Brennan v. Brennan Assocs.

316 Conn. 677

113 A.3d 957

Thomas BRENNAN

v.BRENNAN ASSOCIATES et al.

Nos. 19116

19150.

Supreme Court of Connecticut.

Argued Sept. 24, 2014.

Decided May 5, 2015.

J. Christopher Rooney, with whom were John A. Farnsworth and, on the brief, Anne D. Peterson, New Haven, for the appellants in Docket No. SC 19116 and the appellees in Docket No. SC 19150 (defendants).

William H. Clendenen, Jr., with whom were Maura A. Mastrony and, on the brief, Kevin Shea, New Haven, and James Coyne, Stratford, for the appellee in Docket No. SC 19116 and the appellant in Docket No. SC 19150 (plaintiff).

ROGERS, C.J., and PALMER, ZARELLA, EVELEIGH, ESPINOSA, ROBINSON and VERTEFEUILLE, Js.

Opinion

ZARELLA, J.

The present appeals arise from the protracted and acrimonious breakup of a partnership that was the subject of a prior appeal to this court. In Brennan v. Brennan Associates, 293 Conn. 60, 72, 977 A.2d 107 (2009) ( Brennan I ), we upheld the judicial dissociation of the plaintiff, Thomas Brennan, from the named defendant, Brennan Associates (partnership). The plaintiff subsequently instituted the present action to have his interest in the partnership valued and bought out by the partnership. The partnership and the remaining partners, the defendants Alexander Aiello, Serge Mihaly, and the coadministrators of the estate of former partner Richard Aiello,¹ who died prior to this litigation, now appeal from the judgment of the trial court, which awarded the plaintiff approximately $6.9 million for his interest in the partnership, as well as approximately $3.5 million in interest on that award. The defendants claim that the trial court (1) should have valued the plaintiff's interest in the partnership as of 2009, when this court upheld the plaintiff's dissociation in Brennan I, instead of 2006, when the trial court rendered the judgment of dissociation, (2) incorrectly determined that interest accrued on the plaintiff's buyout award from the date of the judgment of dissociation, and (3) in valuing the partnership, should have treated the defendants' attorney's fees as a liability of the partnership. The plaintiff filed a separate appeal from the judgment of the trial court, claiming that the trial court should have awarded him offer of compromise interest in addition to the sums already awarded. We agree with the defendants on their first two claims and decline to review their third claim because the record is inadequate for review. Accordingly, we reverse in part the trial court's judgment and remand the case for further proceedings. Because we reverse in part the trial court's judgment and the plaintiff's interest must be valued again, we cannot resolve the plaintiff's claim and therefore dismiss the appeal in Docket No. SC 19150.

The record reveals the following undisputed facts and procedural history, some of which are set forth in Brennan I. See id., at 64–70, 977 A.2d 107. In 1984, the plaintiff entered into a general partnership agreement with Alexander Aiello, Richard Aiello and Mihaly to operate and manage a shopping center they owned in the town of Trumbull. The partnership operated successfully for twenty years before Richard Aiello passed away. Upon his death, the coadministrators of Richard Aiello's estate succeeded to his interest in the partnership, at which time animosity began to grow among the remaining partners. The subsequent litigation between the partners, separate from the present case, resulted in a judgment of dissociation against the plaintiff on September 27, 2006, pursuant to General Statutes § 34–355(5)(C).² The plaintiff appealed from the judgment of dissociation, claiming, inter alia, that he should be allowed to remain in the partnership. Consequently, the judgment of dissociation was automatically stayed pursuant to Practice Book § 61–11(a).

While the plaintiff's appeal was pending, he remained actively involved in managing the partnership's business and continued to profit from it. Specifically, the plaintiff continued to solicit tenants for the shopping mall and to attend partnership meetings. The plaintiff also continued to receive approximately $49,000 per month in partnership profits, as he had prior to the judgment of dissociation. In total, the plaintiff received a total of $1,702,400 in partnership profits while his appeal was pending. In an attempt to terminate the plaintiff's control over the partnership, the defendants moved to partially terminate the automatic stay that was in place pending appeal to enforce the judgment of dissociation, but the motion was denied. The plaintiff's appeal concluded on August 18, 2009, when, in Brennan I, this court affirmed the trial court's judgment of dissociation. Id., at 93, 977 A.2d 107. The court also held that, under the Revised Uniform Partnership Act (RUPA), as incorporated in Connecticut's Uniform Partnership Act (partnership act), General Statutes §§ 34–300 through 34–399, when a partner is dissociated, only the dissociated partner can initiate the buyout process, not the trial court or the remaining partners. Id., at 92–93, 977 A.2d 107.

