Boccanfuso v. Daghoghi

DOMINICK BOCCANFUSO ET AL. v. NADER DAGHOGHI ET AL.

No. SC 20397

Supreme Court of Connecticut

September 30, 2020 ^[**]

Submitted on briefs May 8, 2020

Procedural History

Summary process action, brought to the Superior Court in the judicial district of Stamford-Norwalk, Housing Session at Norwalk, and tried to the court, Rodriguez, J.; judgment for the plaintiffs, from which the defendants appealed to the Appellate Court; thereafter, the court, Rodriguez J., issued articulations of its decision subsequently, the Appellate Court, Keller Prescott and Pellegrino, Js., affirmed the trial court's judgment, and the defendants, on the granting of certification, appealed to this court. Affirmed.

Ryan P. Driscoll filed a brief for the appellants (defendants).

Matthew B. Woods filed a brief for the appellees (plaintiffs).

Robinson, C. J., and Palmer, McDonald, D'Auria, Mullins, Kahn and Ecker, Js. ^[*]

OPINION

ECKER, J.

The issue in this certified appeal is whether the trial court properly rejected the defendants' claim that the doctrine of equitable nonforfeiture should have operated to prevent their eviction in a summary process action for nonpayment of rent under the terms of a commercial lease. The defendants, Nader Daghoghi (Nader), Sassoon Daghoghi (Sassoon), and 940 Post Road East, LLC, doing business as Savoy Rug Gallery, appeal from the judgment of the Appellate Court, which affirmed the trial court's judgment of possession rendered in favor of the plaintiffs, Dominick Boccanfuso (Dominick), Crescienzo Boccanfuso, and Boccanfuso Bros., Inc. (plaintiff corporation). The defendants claim that the Appellate Court improperly affirmed the judgment of the trial court denying the defendants equitable relief from forfeiture of their tenancy. We affirm the judgment of the Appellate Court.

I

The following facts^[1] and procedural history are relevant to this appeal. The plaintiff corporation owns commercial property located at 936-940 Post Road East in Westport. From 1970 until January 14, 2014, the premises were used as an automotive repair and sales shop. Two underground storage tanks were located on the property: a 2000 gallon tank used to store gasoline and a 330 gallon tank used to store waste oil.

On May 4, 2010, an inspector from the Department of Energy and Environmental Protection (DEEP)^[2] conducted a compliance inspection of the 2000 gallon tank. The inspector found that an automatic tank gauging system and probes needed to be installed and that ‘‘no annual cathodic protection test [is] being conducted on the tank and associated product line piping.'' The inspector's report identified nine ‘‘potential violations'' of state law on the basis of these findings. On July 15, 2010, the DEEP inspector conducted a ‘‘[f]ollow-up'' compliance audit during which the inspector informed the plaintiffs that the cathodic protection of the tank needed to be tested annually. The inspector's report indicated that one of the plaintiffs ‘‘stated [that] he will call [a] contractor and inform me who[m] he selected to [test the cathodic protection].'' On March 3, 2011, a second DEEP inspector found that the violations had not been addressed. The inspector had a conversation with Dominick, during which Dominick stated that he would hire a contractor to test the tank and piping for corrosion protection. The inspector informed Dominick that the tank was in ‘‘temporary closure status'' until it was either brought into compliance or permanently removed. (Internal quotation marks omitted.) The inspector cited six ‘‘potential violations'' on the basis of his findings.

On April 27, 2011, the plaintiffs hired Absolute Tank Testing Inc. (Absolute Tank), to conduct a cathodic protection test of the 2000 gallon tank. Absolute Tank subsequently sent a letter to Dominick on May 1, 2011, advising him that the tank had ‘‘passed'' the test but that the lines connected to the tank had ‘‘fail[ed]'' the test. Absolute Tank recommended that the plaintiffs retain a cathodic protection engineer to confirm the readings and make recommendations accordingly. On October 31, 2011, Dominick received a second letter from Absolute Tank advising him that soil samples taken from the area surrounding the 2000 gallon tank contained ‘‘detectable concentrations of [Extractable Total Petroleum Hydrocarbons at] 540 parts per million'' and that DEEP had been notified.^[3]

In March, 2013, Giuseppe Boccanfuso (Giuseppe), Dominick's nephew, removed the 2000 gallon tank. Afterward, Connecticut Tank Removal, Inc. (Connecticut Tank), conducted soil sampling of the area where the tank had been located. The sample ‘‘indicate[d] elevated levels of contaminants . . . .'' Approximately one year later, in March or April of 2014, Giuseppe removed the 330 gallon tank, as well. Giuseppe was not licensed to remove these tanks, and neither he nor the plaintiffs notified DEEP of their removal.

