HARLEY v. INDIAN SPRING LAND COMPANY

For example, the reservation agreement provided that the execution of a purchase and sale agreement was to occur no later than September 7, 2004, and for a closing to occur no later than October 1, 2004.

On the basis of our thorough review of the record before us, we conclude that the court was not clearly erroneous in finding that there was a mutual understanding to modify the reservation agreement, extending it until the plaintiff's design plans were accepted or rejected. Because the modification of a contract may be inferred from the attendant circumstances and conduct of the parties; see Tsionis v. Martens, supra, 116 Conn. App. 577; we underscore the following facts gleaned from the record. The plaintiff testified that, on the basis of his conversation with Rockefeller seeking an extension of the deadline for his submission of design plans, "[o]ur general understanding [concerning the modification of the reservation agreement] was that as long as I was working on plans in good faith, we still had a deal." His conduct after the conversation comports with such an understanding because the record reveals that the plaintiff pursued acquiring the design plans in the ensuing months. Rockefeller's testimony, as the court found, corroborated the plaintiff's testimony that, as a result of their conversation, there was an understanding that he could take his time obtaining the requisite design plans. Moreover, Rockefeller testified that because of the cumbersome process involved in purchasing a lot from the defendant, there was a policy of flexibility in modifying reservation agreements regarding the dates of performance. As a result, we conclude that the court properly determined that the oral modification was valid in that the parties mutually assented to the meaning and conditions of the modification. The defendant also claims that any modification to the reservation agreement was not supported by consideration because the plaintiff exchanged nothing of value in return for an extension on his option. As previously noted, "[t]he doctrine of consideration is fundamental in the law of contracts, the general rule being that in the absence of consideration an executory promise is unenforceable. . . . While mutual promises may be sufficient consideration to bind parties to a modification . . . a promise to do that which one is already bound by his contract to do is not sufficient consideration to support an additional promise by the other party to the contract." (Citations omitted; internal quotation marks omitted.) New England Rock Services, Inc. v. Empire Paving Inc., 53 Conn. App. 771, 776, 731 A.2d 784, cert. denied, 250 Conn. 921, 738 A.2d 658 (1999).

The reservation agreement required the plaintiff to pay to the defendant a $10,000 good faith deposit. Under the terms of that agreement, that deposit was to be either refunded if the plaintiff elected not to execute a purchase and sale agreement or paid over to the defendant to be applied to the deposit required to purchase the lot if the plaintiff executed a purchase and sale agreement. We determined that the $10,000 deposit was adequate consideration to support the reservation agreement. See part I A of this opinion. Under the terms of the reservation agreement prior to modification, the good faith deposit either was to be returned to the plaintiff or applied to the deposit required to purchase the lot by September 7, 2004. In order to keep his option to purchase the lot at the reserved price, the plaintiff was not bound, under the reservation agreement, to permit the defendant to retain the deposit after that date. On May 2, 2005, the defendant forwarded to the plaintiff a check for $10,000 along with a letter declaring that the reservation agreement was null and void for the plaintiffs failure to comply with its conditions by September 7, 2004. Because the deposit was not returned to the plaintiff until May 2, 2005, the defendant retained the benefits for which it bargained under the reservation agreement through the duration of the oral modification. Therefore, in light of our conclusion in part IA of this opinion that the deposit was valid consideration supporting the reservation agreement, we conclude that the plaintiff's permitting the deposit to be retained by the defendant was valid consideration supporting the modification. As a result, on the basis of the record before us, we conclude that the court properly determined that the oral modification of the reservation agreement was valid.

The defendant also claims that even if there was a valid oral modification to the reservation agreement, the court improperly applied the doctrine of equitable estoppel to bar the defendant from asserting the statute of frauds as a defense. We disagree.

"The doctrine of equitable estoppel is well established. [W]here one, by his words or actions, intentionally causes another to believe in the existence of a certain state of things, and thereby induces him to act on that belief, so as injuriously to affect his previous position, he is [precluded] from averring a different state of things as existing at the time." (Internal quotation marks omitted.) Blackwell v. Mahmood, 120 Conn. App. 690, 694-95, 992 A.2d 1219 (2010). "The party claiming estoppel . . . has the burden of proof. . . . Whether that burden has been met is a question of fact that will not be overturned unless it is clearly erroneous. . . . A court's determination is clearly erroneous only in cases in which the record contains no evidence to support it, or in cases in which there is evidence, but the reviewing court is left with the definite and firm conviction that a mistake has been made. . . . The legal conclusions of the trial court will stand, however, only if they are legally and logically correct and are consistent with the facts of the case. . . . Accordingly, we will reverse the trial court's legal conclusions regarding estoppel only if they involve an erroneous application of the law." (Internal quotation marks omitted.) Id., 694.

