Fairfield Shores, LLC v. DeSalvo

205 Conn.App. 96

256 A.3d 716

FAIRFIELD SHORES, LLC

v.Peter M. DESALVO et al.

AC 42969

Appellate Court of Connecticut.

Argued March 1, 2021

Officially released June 1, 2021

Abram Heisler, for the appellants (defendants).

Raymond W. Ganim, Stratford, for the appellee (plaintiff).

Moll, Alexander and Devlin, Js.

DEVLIN, J.

The defendants¹ appeal from the judgment of the trial court rendered in favor of the plaintiff landlord, Fairfield Shores, LLC. On appeal, the defendants claim that the court improperly rendered judgment in favor of the plaintiff on the basis of its finding that the plaintiff was exempt, pursuant to General Statutes § 47a-2,² from application of General Statutes (Rev. to 2013) § 47a-21,³ the statute governing security deposits, because it provided housing incidental to the education of the defendant students. Although we conclude that the court improperly considered § 47a-2, we, nevertheless, affirm the judgment of the court.

The following factual and procedural history is necessary to our resolution of the claim on appeal. The plaintiff owns property located at 1027 Fairfield Beach Road in Fairfield, on which a three-story, single-family beachfront home (premises) is situated. On February 29, 2012, the defendant students entered into a lease with the plaintiff for the rental of the premises for their senior year, with the lease term running from September 3, 2013, until May 20, 2014, or the day after graduation. The rental rate for the period of the lease was $100,000, and that amount was to be paid in two installments prior to the commencement of the lease: the sum of $50,000 was to be paid on November 1, 2012, and another $50,000 on January 15, 2013. The lease also required a $10,000 security deposit. The defendant parents signed the lease as guarantors.

The plaintiff commenced the present action at the end of the tenancy, on May 18, 2014, claiming that the defendant students had caused damage to the premises that exceeded the amount of the security deposit. Thereafter, the plaintiff provided the defendants with a list of damages, which they disputed. The defendants subsequently filed an amended answer, special defenses, and counterclaim. The court then granted the plaintiff's motion to strike as to the second and third special defenses, leaving the first special defense, which alleged that the claimed damages existed prior to the defendant students’ tenancy, and the fourth special defense, which alleged that the plaintiff had failed to comply with certain local and state health and safety requirements. The amended counterclaim alleged, in count one, a violation of the security deposit statute, § 47a-21 ; in count two, that the plaintiff had failed to comply with municipal and state codes by failing to obtain a certificate of apartment occupancy and by renting the premises to more students than what is permitted by the zoning regulations; and, in count three, a violation of the Connecticut Unfair Trade Practices Act (CUTPA), § 42-110a et seq. The plaintiff denied the allegations of all three counts of the amended counterclaim.

On February 18, 2016, the defendants filed a second amended counterclaim, which alleged, in addition to the claims raised in their amended counterclaim, that the $100,000 prepayment of rent constituted a security deposit for purposes of § 47a-21. On November 18, 2016, the parties filed a signed, joint stipulation of facts with the court. In the stipulation, the parties agreed to certain facts, including, inter alia, that the plaintiff had entered into a tenancy agreement with the defendant students for the rental of the premises for a term commencing on September 3, 2013, and ending on May 20, 2014; that, pursuant to the rental agreement, the total security deposit was $10,000; that the defendant students took possession of and vacated the property per the agreement; that the security deposit was not returned because the plaintiff claimed to have sustained damages exceeding the amount of the security deposit; and that the parties disagreed as to the damages. On December 13, 2018, the plaintiff filed its reply to the defendants’ special defenses and its answer to the defendants’ second amended counterclaim, denying that the prepaid rent constituted a security deposit and asserting, as one of its special defenses, that the counterclaim was barred by the doctrine of res judicata to the extent that it contradicted the stipulation.

