J.E.M. v. Meriden Econ. Res. Gr.

Full title: J.E.M., INC. v. MERIDEN ECONOMIC RESOURCES GROUP, INC

Court: Connecticut Superior Court Judicial District of New Haven at Meriden

Date published: Dec 6, 2007

2007 Ct. Sup. 20868 (Conn. Super. Ct. 2007)

Opinion

No. NNI-CV-99-0269962-S

December 6, 2007

MEMORANDUM OF DECISION

NICOLA E. RUBINOW, JUDGE.

This memorandum of decision addresses claims arising from the unsuccessful efforts of the plaintiff, J.E.M., Inc. (JEM) to purchase real property known as the Hub, located in Meriden, from the defendant, Meriden Economic Resources Group, Inc. (MERG). In its revised complaint JEM has asserted claims sounding in breach of contract, bad faith, and specific performance. The matter was tried to the court; both parties have been represented throughout by skilled, experienced and attentive counsel. After hearing and consideration of the evidence in its entirety and after review of the parties' comprehensive briefs and oral arguments, the court finds all issues in favor of MERG. Accordingly, judgment is entered on behalf of the defendant on each count.

I. PROCEDURAL HISTORY

The original five-count complaint, filed on November 2, 1999, named MERG and the city of Meriden (the city) as defendants. Counts one, two and four, for breach of contract, bad faith and specific performance respectively, were directed against MERG; count three, for tortious interference, was directed against the city; and count five, for conspiracy, was directed against both MERG and the city. After the court (Gilardi, J.) granted MERG's request to revise, JEM filed a six-count revised complaint against MERG and the city on January 8, 2002 (#115). Count six of the revised complaint newly asserted a claim against the city, directed at piercing the municipal corporation's veil. On February 25, 2003, JEM withdrew its cause of action against the city (#133). On March 20, 2003, JEM withdrew count five, for conspiracy, of the revised complaint; counts one, two and four remained pending against MERG (#135).¹

1 The claims in the remaining three counts, raising myriad claims that are factually and legally complex, were the subject of intensive evidence, oral and written argument presented by defendant's counsel.

On March 5, 2004, MERG filed an answer, admitting some of JEM's allegations, and a special defense (#136).² In its special defense, MERG asserts that by virtue of having entered into the second amendment to earnest money contract, JEM has waived all or part of its claims alleged in the complaint and so is estopped from raising those claims. MERG asserts that it has complied with its obligations under the operative purchase and sale contract and the forbearance agreement, and that it complied with or fulfilled all pre-closing covenants and conditions.

2 In responding to JEM's complaint, MERG framed the issues differently, but defense counsel also presented abundant evidence, and extensive responsive oral and written argument.

On March 9, 2004, JEM denied the allegations in MERG's special defense (#137). The matter was tried to the court on divers days from July 12, 2005 through May 23, 2007. On July 13, 2005, JEM withdrew the allegations in count three of the complaint that requested the court to order MERG to deliver the deed to the Hub.³ On July 13, 2005, subsequent to its withdrawal of the demand for the delivery of the deed, JEM rested. MERG then filed a motion to dismiss for failure to make out a prima facie case pursuant to Practice Book § 15-8, and the parties submitted comprehensive briefs in support of and in opposition to this motion. After hearing and argument, MERG's motion to dismiss was denied without prejudice.⁴

3 As discussed in Part II, the Hub property has been taken by the city. The parties jointly refer to count four, for specific performance, as a count in which JEM requests the court to order MERG to deliver the deed to the Hub. They further jointly refer to this count as the basis for JEM's claims that MERG should be ordered to perform its obligation under the condemnation clause of the earnest money contract by assigning its interest in the compensation for condemned property to JEM. These requests are not derived from a specific performance count in JEM's complaint, but are raised through the plaintiff's prayer for relief.

4 In so ruling, the court concluded only that JEM had "submit[ted] evidence which, if credited, [wa]s sufficient to establish the fact or facts which it [wa]s adduced to prove." (Emphasis added; internal quotation marks omitted.) Winn v. Posades, 281 Conn. 50, 55, 913 A.2d 407 (2007). For the purpose of this motion, "[t]he evidence offered by the plaintiff is to be taken as true and interpreted in the light most favorable to [the plaintiff], and every reasonable inference is to be drawn in [the plaintiff's] favor." (Internal quotation marks omitted.) Id.

On March 9, 2007, also during the course of trial, JEM filed a proposed second revised complaint (#169) with count four, for specific performance, reinstated in its original form, again placing before the court its demand for delivery of the deed to the Hub. After hearing on May 23, 2007, this court denied MERG's objection and granted, without prejudice, JEM's motion for leave to amend the complaint.

MERG filed its posttrial brief on August 8, 2007; JEM filed its brief on August 9, 2007.

II. FACTUAL FINDINGS

The parties provided the court with voluminous documentary evidence consisting of the following: earnest money contracts; forbearance agreements; letters of intent; correspondence and facsimile transmissions, with attachments; loan, mortgage, security, lease, management and other financing data; deposition transcripts excerpts; property expense, reimbursements and rent reports; a title report; a calendar; a return of service and other court documents. The parties stipulated to certain facts, and permitted the court to take judicial notice of the file in Meriden v. Meriden Economic Resources Group, Inc., Superior Court, judicial district of New Haven at Meriden, Docket No. CV 05 4003457 (condemnation file). Testimony was presented through: Randall Kamerbeek, the city's director of economic development; Joseph Tesoriere, JEM's Chief Executive Officer; John Stanton, counsel for MERG; Donald Provencal, formerly associated with the Hub's property management firm; Theodore Schaffer, former president of a division of FIP, the Hub's property management firm; and Kenneth Mango, counsel for JEM. The plaintiff presented full transcripts of deposition testimony from James McGuire, the president and half owner of JEM (Exs. 62, 62A); Donald Taylor, the president of Northeast Capital Group, Inc. (Ex. 63); Peter Underhill, a member of Peter K. Underhill Associates, LLC (Ex. 65); and Joseph Marinan, the city's former mayor (Ex. 66). The court utilized the applicable legal standards when considering the evidence as a whole.⁵ By this measure, the court finds the following salient, relevant facts.⁶

5 "[T]he sifting and weighing of evidence is peculiarly the function of the trier [of fact]. [N]othing in our law is more elementary than that the trier [of fact] is the final judge of the credibility of witnesses and of the weight to be accorded to their testimony . . . The trier is free to accept or reject, in whole or in part, the testimony offered by either party . . . Smith v. Smith, 183 Conn. 121, 123, 438 A.2d 842 (1981). The determination of the credibility of the witnesses is a function of the trial court . . ." (Internal quotation marks omitted.) Welsch v. Groat, 95 Conn.App. 658, 664, 897 A.2d 710 (2006). "In considering the evidence introduced in a case, [triers of fact] are not required to leave common sense at the courtroom door . . . nor are they expected to lay aside matters of common knowledge or their own observations and experience of the affairs of life, but, on the contrary, to apply them to the facts in hand . . ." (Internal quotation marks omitted.) Id., 666-67.

6 Additional facts will be found as required.

On March 1, 1995, MERG was a non-profit entity formed by the city for the ostensible purpose of promoting Meriden's economic resources, and to acquire title to the Hub. (Ex. 57.) MERG then owned the Hub property consisting of land and commercial buildings located at One State Street in Meriden, CT. On that date, Packard BioScience Company, formerly known as Canberra Industries, Inc. (Packard) loaned MERG a total of $3,300,000. That loan was secured by a mortgage encumbering the Hub; the mortgage was recorded in the Meriden land records on March 2, 1995 at Vol. 2084 p. 1. (Exs. 3, 4, 11, 57, T.) The Hub was located in a heavily-developed area of downtown Meriden that had historically been subject to flooding on a frequent basis. (Exs. 50, 57, 66.) MERG was not involved with flood control for the city. (Tes. Kamerbeek.)

In 1995, Jay Beradino was MERG's president and Theodore Schaffer was the vice president of FIP Real Estate Services, Inc. (FIP). Commencing on March 31, 1995, through a contract entered into by Beradino and Schaffer, MERG engaged FIP to serve as "its sole owner to manage and operate" the Hub. FIP's assumed duties included, among other things: maintenance and inspection of the property to determine the state of the Hub and to recommend and perform maintenance, repairs or replacements; collection and recording of rent from lessees using the property; and provision of security and utilities, excluding telephone services, for the property. The property management contract required FIP to obtain MERG's express consent for provision of services "in excess of $2,500 or in excess of line item amounts within budgets previously approved by [MERG.]" (Ex. Z.) Tina Bergeron was the FIP employee directly serving as the manager of the Hub property. Commencing on September 1, 1995, MERG agreed that FIP would serve as the sole agent for the Hub, and FIP held the exclusive right to lease or sell any portion of those premises, receiving agreed-upon commissions therefor. (Exs. C, S, Y.) Through FIP, MERG maintained documentation reflecting its anticipated income and budgeted expenses for the Hub's annual management, maintenance and debt service.⁷ (Exs.45, X; Tes.Schaffer.)

7 FIP ceased managing the Hub in approximately 2000. (Tes. Provencal.)

In 1999, Kamerbeek was the city's Director of Economic Development. While he nominally served as director for MERG, whose membership consisted of volunteers, he did not manage the group's day-to-day operations.

In 1999, JEM desired to purchase the Hub.⁸ James McGuire was then President and CEO of Donaco Property Management LLC (Donaco); he also controlled JEM and State Street LLC. (Exs. 19, 20, 25, 29, 62.) In February 1999, Packard received correspondence from Donaco indicating Donaco's intention to purchase the Hub. Holding the mortgage on the Hub, Packard wrote to Kamerbeek asking that MERG enter into the "negotiations which will be required to complete this transaction expeditiously." (Ex. 11.) On March 9, 1999, Donaco, through its counsel, Mango, wrote to MERG and extended an offer to purchase the Hub for $2,500,000. Recognizing that this offer was less than MERG's indebtedness on the property, Donaco made its offer "contingent upon MERG obtaining a full release of mortgage from Canberra." (Ex. 12.)

8 Kamerbeek had commenced work in this capacity in 1993. He was paid by the city and, in the course of his employment, he engaged in work with FIP. By mid-2001, Kamerbeek had been excluded from MERG's operations. (Ex. 64-1; Tes. Kamerbeek.)

In April 1999, JEM, also represented by Mango, and MERG, represented by Attorney Stanton, engaged in negotiations concerning the use of the property. (Exs. H, I, W.) Having reached agreement, Mango drafted the earnest money contract reflecting the terms for the planned purchase and sale. (Ex. 1; Tes. Stanton, Mango.) The parties entered into the earnest money contract on April 30, 1999; Beradino signed on behalf of the seller, MERG, and McGuire signed as president of JEM, the purchaser, with Mango and Stanton serving as witnesses. Sections 2.1 and 2.2 of the contract established that as consideration for the Hub property, JEM would pay $2,500,000 "in cash at Closing or in such form as to be immediately available for investment by Seller on the day of closing." Section 3.1 of the contract called for JEM to produce an earnest money deposit of $10,000 that would be held by Stanton as the escrow agent, to be applied to the purchase price at closing. The contract, however, clearly anticipated the possibility that the closing might not ever occur as Section 3.1 also contained the following language: "In the event this Contract is not closed, the Escrow Agent shall disburse the Earnest Money in the manner provided for elsewhere in this contract." Section 4.1 of the contract set forth the parties' agreement that JEM would obtain a commitment for title insurance within ten days following execution of the contract. Section 4.1 further provided "that the mortgage currently on the [Hub] in favor of Packard BioScience Company dated March 1, 1995 . . . will be released in accordance with the terms set forth herein and in that certain Forbearance Agreement among the Seller, Purchaser and Packard . . . of even date herewith the `Forbearance Agreement.'" Section 4.2 identified JEM's obligation to have, "[a]t closing, obtained the agreed upon form of title insurance." Section 5.1 set forth the partie's agreement that in the event of a "taking by condemnation . . . of a portion of the [Hub] which is not material to the use of the remainder in accordance with [JEM's] development plan, this Contract shall not terminate, but shall remain in full force and effect, and [MERG] shall assign or pay to [JEM] at Closing [MERG's] interest in and to any condemnation . . . In the event of a taking by condemnation . . . of all of the [Hub] or any portion of the [Hub] which is material to the use of the remainder in accordance with [JEM's] development plan, [JEM] shall have the option to terminate this Contract upon written notice to Seller prior to Closing, in which event the Earnest Money and all earnings thereon shall be promptly refunded . . . Should [JEM] elect not to exercise its option as provided hereunder, then the Contract shall remain in full force and effect and Seller shall assign or pay to Purchaser at Closing Seller's interest in and to all condemnation awards . . . subject to the prior rights of the holder of any mortgage encumbering the Premises." (Ex. 1.)

Section 7.1 of the earnest money contract designated June 1, 1999, as the closing date; this date was selected by McGuire. (Ex. 1; Tes. Stanton.) Section 9.1 rendered the contract "contingent upon receipt by [JEM] of environmental, engineering, and structural surveys, tests and reports satisfactory to [JEM] in its sole discretion by May 22, 1999." Section 7.1 further provided that if the documents were "unsatisfactory to [JEM] and [JEM] notifies [MERG] in writing by May 22, 1999," the earnest money deposit would be returned to JEM. Through Section 10.1, MERG represented that it had not received notice from any governmental agency indicating that there was "a current and ongoing violation" of environmental or hazardous substance statues or regulations at the Hub. (Ex. 1.) Section 13.1 provided JEM with the right to enter the Hub at any reasonable time to investigate, test or study the property. Section 13.1 further obligated MERG, prior to the closing date, to "furnish to [JEM] all information concerning the [Hub] that [JEM] may reasonably request." Section 15.1 specifies that any notice or communication to MERG required under the contract be made in writing and delivered to Kamerbeek at the Meriden City Hall, with a copy to Stanton, thereby requiring that any request to MERG for information concerning the Hub that JEM might present pursuant to Section 13.1 would have to be delivered, in writing, to Kamerbeek and copied to Stanton. (Ex. 1.)

Also on April 30, 1999, simultaneous to the execution of the earnest money contract and for due consideration, JEM, MERG and Packard entered into a written forbearance agreement. This agreement reflected, among other things, that MERG was in default of its obligations to repay Packard's $3,300,000 loan; that JEM and MERG have executed a contract for transfer of the HUB to JEM "on or before June 1, 1999;" and that, upon MERG's request, Packard agreed to "forbear for a reasonable period of time from pursuing its rights and remedies" to foreclose on the Hub property. (Ex. 4.) Paragraph 1(a) of the forbearance agreement defined that "reasonable period of time" as follows: "[I]f the transfer of the Property from [MERG] to [JEM] and the repayment to [Packard] of the agreed upon portion of the Indebtedness have not occurred on or before June 1, 1999, the Forbearance Period shall end on June 14, 1999, without notice or demand. Time shall be of the essence with respect to the latter date." (Ex. 4.) Paragraph 2 of the forbearance agreement called for both JEM and MERG to make certain payments "on the Date of Closing"; neither buyer nor seller would be obligated to make payments if the other did not comply. Paragraph 2(a) of the forbearance agreement expressly described JEM's obligation, at closing and "[o]n behalf of MERG," to pay Packard $2,230,000.⁹ Paragraph 2(b) expressly described JEM's obligations to pay: the amounts described in ¶ 2(a); to pay MERG up to $150,000 to cover the ordinary costs of operating the Hub between the date of contract and the date of closing, subject to adjustment and certain of Stanton's legal fees and other expenses of the sale.¹⁰ (Ex. 4.) Paragraph 2(f) called for Packard to release the mortgage on the Hub and to return the Note to MERG at the closing "[u]pon receipt of all amounts to be paid to [Packard] under this Agreement . . ." (Ex. 4.) The forbearance agreement was executed by Packard, by Beradino for MERG and by McGuire for JEM. (Ex. 4.)