Thus, shortly after the appeal in Brennan I concluded, the plaintiff instituted the present action under General Statutes § 34–362 to have the trial court value the partnership and his interest therein so that the partnership could buy him out. According to § 34–362(b), a dissociated partner's interest should be valued as of the “date of dissociation....” At trial, the parties disagreed on when the plaintiff had been dissociated from the partnership. The parties presented evidence that the partnership's assets had declined significantly in value between 2006 and 2009 while the plaintiff's appeal in Brennan I was pending. The plaintiff argued that his interest should be valued as of September 27, 2006, the day the trial court rendered the judgment of dissociation against him, before the partnership's assets had declined in value. In contrast, the defendants argued that the plaintiff's interest should be valued as of August 18, 2009, the date on which Brennan I was officially decided, which was after the partnership's assets had declined in value. After weighing the parties' arguments, the trial court adopted the plaintiff's position and valued the plaintiff's interest in the partnership as of September 27, 2006, the date the trial court rendered the judgment of dissociation, rather than on August 18, 2009, the date that judgment was affirmed by this court.

Using the date of September 27, 2006, the trial court valued the plaintiff's interest in the partnership at $8,640,000. From that amount, the trial court subtracted $1,702,400 to account for the monthly payments that the plaintiff had received from the partnership while his appeal in Brennan I was pending. Accordingly, the trial court awarded the plaintiff a total of $6,937,600. The trial court also awarded the plaintiff interest on that sum starting from the date of dissociation, which, as we noted previously, the trial court had determined was September 27, 2006. The interest on the buyout award was approximately $3.5 million. In determining the plaintiff's award, the trial court rejected the defendants' request to offset the award by the amount the defendants had paid in attorney's fees as damages under General Statutes § 34–356(c) or § 34–362(c). The defendants appealed from the judgment of the trial court to the Appellate Court, and we transferred the appeal to this court pursuant to General Statutes § 51–199(c) and Practice Book § 65–1.³ We now address the defendants' claims in turn.

I

The defendants first claim that the trial court incorrectly determined that the plaintiff had been dissociated in 2006, when the judgment of dissociation was rendered, rather than in 2009, when that judgment was affirmed in Brennan I and, thus, improperly valued the partnership and the plaintiff's interest therein as of the earlier date. The defendants argue that the plaintiff could not have been dissociated from the partnership until the conclusion of his appeal in Brennan I because, until that point, the judgment of dissociation had been automatically stayed pursuant to Practice Book § 61–11(a) and the plaintiff had continued to profit from and to participate in managing the partnership. In opposition, the plaintiff claims that, regardless of the defendants' ability to enforce the judgment of dissociation, he was dissociated in 2006 because that was when the “judicial determination” was made that he should be dissociated. General Statutes § 34–355(5)(C). We agree with the defendants and conclude that the plaintiff was not dissociated from the partnership until the automatic stay was terminated upon the conclusion of his appeal in Brennan I.

To resolve this claim we must interpret the partnership act and, specifically, the term “date of dissociation” in § 34–362(b). “[A]s with any question of statutory construction, our review is plenary....” (Citation omitted.) Brennan v. Brennan Associates, supra, 293 Conn. at 90, 977 A.2d 107. “When construing a statute, [o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature.... In seeking to determine that meaning, General Statutes § 1–2z directs us first to consider 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.... When a statute is not plain and unambiguous, we also look for interpretive guidance to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation and common law principles governing the same general subject matter....” (Internal quotation marks omitted.) Gilmore v. Pawn King, Inc., 313 Conn. 535, 542–43, 98 A.3d 808 (201...