of the Mortgage, the nonrecourse provisions of Section 10(a) of the Note are null and void, and the Note is a full recourse obligation of Signature. Thus, SNL is not limited to the security interests granted by Signature in seeking recovery after default. Under General Statutes § 49-14(a), Signature is fully liable for any deficiency judgment which SNL may obtain. Accordingly, summary judgment may enter for SNL on count three.
Section 49-14(a) provides, in relevant part, "[a]t any time within thirty days after the time limited for redemption has expired, any party to a mortgage foreclosure may file a motion seeking a deficiency judgment. Such motion shall be placed on the short calendar for an evidentiary hearing . . . At such hearing the court shall hear the evidence, establish a valuation for the mortgaged property and shall render judgment for the plaintiff for the difference, if any, between such valuation and the plaintiff's claim."
D Count Four
"A guaranty is merely a species of contract . . . [A] guarantee is a promise to answer for the debt, default or miscarriage of another." (Citation omitted; internal quotation marks omitted.) JSA Financial Corp. v. Quality Kitchen Corp. Of Delaware, 113 Conn.App. 52, 57, 964 A.2d 584 (2009). "The elements of a prima facie claim for a breach of a written guaranty are the same as those required to assert a claim of breach of contract. `[T]he elements of a cause of action founded on breach of contract [are] (1) the formation of an agreement, (2) performance by one party, (3) breach of the agreement by the opposing party and (4) damages.' McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., 93 Conn.App. 486, 503, 504, 890 A.2d 140 (2005), cert. denied, 277 Conn. 928 [, 895 A.2d 798] (2006).'" Grand Pacific Finance Corp. v. Augeri-Newfield Associates, LLC, Superior Court, judicial district of Middlesex at Middletown, Docket No. CV 07 5002206 (December 21, 2007, Aurigemma, J.). "[P]laintiff must show (1) that it is owed a debt from a third party; (2) that defendant made a guaranty of payment of the debt; and (3) that the debt has not been paid by either the third party or defendant." (Internal quotation marks omitted.) TD Banknorth, N.A. v. Norwich River, LLC, Superior Court, judicial district of New London at New London, Docket No. CV 07 5008138 (December 8, 2008, Martin, J.).
As discussed above, SNL has proved that Signature is fully liable to it for all amounts due and owing under the Note and Mortgage. Signature's breach of Sections 4.3 and 8.2 of the Mortgage triggered the recourse provisions under Section 10(a)(i) of the Note. Thus, SNL has shown that it is owed a debt from Signature.
Section 1.1 of the Guaranty, quoted above, provides that the Guarantor defendants unconditionally guaranteed the payment of the Guaranteed Obligations. Section 1.2 of the Guaranty, also quoted above, provides that, if the recourse provisions of the Note and Mortgage are triggered, then the Guaranteed Obligations include Signature's full recourse obligation to pay the debt. SNL has shown that, under these circumstances, the Guarantor defendants guaranteed the payment of the debt.
As to the third element, SNL also has shown that the debt has not been paid since the April 2007 default in payment. SNL has accelerated all amounts due and owing pursuant to Section 5 of the Note and Sections 10.1(c) and 20.1 of the Mortgage.
SNL has shown that it is entitled to judgment on count four. The Guarantor defendants are jointly and severally liable for Signature's full recourse obligation under the Note and Mortgage, including any deficiency judgment.
E Defendants' Special Defenses To Counts Two, Three, and Four
In the context of a summary judgment motion, the appellate courts have stated that "it is appropriate for a court to render summary judgment in favor of a plaintiff when the special defenses asserted by a defendant are either not legally viable or do not present a genuine issue of material fact. See, e.g. Webster Bank v. Oakley, 265 Conn. 539, 830 A.2d 139 (2003)." Kazlon Communications, LLC v. American Golfer, Inc., 82 Conn.App. 593, 596, 847 A.2d 1012 (2004).
In that matter, the Supreme Court affirmed the granting of summary judgment in favor of the plaintiff on the special defenses pleaded by the defendant in response to the plaintiff's foreclosure complaint. See id., 265 Conn. 544 n. 7.
Signature and the Guarantor defendants have listed in their opposition briefs seven special defenses to counts two through four of the amended complaint: (1) equitable estoppel; (2) unclean hands; (3) breach of implied covenant of good faith and fair dealing; (4) laches; (5) duty to mitigate; (6) Parking Agreement does not "run" with Shaw's Cove; (7) plaintiff's foreclosure of the Parking Agreement negates any alleged damage resulting from defendants' alleged termination of Parking Agreement. The first four defenses may be characterized as "misrepresentation defenses," pertaining to the assertion that the lender falsely represented that it would not seek a deficiency judgment. The final three may be termed the "Parking Agreement defenses."