9 Paragraph 2(a) of the forbearance agreement also described JEM's obligation, at closing and on behalf of MERG, and to pay a total of $270,000 to the Meriden YMCA, Inc., the United Way of Meriden Wallingford, and to MidState Medical Center.

10 Paragraph 11 of the forbearance agreement expressly anticipates MERG's "retaining the net sum of $150,000 after disposition of the Property," and further contemplated MERG's authority to withdraw from the purchase and sale agreement in the event that a lesser amount would be available. (Ex. 4.) JEM has provided insufficient basis from which the court could reasonably conclude that this provision played any relevant role in MERG's determination not to extend the closing date beyond August 24, 1999, or that this language in any way impacted MERG's interactions with JEM during the due diligence period.

By May 3, 1999, JEM had commenced its due diligence inquiries into the physical and financial status of the Hub property. JEM had been informed that information concerning the Hub, including common charges to the Hub's tenants, could be obtained through inquiries directed at FIP, the property manager. (Exs. 13, 14.)

On May 20, 1999, for ten dollars consideration, JEM and MERG entered into the first amendment to the earnest money contract; the amendment was executed by McGuire for JEM and Beradino for MERG in the presence of Mango and Stanton. Through this amendment, the closing date specified in § 7.1 of the original contract was changed to June 20, 1999. In addition, "[t]he date for receipt by [JEM] of environmental, engineering and structural surveys, tests and reports satisfactory to [JEM] in its sole discretion, and the date for notification to [MERG] by [JEM] in writing if the surveys, tests or reports are unsatisfactory, [was] changed from May 22, 1999 to June 1, 1999." (Ex. 2.)

Also on May 20, 1999, for due consideration, JEM, MERG and Packard entered into a first amendment to the forbearance agreement. Through this amendment, the parties to the forbearance agreement acknowledged that the date for transfer of the Hub from MERG to JEM and the closing dates were "changed from June 1, 1999, to June 30, 1999" and established that "[t]he date for the end of the Forbearance Period set forth in Subparagraph 1(a) [was] changed from June 14, 1999, to July 13, 1999." (Ex. 5.) Pursuant to ¶ 5 of this first amendment, the "terms, provisions and conditions" of the forebearance agreement, logically including the "time is of the essence" clause, would otherwise "remain in full force and effect." (Ex. 5.) This amendment to the forbearance agreement was executed by Packard, by Beradino for MERG and by McGuire for JEM. (Ex. 5.)

Thereafter, the parties agreed to a series of extensions for the closing date. The first extension scheduled the closing date for June 30, 1999; the second extension scheduled the closing date for July 14, 1999; and the third extension scheduled the closing date for July 24, 1999.¹¹ (Exs. 3, P; see also Exhibit 23.)

11 On behalf of JEM, Mango requested the second extension of the closing date through a June 29, 1999 letter to Stanton, as follows: "At this point in time, my client does not have a written loan commitment for the purchase of the [Hub]. Jim McGuire tells me that one is imminent but I have no knowledge of that beyond his statement to me. It is obvious that a closing cannot take place tomorrow. It seems to me that any lender will require at least two (2) weeks to close. Therefore, I am requesting a two (2) week extension." (Ex. P; see also Tes. Stanton.)

On July 22, 1999, for due consideration, Packard, JEM and MERG entered into a second amendment to the forbearance agreement. Through this amendment, the parties to the forbearance agreement acknowledged that the date for transfer of the Hub from MERG to JEM and the closing dates were "changed to August 24, 1999," effectively establishing a fourth extension of the date for closing. (Exs. 6, Q, U; see Exhibit 24; Tes. Mango, Stanton.) This amendment also indicated that "[t]he date for the end of the Forbearance Period set forth in Subparagraph 1(a) [was] changed to August 24, 1999." (Exs. 6, U.) Pursuant to ¶ 5 of this second amendment, the "terms, provisions and conditions" of the forebearance agreement, logically including the "time is of the essence" clause appearing in the original forbearance agreement, would expressly "remain in full force and effect." (Exs. 6, U.) This amendment to the forbearance agreement was executed by Packard, by Beradino for MERG and by McGuire for JEM. (Exs. 6, R, U; see also Exhibit 23.)

On July 29, 1999, Packard proffered a commitment to loan State Street, LLC $500,000 for a period of one year at a rate of 13% annual interest, to finance a portion of the cost of acquiring the Hub. The loan commitment anticipated and designated several conditions precedent to the loan: Packard's security by way of a second mortgage status against the Hub; collateral assignment of profits subject to the interest of the first mortgagor; a first security interest in fixtures, equipment and personalty; and State Street's solvency on the closing date. The loan further anticipated State Street's simultaneous closing on a loan not to exceed $2,000,000, to be secured by a first mortgage; and the payment of $2,095,000, by wire transfer, from State Street to Packard that Packard would accept "as payment in full" of MERG's $3,300,000 debt. (Ex. 25.) Paragraph 20 of the commitment expressly stated that it "shall terminate and expire if the Loan closing shall not have been completed on or before August 31, 1999." (Ex. 25.)

On August 13, 1999, MERG's board agreed to extend the closing date for a fourth time, conditioned on the following criteria: time for closing must be made of the essence in the earnest money contract; JEM must have met all its preclosing obligations; and the contract for purchase and sale would automatically terminate if JEM failed to close on or before August 24, 1999. (Ex. 31; Tes. Stanton.) Thus, on or about August 19, 1999, for ten dollars as due consideration, JEM and MERG entered into a second amendment to the earnest money contract. (Ex. 3.) Like the prior amendments, this contract amendment was signed by McGuire for JEM and Beradino for MERG; signatures were witnessed by Mango and Stanton. (See Exhibits 36, 38.) Through ¶ 1 of this amendment, the fourth extension of the closing date was expressly agreed to, leaving the closing to take place on August 24, 1999. Unlike the earnest money contract of April 30, 1999, or the first amendment of May 22, 1999, ¶ 1 of the second amendment expressly set forth the parties' agreement that the closing would take place on August 24, 1999, and that "Time shall be of the essence with respect to said Closing Date." ¹² (Emphasis added.) (Exs. 3, 59; Testimony of Kamerbeek.) In ¶ 2, this second amendment set forth the parties' agreement as to the status of the planned purchase and sale: "[JEM] hereby acknowledges that as of the date of this Second Amendment To Earnest Money Contract [MERG] has complied with its obligations under said Contract, as amended to date, and to the best of [JEM's] knowledge, under that certain Forbearance Agreement dated April 30, 1999 as amended to date, between [Packard], [MERG] and [JEM]. To the best of [JEM's] knowledge, all pre-closing covenants and conditions, as of the date hereof, have been complied with and fulfilled." (Emphasis added.) (Ex. 3.) In ¶ 3 of this second amendment, the parties expressed their intention that the fourth extension of the closing date would be final: "In the event that [JEM] fails to close by the extended closing date of August 24, 1999, the Contract shall terminate, [JEM's] deposit shall be retained by [MERG] as liquidated damages, and the parties shall have no further obligations to each other thereunder, except for the obligations of the Purchaser under Article 13.1 of the Earnest Money Contract, as amended to date."¹³ (Emphasis added.) (Ex. 3.)

12 This fourth extension of the closing date was fundamentally agreed to by Packard, although it was not a party to this contract; the "time is of the essence" terms included in ¶ 1 of the second amendment to the earnest money contract mirrored, however, the language of the forbearance agreements to which Packard was a party. (Exs. 4, 5, 6; see also Exhibit 24.)

13 In the event that the closing did not occur, Section 13.1 of the Earnest Money Contract obligated JEM to return to MERG any confidential environmental and/or engineering reports concerning the Hub. (Ex 1.)

Following April 30, 1999, and continuing into August 1999, JEM made efforts, albeit unsuccessful, at obtaining financing from a procession of lenders, directed at meeting its financial obligations to purchase the Hub as called for under the earnest money contracts, the forbearance agreement, and the amendments thereto.¹⁴ JEM's evidence lacked specificity with regard to the financial basis accompanying its entreaties to those lenders, which included The Northfield Corporation (Northfield); Dynamic Funding Corp. (Dynamic); The Northeast Capital Group, Inc. (Northeast); and Peter K. Underhill Associates (Underhill Assoc.). (Exs. 7, 8, 19, 20, 26.) The evidence is sufficient for the court to conclude that none of these lenders made funds available for JEM to use in meeting its contractual obligations with regard to purchasing the Hub; even in August 1999, as the fourth extended closing date approached, JEM was engaged in yet another endeavor to secure financing, this time from Underhill Assoc., to whom JEM sent due diligence documents under date of August 12, 1999.¹⁵ (Exs. 26, 27, 29, C, F, M; Tes. Underhill.) This fact supports the court's conclusion that JEM had not yet succeeded in securing appropriate financing from any of the lenders to whom it had applied. Moreover, despite JEM's tenacious arguments to the contrary, the evidence as a whole is insufficient to allow the court to conclude that its failure to secure the requisite financing resulted from any acts or omissions on the part of MERG, FIP or its agents insofar as their response to inquiries for information regarding the Hub was concerned. (Ex. 19; Tes. Schaffer, Kamerbeek.) While JEM protests that it consistently had commitments for financing enabling it to close upon the property, such a finding is inconsistent with the credible evidence that the plaintiff ventured from one lender to another and to another without closing on any of the dates specified during the late spring and summer of 1999. Close evaluation of the evidence related to JEM's application to Underhill Assoc. yields insufficient basis for concluding that this lender was willing to extend the funds necessary to close the Hub transaction, to protect the Packard loan, or to otherwise fulfill JEM's contractual obligations, by August 24, 1999, or at any reasonable time thereafter. (Exs. 33, 34, 35, 39, 40, 42, 62, 62A, 66; Tes. McGuire, Underhill.)

14 JEM utilized the services of Bryan Woods, a broker associated with Universal Funding, to assemble the financing. (Exhibits 44, 49.)

15 Despite Mango's communications implying that JEM had commenced negotiations with Underhill Assoc. late in the summer of 1999, McGuire admits that this lender had been a part of JEM's financing efforts as early as June 1999. (Ex. 62.) If this is so, notwithstanding the passage of multiple scheduled closing dates in June and July 1999, Underhill Assoc. apparently delayed sending JEM its "list" of required due diligence materials until August 4, 1999. (Ex. 26.) At trial, JEM presented correspondence from Underhill Assoc. that specified the extensive list of "Items Requested" by this lender in conjunction with the plaintiff's loan application and that indicated the insufficiency of JEM's previous submissions. (Exs. 26, 35.) These facts yield the reasonable inference that JEM's failure to timely secure financing for the Hub was due to the relative ennui of entities other than MERG.

It is undisputed that the closing did not take place, as scheduled, on the date of the fourth extension, August 24, 1999. (Tes. Stanton.) The circumstances of this case, reflecting JEM's requests for extensions of the closing date until June 30, July 14, until July 24, and until August 24, 1999, impel the determination that JEM had irresolvable difficulties that prevented it from reasonably timely closure of this transaction, which difficulties were not caused, created, or enhanced in any way by the conduct of the defendant MERG. This conclusion is supported by the fact that on Tuesday, August 24, 1999, Mango wrote to MERG acknowledging that an unnamed lender to whom JEM was said to have applied for financing, had "cancelled the deal" on Friday, August 20, 1999, ostensibly because of the lender's misunderstanding with regard to the status of a single lease at the Hub property. (Exs. 42, V; Tes. Stanton.)

Mango thus requested a fifth extension of the closing date, asking that it take place on September 15, 1999. In so doing, however, Mango provided MERG with documentation reflecting JEM's apparent reliance upon Packard's extension of the $500,000 loan proposed on July 29, 1999, as discussed above. (Ex. 25.) This very loan proposal was both dependent upon MERG's sale of the Hub to JEM, and would expire, by its very terms, on August 31, 1999. Moreover, Mango's submissions indicated the still-tenuous nature of any additional financing JEM may have procured through the "alternate lender" to whom his letter referred, as the access to that funding was still based on the assumption that "the due diligence does not uncover any serious problems." (Ex. 42; Tes. Stanton.) MERG perceived Mango's letter as providing insufficient reason to expect that there would be any change in JEM's pattern of failure to close on time. (Tes. Kamerbeek.) Accordingly, MERG declined to extend the closing to a fifth date requested by the plaintiff.¹⁶ On MERG's behalf, Stanton wrote to McGuire on September 3, 1999, informing him of this decision. (Ex. 51; Tes. Stanton.) The parties did not reach agreement concerning further amendment of the earnest money contract after it expired, of its own terms, on August 24, 1999. (Tes. Stanton.) McGuire, unilaterally, continued to pursue purchase of the Hub property. (Ex. 52.)

16 Notwithstanding MERG's decision, Woods continued to work on JEM's behalf in an effort to acquire the Hub. After August 24, 1999, Underhill Assoc. continued to review the Hub's financial information, and continued to request additional financial data through Woods. (Exs. 46, 47; see also Exhibit 48.) On August 24, 1999, Woods wrote to Mango proposing the creation of a single-asset entity to hold the property; that single-asset entity would be comprised of judgment proof entities representing Underhill and McGuire. (Ex. 44.) As transmitted to Packard's counsel, this proposal still contemplated Packard's extension of the $500,000 loan previously mentioned, notwithstanding the likelihood that the August 31, 1999 expiration date would pass before the new entity could secure the Hub. (Ex. 44.) On August 25, 1999, Woods wrote to Mango indicating that Underhill was "still moving ahead with the $2,000,000 financing of the Hub" and anticipated closing on September 15, 1999. (Ex. 49.) Notwithstanding Underhill's claimed forward motion, however, that proposed lender was still questioning the viability of the Hub's economic stability and the potential that the building was affected by asbestos contamination, indicating the still-insecure nature of the funding at issue. (Ex. 49.)

As of May 3, 1999, Mango had sent Kamerbeek a letter indicating that JEM was aware that the Hub property could be adversely affected by water flowing from Harbor Brook.¹⁷ (Ex. 13.) On June 23, 1999, an article published in the local newspaper indicated that some city officials felt the sale of the Hub to a private party could hinder municipal efforts at flood control. (Ex. 16; see also Exhibit 66.) Some years prior to the summer of 1999, the city had engaged consultants to investigate "the factors contributing to flooding in the downtown Meriden area . . ." including the Hub. (Ex. 50; see also Exhibit 16.) On September 2, 1999, while the consultant's study was being completed, the city engineer wrote to the city manager stating "the acquisition of the Hub property is very important to alleviating the downtown flooding problems and the overall Harbor Brook Flood Control Project."¹⁸ (Ex. 50; see also Exhibit 57.) However, there is insufficient evidence, however, from which the court could reasonably conclude that any person associated with MERG, including Kamerbeek or FIP personnel, had knowledge, at any time prior to August 24, 1999, that the city had decided to take the Hub property as its own, to the exclusion of a private owner. (Tes. Kamerbeek.)

17 At this time, while Kamerbeek remained as the city's director of economic development, he was no longer assigned to coordinate MERG's activities. (Tes. Kamerbeek.)

