Gateway Dev./E. Lyme v. Duong

321 A.3d 489

277 Conn.App. 38

GATEWAY DEVELOPMENT/EAST LYME, LLC

v.Anh DUONG et al.

(AC 46505)

Appellate Court of Connecticut.

Argued May 13, 2024

Officially Released July 30, 2024

Keith Yagaloff, South Windsor, for the appellants (defendants).

Alexa Massad Powers, with whom, on the brief, was Jason B. Burdick, for the appellee (plaintiff).

Suarez, Clark and Vertefeuille, Js.

VERTEFEUILLE, J.

₃₉In this summary process action, the plaintiff, Gateway Development/East Lyme, LLC, leased property located at 295 Flanders Road in East Lyme (premises) and subleased the premises to the defendants, Anh Duong doing business as Daddy’s Noodle Bar and Daddy’s Noodle Bar 2, LLC. The defendants appeal from the trial court’s judgment of possession rendered in favor of the plaintiff. It is undisputed that the defendants failed to pay rent in a timely manner. On appeal, the defendants claim that the court improperly concluded that the plaintiff was not required to provide them with a pretermination notice and an opportunity to cure their default for nonpayment of rent within ₄₀ten days of such notice. We disagree and, accordingly, affirm the judgment of the trial court.

The record reveals the following facts and procedural history that are relevant to our resolution of the defendants’ appeal. The plaintiff subleased the premises to the defendants beginning in January, 2019.¹ The defendants occupied the premises and agreed to pay $6829.54 per month for rent, due on the first day of each month. The defendants failed to pay the rent due on November 1, 2022. On November 11, 2022, the plaintiff sent the defendants a notice of cancellation of the lease, and, on November 14, 2022, the plaintiff served the defendants with a notice to quit possession on the ground of nonpayment of rent.

Although the notice to quit instructed the defendants to vacate the property by November 22, 2022, the defendants did not quit possession. The plaintiff served the defendants with a summary process summons and complaint on November 28, 2022, seeking immediate possession of the premises. In response, the defendants filed an answer and special defenses to the plaintiff's complaint, asserting, inter alia, that the plaintiff's notice to quit was defective and that they had lawfully tendered rent.² Specifically, the defendants argued that the sublease agreement required the plaintiff to afford them a ten day notice to cure their default before serving them with a notice to quit. The defendants further argued that the plaintiff improperly refused to accept a payment of rent that they had tendered on November 16, 2022, ₄₁which they contended would have been within the ten day cure period.

The defendants specifically relied on paragraph 21 of the sublease agreement, which provides in relevant part: "Any of the following occurrences shall constitute a default under this Sublease … Failure of Sublessee to pay any installment of rent, reimbursements, or any other charge within ten (10) days after the same is due and payable … Any breach by Sublessee to observe or perform any of its other obligations under this Sublease, which shall continue for ten (10) days after notice in writing to Sublessee of such default, and in connection with which Sublessee shall not have in good faith commenced performance if full performance cannot be reasonably had within the ten (10) day period

….

"In the event Sublessee shall fail to pay its rent within ten (10) days after the same shall be due and payable, Sublessor shall have the right, without prior notice to the Sublessee, to immediately initiate any and all legal action to recover possession of the Premises, and to terminate this Sublease in the manner provided by law relating to summary process. Such right shall be in addition to any other rights to which Sublessor is entitled by law or by the other terms of this Sublease.

"Upon the occurrence of any one or more of such events, and upon Sublessor serving a written ten (10) days notice of cancellation of this Sublease upon Sublessee and upon the expiration of such ten (10) days, this Sublease and the terms thereunder shall end and expire as fully and completely as if the date of expiration of such ten (10) day period herein definitely fixed for the end and expiration of this Sublease and Sublessee shall then quit and surrender the Premises to Sublessor, but Sublessee shall remain liable as hereinafter provided. …"

₄₂In their pretrial brief, the defendants argued that, in addition to the language of the agreement, "[t]he course of performance by the parties demonstrated that [paragraph] 21 required notice and a ten , day cure period, including for nonpayment of rent."