The matter was tried to the court on December 14, 2018. At the trial, Paul Ganim, who testified that he is the owner and manager of the plaintiff, testified regarding the lease agreement and the extent of the damages to the premises that allegedly were caused by the defendant students.⁴ Ganim testified that he put the $10,000 security deposit into a security deposit bank account at Webster Bank and that the amount of the security deposit was not sufficient to cover the damages to the premises. The plaintiff also offered testimony from a builder and a painting contractor in support of its claim of damages. After the plaintiff rested, the defendants called one of the defendant parents, Tom Davies, as a witness. He testified regarding a video he took that showed the condition of the premises at the time when his son moved in.

Following the trial, the parties filed posttrial briefs. In their brief, the defendants claimed that most of the alleged damages to the property were preexisting when the defendant students took occupancy and, thus, that the plaintiff had failed to establish that any of the claimed damages were caused by the defendants. Second, they argued that the $100,000 advance rental payment constituted a security deposit under § 47a-21, which required the plaintiff, under § 47a-21 (h), to escrow that payment. Thus, they claimed that the plaintiff's failure to do so violated § 47a-21, and that the plaintiff had violated several other statutes. In contrast, the plaintiff argued in its posttrial brief that the defendants had failed to meet their burden of demonstrating any statutory violations by the plaintiff. The plaintiff also requested that the court take judicial notice of a lease purportedly used by the University of Connecticut with respect to on campus housing.⁵

In a memorandum of decision dated May 6, 2019, the court rendered judgment in favor of the plaintiff. The court made the following additional findings in its decision. The defendant students had "obtained approval from Fairfield University to utilize the plaintiff's premises as their school housing accommodations for their senior year. The [defendant students] took possession of the premises a few days prior to the commencement of the lease for the agreed upon rate of an additional $1000. Zoning ordinances of the town of Fairfield prohibit more than four unrelated persons to occupy the premises. While the [lease] is only between the plaintiff and four students, without permission of the plaintiff, on August 30, 2013, at least six students moved into the premises.

"The plaintiff had rented the premises for the summer season prior to the [defendant students’] tenancy and did not fully clean, paint, or prepare the premises for the students’ possession. The defendants were aware that this upkeep had not occurred, but they had ... activities [prior to the start of school] they needed to attend to necessitating early possession and so they agreed to take possession of the premises ‘as is.’ Further, the defendants did not notify the plaintiff of any damage to the premises that they believed [to be] present prior to their taking possession.

"The premises hosted activities typical of what would be expected by Fairfield University seniors living in a beach house. Damages [occurred] early on in the tenancy, which prompted [the] defendants to apply new coating to the floor and patch and paint the walls. By the end of the leasehold, damages occurred that required repairs in an amount less than that claimed by the plaintiff, but more than believed to be due by the defendants." The court further noted that the plaintiff, which alleged that the premises incurred damages in the amount of $20,788.24, sought the amount of damages sustained in excess of the security deposit, plus attorney's fees and costs.

In finding that additional damage to the premises had occurred, the court explained: "Certainly, damage existed to the property prior to the defendants taking possession. There were damages that occurred early on during their tenancy and there was damage caused on their way out. The defendants knew of this damage. During their tenancy, the parents paid to refinish hardwood floors, repair a ceiling hole and repaint. Near the end of the tenancy, [the] defendants employed Merry Maids to clean two rooms whose level of dirtiness proved to surpass the abilities of the students’ mothers’ cleaning brigade. After the students vacated, Tom Davies testified that he walked through the house and patched up walls with compound.

"While the defendants’ efforts to remedy the damages indicates an awareness on the part of the defendants in contributing to existing damage and the need for repairs, the plaintiff did not substantiate its claim of over $20,000 in damages. The plaintiff's witnesses did, however, establish damages in excess of the $10,000 security deposit." The court found damages in the amount of $10,967.44, which included costs for repainting, refinishing the floors and replacing the countertop, as well as the cost of a water bill that was supposed to have been paid by the defendant students. After accounting for the $10,000 security deposit and interest on the security deposit in the amount of $27.82, the court rendered judgment in favor of the plaintiff in the amount of $939.62.⁶

The court rejected the defendants’ request to treat their prepayment of $100,000 in rent for the lease term as a security deposit or an advance rental payment under § 47a-21, as the court found that statute to be...