18 The consultant's report was made available to the city on a date not made known to the court. The report, itself, recognized the significance of the Hub in flood prevention: "Removal of the Hub [demolition] would allow for the construction of an engineered flood control system that could prevent the flooding of other businesses in the downtown area, while providing a park area in the center of Meriden." (Ex. 57.)

MERG continued to default with regard to the Packard mortgage. (Tes. Kamerbeek.) On September 7, 1999, the city, through its council, voted to acquire the notes and mortgage on the Hub through payment to Packard of "an amount not to exceed $2,250,000." (Ex. 53.) On September 8, 1999, McGuire wrote to Packard explaining his intention to bring suit against "all parties" in view of, among other things, MERG's "efforts to undermine our contract . . ." (Ex. 54.) On September 10, 1999, notwithstanding McGuire's intentions, Packard and the city entered into an agreement acknowledging that Packard desired to sell, and the city desired to acquire, Packard's interest in the mortgage and the Hub property in exchange for the city's payment of $2,250,000. The closing date was set for October 15, 1999.¹⁹ (Exhibit 56.)

19 On September 13, 1999, the city requested $2,250,000 of state assistance to acquire the property, representing that this "investment will lead to elimination of [the downtown Meriden area's] flooding problem, and to the economic renaissance of the center of our city." (Ex. 57.) At a city council meeting on September 20, 1999, the municipality made $500,000 available from its general fund for acquisition of the notes, mortgage, and security agreement regarding the Hub. (Ex. 57.)

Under date of October 14, 1999, JEM prepared a Lis Pendens giving notice "of the pendency of a civil action brought by [JEM] against [MERG and the city] by writ dated October 14, 1999, returnable to the Superior Court to be held at Meriden, within and for the Judicial District of New Haven on November 9, 1999, which action was brought for specific performance and damages with respect to a certain Earnest Money Contract between the plaintiff as purchaser and the defendant [MERG], as seller, dated April 30, 1999 . . ." (Ex. 70.) This lis pendens, describing the Hub property, was recorded at Vol. 2509 Pg. 180 of the Meriden land records. (Ex. 70.)

On June 22, 2005, the city commenced the condemnation proceedings. On that date, the city filed with the clerk of the court a Statement of Compensation (statement) indicating that on May 16, 2005, the city's governing body had determined to condemn the Hub property and a second parcel of land "for the purposes of flood control." (Ex. 68.) In ¶ 5, the statement sets forth the "names of all persons having a record interest in the property," referencing, among others: MERG as the Hub property's owner in fee simple "subject to any encumbrances"; and JEM as having a lis pendens on the property; and the city as having an interest in MERG's March 1, 1995 mortgage to Canberra Industries to secure the payment of $3,300,000, "which mortgage was assigned to the City of Meriden [on] October 12, 1999." (Ex. 68.) In ¶ 6, the statement gives notice that "The Condemnor has determined that the amount of the compensation to be paid to persons entitled thereto for such taking is $1,685,000.00 . . . and this sum is being deposited with the Clerk of the Superior Court for the Judicial District of New Haven at Meriden in accordance with the provisions of Section 8-130 of the Connecticut General Statutes." (Ex. 68.) On that date, the city also filed its notice to, among others, JEM and MERG, indicating that the statement had been filed relative to the Hub property; that the condemnor intended to file a Return of Notice not less than twelve but not more than ninety days with regard to "all persons having a record interest in the premises" (¶ 2.); that "Upon receipt of such Return of Notice, the Clerk shall issue a Certificate of Taking" for the property at issue (¶ 3.); that "Upon the recording of such Certificate of Taking, title to the premises described therein shall vest in the condemnor, the right to just compensation shall vest in the persons entitled thereto and the condemnor may then . . . take whatever action is proposed with regard to such property in pursuance with the planned use for the property." (¶ 4.) (Ex. 69.) The statement and notice indicated a return date of July 26, 2005. (Exs. 68, 69.)

On July 7, 2005, the city filed its return of notice indicating, among other things, that on June 23, 2005, the notice and the statement were served, in hand, upon an authorized officer of JEM. (Condemnation File #101; Exhibit AA; Tes. Stanton.) Also on that date, the Deputy Chief Clerk issued his Certificate of Taking regarding the Hub property; acknowledging the effect of this issuance, the parties have stipulated that title to the Hub vested in the city of Meriden as of July 7, 2005. In ¶ 3, the Certificate of Taking identified JEM as a person "having a record interest in the property." In ¶ 5, the Certificate of Taking concludes that "[t]he taking has now been completed . . ." and that the interest in the Hub property vests in the condemnor, while "the right to just compensation shall vest in the persons entitled thereto . . ." (Exs. 67, 71; Condemnation File #102.) The Certificate of Taking was recorded at Vol. 3611 Pg. 147 of the Meriden land records. (Ex. 71.) JEM does not contest the adequacy of the recording of the certificate of taking upon the land records for the city of Meriden.

Notwithstanding due notice of the proceedings, the condemnation file does not reflect any appearance entered on JEM's behalf in that matter. On August 12, 2005, the city moved for default against JEM and others for failure to appear pursuant to Practice Book § 17-20. (Condemnation File #103.) Without submission of objection by JEM, the clerk granted this motion, in the ordinary course of the court's business, on August 17, 2005. On August 15, 2005, the city filed its Motions for Judgment, Determination of Priorities, and for Payment of Deposit (motion for judgment).²⁰ (Condemnation File #104, #104.25, #104.50; Exhibit BB; Tes. Stanton.) On August 29, 2005, the court (Wiese, J.) granted each motion in favor of the city. Accordingly, the court that date entered judgment for the plaintiff in the condemnation case, and ordered payment of $1,685,000.00 to the city of Meriden. Nothing, however, was ordered paid to MERG. (Condemnation File #105.) The parties have stipulated that JEM did not appeal the issuance of the Certificate of Taking, the Statement of Compensation or condemnation issues.

20 Although the city entitled this submission, in part, "Motion for Supplemental Judgment," no judgment had been entered as of August 12, 2005.

JEM entered bankruptcy in 1999. In July 2005, JEM did not have the $2,500,000 in assets necessary to perform as required by the earnest money contract. (Exs. 1, 2, 3; Tes. Tesoriere.) Any assets JEM had in 1999 have been merged into the liquidation process associated with the bankruptcy. Any monies JEM might recover in this lawsuit would be assigned to the bankruptcy litigation trust which is part of JEM's reorganization plan. (Tes. Tesoriere.)

The parties have stipulated that as of May 23, 2007, the buildings upon the Hub property had been demolished.

III. ADJUDICATION

As found in Part I., JEM's present complaint raises complex claims that, fundamentally, sound in breach of contract, breach of the covenant of good faith and fair dealing, and specific performance. Despite the significant quantity of evidence and the vigor of the arguments JEM submitted in support of these claims, that evidence is insufficient to meet the assigned burden of proof. Accordingly, for the following reasons, the court finds each count in favor of the defendant.

A. CLAIMS BASED ON BREACH OF CONTRACT

In count one, JEM claims that MERG breached the earnest money contract in three discrete ways: by failing to provide, as requested, the due diligence materials that were necessary to secure its financing of the Hub purchase; by failing to timely disclose the existence of structural and contamination problems on the property; and by refusing to extend the closing date beyond August 24, 1999. The evidence, taken as a whole, thus compels the conclusion that the plaintiff has not met its burden of proving MERG's breach of contract as alleged in count one.²¹ Moreover, MERG has presented evidence sufficient to prove, as alleged in its special defense, that JEM's inability or unwillingness to perform under the contract bars its recovery in this case. Accordingly, the plaintiff cannot prevail on count one of the complaint.

21 As in most other civil matters, "a breach of contract claim . . . requires proof by a preponderance of the evidence." Foley v. Huntington Co., 42 Conn.App. 712, 732 n. 7, 682 A.2d 1026, cert. denied, 239 Conn. 931, 683 A.2d 397(1996). "Whether there was a breach of contract is ordinarily a question of fact." (Internal quotation marks omitted.) Colliers Dow Condon, Inc. v. Schwartz, 77 Conn.App. 462, 471, 823 A.2d 438 (2003).

"The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages." (Internal quotation marks omitted.) Chiulli v. Zola, 97 Conn.App. 699, 706-07, 905 A.2d 1236 (2006). Moreover, "[t]he nonbreaching party may recover only for damages that are direct[ly] and proximate[ly] caused by a defendant's breach of contract [as c]ausation is an element — and a crucial one — of the plaintiff's prima facie case." (Internal quotation marks omitted.) McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., 93 Conn.App. 486, 504, 890 A.2d 140, cert. denied, 277 Conn. 928, 895 A.2d 798 (2006). Moreover, it is well settled that a plaintiff cannot recover contract damages under the agreement "unless he has fully performed his own obligation under it, has tendered performance, or has some legal excuse for not performing." (Internal quotation marks omitted.) David M. Somers Associates, P.C. v. Busch, 283 Conn. 396, 406, 927 A.2d 832 (2007).

As to the parties' entry into an agreement, as found in Part II, it is undisputed that JEM and MERG executed an earnest money contract for the purchase of the Hub on April 30, 1999. JEM's opportunity to perform pursuant to this contract was originally set for June 1, 1999, and was finally extended until August 24, 1999. Therefore, in order to prove the breach of contract, JEM must demonstrate that it performed its obligations under the contract, as amended, or that it was excused from performance, and that MERG breached the contract by failing to perform. Chiulli v. Zola, supra, 97 Conn.App. 706-07. This JEM has failed to do.

1. Claims regarding Contract Terms

The parties' factual contest is largely based upon their different views of their obligations pursuant to the earnest money contracts and the degree to which they have met these obligations. JEM offered evidence in an effort to prove that it adequately performed under the contract because it complied with its two specified obligations: first, to deliver $10,000 to MERG's attorney and second, to obtain a title commitment. JEM further submitted evidence in an effort to establish that because MERG received the benefit of forbearance from Packard's foreclosure until it could transfer title to JEM, the plaintiff must be found to have performed in accordance with the contract terms. In addition, JEM tendered evidence in an effort to prove that MERG prevented the buyer's performance by breaching the seller's contractual obligation to furnish all information concerning the premises that it reasonably requested, and by failing to extend the closing date beyond August 24, 1999. In support of its special defense, MERG presented more credible evidence which established that JEM failed to prove that it fully performed, had tendered performance or had some legal excuse for not performing. MERG's evidence clearly demonstrated that JEM was functionally unable to perform under the contract by tendering the $2,500,000 purchase price on any of the agreed-to closing dates including the final date of August 24, 1999. Moreover, MERG's evidence was sufficient to defeat the possibility of reasonably concluding that the defendant, in any way, caused JEM's inability to perform.

In resolving these issues, the court examined the terms of the contracts into which the parties voluntarily entered and ascertained the impact of these terms according to the applicable principles of law. "[O]ur case law requires definite agreement on the essential terms of an enforceable agreement." (Internal quotation marks omitted.) 111 Whitney Avenue, Inc. v. Commissioner of Mental Retardation, 70 Conn.App. 692, CT Page 20882 699, 802 A.2d 117 (2002).²² In giving meaning to the terms of a contract, "[the court] must first ascertain whether the relevant language in the agreement is ambiguous . . . A contract is ambiguous if the intent of the parties is not clear and certain from the language of the contract itself . . . Accordingly, 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 . . . When the language of a contract is ambiguous, the determination of the parties' intent is a question of fact . . ." (Citations omitted; internal quotation marks omitted.) David M. Somers Associates, P.C. v. Busch, supra, 283 Conn. 402-03.²³ "[The court] construe[s] a contract in accordance with what [it] conclude[s] to be the understanding and intention of the parties as determined from the language used by them interpreted in light of the situation of the parties and the circumstances connected with the transaction . . . The intention of the parties manifested by their words and acts is essential." (Citation omitted; internal quotation marks omitted.) McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., supra, 93 Conn.App. 502-03.

22 "[F]or an enforceable contract to exist, the court must find that the parties' minds had truly met . . . If there has been a misunderstanding between the parties, or a misapprehension by one or both so that their minds have never met, no contract has been entered into by them and the court will not make for them a contract which they themselves did not make . . . [A]n agreement must be definite and certain as to its terms and requirements." (Internal quotation marks omitted.) Electrical Wholesalers, Inc. v. M.J.B. Corp., 99 Conn.App. 294, 302, 912 A.2d 1117 (2007).

23 "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 . . . When only one interpretation of a contract is possible, the court need not look outside the four corners of the contract . . . A court will not torture words to import ambiguity when the ordinary meaning leaves no room for ambiguity, and words do not become ambiguous simply because lawyers or laymen contend for different meanings." (Citation omitted; internal quotation marks omitted.) McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., supra, 93 Conn.App. 503.

Here, the court agrees with MERG's argument that the contract and agreement contain definitive language, clearly expressing what the parties intended insofar as conduct and schedule for purchase and sale of the Hub was concerned. The circumstances connected with the transaction support the conclusion that there is no ambiguity within the four corners of any generation of the earnest money contracts or forbearance agreements in evidence. Thus, it is unnecessary, and would be improper, for the court to acquiesce to JEM's request to import ambiguity into the contract terms when their ordinary meaning leaves no room for ambiguity. McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., supra, 93 Conn.App. 503; see also David M. Somers Associates, P.C. v. Busch, supra, 283 Conn. 402-03.

JEM unsuccessfully argues that the terms of the earnest money contract relieved it of any obligation to tender the purchase price as a precondition to MERG's transfer of the title. JEM would have the court interpret this contract as so providing even although the contract terms clearly require it to deliver the purchase price to MERG, and even though the parties clearly stated their agreement that the Packard mortgage would be released in accordance with the terms of the earnest money contract and the forbearance agreement. (Exs. 1, 2, 3, 4, 5, 6.) Using its preferred construction of the contract terms, however, JEM urges the court to find that the parties had agreed that Packard was to receive payment directly from JEM, not from MERG, and that JEM was to receive the release of Packard's mortgage. JEM thus claims that it is entitled to the deed to the Hub even thought it never tendered the purchase price because it was, and is, willing to take the property with the Packard's mortgage remaining on it; that it was supposed to pay $2,500,000 for the release of the mortgage and not for the transfer of the title to the Hub and that under the forbearance agreement JEM did not have to pay it as of the closing date, the forbearance period had expired or earlier terminated; and that as the forbearance period did expire on August 24, 1999, JEM was excused from paying $2,500,000 for any purpose after that date. In so arguing, JEM would also have the court find that through the parties' entry into the earnest money contract and the forbearance agreement, each had waived the title exception for the Packard mortgage. This argument misconstrues, however, the interface between the earnest money contract and the forbearance agreement.

MERG successfully counters JEM's arguments by identifying clear, unambiguous language in the earnest money contract and forbearance agreement that requires no interpretation, and that directs the purchaser to perform certain acts that never occurred, and that JEM is incapable of consummating. Relying upon the language identified in Part II, MERG established that there is no contract basis, and therefore no merit, to JEM's assertions that the buyer is excused from tendering the agreed-upon purchase price if the buyer has conferred any benefit whatsoever upon the seller, or that the buyer is excused from performance when the bulk of the purchase price is to be tendered by the buyer to the seller's mortgagee. As MERG cogently argues, such construction is inconsistent with the text of the earnest money contract and the forbearance agreement at issue. Utilizing the clear terms of the earnest money contract and forbearance agreement, MERG correctly observes that for the court to approve JEM's claim that it is entitled to the title to the Hub without having to tender the purchase price, the court would have to engage in an unlawful and unnecessary reformation of the parties' lucid agreements.

