Opinion
CV166058816S
04-19-2017
Property Tax Management, LLC v. John Karageorge
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
Edward T. Krumeich, J.
Plaintiff Property Tax Management, LLC sued defendant John Karageorge (" Karageorge") to collect a fee for property tax consulting services provided in connection with certain properties owned by Karageorge's entities in Fairfield. Karageorge denied that plaintiff had earned fees in connection with the reduction of property taxes on a commercial property located at 1610 Post Road in Fairfield. For the reasons stated below, the Court finds that plaintiff has proven that Karageorge breached his contract with plaintiff and awards damages, interest and costs of collection, including reasonable attorneys fees.
Karageorge did not object to the fees claimed in connection with 1795 Post Road.
On December 11, 2015, the parties entered into a written contract in which Karageorge engaged plaintiff to provide consulting services in connection with tax appeals relating to certain properties owned by defendant's entities that were identified in an exhibit to the contract. Karageorge and Michael Fazio (" Fazio"), the owner of plaintiff, met to review the proposed contract and information Karageorge had obtained relating to the revalued assessments. Fazio signed and presented Karageorge with plaintiff's standard contract that listed five properties owned by Karageorge as the subjects of the engagement. Fazio agreed to provide consulting services to Karageorge relating to three specified commercial properties but not to three other residential properties. On December 11, 2015, at 5:20 p.m. Karageorge faxed a signed contract to plaintiff that struck from the list three residential properties, but kept all three commercial properties: 1610 Post Road, 1795 Post Road and 1460 Post Road. Karageorge testified that he specifically withdrew 1610 Post Road from the agreement, but presented no evidence of having done so. Fazio testified that 1610 Post Road was included within the scope of services performed by plaintiff. The credible evidence, most notably the contract signed and edited by Karageorge on December 11, 2015, proved that tax liability reduction for 1610 Post Road was within the scope of the agreement.
The contract described the scope of services as follows: " [t]he services to be provided are to obtain a tax liability reduction for the property(s) [sic] listed in Exhibit 'A, ' including appealing at the Informal Hearing, appealing to the local Board of Assessment Appeals, negotiations with the taxing authorities and, if necessary, and, at our discretion, filing an appeal to the Superior Court." Karageorge testified that plaintiff was supposed to attend a meeting with Steven Zaiko, a town revaluation representative, but that Fazio failed to show up. Fazio testified he negotiated directly with the Town Tax Assessor a reduction in assessed values of the properties located at 1610 Post Road and 1795 Post Road. The reductions in value Fazio negotiated resulted in substantial property tax savings. The appraised value of 1610 Post Road was reduced by $805, 200 from $2, 351, 500 to $1, 546, 300, which translates at 70% of fair market value to an assessed value of $1, 082, 420 for an annual tax saving of $14, 494. The appraised value of 1795 Post Road was reduced by $223, 600 from $1, 017, 700 to $794, 100, which translates at 70% of market value to an assessed value of $555, 870 for an annual tax savings of $4, 025. Karageorge did not continue the appeal process on the valuations included in the October 2015 Grand List and accepted the benefits of the lower appraisals negotiated by Fazio.
Karageorge was unclear whether Mr. Zaiko was a town attorney or assessor. The first stage in the appeal process described in the notices of assessment change was an informal review by appointment with a representative of Vision Government Solutions, the revaluation company working with Fairfield. Presumably, this was the meeting Karageorge referred to that Fazio skipped.
Fazio testified that the third commercial property at 1460 Post Road was fairly assessed so he did not pursue a reduction.
Karageorge testified he was able to negotiate further reductions in subsequent years. Whether or not Karageorge could have negotiated the same or better reductions is not relevant to his contractual obligation to compensate plaintiff for the reductions Fazio negotiated.
On April 7, 2016, plaintiff sent Karageorge an invoice for $30, 555.36, broken down as $23, 914.44 for the tax reduction on 1610 Post Road and $6, 640 for the tax reduction on 1795 Post Road. Karageorge failed to pay the invoice. Although he testified he did not dispute the fees on 1795 Post Road, he refuses to pay the much larger fee on 1610 Post Road, which he credits to the information he provided to Fazio. The agreement obligated Karageorge to provide information requested by plaintiff. It also includes " negotiations with the taxing authority" among the services to be provided; there is nothing in the contract that would prohibit negotiations with the Assessor outside of Karageorge's presence. The Court finds that plaintiff performed the services called for under the contract. Karageorge's decision not to take the appeals process beyond the reductions negotiated by Fazio ratified the services provided and his unhappiness at the amount of the fee does not deprive plaintiff of the compensation due under the contract.
Karageorge discounted the importance of the terms of the contract he signed and he appeared not to know the contents of the contract he signed or to appreciate that he was bound to follow the terms he agreed to by signing and returning the fully executed contract to plaintiff. " The general rule is that where a person of mature years and who can read and write, signs or accepts a formal written contract affecting his pecuniary interests, it is [that person's] duty to read it and notice of its contents will be imputed to [that person] if [that person] negligently fails to do so . . ." Phoenix Leasing, Inc. v. Kosinski, 47 Conn.App. 650, 654, 707 A.2d 314 (1998), quoting First Charter National Bank v. Ross, 29 Conn.App. 667, 671, 617 A.2d 909 (1992).
The agreement provides for a contingent fee based on 33% of tax savings from a taxable value reduction in the years included in the tax cycle. The invoice calculated the contingent fee due under the contract for the reductions in value on the two commercial properties negotiated by plaintiff. Karageorge's refusal to pay plaintiff's invoice was a material breach of contract.
In calculating the amount of damages, " [t]he general rule of damages in a breach of contract action is that the award should place the injured party in the same position as he would have been in had the contract been performed." Meribear Productions, Inc. v. Frank, 165 Conn.App. 305, 323, 140 A.3d 993 (2016), quoting Harley v. Indian Spring Land Co., 123 Conn.App. 800, 839, 3 A.3d 992 (2010).
In addition to the $30, 555.36 in fees, the agreement provides for " liquidated damages" at 1.5% per month and costs of collection including reasonable attorneys fees. The interest provision for unpaid debt is enforceable. See e.g., Scientific Products v. Cyto Medical Laboratory, Inc., 457 F.Supp. 1373, 1380 (D.Conn. 1978). Plaintiff is entitled to recover $5, 041.63 interest for its unpaid invoice for the eleven months between May 7, 2016, when the invoice should have been paid, to date. Plaintiff is also entitled to recover its costs of collection of $4, 900.80, which includes $4, 480.00 in reasonable attorneys fees.
Judgment shall enter in favor of plaintiff Property Tax Management, LLC and against defendant John Karageorge in the amount of $40, 497.79.