"Equitable estoppel is a doctrine that operates in many contexts to bar a party from asserting a right that it otherwise would have but for its own conduct. . . . In its general application, we have recognized that [t]here are two essential elements to an estoppel — the party must do or say something that is intended or calculated to induce another to believe in the existence of certain facts and to act upon that belief, and the other party, influenced thereby, must actually change his position or do some act to his injury which he otherwise would not have done. . . . This court previously has applied the doctrine of equitable estoppel to bar a party from asserting the statute of frauds as a defense so as to prevent the use of the statute itself from accomplishing a fraud." (Citations omitted; internal quotation marks omitted.) Glazer v. Dress Barn, Inc., supra, 274 Conn. 60.

"Thus, in sum, the elements required for part performance are: (1) statements, acts or omissions that lead a party to act to his detriment in reliance on the contract; (2) knowledge or assent to the party's actions in reliance on the contract; and (3) acts that unmistakably point to the contract. . . . Under this test, two separate but related criteria are met that warrant precluding a party from asserting the statute of frauds. . . . First, part performance satisfies the evidentiary function of the statute of frauds by providing proof of the contract itself. . . . Second, the inducement of reliance on the oral agreement implicates the equitable principle underlying estoppel because repudiation of the contract by the other party would amount to the perpetration of a fraud." (Citations omitted; internal quotation marks omitted.) Id., 62-63.

The court found that "[t]he forbearing assurances of . . . Rockefeller, without the specter of a price increase, obviously kept [the] plaintiff working with and paying [Sammons]. [Equally] clear is that through the vast bulk of that period the company had knowledge of and assented to the continuation of [the] plaintiff's work, of his spending money and of his making submissions to it." The court noted that it next had to determine whether those "detrimental reliance type of actions by a plaintiff" were of such a character that they could be naturally and reasonably accounted for in no other way than by the existence of some contract in relation to the subject matter in dispute. The court found that standard was "well and clearly met. No defense suggestion nor any court exertion of imagination suggests a different rationale for this commissioning of a widely renowned architect to make and revise plans (and to supplement with landscape detail, including which trees would be saved) beyond [the] plaintiff being given to understand [that] he could and should so proceed with [the] defendant's forbearance having been expressed." We agree with the court.

The record reveals that after the oral modification, the plaintiff engaged Sammons to draft a second set of plans for the house for the lot that met the plaintiff's aesthetic and budgetary needs. Throughout the fall of 2004, the plaintiff and Laudone continued to take an active role in the design process. Moreover, during the time period from September through December, 2004, Sammons' firm billed the plaintiff for 157 hours of architectural services for the design of the plaintiff's home for the lot. The plans themselves, as well as other exhibits before the court, showed that the design process engaged in by the plaintiff was specifically aimed at lot 29 in order to accommodate its size, shape, topography and orientation to the street. Moreover, the plaintiff, when directed by the defendant to submit his plans in December, 2004, submitted the plans that resulted from his efforts with Sammons to design a house for the lot. Tellingly, the defendant submitted those plans to its design review board. Thus, the record shows clearly that the plaintiff continued to pursue the design plans requisite in the reservation agreement and that the defendant exhibited its assent to that pursuit.

On the basis of our review of the record, we conclude that the plaintiff has demonstrated acts that constitute part performance of the oral modification to the reservation agreement. We further conclude that those acts were in pursuance of that oral modification, with the design of carrying the reservation agreement into execution, and were done with the assent, express or implied, or knowledge of the defendant and were such acts that altered the relations of the parties. Likewise, we conclude that they were of such a character that they could be naturally and reasonably accounted for in no other way than by the existence of a valid oral modification of the reservation agreement. See Glazer v. Dress Barn, Inc., supra, 274 Conn. 60-65. The actions of the plaintiff, in conjunction with the defendant's assent to them, were sufficient as part performance of the oral modification of the reservation agreement such that we conclude that the court properly applied the doctrine of equitable estoppel to bar the defendant from asserting the statute of frauds as a defense. See id., 60-63.