The court's conclusion that JEM has proposed an unnecessary and invalid construction of the parties' contracts and agreements is supported by attention to the clear and unambiguous terms contained in the earnest money contracts, including the second amended contract and the forbearance agreement and amendments. As MERG correctly observes, there is no language within these documents indicating that Packard's agreement not to foreclose on its loan, from April 1 through August 24, 1999, was in any way sufficient to establish performance by JEM, who was expected to tender funds for the purchase of the Hub property. The forbearance agreement does require JEM to pay that purchase price to Packard on MERG's behalf. However, JEM has not adequately identified any terms within any version of the earnest money contract presents that contemplates MERG's transfer of title to JEM before the buyer has paid the purchase price; without this event, under the clear terms of the forbearance agreement, Packard's mortgage on the Hub will remain intact. (Exs. 4, 5, 6.) Although JEM's payment of the purchase price was a consideration contemplated by the earnest money contract, the agreement not to foreclose was not consideration in any respect.

2. Claims that JEM is Excused From Performance

JEM also contends that it is excused from performance because of MERG's failure to provide requested due diligence and MERG's refusal to extend the closing date. Without admitting failure to perform under the contract terms, JEM asks the court to award the requested relief on the grounds that MERG's conduct served to excuse the buyer from performance. The court finds insufficient ground for honoring this request.

It is well settled that a party cannot recover "contract damages under the agreement unless he has fully performed his own obligation under it, has tendered performance, or has some legal excuse for not performing." (Emphasis added; internal quotation marks omitted.) David M. Somers Associates, P.C. v. Busch, supra, 283 Conn. 406. However, the court finds JEM's reliance upon this principle to be unavailing under the circumstances of this case.²⁴ It is well settled that "[l]egal excuses for not performing contract obligations as agreed cannot be based upon the occurrence of an event or the existence of a condition or a circumstance for which the party's claiming excuse is himself responsible, either because his conduct gave rise to it or because the risk of its occurrence or existence is allocated to him, by the contract or by custom . . . Where a party who has neither performed his contractual obligations nor tendered performance under the contract has no valid legal excuse for not performing the contract as agreed to, he is not entitled to recover unpaid fees as damages in an action for breach of contract. Phillips v. Sturm, 91 Conn. 331, 99 A. 689 (1917)." David M. Somers Associates, P.C. v. Busch, Superior Court, judicial district of Hartford, Docket No. CV 03 0822125 (April 10, 2006, Sheldon, J.) [ 41 Conn. L. Rptr. 332], aff'd, 283 Conn. 396, 927 A.2d 832 (2007).

24 In reaching this determination, the court recognizes that "non-performance resulting from the other party's prevention of performance is a valid legal excuse for non-performance; see, e.g., Morehouse v. Bradley, 80 Conn. 611, 69 A. 947 (1908); as is inability to perform or complete the contract due to an unexpected occurrence, condition or circumstance, the risk of which is not allocated to either party by the contract or by custom, which makes its performance or completion impossible or commercially impracticable. Roy v. Stephen Pontiac-Cadillac, Inc., 15 Conn.App. 101, 104, 543 A.2d 775 (1988)." David M. Somers Associates, P.C. v. Busch, Superior Court, judicial district of Hartford, Docket No. CV 03 0822125 (April 10, 2006, Sheldon, J.), aff'd, 283 Conn. 396, 927 A.2d 832 (2007).

a. Alleged Refusal to Provide Due Diligence

Although JEM steadfastly alleges that MERG did not timely respond to its requests for the information necessary to conduct its due diligence evaluation of the Hub property, and that the defendant thereby precluded it from obtaining financing, the evidence is insufficient to support these assertions. Rather than relying upon specific requests made by JEM for due diligence materials, prior to August 12, 1999, JEM would have the court infer, from the voluminous trial evidence, first, that it had made timely requests that MERG provide it with due diligence information; second, that MERG failed to meet its contractual obligation to comply with these requests; and third, that MERG's failure was a substantial factor in causing JEM to fail to timely secure financing, and thus in preventing it from purchasing the Hub. The evidence, taken as a whole, is, however, insufficient to establish that JEM timely requested but received too late or not at all, inter alia, information relating to roof repairs upon the Hub structures, satisfactory responses to questions about MERG's tax returns and information regarding the subordination of Packard's mortgage upon the property.²⁵ Accordingly, the court is constrained to conclude that there is inadequate evidence to support JEM's claim that MERG's conduct, in failing to appropriately provide this data, resulted in JEM's inability to obtaining financing before August 24, 1999.

25 In addressing this aspect of JEM's claims, the court remains cognizant that, as found in Part II, by voluntarily entering into the second amendment to the earnest money contract, the plaintiff explicitly admitted that MERG had met all of its pre-closing obligations, covenants and conditions with both the contract and the forbearance agreement. (Ex. 3, ¶ 2.)

Specifically, the court finds insufficient basis for crediting the evidence JEM proffered through the deposition testimony of Taylor, Marinan, Underhill or McGuire, insofar as it may have related to any unrequited requests that supposedly were made for production of due diligence information by FIP or MERG. See Welsch v. Groat, supra, 95 Conn.App. 666-67.²⁶ (Exs. 62, 62A, 63, 65, 66.) The court credits Taylor's assertion that he was the president of Northeast, a company engaged in residential and commercial mortgage brokerage and joint venture work. The court further credits Taylor's testimony that McGuire unilaterally discontinued his efforts to acquire financing through Northeast, choosing instead to work with Underhill Assoc. Even so, Taylor's statements are insufficient to prove JEM's claims that any identified acts or omissions by the defendant caused or created the plaintiff's inability to timely obtain financing. (Ex. 63.) The court credits Underhill's deposition testimony establishing that he was a member of Underhill Assoc. and of Richill Associates, an entity that had engaged in a separate $1,300,000 loan transaction involving McGuire.²⁷ Overall and taken with the remainder of the evidence, however, no aspect of Underhill's statements can be found sufficient to prove JEM's claims that MERG's acts or omissions caused or created the conditions that led Underhill Assoc. to forgo providing funding for the Hub's purchase until after August 24, 1999, or that led to JEM's ultimate inability to timely purchase the Hub. (Ex. 65.) JEM's proffer of Marinan's deposition testimony fails to support this aspect of its claims, as well. Marinan's testimony reflects his disregard for McGuire's business practices.²⁸ Notwithstanding Marinan's attitude toward JEM's principal, however, his statements, alone or viewed along with the other evidence, are insufficient to prove JEM's claims that MERG interfered in any measurable way with the due diligence process.²⁹ (Ex. 66.)

26 Even taken with the testimony of Kamerbeek, the deposition evidence is insufficient to establish that any acts or omissions by MERG prevented JEM from timely obtaining the financing at issue. JEM's clearly evidence falls far short of proving, as it has alleged, that MERG refused to provide any due diligence information that JEM requested.

27 The transcript of Underhill's testimony reflects a witness who was relatively guarded, often unresponsive, less-than forthcoming, uncooperative, and thus difficult to credit in many respects. (Ex. 65.) See Welsch v. Groat, supra, 95 Conn.App. 666-67.

28 The city's former mayor stated that the Hub "would have been better in city hands than in Jim McGuire's hands." (Ex. 66.)

29 Marinan's speculative and unsure testimony on the subject fails to support JEM's allegations that MERG unreasonably withheld information concerning contamination of the Hub property. Overall, it fails to support the necessary prerequisite finding that any MERG representative had actual or specific notice of the contamination, although "some of the older members" likely knew that the Hub was "right next to an old International Silver factory." (Ex. 66.) Such general information would have been equally available to JEM during the course of a reasonably conducted due diligence search. In any case, no specific comments made by Marinan support JEM's preferred conclusion that MERG withheld information or refused to disclose due diligence information upon request by the buyer. (Ex. 66.)

JEM's tender of McGuire's deposition was also unsuccessful in proving this aspect of its claim. McGuire has extensive experience in applying for real estate financing and knew, when he entered the first earnest money contract, that the length of time the due diligence would take would depend upon "the list" or "checklist" of items the lender required. (Ex. 62.) Other than the list of lender-requested items presented in connection with the Underhill Assoc. loan application, however, the evidence reflects no specification of items that any other financial resource required JEM to obtain from the seller.³⁰ (Ex. 62; See Exhibits 25, 35.) McGuire's deposition testimony yields the inference that JEM never timely requested MERG to provide particular due diligence information. (Ex. 62.) Overall, and again taken with the remainder of the evidence, McGuire's deposition testimony is fundamentally insufficient to prove JEM's claims that MERG's acts or omissions caused or created the conditions that impeded the plaintiff's timely procurement of funding to purchase the Hub property in accordance with the earnest money contracts, including the second amended contract through which the parties agreed that "time [wa]s of the essence" insofar as the closing was concerned. (Exhibits 1, 2, 3.)

30 McGuire's lack of detailed or consistent knowledge about the Hub purchase or MERG's role in the due diligence process was so clearly apparent at the depositions on February 23, 2000 and on June 6, 2001 that the substantive aspects of his proffered testimony must concomitantly lack weight. (Ex. 62.) For instance, when McGuire was asked "what due diligence was it that hadn't been done by June 1st, `99, that prevented that closing," he failed to answer, explaining "I don't have the paperwork in front of me. I can't tell you that." (Ex. 62.) Thereafter, McGuire gave a similar response to an inquiry about "other due diligence . . . that required [JEM to request a postponement of the due diligence date." (Ex. 62.) Thereafter, despite his promise to do so, McGuire was unable to identify or to present at his continued deposition any documentation of the lack of due diligence JEM has claimed on MERG's part. (Ex. 62A.) McGuire's consistently demonstrated knowledge void, apparent even when questioned by his own lawyer, concerning the role, if any, that MERG or FIP played in failing to properly respond to requests due diligence information further undermined his credibility. (Exs. 62, 62A.) McGuire's most cogent response to questioning as to the reason why the closing did not occur on August 24, 1999, was insubstantial: he stated, without further explication: "The problem is — somebody didn't get us the paperwork to do the proper due diligence." (Emphasis added.) (Ex. 62A.) Furthermore, aspects of McGuire's testimony casts doubt upon the accuracy of representations that his lawyer, Mango, was willing to make on his client, JEM's, behalf, further weakening the value of the trial evidence presented on the plaintiff's behalf. (Ex. 62.) See Welsch v. Groat, supra, 95 Conn.App. 666-67.

Even if the court should credit the body of deposition evidence proffered by JEM, there is still insufficient basis from which the court could reasonably conclude that MERG's role in providing the due diligence information played measurable role in any lender's decline the plaintiff's application for the acquisition funds. Rather, the evidence, taken as a whole, reflects that MERG appropriately cooperated with and facilitated the due diligence process.³¹ The court fully credits Stanton's testimony establishing that even before the original earnest money contract was signed on April 30, 1999, he had directed FIP, on MERG's behalf, to gather all documentation available concerning the Hub property, so that JEM could review it upon request.³² On May 3, 1999, Stanton advised Mango, JEM's attorney and agent, of the masonry work that had to be performed in the pharmacy area of the Hub, identifying the reported shifting or movement in the structure so that JEM could conduct inspection of this area, if it chose, during the due diligence period. Stanton also provided Mango with documentation identifying FIP's role as the exclusive leasing agent for the Hub, effectively informing JEM where to access to information concerning such issues as rental census, common charges, utility shares, and other tenant-related matters. (Ex. 14; Tes. Stanton, Provencal.)³³

31 In reaching this determination, the court acknowledges that Kamerbeek did not personally support MERG's sale of the property to JEM because of McGuire's failure to satisfactorily manage another large piece of property he had purchased within the city. (Ex. 62; Tes. Kamerbeek.) The court fully credits Kamerbeek's clear and candid testimony that nonetheless, he did not in any way impede the due diligence process involved with the Hub sale to JEM. (Tes. Kamerbeek.)

32 Stanton undertook this task because MERG had no staff. (Tes. Stanton.)

33 The credible testimony of Stanton, and of Schaffer as discussed below, is fully consistent with Mango's admission that he had received, on April 21, 1999, the Exclusive Right to Lease agreement that had been entered into by FIP and MERG (Ex. 7) and, on June 17, 1999, a rent roll and list of security deposits held by FIP for the Hub property (Ex. 6; Tes. Mango.) On other dates, Mango had received the 1995 Management Agreement between the Hub and FIP (Ex. Z.) and MERG's 1999 Hub Budget (Ex. X.) As Mango had received this information, it is considered to have been known by JEM, as well, for it is axiomatic that "[t]he knowledge and admissions of an attorney are imputed to his client . . ." (Internal quotation marks omitted.) Friezo v. Friezo, 281 Conn. 166, 195, 914 A.2d 533 (2007).

FIP's cooperation in the due diligence process is further supported by Provencal's credible testimony, consistent with other evidence. Nearly a month passed following the execution of the April 30, 1999 earnest money contract before any JEM representative contacted FIP personnel to request data concerning the Hub. (Testimony of Provencal, Schaffer.) FIP maintained, but never withheld from JEM: budget data for the Hub, activity reports reflecting repairs, maintenance, leases, rent rolls and monthly summations for delivery to MERG's members at the board's meetings. (Testimony of Schaffer.) Provencal was available at FIP to provide accounting or financial statements or other operating data to JEM upon request. Bergeron was available at FIP to collect, process and distribute information about leasing and tenant status, to JEM upon request.³⁴ In addition, Schaffer was available at FIP to provide other Hub data to JEM, upon request. By August 3, FIP had responded to JEM's request for a reasonably accurate roster of the Hub's tenants, the rents they were expected to pay, and the total amount of assigned carrying and maintenance charges, providing sufficient information from which a buyer could have determined whether or not to purchase the Hub property.³⁵ (Exhibits J, X; Testimony of Schaffer.) In the usual course of its business, and in a timely fashion, FIP provided JEM with every piece of data that was requested, including copies of several years worth of MERG board minutes and specified tax returns. Such practice was consistent with FIP's ordinary course of business in cooperating with buyers of the property for which they provided management services. FIP would have received no benefit from failing to cooperate with a potential buyers' request, although FIP lacked the authority to initiate delivery of information to an interested party, such as JEM, without a specific request from that party. No FIP personnel ever withheld any information concerning the management or physical status of the Hub from JEM and no FIP personnel ever refused to permit JEM to enter MERG's offices.³⁶ (Testimony of Provencal, Schaffer.)

34 Bergeron died in 2000. The court fully credits Provencal's testimony, however, that it was Bergeron's custom and habit, in the ordinary course of FIP's business, to provide buyers' attorneys with whatever due diligence they had requested. The record specifically reflects, for instance, Bergeron's June 16, 1999 compliance with a request for provision to Stanton, for delivery to JEM, of data concerning the Hub's rent rolls. (Exhibit D; Testimony of Provencal.)

35 Schaffer candidly admitted that when Underhill Assoc. inquired about the status of the in-place Hub financing, he elected to consult with MERG before responding; Schaffer concluded that detailed information about the Packard mortgage should be released only with MERG's approval. (Testimony of Schaffer.) Even so, JEM's lawyer, Mango, already had access to documentation reflecting the terms of the Packard's loan; he had witnessed the execution of the March 1, 1995 mortgage, which was a matter of public record, having been recorded on March 2, 1995 at Vol. 2084 p. 1 of the Meriden land records, as discussed above. (Ex T.) Thus, Schaffer's prudence could not have had a measurable adverse impact upon JEM's ability to procure financing.

36 Bob Cooper, a subcontractor who sought deals, financing and real estate on Donaco's behalf, had, on one occasion, come to FIP's offices and gone through file cabinets, ostensibly in search of due diligence documents regarding the Hub. (Exhibit 62; Testimony of Schaffer.)