Defendants Maureen Julian, Michael Murray, and Andrew Julian also allege that the complaint fails to state a claim upon which relief may be granted. They have not briefed this contention. Accordingly, it is deemed to be abandoned. See State v. Orr, supra, 291 Conn. 645 n. 4; SKW Real Estate Limited Partnership v. Gallicchio, supra, 49 Conn.App. 564 n. 2.
1. Waiver
SNL contends that, under Article 2 of the Guaranty, the Guarantor defendants have waived any defenses they might have had with respect to their obligations under the Guaranty. Specifically, they cite to Sections 2.4, 2.8 and 2.12 of the Guaranty in support of their claim that the Guarantor defendants have waived their defenses.
Article 2 of the Guaranty (page 5) provides that "Guarantor hereby consents and agrees to each of the following, and agrees that Guarantor's obligations under this Guaranty shall not be released, diminished, impaired, reduced or adversely affected by any of the following, and waives any common law, equitable, statutory or other rights . . . which Guarantor might otherwise have as a result of or in connection with any of the following: . . .
[Section 2.4, page 6] The . . . unenforceability of all or any part of the Guaranteed Obligations . . . for any reason whatsoever, including without limitation the fact that . . . (v) [Signature] has valid defenses, claims or offsets (whether at law; in equity or by agreement) which render the Guaranteed Obligations wholly or partially uncollectible from [Signature] . . .
[Section 2.8, pages 6-7] The failure of Lender or any other party to exercise diligence or reasonable care in the . . . enforcement, sale or other handling or treatment of all or any part of such collateral, property or security, including but not limited to any neglect, delay, omission, failure or refusal of Lender (i) to take or prosecute any action for the collection of any of the Guaranteed Obligations, or (ii) to foreclose, or initiate any action to foreclose, or, once commenced, prosecute to completion any action to foreclose upon any security therefore, or (iii) to take or prosecute any action in connection with any instrument or agreement evidencing or securing all or any part of the Guaranteed Obligations . . .
[Section 2.12, page 7] Any other action taken or omitted to be taken with respect to the Loan Documents, the Guaranteed Obligations, or the security and collateral therefore, whether or not such action or omission prejudices Guarantor or increases the likelihood that Guarantor will be required to pay the Guaranteed Obligations pursuant to the terms hereof, it is the unambiguous and unequivocal intention of Guarantor that Guarantor shall be obligated to pay the Guaranteed Obligations when due, notwithstanding any occurrence, circumstance, event, action, or omission whatsoever, whether or not contemplated, and whether or not otherwise or particularly described herein, which obligation shall be deemed satisfied only upon the full and final payment and satisfaction of the Guaranteed Obligations." (Emphasis added.)
"[A] guarantor may expressly waive his rights with respect to collateral that secures the debt that he has guaranteed . . . While a determination about a party's intent to waive his rights ordinarily poses a question of fact, clear and definitive contract language can establish waiver as a matter of law." Connecticut National Bank v. Douglas, 221 Conn. 530, 545, 606 A.2d 684 (1992). "Under Connecticut law, a party to a contract may waive any defenses or rights it has against the other party to the contract, and such a waiver will be enforced if it is clear and unambiguous." Albany Insurance Co. v. United Alarm Services Inc., 194 F.Sup.2d 87, 91 (D.Conn. 2002).
While the Guarantor defendants do not challenge the validity or the clarity of the quoted language, they counter that they did not waive any defenses because Sections 2.8 and 2.12 of the Guaranty are irrelevant. They argue that those Sections are limited to "Guaranteed Obligations" and Section 1.2 of the Guaranty defines "Guaranteed Obligations" to exclude "the unpaid balance of the Debt (as defined in the Security Instrument)," since no breach of Sections 4.3 or 8.2 of the Mortgage occurred.
As discussed above, the undisputed facts show that these Mortgage provisions were breached, making the unpaid balance of the debt part of the Guaranteed Obligations under the Guaranty. See Guaranty, Section 1.2 (page 2).