A bench trial was held on April 5, 2023. Copies of the sublease agreement and subsequent amendments to that agreement were admitted into evidence. In addition, the plaintiff presented testimony from Mara Henderson King, who worked as the plaintiff's lease administrator. King testified, in relevant part, that the defendants’ rental payments were "habitually late" and they had paid rent within the first ten days of the month on only eight occasions since the inception of the lease in January, 2019. She also testified that she typically sent the defendants a "notice of default" with a ten day right to cure such default, and she would routinely accept the late payments that followed. She explained that the plaintiff would "try to be as accommodating to [its] tenants as possible," which is why she typically provided a notice of default with a cure period, regardless of whether it was required under the lease. When the defendants failed to pay their November, 2022 rent in a timely fashion, King sent the notice of cancellation and issued the notice to quit, rather than providing a notice of default with a cure period, because "[p]atience ha[d] been worn way too thin." King further testified as to her understanding of what was required under the terms of the lease. Specifically, she testified that, pursuant to paragraph 21 of the sublease agreement,³ a pretermination notice was not required when the claimed default was the nonpayment of rent. Instead, a notice of default with a ten day cure period was ₄₃required with respect to the other events of default listed in the lease.⁴

The defendants presented testimony from Peter Tran, who had a personal relationship with Duong. Tran handled communications with King about the lease on behalf of Duong. Tran testified that the plaintiff accepted many late rental payments from the defendants after providing them with a ten day period to cure their default and, on the basis of the notices of default they previously had received, he believed the defendants had a right to cure under the terms of the lease. The defendants also submitted documentary evidence to the court, including two letters sent from King to Duong dated May 11, 2020, and October 31, 2022. The letters provided the defendants with notice of certain prior defaults, including the nonpayment of rent and multiple bounced checks, and gave the defendants ten days to cure such defaults.

At the conclusion of trial, the defendants’ counsel argued that the foregoing evidence reflected the parties’ course of performance ⁵ and that such evidence could be used in two ways: (1) it could serve as evidence of the intent of the parties in the court’s interpretation of the sublease agreement, and (2) it could demonstrate a modification of the sublease agreement.

In an order dated April 12, 2023, the court, Graff J., found that the defendants had breached the sublease agreement by nonpayment of rent and rejected the defendants’ argument that the sublease agreement required the plaintiff to provide the defendants with a pretermination notice and a ten day right to cure. The ₄₄court explained: "It is clear that the terms of the lease in the aforementioned paragraph 21 do not require a ten day notice to cure period for the failure to pay rent. While there is a notice to cure provision, this provision does not apply to the failure to pay rent. The lease permits that when there is a failure to pay rent, the landlord may take possession of the premises as well as take advantage of other legal remedies available.

"A landlord cannot commence an eviction without first complying with the notice and compliance provisions of a lease. … Here, the terms of the lease do not require a ten day notice to cure period. Moreover, the court finds that the notice to quit which is dated November 29, 2022, is sufficient. … The plaintiff has met its burden of showing that there has been nonpayment of rent in violation of the lease terms." (Citations omitted.) Accordingly, the court rendered a judgment of possession in favor of the plaintiff. This appeal followed.

On appeal, the defendants claim that the court improperly concluded that the plaintiff was not required to provide them with a pretermination notice and a ten day cure period prior to serving them with a notice to quit. Specifically, the defendants contend that the court incorrectly limited its analysis to the terms of the parties’ sublease agreement and that it should have considered evidence of the parties’ course of performance (1) as evidence of the parties’ understanding or intended interpretation of the agreement, or (2) to find that the parties had modified the terms of their agreement through that course of performance.

[1] As an initial matter, we note that the court did not make any specific factual findings regarding whether the defendants had established a course of performance between the parties, and it did not explicitly address the defendants’ arguments related to the parties’ alleged ₄₅course of performance.⁶ Nevertheless, in reaching its conclusion, the court necessarily rejected the defendants’ arguments concerning course of performance; see Russo v. Thornton, 217 Conn. App. 553, 567 n.18, 290 A.3d 387 (court "necessarily rejected" argument that it did not explicitly address), cert. denied...