Moreover, the court credits the overall evidence establishing that JEM's inability or unwillingness to perform as required was wholly unrelated to any act, omission or breach of contractual terms on the part of MERG. In part, JEM's own evidence counters this aspect of its argument. JEM attempted to affirmatively demonstrate that it had entered into negotiations for procurement of financing for the Hub purchase, however, while JEM's efforts were uniformly unsuccessful, there was no reliable or credible evidence from which the court could reasonably conclude that MERG played any role in JEM's inability to consummate the loans for which it applied.³⁷ JEM's own evidence establishes that by May 3, 1999, only three days after entering into the original earnest money contract, it was fully aware that a workman had reported "that some movement has occurred in the structure" comprising "one of the main buildings at the HUB." (Exhibit 13.)³⁸ By that date, JEM and Mango were also aware of the potential for flooding to affect the property, given "the flow of the Harbor Brook waters."³⁹ (Exhibit 13.) MERG fully and appropriately apprised JEM that if "more and better information" was requested, it could be obtained by contacting Schaffer at FIP. (Exhibit 14.) Upon receipt of this information, JEM requested an extension, from May 22, 1999 to June 1, 1999, of the time for engineering evaluation of the property, consistent with the due diligence process. MERG complied with this request. (Exhibits 2, 5, 15.)

37 See generally Part II. For instance, JEM's tender of undated correspondence ostensibly originating from Northfield establishes that lender's requirement that the Hub " appraise for a minimum of $6,000.000 USD." (Exhibit 7.) JEM proffered no evidence from which the court could reasonably conclude that this valuation criteria could ever be fulfilled under the circumstances of this case. JEM also provided correspondence ostensibly originating from Dynamic on July 7, 1999, indicating that his lender was interested in extending bridge financing. However, this lender would only service JEM if JEM was a minority holder of the equity in the property, which was not McGuire's intent. (Exhibit 8.) By June 28, 1999, McGuire had secured a commitment for $2,800,000 in financing from Northeast, for purposes of acquiring the Hub subject to a number of specified criteria. (Exhibit 19.) While JEM had procured a title report as required by Northfield, there is insufficient evidence, from which the court could reasonably conclude that JEM timely fulfilled this lender's other prerequisites to extension of the loan, or that JEM made timely requests of MERG, FIP or their agents for data relevant to Northeast's requests. (Exs. 19, 20, L; Testimony of Schaffer, Kamerbeek.) Regardless of when JEM had entered into financing negotiations with Underhill Assoc., by mid-August 1999 that lender was clearly dissatisfied with the "economics" of the information JEM had provided to it and, thus, would not provide the loan JEM sought. (Ex. 39; see also Exhibits 26, 35.) Even the letter from Underhill Assoc. dated August 23, 1999, upon which JEM relies as an absolute indication of its ability to close on the Hub by September 15, 1999, contains a contingency that, under the circumstances of this case, fails to support JEM's proposition concerning the availability of funding: this letter indicates that a partial $2,000,000 loan would be tendered only "[a]ssuming the due diligence does not uncover unsolvable issues." (Ex: 40, 42, F.) Underhill Assoc. was made aware of likely "unsolvable issues" on September 7, 1999, when its commercial contractor-inspector contractor reported that while some areas of the Hub roofs were in good condition, other areas were either not visible, were "in very poor condition" requiring replacement, or "in very bad condition, totally saturated" and likely accompanied with "some rotted decking under the roof." (Exhibit 55.) Thus, Underhill Assoc's status as a potential lender remained inchoate, subject to unforseen vicissitudes of the due diligence process even as early September 1999. Even if Underhill Assoc. did make $2,000,000 to JEM sometime in September 1999, Packard's offer to lend the remaining $500,000 needed for the closing was subject to "terminate and expire if the Loan closing [on the Hub] shall not have been completed on or before August 31, 1999." (Exhibit 25.) Any Underhill Assoc.'s commitment to provide funding after that date would thus be inadequate to consummate the transaction. Thus, even this evidence is insufficient to establish that JEM was ever able to secure the financing necessary to purchase the Hub from MERG under the terms set forth in any version of the earnest money contract.

38 In addition, the information about the need for masonry repairs to the Hub structure, related to the issue of "movement," was voluntarily provided by FIP and made available to Mango, JEM's agent, in a timely manner. (Exhibits 13, 14.)

39 In determining that Exhibit 13 adequately establishes JEM's foreknowledge of the potential for water-flow related problems affecting the Hub, the court has acknowledged, and given due weight to, the information set forth in Exhibit 16, representing a newspaper article published in a local newspaper on June 23, 1999. (Exhibit 16.) That article makes reference to the same "Harbor Brook" that is referenced in Mango's May 3, 1999 letter to Kamerbeek, relating McGuire's awareness of the potential effect of "a hydraulic pressure build-up under the site caused by the flow of the Harbor Brook waters." (Exhibit 13.) Moreover, the article explains that, like JEM, MERG had no access to an "environmental study commissioned by the city's Flood Control Implementation Agency." (Exhibit 16.) According to the article, some eleven weeks after the execution of the earnest money contract, "that study [had] not been shared with the parties involved in the Hub purchase." (Exhibit 16.) As found in Part I, JEM had withdrawn its counts against the city at the start of trial. Thus, while the evidence might support a claim that the city withheld information from JEM, there is insufficient evidence that MERG, who had no access to this environmental study, failed to make it available to the plaintiff.

Furthermore, as discussed above, the court credits Schaffer's detailed testimony, consistent with the testimony of Provencal and supported by documentation submitted by JEM, establishing that FIP cooperated with any requests the plaintiff for information concerning the Hub's management, structural status, tenancy, and financial operations.⁴⁰ (Exhibit 29; Testimony of Schaffer.) There is insufficient information from which the court could reasonably conclude that MERG, FIP or any person affiliated with the city withheld or declined to provide, for any purpose or at any time, information related to the potential that there were structural defects in the Hub property, or related to any other aspect, physical or financial, of the property, at issue.⁴¹ To the contrary, the evidence reflects that FIP at all times remained ready, willing, and able to provide JEM with data concerning the Hub had JEM seasonably presented the property management company with a request for such information.⁴² (See, e.g., Exhibits 45, N.)

40 In reaching this determination, the court declines to credit the related portions of testimony and documentary evidence created by and/or adduced though Mango, whose client is an interested party to the proceeding. (See, e.g., Exhibit 30.)

41 Exhibit 45 is a ledger reflecting FIP's analysis of the Hub's expenditures from January 1 through August 25, 1999. From the fact that this ledger was generated on August 25, 1999, JEM would have the court conclude that FIP had not provided expenditure information that had been requested prior to that date. The court concludes, however, that the ledger better serves to establish that at all times during the due diligence period, upon request, FIP had the ability to generate reports concerning myriad aspects of the Hub's expenses, including utilities costs, taxes, insurance and the like. (See, e.g, Exhibit N, a set of ledger sheets faxed from FIP's offices on January 26, 1999.) Exhibit 45 thus fails to provide any basis for concluding that FIP would have withheld such information from JEM or its agents, had the information been requested. (See also Exhibit 48, a like ledger printed by FIP on August 30, 1999, and transmitted to Woods.)

42 The ready availability of this information at FIP's offices is further represented by Exhibit 45. See note 39. Provencal sent this document to Cooper, the Donaco representative, in prompt response to Cooper's request, which was likely made at or about the time of transmittal. (Testimony of Schaffer, Provencal.) JEM's prior receipt of detailed information about the status of the Hub property is made apparent through a close review of the cover sheet for Exhibit 45, upon which Provencal responded to Cooper's inquiry about caulking work done on the masonry exterior of the Hub structure in 1998 and about services provided by Charter Oak Janitorial. (Exhibit 45; Testimony of Provencal.)

Viewed most favorably, JEM's evidence does include some indication that unnamed "city personnel" may have been providing some "negative reports on the property" to certain lenders whom McGuire may have contacted during midsummer of 1999. (See Exhibit 22.) In the absence of specificity or detail concerning those reports or the persons who made them, however, the court declines to attribute any particular weight to this evidence. Even if the court could credit this evidence and even if the court could find that these undesignated reports from unnamed individuals were made, there would still be inadequate basis for crediting, without more, Mango's partial and conclusory statement, on July 22, 1999, that these events had in any measurable way "delayed the process" of JEM's closing the Hub transaction. (Exhibits 22, 30.) To the contrary, the court credits MERG's proffered evidence establishing that it did, in fact, timely provide JEM or its representatives with all due diligence sought and that MERG fully cooperated by timely providing information, which JEM requested, even though it was outside the reasonable bounds of data related to the evaluation of the Hub, its structures, or its income producing potential.

As found in Part II, despite the expiration of multiple closing dates, JEM raised no complaint about MERG's failure to cooperate with the provision of requested due diligence information until August 12, 1999, after the agency had granted a fourth extension of the original closing date.⁴³ (See Exhibits 30, 32.) JEM's representative, Cooper, had visited FIP's offices and had searched through FIP's files, without complaining that data was lacking. (Testimony of Schaffer.) The belatedness of JEM's complaints supports the inference that, notwithstanding its supposed interest in acquiring the Hub, the buyer had attended to its own obligations, as established under the earnest money contract and amendments, with a lesser degree of attention and commitment than was appropriate under the circumstances.⁴⁴ Furthermore, the court fully credits Stanton's consistent, detailed testimony establishing that long prior to August 14, 1999, he had sent Mango abundant information related to FIP's role in the management of the Hub property and the oversight of leasing arrangements. (Testimony of Stanton; see also Exhibit 31.) The court also fully credits Stanton's testimony, supported by Exhibit T, indicating that, although JEM claimed the defendant's failure to deliver a copy of the Packard's mortgage caused delay in obtaining financing, JEM's own counsel, Mango, had witnessed the execution of that mortgage, and the document was a matter of public record.⁴⁵ Stanton's testimony further supports the conclusion that although JEM knew where to obtain the due diligence information about the Hub property and tenancy issues, the buyer failed to timely make inquiry so as to obtain that data, thus enhancing its inability to obtain appropriate financing to close the transaction. Even if this conclusion cannot be reached, the evidence as a whole supports the determination that Stanton only assisted, but never impeded, JEM's procurement of the due diligence information at issue. (Testimony of Stanton.) The evidence demonstrates that JEM sought a fifth extension of the closing date, until September 15, 1999, not because of MERG's supposed interference with the due diligence process but because the lender with whom it had most recently been working declined to provide financing when he realized that the term of the Hub's lease with a key tenant was for five years rather than ten years.⁴⁶ See Part II.

43 Even when JEM learned, on June 23, 1999, of the city's Flood Control study, no complaint was raised with regard to MERG's putative role in failing to make this information available. (Exhibit 17.) When Mango wrote to Stanton on July 14, 1999, requesting the third extension of the closing date, no representations were made that JEM was missing any of the due diligence materials it had purportedly requested from FIP. (Exhibit 21; Testimony of Stanton.) These circumstances support the inference that either FIP had provided JEM with all requested information concerning the Hub, or JEM had not yet requested such data from the property manager.

44 See, e.g., Exhibits 33 and 34, portions of which were originated with FIP and other portions which were ostensibly prepared by McGuire to send to Underhill on August 15, 1999, some three and a half months after the parties' entry into the earnest money contract and after the second amendment to the forbearance agreement had designated that the closing date of August 24, 1999, was subject to a "time is of the essence" clause.

45 There is no merit to JEM's claims that it was delayed in obtaining financing due to MERG's failure to timely provide it with a copy of the Mortgage and Security Agreement detailing Packard's March 1, 1995 $3,300,000 loan to MERG and the related encumbrance upon the Hub. As discussed in footnote 35, the agreement was available to the public, having been recorded upon the Meriden land records.

46 Appropriately, JEM did not ascribe any role to MERG for that particular decision on the lender's part.

A reasonable construction of the evidence leads to the conclusion that JEM already had the due diligence information it claimed to be missing or withheld on August 12, 1999, mere days before it requested that the closing date be extended until September 15, 1999. Even if JEM had not received this due diligence, the evidence compels the conclusion that either this data had been provided to JEM by MERG as of August 13, 1999, prior to the requested extension or, in the alternative, JEM had failed to timely request provision of specific documents. Thus, despite JEM's repeated claims that MERG in some way interfered with the provision of its due diligence information, the evidence, taken as a whole, fails to support this allegation.

b. Alleged Refusal to Extend Closing Date

JEM argues that MERG further compounded its breach by refusing to extend the August 24, 1999 closing date; JEM asserts that if it had timely received the information requested from MERG, it could have closed by September 15, 1999, a reasonable period from the contract's stated termination date. JEM further argues that MERG cannot rely upon the conditions for extending the date for delivery of the deed, inserted into the second amendment to the earnest money contract, claiming that these conditions had no effect because Packard never consented to them. However, the evidence establishes that JEM voluntarily and intentionally agreed both that "time was of the essence" with regard to the August 24, 1999 extension for closing, and that the contract would bind neither plaintiff nor defendant if the transaction had not occurred by that date, regardless of Packard's consent. Moreover, there is insufficient evidence from which the court could reasonably conclude that JEM had either the capacity or the willingness to honor the contract terms within a reasonable time following the August 24, 1999 closing date or on any reasonable date thereafter. Under these circumstances, the court cannot conclude that MERG unreasonably refused to extend the closing date.

In reaching this determination, the court adhered to the applicable rules for the time within which a purchaser of land must meet the terms of the underlying contract of sale. "Ordinarily, the time for the completion of a sales contract for land is not an essential term of the contract, because in the absence of a date for performance, the law will imply a reasonable time to perform." Christophersen v. Blount, 216 Conn. 509, 511-12, 582 A.2d 460 (1990). The date for performance, however, becomes an essential element when the conveyance contract includes a clause providing that "time is of the essence." Bethlehem Christian Fellowship, Inc. v. Planning Zoning Commission, 58 Conn.App. 441, 446, 755 A.2d 249 (2000). "By giving notice, either party has power to make performance itself essential as a condition of the party's duty, provided that the notice leaves the other party a reasonable time for rendering the performance . . . [S]uch a notice may shorten the time allowed by the law . . . [which] would have held that performance within a reasonable time after the agreed date would be sufficient to hold the other party to the promise, while the notice, if given a reasonable time before the agreed date, makes performance by that date a condition." (Emphasis in original; internal quotation marks omitted.) Jaramillo v. Case, 100 Conn.App. 815, 825-26, 919 A.2d 1061, cert denied, 283 Conn. 902, 926 A.2d 670 (2007).

Several aspects of the evidence reflect the reasonableness of MERG's refusal to extend the closing date beyond August 24, 1999. As found in Parts I and II, following the establishment of the original June 1, 1999 closing date, MERG agreed to four extensions at JEM's request. The extension to August 24, 1999 was grounded on several conditions included in the terms of the second amendment to the earnest money contract, as found in Part II: that "time was of the essence" insofar as the specified date for closing was concerned; that JEM acknowledge that MERG had performed and thus satisfied its pre-closing obligations; and that the contract would automatically terminate if JEM failed to close by the newest closing date. (Ex. 3.) At his deposition taken only six months following the failed August 24, 1999 closing, McGuire admitted that he knew well that "time was of the essence to MERG" when he executed this second amendment to the earnest money contract incorporating MERG's conditions.⁴⁷ (Exhibit 62.) Notwithstanding this admission, JEM argues that the "time is of the essence" contract language is invalid because Packard did not agree to this condition and because the forbearance agreement precludes amendment of the earnest money contract without Packard's prior written consent. Even in the absence of evidence that it could seasonably meet the contract terms, JEM therefore claims entitlement to an indefinite period within which to have procured the financing for purchasing the Hub. See Christophersen v. Blount, supra, 216 Conn. 511-12.