Meanwhile, in 2012, the parties began discussing a potential lease of the premises and the defendants' intention to operate a retail rug gallery and a Subway sandwich restaurant thereon. The parties agreed that the defendants would make significant renovations to the premises in preparation for operating these businesses. To undertake these renovations, the defendants were required to obtain building permits and certificates of occupancy for each business. At some point during the discussions over the proposed lease, Nader asked Dominick whether any environmental contamination was present on the property. Nader and his brother Sassoon had experienced environmental issues in the past with a different property that, like the premises at issue, also had been an automobile repair business, and they wanted to ensure there would be no similar problems with the leased premises. Dominick did not inform Nader of the presence of the tanks, the results of the DEEP inspections, the testing performed by Absolute Tank, or any potential contamination on the site.^[4]

Richard H. Girouard, Sr., the property manager for the plaintiffs, served as the leasing agent for the premises. Girouard drafted and negotiated the terms of the lease on behalf of the plaintiffs. In addition, distinct from his role as the plaintiffs' leasing agent, Girouard offered to consult with the defendants regarding the renovation and permitting of the premises. Prior to the execution of the lease, the defendants and Girouard memorialized, in a letter dated October 29, 2013, their agreement that Girouard would provide ‘‘consulting [and] design services'' for the renovations and permitting process.^[5]These services included ‘‘[a]ssist[ing] [the] owners^[6] in overseeing demolition [and] renovation of [the premises], '' ‘‘[s]chedul[ing] and oversee[ing] necessary inspections, '' facilitating the ‘‘[p]ermitting process for [e]ngineering, [b]uilding, [z]oning [and] [f]ire [d]epartments, '' and ‘‘[p]repar[ing] for permits, inspections, etc.'' (Footnote added.) The defendants agreed to pay Girouard $22, 500 for these services.

On November 22, 2013, the parties entered into a lease for the premises. The term of the lease was for five years, with an option to extend for five additional five year terms. Under the lease, the defendants would assume ‘‘the sole responsibility for all expenses and costs associated with the [p]remises . . . .'' The lease provided, however, that the plaintiffs were ‘‘responsible for any environmental issues which may arise with the [premises].'' The monthly rent was $16, 388, payment of which would commence on the earlier of (1) the date on which the defendants opened for business, or (2) the 180th day after a fully executed lease was delivered to the defendants.

After the execution of the lease, the defendants began preparations to renovate the premises. In December, 2013, Girouard provided renovation plans to the defendants, which they approved. Girouard also solicited bids from prospective contractors for the renovation project. As work on the renovations progressed, Girouard signed applications for the relevant permits and had discussions with various officials, including representatives of Westport's planning and zoning, conservation, and engineering departments.

The 180th day following the delivery of the executed lease to the defendants occurred on May 21, 2014. At that point, no building permit for the retail rug gallery or the Subway restaurant had yet been issued. Consequently, no construction renovations had begun. On May 28, 2014, Girouard sent a letter to Nader and Sas-soon indicating that the first rent payment was due on June 1, 2014. Thereafter, the plaintiffs agreed to grant the defendants a five week rent concession. In a letter dated June 27, 2014, Girouard informed the defendants that the first rent payment was due by July 10, 2014. Girouard also informed the defendants that the plaintiffs wanted Girouard to ‘‘exclusively handle all future lease and building matters and do not want to be called or visited at their residences or place of business.'' In a letter dated July 1, 2014, the plaintiffs informed the defendants that ‘‘[n]o further concessions of any kind will be granted and [the plaintiffs] are fully expecting rental payments to begin July [1].'' The defendants made the July rent payment and continued paying rent through November, 2014.

On June 11, 2014, the defendants obtained a building permit for the retail rug gallery portion of the premises. Renovations on that portion of the site began some time in July, 2014. On July 1, 2014, however, DEEP issued an enforcement order finding environmental contamination on the property based on the results of the tests performed by Absolute Tank and Connecticut Tank. The order expressed DEEP's conclusion that ‘‘an unpermitted discharge has...