Accordingly, the waiver provisions of the Guaranty, quoted above, are not irrelevant. Rather, the waiver provisions prevent the Guarantor defendants from raising special defenses to SNL's claims against them. For example, in the misrepresentation defenses, the Guarantor defendants allege various common law and/or equitable defenses, concerning the exercise of remedies and alleged delay in exercising those remedies, such as representing that no deficiency would be sought or no attempt would be made to trigger the recourse provisions of the Mortgage. Such defenses were waived, as set forth in the Guaranty language quoted above. Also, as set forth above, in Section 2.4 of the Guaranty, the Guarantor defendants agreed that, even if Signature were to have such defenses, they agreed to remain liable for the Guaranteed Obligations.
The only Guarantor defendant to assert the Parking Agreement defenses was defendant Lord Drake. In the Guaranty, she waived these defenses. The Parking Agreement defenses assert that the Guaranteed Obligations are unenforceable. They were waived under Section 2.4 of the Guaranty, quoted above. Also, to the extent that they rely on actions taken by the Lender, they were also waived under Section 2.12 of the Guaranty.
2. Special Defenses Fail
In response to SNL's motion, Signature adopted the presentation made in opposition by Guarantor defendants Andrew J. Julian and Michael Murray. See #305. In that presentation, as discussed above in connection with count two, the defendants contend that SNL is attempting to rewrite the history of the Loan and rewrite the terms of the Loan documents. They assert again that the 120 parking spaces were allocated to Electric Boat, which had the right to terminate its lease and did so. They reiterate that SNL failed to pay the license fee to protect its alleged "Property" interest in the Parking Agreement, and chose to sit on its rights under the Mortgage and to use the lapse of the Parking Agreement as a pretext to claim that there has been a breach of the mortgage and that the nonrecourse provisions of the Mortgage should not be enforced. Thus, they rely on the same facts discussed above to support their special defenses.
The misrepresentation defenses, as stated above, consist of (1) equitable estoppel; (2) unclean hands; (3) breach of implied covenant of good faith and fair dealing; and (4) laches. "The standards governing the application of equitable estoppel are well established. There are two essential elements to an estoppel — the party must do or say something that is intended or calculated to induce another to believe in the existence of certain facts and to act upon that belief, and the other party, influenced thereby, must actually change his position or do some act to his injury which he otherwise would not have done." (Internal quotation marks omitted.) O'Connor v. City of Waterbury, 286 Conn. 732, 757, 945 A.2d 936 (2008). In support of their defense of equitable estoppel, the defendants make the same arguments which the court has considered above concerning count two. Based on the same facts, they assert that the loan remains a nonrecourse obligation and that SNL should be estopped from claiming that a breach of the Mortgage occurred and that 6 Shaw's Cove lacks sufficient parking. Their argument is largely based on the documents discussed above, including those related to the Parking Agreement.
Also, the defendants do not contend that SNL ever agreed to accept a deed in lieu of foreclosure.
For the reasons stated above, the undisputed facts show that there is no material issue of fact and that SNL is entitled to judgment as a matter of law. "Without a showing that the defendant was misled, its argument that the doctrine of equitable estoppel should . . . preclude . . . the court from rendering summary judgment has no basis." LaSalle National Bank v. Freshfield Meadows, LLC, 69 Conn.App. 824, 838, 798 A.2d 445 (2002).
The same is true concerning unclean hands. "[F]oreclosure is an equitable action. Our jurisprudence has recognized that those seeking equitable redress in our courts must come with clean hands. The doctrine of unclean hands expresses the principle that where a plaintiff seeks equitable relief, he must show that his conduct has been fair, equitable and honest as to the particular controversy in issue . . . For a complainant to show that he is entitled to the benefit of equity he must establish that he comes into court with clean hands . . . The clean hands doctrine is applied not for the protection of the parties but for the protection of the court . . . It is applied . . . for the advancement of right and justice . . . The party seeking to invoke the clean hands doctrine to bar equitable relief must show that his opponent engaged in wilful misconduct with regard to the matter in litigation . . . The trial court enjoys broad discretion in determining whether the promotion of public policy and the preservation of the courts' integrity dictate that the clean hands doctrine be invoked." (Internal quotation marks omitted.) Emigrant Mortgage Corp. v. D'Agostino, 94 Conn.App. 793, 804, 896 A.2d 814, cert. denied, 278 Conn. 919, 901 A.2d 43 (2006).
The defendants have not shown that SNL engaged in wilful misconduct. As to this defense, they make the same argument, that a nonrecourse loan, was bargained for and that SNL seeks to rewrite the terms thereof. As explained above, the undisputed facts show this not to be the case. Summary judgment is properly rendered where there is no genuine issue of material fact to support the special defense. See Chase Manhattan Mortgage Corp. v. Machado, 83 Conn.App. 183, 190, 850 A.2d 260 (2004).