47 JEM was placed on notice as early as June 30, 1999 that MERG would not consent to indefinite requests for extension of the closing date. (Exhibit 18.)

MERG does not contest JEM's contention that Packard gave no written consent to make the closing date of the essence; the only change Packard approved was extension of the closing date to August 24, 1999. Thus, Packard, a non-party, could not be bound by the second amendment to the earnest money contract. However, JEM has provided insufficient basis, in fact or in law, upon which the court could reasonably conclude that Packard's lack of written consent to MERG's "time is of the essence" condition or to the automatic termination provision renders the August 24, 1999 closing date void and unenforceable as to JEM and MERG in the present litigation: these parties are bound by the clear and unambiguous terms of the contract into which they entered on August 19, 1999, for due consideration. (Exhibit 3.) See Jaramillo v. Case, supra, 100 Conn.App. 825-26; see also Bethlehem Christian Fellowship, Inc. v. Planning Zoning Commission, supra, 58 Conn.App. 446.

As MERG aptly argues, and as found in Part II, the parties voluntarily entered into the second amendment to the earnest money contract, which specifically provided that by failing to close on August 24, 1999, a date chosen by JEM would, among other things, forfeit its earnest money. Even in the absence of Packard's participation, the necessary parties to the earnest money contract explicitly agreed to include a "time is of the essence" clause and an automatic termination provision in the second amendment, consistent with JEM's expressly stated desire that the Hub transaction conclude by that date.⁴⁸ JEM's own breach of the earnest money contract, by failing to close by the very date it selected, thus triggered the negative consequences to which it had consented when executing this second amendment.⁴⁹ JEM, who stood to benefit from the second amendment to the earnest money contract had it timely closed on the Hub property, even without Packard's consent to certain terms, cannot now reasonably argue that the amendment is unenforceable because Packard did not approve those contract terms.

48 JEM's election to use August 24, 1999, as the closing date demonstrates the plaintiff's own admission of the inherent reasonableness of this date.

49 MERG cogently argues that Packard did effectively agree to make time of the essence for the August 24 closing and, even if it did not, the result would be the invalidation of any closing dates subsequent to the July 22, 1999 closing date that JEM had not met, thus rendering any contract for JEM's purchase of the Hub null and void due to the passage of time without compliance by the buyer.

Other aspects of the evidence also establish that MERG's decision not extend the closing date beyond August 24, 1999, was reasonable and appropriate. As found in Part II, JEM's requested four postponements resulted in delaying the closing for eighty-five days. The second and third postponements of the closing date were sought by JEM due to its failure to secure financing for the purchase price, not because of any concerns that due diligence had not been provided; those latter concerns were not raised until August 12, 1999. When JEM advised MERG that it would not be able to close on August 24, 1999, and sought a fifth extension of the closing date to September 15, 1999, MERG was well aware that JEM's commitment from Packard to fund $595,000 of the purchase price in the form of a second mortgage, the buyer's only extant financing, would expire on August 31, 1999. In addition, when JEM sought the fifth extension, as discussed above, neither Packard nor any other lender had formally committed to providing financing that would be available after that date. In view of JEM's historical inability or unwillingness to secure timely financing, MERG's decision to forgo a fifth extension, objectively viewed, was reasonable.⁵⁰

50 Jaramillo v. Case affirms that "[w]hen the parties to a real estate contract want to fix a specific date for performance, we generally have required them to express specifically in the contract that time is of the essence; otherwise, performance within a reasonable time will satisfy the contract . . . Ordinarily, what constitutes a reasonable length of time is largely a question of fact to be determined in the light of the particular circumstances of each case . . . In determining what is a reasonable time, we must look to the act requested." (Internal quotation marks omitted.) Jaramillo v. Case, supra, 100 Conn.App. 823. "Reasonableness . . . is an objective standard, involving an analysis of what a person with ordinary prudence would do given the circumstances, without accounting for any particular knowledge or skill . . . In contracts as in tort cases, [t]he test is external, not subjective, that is, the question is how would a person of ordinary prudence in such a situation have behaved, not how did the defendant in fact behave." (Internal quotation marks omitted.) Id., 824-25.

Clearly, if the "time is of the essence" clause was operative, JEM's failure to complete the transaction on or before August 24, 1999 rendered its present claims for relief without avail. Recently addressed circumstances not dissimilar to the case at bar, the Appellate Court found that the seller has no obligation to continue to extend the date for a real estate closing. In Jaramillo v. Case, supra, an action for specific performance of a contract to sell real property, the defendant sellers refused to grant the plaintiff buyer a second, four-day extension of the mortgage contingency date; the property was then sold to the third-party defendants at a lower price than that the plaintiff had agreed to pay. Id., 822-23, 827. The trial court found, and the Appellate Court affirmed, "that the [sellers'] refusal to extend the mortgage contingency date for a second time was reasonable." Id., 828. The Appellate Court found that the letter the sellers sent the plaintiff, notifying him of the reasons why they wanted assurance that he could timely close, "put [him] on notice of the defendants' need to sell the property in a timely fashion." Id., 827. The Appellate Court further concluded that the refusal to extend the mortgage contingency date was reasonable because the evidence demonstrated that the sellers wanted to transfer the property to avoid the expense of owning it and to prevent waste and deterioration; id., 826; that the plaintiff had notice that the defendants wanted to sell the property in a timely manner; id., 827; and that the plaintiff was having difficulty securing a mortgage, contrary to his representation that he had been preapproved for a mortgage loan, a discrepancy that, coupled with the fact that the lender wanted to look at the plaintiff's tax returns raised "questions in the mind of a reasonable person as to whether the plaintiff's application would be approved at all." Id., 826-27.

Applying the lessons of Jaramillo v. Case to JEM's situation leads to the conclusion that MERG reasonably to refuse to extend the August 24, 1999 closing date even if the "time is of the essence" clause was inoperative. As previously found, MERG granted JEM four extensions of the time to close, each time moving the closing to the dates requested by JEM. It is undisputed that, intrinsic to granting the fourth extension, to August 24, 1999, MERG notified JEM that it would grant the extension only upon express date-sensitive conditions. As in Jaramillo v. Case, these conditions, included in the second amendment to the earnest money contract, provided JEM with due notice that MERG was motivated to sell the Hub in a timely fashion, and that MERG would likely deny any further request for extension of the closing date. Id., 826-27. Thus, MERG put JEM on timely notice performance by August 24, 1999 was a fundamental condition of the sale contract, and JEM had due notice of MERG's intention to limit its access to time within which JEM could purchase the Hub. Id., 826.

Because JEM thus had adequate advance notice of MERG's desire to sell the Hub in the timely fashion, i.e., on or before August 24, 1999, the absence of Packard's written consent to the "time is of the essence" or automatic termination clauses carries neither weight nor relevance. Id., 826-27. Moreover, because JEM voluntarily agreed to include a "time is of the essence" clause in the earnest money contract signed August 19, 1999, JEM effectively waived its right to object to the second amendment. (Ex. 3.) "Waiver involves an intentional relinquishment of a known right . . . Waiver does not have to be express, but may consist of acts or conduct from which waiver may be implied . . . In other words, waiver may be inferred from the circumstances if it is reasonable to do so . . ." (Citations omitted; internal quotation marks omitted.) Banks Building Co., LLC v. Malanga Family Real Estate Holding, CT Page 20894 102 Conn.App. 231, 239, 926 A.2d 1 (2007). By agreeing to amend the purchase money contract to make the time of the essence, JEM functionally assented to making the time to close "of the essence" with or without any participation by Packard in the establishment of the closing schedule.

As with the Jaramillo plaintiff, the evidence supports the finding that JEM's independent failure to secure financing fatally prevented its proposed purchase of the Hub, notwithstanding JEM's assiduous argument "that it was the defendants' fault that approval of his mortgage application was delayed." Jaramillo v. Case, supra, 100 Conn.App. 827. As in Jaramillo, the buyer has failed to present evidence sufficient to support the laying of blame at the feet of the seller. As found in Part III.A.2.a., despite JEM's claims to the contrary, the evidence establishes that MERG or its agents provided reasonably prompt and adequate response to all requests it received for due diligence information, and the evidence is insufficient to establish JEM's explicit claim that MERG, whether intentionally or inadvertently, withheld any requested data or documentation. Under these circumstances, JEM is not entitled to rely on any identifiable factual or "legal excuse for not performing" as required under the terms of the earnest money contract and/or the forbearance agreement. David M. Somers Associates, P.C. v. Busch, supra, 283 Conn. 406; see also David M. Somers Associates, P.C. v. Busch, supra, Docket No. CV 03 0822125. Even if JEM could prevail on its claim that MERG was bound to extend the closing date, or that the "time is of the essence" clause did not compel its timely performance, the evidence supports the conclusion JEM's manifest inability and/or unwillingness to perform the fundamental contract prerequisites in a timely manner, including but not limited to the procurement of financing, effectively rendered prudent and appropriate MERG's refusal to extend the August 24, 1999 closing date. See Christophersen v. Blount, supra, 216 Conn. 511-12; Bethlehem Christian Fellowship, Inc. v. Planning Zoning Commission, supra, 58 Conn.App. 446. Accordingly, JEM cannot prevail on its claim that MERG unreasonably refused to extend the closing date beyond August 24, 1999.

B. CLAIMS BASED ON BREACH OF COVENANT OF GOOD FAITH AND FAIR DEALING

Distilled, the allegations of count two of the complaint allege that MERG failed to enter into or adhere to the contract with JEM in good faith.⁵¹ "It is the burden of the party asserting the lack of good faith to establish its existence and whether that burden has been satisfied in a particular case is a question of fact." (Internal quotation marks omitted.) Kronberg Bros., Inc. v. Steele, CT Page 20895 72 Conn.App. 53, 63, 804 A.2d 239, cert. denied, 262 Conn. 912, 810 A.2d 277 (2002). Despite the sincerity of JEM's arguments, the evidence, in its entirety, cannot sustain the plaintiff's burden of proof. Accordingly, the court finds count two in favor of the defendant.

51 "[Good faith] is a subjective standard of honesty of fact in the conduct or transaction concerned, taking into account the person's state of mind, actual knowledge and motives . . . Whether good faith exists is a question of fact to be determined from all the circumstances." (Internal quotation marks omitted.) Jaser v. Fisher, 65 Conn.App. 349, 359-60, 783 A.2d 28 (2001).

"[I]t is axiomatic that the . . . duty of good faith and fair dealing is a covenant implied into a contract or a contractual relationship . . . In other words, every contract carries an implied duty requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement . . . The covenant of good faith and fair dealing presupposes that the terms and purpose of the contract are agreed upon by the parties and that what is in dispute is a party's discretionary application or interpretation of a contract term . . . To constitute a breach of [the implied covenant of good faith and fair dealing], the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith." (Internal quotation marks omitted.) Renaissance Management Co. v. Connecticut Housing Finance Authority, 281 Conn. 227, 240; 915 A.2d 290 (2007). "Bad faith means more than mere negligence; it involves a dishonest purpose . . . Bad faith in general implies both actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake as to one's rights or duties, but by some interested or sinister motive." (Internal quotation marks omitted.) Hudson United Bank v. Cinnamon Ridge Corp., 81 Conn.App. 557, 576-77, 845 A.2d 417 (2004).

JEM would have the court infer MERG's absence of good faith and fair dealing, or its bad faith, from a constellation of events that it claims resulted in its inability to purchase the Hub as scheduled. In clear focus, JEM's claims emanate from its perception that because neither the city nor MERG ever wanted to sell the Hub, the city caused MERG to induce JEM into contract for purchase and sale of the property without the intention of honoring that contract, but thus using JEM as a shield against Packard's foreclosure. JEM argues that this inference must be drawn because throughout the months when the earnest money contract was in place, the city was preparing to buy the notes and mortgage from Packard. Notwithstanding the tenor of JEM's claims, the evidence is overall insufficient to support any determination that MERG, the sole defendant, acted in bad faith, with interested or sinister motive, or with the intent to defraud or mislead the plaintiff concerning the sale of the Hub. To the contrary, the evidence as a whole establishes that MERG demonstrated good faith and fair dealing in all of its interactions with JEM, and that MERG did not contribute to the transaction's failure.⁵²

52 For instance, as found in Part III.A.2.a. and b., notwithstanding JEM's claims to the contrary, MERG acted reasonably and appropriately under the circumstances when providing whatever due diligence documents were requested, in not withholding any such information, and in declining to extend the closing date beyond August 24, 1999.

In determining that JEM has failed to meet its burden of proof on the second count, the court notes the absence of evidence from which it reasonably find that MERG would have achieved any benefit by deciding not to have the plaintiff deliver, in the summer of 1999, $2,500,000 as payment for the Hub. To the contrary, the evidence as a whole supports the conclusion that it would have been to MERG's benefit, and to the benefit of the city, to have received this sum as payment for the Hub in June, July or in August of 1999, whereby Packard's loan could have been released; and supports the further conclusion that MERG acted prudently in declining to extend, after August 24, 1999, further opportunities for purchase by a party who was demonstrably unable or unwilling to close the transaction. See Parts III.A.2.a. and b. The credible evidence supports further conclusion that, despite JEM's innuendo and search for an ulterior motive, MERG never intentionally or inadvertently interfered with the perfection of the earnest money contract because it had another buyer with whom it would prefer to have done business.⁵³ (Testimony of Schaffer; see also Testimony of Kamerbeek.) Accordingly, there is insufficient basis from which the court could reasonably ascertain the existence of the dishonest purpose, of actual or constructive fraud, design to mislead or deceive the potential buyer, or of neglect or refusal to fulfill a duty or some contractual obligation, not prompted by an honest mistake as to MERG's rights or duties but by some interested or sinister motive, which is prerequisite to a finding of breach of the covenant of good faith and fair dealing. See Hudson United Bank v. Cinnamon Ridge Corp., supra, 81 Conn.App. 576-77. In the absence of such credible proof, JEM cannot meet its burden of proof on count two of its complaint. Renaissance Management Co. v. Connecticut Housing Finance Authority, supra, 281 Conn. 240.

53 In reaching this determination, the court declines to credit McGuire's undetailed, speculative, self-interested deposition testimony as to the city's motive in withholding the Hub's ownership from him. (Exhibits 62, 62A.) While crediting Marinan's deposition testimony establishing his personal disdain for McGuire, that testimony overall was insufficient to support the claims of misleading conduct, sinister motive and bad faith on MERG's behalf. (Exhibit 66.)

Also, the protections founded upon breach of implied covenant of good faith and fair dealing do not apply to JEM; they are applicable only when a buyer has shown its right to receive some or all of the benefits of the underlying contract. As found in Part III.A., under the circumstances of the present case, JEM had no such right can exist after the unsatisfied August 24, 1999 closing date had passed. Thus, even if it could be found that MERG in some way engaged in conduct that caused injury to JEM, the principles of breach of implied covenant of good faith and fair dealing would not protect a plaintiff who had no right to receive any benefits of the contract after that date, due to the effect of the "time is of the essence" clause, to which JEM agreed, of the automatic termination provision, of JEM's concession that MERG had performed its contract obligations and due, as well as of JEM's inability or unwillingness to close the transaction within a reasonable time thereafter. Because MERG had no obligation to grant further extensions of the closing date after JEM's failure to meet the August 24, 1999 deadline, MERG's reasons for declining to do so cannot implicate the succor available to a buyer whose right to contractual benefits remained extant.

C. CLAIMS BASED ON SPECIFIC PERFORMANCE

As described in Part I, count four of the complaint fundamentally alleges that JEM is entitled to an order of specific performance due to MERG's actions in breaching the contract and in demonstrating bad faith; therefore, JEM seeks an award of title to the Hub subject to Packard's mortgage, which became the city's mortgage, and an assignment of MERG's interest in the condemnation proceedings.⁵⁴ Again, notwithstanding JEM's efforts at marshaling the evidence in support of these claims, the plaintiff has failed to meet its burden of proof. Accordingly, for the reasons stated below, this count is also found in favor of MERG.

54 JEM argues that specific performance must be ordered because: the earnest money contract gave it the right to the delivery of a deed to the Hub even in the absence of financing sufficient to release Packard's mortgage; it has performed and remains ready, willing and able to perform its obligations under the earnest money contract and the forbearance agreement; and even though the city is no longer a party to this action, the court's determination of the equities in the condemnation proceedings is not conclusive upon JEM, so that the condemning authority must pay it just compensation by virtue of its lis pendens on the property.

"Specific performance is an equitable remedy permitting courts to compel the performance of contracts for the sale of real property, and certain other contracts, pursuant to the principles of equity . . . Every complaint asking for specific performance of a contract to convey real estate is addressed to the discretion of the court, and will not be granted unless the contract is made according to the requirements of law, and is fair, equitable, reasonable, certain, mutual, on good consideration, consistent with policy and free from fraud, surprise or mistake." (Citation omitted; internal quotation marks omitted.) Jaramillo v. Case, supra, 100 Conn.App. 828. "Even when a valid contract is found, there is no right to specific performance, but rather [t]he granting of specific performance of a contract to sell land is a remedy which rests in the broad discretion of the trial court depending on all of the facts and circumstances when viewed in light of the settled principles of equity . . . The determination of what equity requires in a particular case, the balancing of the equities, is a matter for the discretion of the trial court." (Citation omitted; internal quotation marks omitted.) Id., 828-29.

1. Claims that JEM Has Performed, Was and/or Is Ready, Willing and Able to Perform

As found in Part II, JEM is currently in Chapter 11 bankruptcy. JEM only exists as a litigation trust whose assets, if any, are bound to the bankruptcy trustee who did not participate in the pending litigation. Nonetheless, JEM contends that it is entitled to relief because there are no prima facie elements to a claim for specific performance. JEM further argues that because it had no obligation under the earnest money contract to pay $2,500,000 to MERG, it need not demonstrate that it was and is ready, willing and able to perform in order to be awarded specific performance. Our law, however, is to the contrary. "It is well settled that a buyer seeking specific performance has the burden of proving that he or she is ready, willing and able to purchase the premises, even when a seller refuses to participate in or attend a closing, or has failed to satisfy a condition of the contract . . . Whether a buyer is ready, willing and able to make a purchase is a question of fact." (Citation omitted; internal quotation marks omitted.) Jaramillo v. Case, supra, 100 Conn.App. 829.

While JEM's factual claims are again multiple and multi-faceted, the evidence is insufficient to establish any basis for concluding that it is entitled to the remedy of specific performance. To secure this remedy, whether or not the Hub property has been condemned and taken by the city, JEM must still demonstrate that it was able to substantially perform under the contract in 1999; contrary to its claim, JEM's reliance upon its extension of the deposit price cannot satisfy its obligation to prove that it was, at any relevant time, ready, willing and able to tender the purchase price to MERG. See Jaramillo v. Case, supra, 100 Conn.App. 829. The evidence, as a whole, compels the opposite conclusion, to wit, that JEM could not in 1999 and cannot now perform its obligations under the contract for purchase of the Hub and that, therefore, it is not entitled to an award of specific performance whether for the actual property or for MERG's interest in the condemnation proceedings.⁵⁵ Rather, judgment must enter in favor of MERG because JEM was unable to perform on August 24, 1999; because its inability to perform was not caused by MERG; and because it remains unable to perform under the contract.

55 Moreover, because, as found in Parts II and III.A., JEM agreed in writing to make time of the essence, to allow the purchase and sale agreement to expire on August 24, 1999 if closing had not occurred, and that MERG had met its contractual obligations, and because JEM was neither ready, willing nor able to close on August 24, 1999, specific performance cannot be ordered either in equity and/or in law. Jaramillo v. Case, supra, 100 Conn.App. 829.

These conclusions are also consistent with the lessons of Jaramillo v. Case, supra. As discussed in Part III.A.2.b., Jaramillo affirmed the trial court's denial of specific performance where the facts established that the plaintiff buyer was not ready, willing and able to purchase the property. In that matter, as in the present case, the facts demonstrated that the buyer did not have a mortgage loan commitment when the closing date occurred, the defendant sellers reasonably refused to extend the closing date; and any commitment that existed was conditional and for an amount less than that required by the contract. Id., 829-30. As the Appellate Court reminded us, in such a case, "a seller's repudiation excuses a buyer's readiness to perform but it does not excuse a buyer's ability to perform." (Emphasis added.) Id., 829.

Here, under the contract and the forbearance agreement, JEM was obligated to perform by tendering the purchase price for the Hub before MERG's duty to transfer the title and deliver the deed to the Hub would arise. See part III.A.1. (Exs. 1, 2, 3, 4, 5, 6.) The applicable contracts clearly establish that JEM contracted with MERG to purchase the Hub, not to purchase the equity of redemption. It is undisputed that JEM never tendered the $2,500,000 purchase price called for by the earnest money contract and amendments. Moreover, JEM informed MERG that it would not be able to close on August 24, 1999, because it was unable to obtain financing; this inability existed notwithstanding any promise Packard made to fund $595,000 of the purchase price, in the form of a second mortgage, even if that commitment did not expire, as it did, on August 31, 1999. It is also undisputed that JEM has never succeeded in its attempts to secure financing to purchase the Hub and that JEM is currently in bankruptcy. Taken together, notwithstanding the plaintiff's vigorous protestations to the contrary, these circumstances impel the conclusion that JEM was not ready or able to purchase the Hub on August 24, 1999, or at any other time relevant to this action.⁵⁶ Accordingly, JEM is not entitled to specific performance. Jaramillo v. Case, supra, 100 Conn.App. 828; McKenna v. Woods, supra, 21 Conn.App. 534.

56 Given its conclusion that JEM's inability to perform renders specific performance unobtainable under the circumstances, the court need not further address MERG's other arguments in opposition to that aspect of the plaintiff's complaint. However, if the court has erred in reaching its determination of JEM's lack of readiness or ability to perform, other aspects of the evidence also show that specific performance would be impossible and that the plaintiff is not entitled to that relief. In sum, as found in Part II, Packard was a party to the forbearance agreement but not to the earnest money contract; the city was a party to neither the contract nor the agreement. Packard held the note and mortgage on the Hub, later assigned to the city, in the amount of $3,300,000. JEM's purchase of the Hub was contingent on the mortgage holder's agreement to accept $2,500,000 in satisfaction of the $3,300,000 mortgage, consistent with the agreement of JEM and MERG, whereby Packard agreed not to foreclose on the loan and agreed to accept $2,500,000 in satisfaction of the mortgage. The forbearance agreement was incorporated into the earnest money contract. Thus, the earnest money contract cannot be enforced as written and specific performance is rendered impossible as it would require the court to order the city, a non-party to the earnest money contract and the forbearance agreement, to release its mortgage on the property for less than a full value. Under all these circumstances, JEM cannot prevail on its claim for specific performance.

2. Claims that Determination of Equities in the Condemnation Proceeding Is not Conclusive upon JEM

Although the court finds that JEM is not entitled to specific performance because it was not ready or able to purchase the property at issue, the court next addresses JEM's argument that it is able to access this relief because it is not bound by the court's determination of the equities in the 2005 condemnation proceedings. See Practice Book § 64-1. For the following reasons, the court finds this claim in favor of the defendant.

JEM does not contest the fact that, as found in Part II, the city has taken the property at issue. JEM vociferously contends, however, that because it filed a lis pendens on the Hub, and because the condemning authority must pay just compensation to persons entitled thereto including JEM, it still has access to the remedy of specific performance. JEM supports this proposed conclusion by essentially arguing that when JEM recorded a lis pendens on the Hub property, the city was placed on notice that the persons entitled to condemnation compensation could not be determined until the present lawsuit is resolved. JEM would thus have the court find that because the city is a purchaser subsequent to the recording of JEM's lis pendens, the city is bound by the result of this case as if it were a party, and the earnest money contract must still be the subject of compliance.

In the absence of apposite authority, the court declines to adopt JEM's proposal. Instead, the court concurs with MERG's proffered construction of the present circumstances and concludes instead that JEM's failure, despite due notice, to appear and be heard at the condemnation proceedings constituted a waiver of any rights it may have had in that action. In addition, JEM's failure to appeal the certificate of taking issued by the court and filed with the land records collaterally estops it from re-litigating its purported right under the lis pendens. The city's condemnation interest in the property must be seen as superior to, and unaffected by, JEM's lis pendens. Thus JEM cannot prevail on this final aspect of its argument.

The city's right to condemn the property is undisputed. Without providing any exception for property that is the subject of a lis pendens, General Statutes § 7-148(c) provides in relevant part: " Any municipality shall have the power to do any of the following, in addition to all powers granted to municipalities under the Constitution and general statutes . . . Take or acquire by gift, purchase, grant, including any grant from the United States or the state, bequest or devise and hold, condemn, lease, sell, manage, transfer, release and convey such real and personal property or interest therein absolutely or in trust as the purposes of the municipality or any public use or purpose, including that of education, art, ornament, health, charity or amusement, cemeteries, parks or gardens, or the erection or maintenance of statues, monuments, buildings or other structures, or the encouragement of private commercial development, require . . ." (Emphasis added.) "All property is held subject to its condemnation for a public use, and the damages awarded will be just compensation as nearly as the nature of the property will admit." New Haven Water Co. v. Russell, 86 Conn. 361, 368, 85 A. 636 (1912). "[T]he taking of property by municipal authorities for municipal purposes is a taking by virtue of the right of eminent domain." First National Stores, Inc. v. Plan Zoning Commission, 26 Conn.Sup. 302, 311, 222 A.2d 228 (1966). That damages from a proposed condemnation are not such that they may be fully compensated will not prevent the condemnation. Id. "In Connecticut it is not the condemnor, but rather the plaintiff [who has] the burden of establishing that the taking . . . was unreasonable, in bad faith or an abuse of power." (Emphasis in original; internal quotation marks omitted.) Kelo v. New London, 268 Conn. 1, 117, 843 A.2d 500 (2004), aff'd, 545 U.S. 469, 125 S.Ct. 2655, 162 L.Ed.2d 439 (2005).

"The procedures for condemning land where property is taken . . . are controlled by General Statutes §§ 8-128, 8-129, 8-129a, 8-130, 8-131, CT Page 20901 8-132, 8-132a and 8-133. The procedures required by those enumerated sections include: determining the compensation to be paid to the condemnee and filing a statement of compensation with the clerk of the Superior Court; General Statutes § 8-129; filing a deposit as provided in General Statutes § 8-130 with the clerk of the Superior Court; General Statutes § 8-129; giving notice to all persons appearing of record as a property owner affected by the condemnation or as a holder of any encumbrance on such property or interest therein; General Statutes § 8-129; and causing a certificate of taking to be recorded in the office of the town clerk. General Statutes § 8-129." (Internal quotation marks omitted.) New London v. Picinich, 76 Conn.App. 678, 680-81 n. 5, 821 A.2d 782, cert. denied, 266 Conn. 901, 832 A.2d 64 (2003). General Statutes § 8-129 provides in relevant part that the condemner "shall cause such certificate of taking to be recorded in the office of the town clerk of each town in which such property is located. Upon the recording of such certificate, title to such property in fee simple shall vest in the municipality, and the right to just compensation shall vest in the persons entitled thereto . . ." In addition, § 8-131 provides, in relevant part: "After the statement of compensation provided for in section 8-129 has been filed with the clerk of the Superior Court, the property owner affected and all other persons having a record interest therein may file with said clerk his or their written acceptance thereof . . . If the amount of such compensation exceeds ten thousand dollars, said clerk shall not certify the same until the compensation has been approved as reasonable in amount by a judge of the Superior Court or a judge trial referee. If such judge or judge trial referee approves such compensation, said clerk shall thereupon send a certified copy of the statement of compensation and the acceptance thereof to the redevelopment agency, and the court shall order the deposit or any such balance remaining on deposit to be paid to the persons entitled thereto in accordance with their equities upon application made by such persons . . ." (Emphasis added.)

In the present case, it is undisputed that the subject of this litigation, the Hub, was condemned by the city in 2005. As found in Part II., on June 22, 2005, the city filed a statement of compensation with the Superior Court for the judicial district of New Haven at Meriden with a return date of July 26, 2005. (Ex. 68.) The statement identified MERG, the city, JEM and Hudson United Bank as "persons having a record interest in the property;" set forth a description of the specific interest in the Hub held by each "person" or entity; and identified the amount of the compensation the condemner proposed to pay. The notice to each of the entities listed was attached to the statement of the compensation. The return of notice, filed on July 7, 2005, indicates that sufficient service was made, so that JEM received due and timely notice of the condemnation proceedings, of the proposed amount of the compensation award and of the priority of interests. JEM, despite this due notice, did not file an appearance or an application for the payment of compensation deposited by the city with the court, required under § 8-131.

Thereafter, also as found in Part II, the city filed and recorded the certificate of taking on July 7, 2005. Pursuant to General Statutes § 8-129, title to the Hub in fee simple that day vested in the city and the right to just compensation "vested in persons entitled thereto." On July 7, 2005, JEM was not a person entitled to just compensation because this litigation was still pending and JEM's rights and interests with respect to the Hub had not yet been determined. JEM's lis pendens, recorded to give the notice of the pending litigation, was not a "right or interest in property which has a market value." Therefore, at the time the Hub was condemned, JEM was not entitled to compensation, even though under Connecticut law, "[e]very kind of right or interest in property which has a market value must be compensated for in condemnation proceedings." (Emphasis added.) Canterbury Realty Co. v. Ives, 153 Conn. 377, 384, 216 A.2d 426 (1966). To procure compensation, JEM could not merely rely upon its lis pendens; it was required to raise its challenge during the compensation proceedings.

However, despite receiving adequate notice of the compensation process, JEM did not enter its appearance nor request attention from the court in which the statement had been filed. Thus JEM deprived itself of the opportunity to challenge the city's claim to compensation by way of $288,893.62 for due real estate taxes plus $2,869,054.69 for the property, totaling $3,157,948.31. Pursuant to the court's judgment, the city received $1,685,000, as compensation for the taking of the Hub, an amount which was well below the amount necessary to pay off the interests that had priority over JEM's purported claims.