The defendants also argue that if SNL is allowed to rewrite the loan, then fraud in the inducement will have been shown. Again, this contention is premised on the terms of the documents, including those related to the Parking Agreement, which the court has considered and addressed above.
Likewise, as to the other misrepresentation defenses, concerning good faith and fair dealing, and laches, the defendants have not provided evidence of a genuine issue of material fact to support the special defenses. Concerning good faith and fair dealing, the defendants state that "for the reasons stated herein," summary judgment is not appropriate. See defendants Andrew J. Julian and Michael Murray's memorandum of law, p. 33.
"[E]very contract carries an implied covenant of good faith and fair dealing requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement . . . [T]he concept of good faith and fair dealing is [e]ssentially . . . a rule of construction designed to fulfill the reasonable expectations of the contracting parties as they presumably intended." (Internal quotation marks omitted.) PSE Consulting, Inc. v. Frank Mercede and Sons, Inc., 267 Conn. 279, 302, 838 A.2d 135 (2004). The Supreme Court "has tended to use the terms `bad faith,' `lack of good faith' and `breach of the covenant of good faith and fair dealing' interchangeably." Id., 296 n. 7. The defendants have not presented evidence showing that SNL acted in bad faith.
Thus, the facts here contrast with those in Hudson United Bank v. Cinnamon Ridge Corp., 81 Conn.App. 557, 845 A.2d 417 (2004), cited by the defendants. There, as part of a loan restructure, the parties entered into a handwritten agreement, which "provided [the borrower] with an exclusive listing agreement to sell the foreclosed property and a right of first refusal to purchase the foreclosed property." Id., 562. The jury found that the successor to the lender breached the duty of good faith and fair dealing by not giving the borrower either the exclusive listing rights or the right of first refusal, and that the borrower's default on the note was excused. See id., 563, 565-6, 569. Here, the defendants have not presented evidence which creates a genuine issue of material fact to support the assertion that SNL has breached the parties' agreements or the duty of good faith and fair dealing.
Similarly, in Ohio Savings Bank v. Wage, Superior Court, judicial district of Fairfield at Bridgeport, Docket No. CV 04 4002598 (April 4, 2007, Tyma, J.), cited by Signature, the court's denial of summary judgment as to a special defense which was premised on breach of the duty of good faith and fair dealing was based on facts raised in the defendants/borrowers' affidavits and documents concerning alleged agreements, including an oral agreement, concerning how loan payments would be applied. See id. Here, in contrast, as explained above, the defendants argue that SNL is attempting to rewrite the loan and their contentions are based on the terms of unambiguous documents which, as explained above, do not support the defendants' contentions.
The court next addresses laches. "[T]he defense of laches consists of two elements. First, there must have been a delay that was inexcusable and, second, that delay must have prejudiced the defendant . . . The defense of laches does not apply unless there is an unreasonable, inexcusable, and prejudic[ial] delay in bringing suit. Delay in itself is insufficient to bar a right, the delay in bringing suit must be unduly prejudicial." (Internal quotation marks omitted.) Dickinson v. Mullane, 284 Conn. 673, 679, 937 A.2d 667 (2007). The defendants have not provided evidence of a genuine issue of material fact to show that SNL engaged in inexcusable delay which unduly prejudiced them.
Finally, as to the Parking Agreement defenses, the defendants cite no authority to support these defenses. The defenses of (1) duty to mitigate, and (2) the Parking Agreement did not run with the land, are merely mentioned, without citation to authority, as being supported "for the reasons noted herein." See defendants Andrew J. Julian and Michael Murray's memorandum of law, page 33. They are based on the same factual contentions which the court has addressed above and found not to create a material issue of fact which precludes summary judgment. Whether the Parking Agreement "runs" with 6 Shaw's Cove is immaterial; Signature's breaches of Sections 4.3 and 8.2 of the Mortgage may not be rendered meaningless thereby. Since no authority is cited to support them, the court need not consider these defenses further. See Taylor v. Mucci, supra, 288 Conn. 383 n. 4 (contention receiving only cursory attention in the brief, without citation of authorities, is deemed to be abandoned).
Likewise, the same discussion of special defenses by the defendants does not even mention the defense that SNL's "intention to foreclose" the Parking Agreement negates any alleged damage resulting from defendants' alleged termination of the Parking Agreement. This defense is deemed to be abandoned.
CONCLUSION
For the foregoing reasons, SNL's motion for partial summary judgment as to counts one, two, three, and four is granted. It is so ordered.