Having failed to timely appear in the condemnation file, JEM now attempts to obtain compensation through misplaced reliance upon the lis pendens. The notice of lis pendens is a function of General Statutes § 52-325.⁵⁷ "A notice of lis pendens warns all persons that certain property is the subject matter of litigation and that any interests acquired during the pendency of the action are subject to its outcome . . . Accordingly, any party whose interest in the property arose during the interim period is subject to the final judgment." (Internal quotation marks omitted.) LaPenta v. Bank One, N.A., 101 Conn.App. 730, 737, 924 A.2d 868, cert. denied, 284 Conn. 905, 924 A.2d 868 (2007).⁵⁸ "Generally, a notice of lis pendens is simply a notice that, when properly recorded, warns third parties, such as prospective purchasers, that the title to the property is in litigation; [t]he doctrine underlying lis pendens is that a person who deals with property while it is in litigation does so at his peril . . ." (Internal quotation marks omitted.) Ghent v. Meadowhaven Condominium, Inc., 77 Conn.App. 276, 284, 822 A.2d 355 (2003). "The sole purpose of the lis pendens . . . is to give constructive notice to persons who may subsequently acquire an interest in the property, and cause them to be bound by the proceedings." (Internal quotation marks omitted.) Id., 284-85. "The lis pendens statute, General Statutes § 52-325, does not affect prior interests . . . The statute speaks prospectively." (Citation omitted.) Faught v. Edgewood Corners, Inc., 63 Conn.App. 164, 172-73, 772 A.2d 1142, cert. denied, 256 Conn. 934, 776 A.2d 1150 (2001). Thus, "[a] purchaser of property on which a lis pendens has been filed pursuant to General Statutes § 52-325 takes the property subject to the outcome of the lawsuit of which the lis pendens has given the purchaser notice." (Emphasis added.) Id., 731-32.

57 General Statutes § 52-325(a) provides in relevant part: "In any action in a court of this state . . . the plaintiff or his attorney, at the time the action is commenced or afterwards, . . . if the action is intended to affect real property, may cause to be recorded in the office of the town clerk of each town in which the property is situated a notice of lis pendens . . . Such notice shall, from the time of the recording only, be notice to any person thereafter acquiring any interest in such property of the pendency of the action; and each person whose conveyance or encumbrance is subsequently executed or subsequently recorded or whose interest is thereafter obtained, shall be deemed to be a subsequent purchaser or encumbrancer, and shall be bound by all proceedings taken after the recording of such notice, to the same extent as if he were made a party to the action . . ."

58 "A notice of lis pendens is appropriate in any case where the outcome of the case will in some way, either directly or indirectly, affect the title to or an interest in real property . . . [A] notice of lis pendens ensures that the [litigant's] claim cannot be defeated by a prejudgment transfer of the property . . . [T]he lis pendens procedure provides security for payment of the claim pending final resolution of the case." (Internal quotation marks omitted.) Donenfeld v. Friedman, 79 Conn.App. 64, 67-68, 829 A.2d 107 (2003).

The foregoing principles affirm the conclusion that JEM's lis pendens fails to provide lawful access to the relief it seeks, where the property at issue has been taken by a municipality rather than purchased by a non-governmental entity. As previously discussed, on July 7, 2005, when the court, through its clerk, issued a certificate of taking reflecting the city's acquisition of the Hub property and the city recorded that certificate of taking in the Meriden land records that same day, a full fee simple title in the Hub irrevocably vested in the city, notwithstanding any notice implications of the lis pendens. While the certificate of taking effectively, as a matter of law, extinguished any rights to the property JEM now claims to have by virtue of its lis pendens, the condemnation proceeding itself had offered JEM an opportunity to be heard, to request injunction, and/or to be compensated, consistent with the notice-effect of the lis pendens.

An objective review of the record reflects that, when it issued the certificate of taking, the court was aware of JEM's claimed interest in the Hub property. However, JEM's failure, despite due notice, to appear and be heard at the condemnation proceeding or to attempt to enjoin the proceeding, and JEM's subsequent failure to appeal the order transferring title of the Hub to the city, constitutes an effective waiver that collaterally estops JEM from re-litigating any rights to the Hub through the present case. Thereby, in allowing the condemnation proceeding to conclude without filing an appearance and objection, in failing to seek to enjoin the condemnation proceeding and in failing to timely appeal the certificate of taking awarding title to the Hub to Meriden, JEM waived and voided any encumbrance that its lis pendens might have had on the Hub. See Banks Building Co., LLC v. Malanga Family Real Estate Holding, supra, 102 Conn.App. 239.

Thus, the sole effect of JEM's lis pendens was to provide the city with constructive notice that the title to the Hub was in litigation. Pursuant to § 52-325, JEM's lis pendens causes the city to be bound by the outcome of this litigation. As the court has found all counts of the complaint in favor of MERG, the outcome of this litigation has no practical effect on the city's interest in the Hub. JEM has provided insufficient legal or factual basis to support its claim that its lis pendens, which was recorded upon property to which it has no valid claim, can nonetheless somehow mature into an encumbrance on the Hub or an interest which has a measurable market value.⁵⁹ In addition, because the lis pendens statute speaks prospectively, JEM's lis pendens has no effect on the city's prior interest, i.e., the city's earlier-recorded mortgage on the Hub.⁶⁰ Therefore, even if the plaintiff's argument should succeed and a lis pendens should create an independent right to the property at issue, under the circumstances of this case, JEM's lis pendens would have had no effect on the city's prior encumbrance on the Hub. See § 52-325(a).

59 "Every kind of right or interest in property which has a market value must be compensated for in condemnation proceedings." (Emphasis added.) Canterbury Realty Co. v. Ives, supra, 153 Conn. 384.

60 Exhibit 68, the city's Statement of Compensation submitted by the plaintiff, compels the conclusion that JEM's lis pendens was never superior to the city's encumbrance on the Hub. Paragraph 5 of Exhibit 68 establishes that MERG's $3,300,000 mortgage dated March 1, 1995 was assigned to the city on October 12, 1999 and recorded in the Meriden Land Records. That same paragraph establishes that JEM's lis pendens was dated October 14, 1999, and recorded on the Meriden Land Records.

Notwithstanding the foregoing, JEM claims that the court's determination of equities in the condemnation proceeding is not conclusive because it did not receive a notice of any hearing to determine the equities. JEM argues that, pursuant to General Statutes § 8-132a, it was entitled to a ten days' notice of the time and place of hearing to determine the equities of parties in compensation, even though, despite due notice, neither JEM nor its counsel ever entered an appearance in the condemnation proceeding.⁶¹ The court declines to adopt JEM's proposed interpretation of the notice provisions of § 8-132a, which yield absurd or unworkable results.

61 General Statutes § 8-132a provides in relevant part with regard to condemnation proceedings: "(a) Any person making application for payment of moneys deposited in court as provided for by section 8-130 or claiming an interest in the compensation being determined in accordance with section 8-132 may make a motion to the superior court for the judicial district in which the property that is the subject of the proceedings referred to is located for a determination of the equity of the parties having an interest in such moneys. The court may appoint a judge trial referee to hear the facts and to make a determination of the equity of the parties in such moneys; (b) If the court appoints a judge trial referee, such judge trial referee, after giving at least ten days' notice to the parties interested of the time and place of hearing, shall hear the applicant and any parties interested, take such testimonies as such judge trial referee deems material and determine the equities of the parties having a record interest in such moneys and forthwith report to the court . . . (c) If the court does not appoint a judge trial referee, the court, after giving at least ten days' notice to the parties interested of the time and place of hearing, shall take such testimony as it deems material and determine the equities of the parties having a record interest in such moneys. The finding of the court and such determination of the equities shall be conclusive upon all parties given notice of such hearing, subject to appeal to the Appellate Court . . ." (Emphasis added.)

In examining the notice related text of § 8-132a, the court has adhered to the applicable principles of statutory construction. "The meaning of a statute shall, in the first instance, be ascertained from 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," General Statutes § 1-2z. "It is axiomatic that the process of statutory interpretation involves a reasoned search for the intention of the legislature . . . In seeking to discern that intent, we look to the words of the statute itself . . . In applying [the] principles [of statutory construction], we keep in mind that the legislature is presumed to have intended a reasonable, just and constitutional result . . . Additionally, words in a statute must be given their plain and ordinary meaning . . . unless the context indicates that a different meaning was intended." (Citations omitted; internal quotation marks omitted.) Lombard v. Edward J. Peters, Jr., P.C., 79 Conn.App. 290, 296, 830 A.2d 346 (2003).

The clear, unambiguous language of § 8-132a requires the court to give at least ten days' notice of the time and place of hearing "to the parties interested," whether or not a judge trial referee is appointed. However, the statute does not require the court to give the notice of hearing "to the parties having a record interest" in the moneys. General Statutes § 8-132a. While both denominations, the "parties interested" and the "parties having a record interest," are used in § 8-132a, the statutory text makes it apparent that the phrases are not used interchangeably. The delineation between "parties interested," who require notice under § 8-132a, and those who may be found to have a "record interest" but who do not require statutory notice, are consistent with the provisions of Practice Book § 3-7 which establish the method by which parties identify themselves to the court so they may receive due notice of scheduled hearings and other proceedings. Practice Book § 3-7 provides in relevant part: "(a) except by leave of the judicial authority, no attorney shall be permitted to appear in court or to be heard in behalf of a party until the attorney's appearance has been entered . . . (b) After the filing of an appearance the attorney or pro se party shall receive copies of all notices required to be given to the parties by statute or by these rules . . ." Viewed from a pragmatic perspective, while Practice Book § 3-7 enables the court to send notice to a party who enters an appearance, pro se or through counsel, that section also functions to relieve the court from sending notices to parties who do not enter an appearance.⁶²

62 In the condemnation file, as described in Part II, JEM's failure to enter an appearance led to its default pursuant to Practice Book § 17-20, and thereafter to the entry of judgment upon the default.

Using the foregoing measures, it is clear that the plain and ordinary language of § 8-132a contemplates a category of "parties having a record interest" that may have more members than those falling in the category of "parties interested." "Parties having a record interest" are established prior to the commencement of a condemnation proceeding by virtue of their relation to the land at issue. To become "a party interested" within the context of § 8-132a, however, the legislation reasonably, justly, and clearly anticipates that a duly noticed party will have filed an appearance with the court, either though counsel or pro se, pursuant to Practice Book § 3-7. The notice provisions of § 8-132a thus function to ensure that notice of condemnation proceedings is provided to those who have identified themselves to the court as being "parties interested" through the filing of an appearance. Any other construction of these statutory terms would yield absurd or unworkable results, somehow expecting the court to provide notice to persons who had not responded to the statement of compensation and or notice of the condemnation by communicating their desire to participate in the legal proceedings. Such a strained analysis and application of § 8-132a is unwarranted in view of the clear and unambiguous language used in this legislation. See Lombard v. Edward J. Peters, Jr., P.C., supra, 79 Conn.App. 296.

Here, JEM received adequate notice of condemnation proceeding, and was fully apprised of the city's intention to take the Hub property.⁶³ Nevertheless, as previously discussed, JEM failed to file an appearance, and the clerk issued his certificate on July 7, 2005, establishing that "[t]he taking has now been completed . . ." (Condemnation File #102.) Judgment was entered for the city on August 29, 2005, without JEM's participation in the condemnation proceedings. (Condemnation File #104.) As found in Part II, JEM received a notice of the statement of compensation on June 24, 2005, as indicated by the return of notice. However, there is insufficient evidence from which the court could reasonably conclude that JEM timely applied for a review of the statement of compensation within six months after the statement was filed, notwithstanding the opportunity to do so provided through § 8-132(a).⁶⁴

63 "The reasonableness of the notice is not governed by the period for service of civil process. A condemnation proceeding is a suit at law . . ." New Haven Water Co. v. Russell, supra, 86 Conn. 365. The form of summons or notice does not have to be in accordance with that prescribed for civil actions and civil process because "a condemnation proceeding is not a civil action, nor a civil process within the meaning of the statutes relating to civil process. It is a special proceeding to determine in a single action the damages done by the taking." (Emphasis added.) Id.

64 General Statutes § 8-132(a) provides in relevant part: "Any person claiming to be aggrieved by the statement of compensation filed by the redevelopment agency may, at any time within six months after the same has been filed, apply to the superior court for the judicial district in which such property is situated for a review of such statement of compensation so far as the same affects such applicant . . ." (Emphasis added.)

JEM's failure to submit an appearance in the condemnation case and its failure to appeal the certificate of taking collaterally estops it from here raising and relitigating its claim that the lis pendens provided a measurable right to the Hub property. Our Supreme Court has held that "the failure to raise a procedural claim or the failure to utilize a remedy available to cure a procedural defect can constitute a waiver of the right to object to the alleged defect." Jutkowicz v. Department of Health Services, 220 Conn. 86, 95, 596 A.2d 374 (1991); see also Banks Building Co., LLC v. Malanga Family Real Estate Holding, LLC, supra, 102 Conn.App. 239. "[Waiver] involves the idea of assent, and assent is an act of understanding . . . The rule is applicable that no one shall be permitted to deny that he intended the natural consequences of his acts and conduct . . . In order to waive a claim of law it is not necessary . . . that a party be certain of the correctness of the claim and its legal efficacy. It is enough if he knows of the existence of the claim and of its reasonably possible efficacy." (Internal quotation marks omitted.) Segale v. O'Connor, supra, 91 Conn.App. 678.

In the present case, despite the adequate service of notice of the proceedings and of the amount of anticipated compensation, and despite the statutory opportunity for an aggrieved person to protest the compensation scheme, JEM failed to apply to the court for relief in the condemnation proceeding. Thus, JEM failed to utilize remedies available for curing its alleged procedural defect of lack of notice of time and date of a hearing to determine the equities. JEM's acts and conduct in declining to participate in the condemnation proceeding are sufficient to support the inference that it intentionally relinquished known rights with regard to the compensation issue and that it thus intentionally waived any claims that could have been derived from the placing of its lis pendens upon the Hub property.

JEM obliquely argues that Section 5.1 of the earnest money contract, described in Part II, expressed the parties' contemplation that the entire Hub property could be taken by condemnation and set forth their agreement that MERG would be obligated to pay the plaintiff its entire interest in the condemnation award. (Ex. 1.) Such an argument, however sincere, misapplies the clear language of Section 5.1, which is obviously directed at a condemnation that took place while a valid contract for purchase and sale was in effect.⁶⁵ As found in Parts IIIA. and B, following August 24, 1999, there was no extant contract between the parties for purchase and sale of the Hub property. Therefore, the condemnation payment provisions of Section 5.1 could not afford JEM any relief at all. Even if the condemnation payment provisions of the earnest money contract were applicable under the circumstances of this case, Section 5.1 would have required MERG to assign or pay to JEM its interest in the property or any condemnation award it had received "at Closing . . ." (Exhibit 1.) As no closing ever occurred, this contingency never triggered any obligation on MERG's part. Furthermore, if Section 5.1 is applicable, MERG has lost its interest in the Hub through the city's taking in July of 2005, and MERG received no remuneration upon condemnation of the property. Therefore, MERG would have nothing to transfer to JEM even if the provisions of Section 5.1 were binding upon the defendant in this case. (Exhibit 1.)

65 For instance, Section 5.1 of the earnest money contract contains several references to JEM's opportunities to take certain actions "at Closing" or "prior to Closing." (Ex. 1.)

Although the determination of equities in the condemnation file was adverse to JEM, the plaintiff had adequate opportunities to have participate in the special proceeding in chief, or to have applied as an aggrieved person, within six months after the statement of compensation had been filed, for § 8-132(a)'s relief. However, as JEM did not avail itself of any of these remedies, the condemnation proceeding's determination of the Hub equities is conclusive on JEM. Under these circumstances, even if this court were to order MERG to assign its interest in condemnation award to JEM, JEM would be entitled to nothing, as MERG received nothing upon the entry of judgment. (Condemnation File #105.) Accordingly, the court is constrained to conclude that there is insufficient basis, in fact or in law, for granting JEM's request for specific performance.

IV. CONCLUSION

For the foregoing reasons, the court finds all counts in favor of the defendant, MERG. Judgment shall enter in favor of the defendant, without costs to any party.