Because we affirmed in part I of this opinion the court's finding of a valid contract between the parties, we now address the inconsistent judgment as to the complaint's breach of contract and promissory estoppel counts that the court rendered in favor of the plaintiff. Addressing this issue, initially, we note the following facts and procedural history that inform our resolution of this matter. On May 3, 2007, the plaintiff filed a second amended complaint, alleging, inter alia, breach of contract and promissory estoppel. See Practice Book § 10-25. The court, by memorandum of decision, rendered judgment in favor of the plaintiff on both counts. At no time did the parties seek to clarify or to rectify this inconsistent judgment with the trial court pursuant to our rules of practice. Moreover, the defendant did not raise the issue of an inconsistent judgment in its appeals to this court. In addition, although the defendant appealed from the entire judgment rendered against it, it failed to raise any claim on appeal concerning the promissory estoppel count, a circumstance that could render moot its breach of contract claim. See Conservation Commission v. DiMaria, 119 Conn. App. 763, 768, 989 A.2d 131 (2010) (appellate courts do not decide moot questions, disconnected from granting of actual relief or from determination of which no practical relief can follow). Under the circumstances present, these factors lead us to conclude that this court must invoke, sua sponte, our supervisory powers pursuant to Practice Book § 60-2 to resolve this issue in the interest of judicial economy and to ensure the fair and just administration of justice by our courts. See, e.g., State v. James, 261 Conn. 395, 410-11, 802 A.2d 820 (2002); State v. Mukhtaar, 253 Conn. 280, 290 n. 11, 750 A.2d 1059 (2000).

Because the elements of a breach of contract include the formation of an agreement; see American Express Centurion Bank v. Head, 115 Conn. App. 10, 15-16, 971 A.2d 90 (2009); which, in turn, requires the presence of adequate consideration; see Thibodeau v. American Baptist Churches of Connecticut, 120 Conn. App. 666, 676, 994 A.2d 212 (2010); and promissory estoppel is appropriate when there is an absence of consideration to support a contract; see Glazer v. Dress Barn, Inc., supra, 274 Conn. 88; we conclude that the court rendered an inconsistent judgment when it found in favor of the plaintiff on both counts. Moreover, "[a] duty of construction is placed upon the trial court whenever a party pleads inconsistent theories of recovery. . . . Although a party may plead, in good faith, inconsistent facts and theories, a court may not award a judgment on inconsistent facts and conclusions. A judgment, read in its entirety, must admit of a consistent construction. . . . Where a party is entitled to only a single right to recover, it is the responsibility of the trial court to determine which of the inapposite sets of facts the party has proved, and then to render judgment accordingly." (Citations omitted.) DeVita v. Esposito, 13 Conn. App. 101, 107, 535 A.2d 364, cert. denied, 207 Conn. 807, 540 A.2d 375 (1988).

On the basis of our review of the record before us, our research of the relevant case law and the parties' actions; see Taft v. Wheelabrator Putnam, Inc., 255 Conn. 916, 917-18, 763 A.2d 1044 (2000) ( McDonald, C. J., dissenting) (court must consider actions of parties in determining if vacatur appropriate); we conclude that the circumstances here present an extraordinary case in which the public interest, as well as the fair administration of justice to the parties, requires that we invoke our supervisory powers and vacate the court's judgment in favor of the plaintiff on his promissory estoppel count. See State v. Boyle, 287 Conn. 478, 489, 949 A.2d 460 (2008) ("[O]ur law of vacatur, though scanty . . . recognizes that [j]udicial precedents are presumptively correct and valuable to the legal community as a whole. They are not merely the property of private litigants and should stand unless a court concludes that the public interest would be served by a vacatur." [Emphasis added.]). Although in the usual circumstance in which a trial court renders an inconsistent judgment and this court vacates the judgment and remands the case for a new trial; see Marrin v. Spearow, 35 Conn. App. 398, 403, 646 A.2d 254 (1994); that course would serve only to work an injustice on the parties under the particular circumstances present here, as well as to tax unnecessarily our scant judicial resources. See In re Candace H., 259 Conn. 523, 527, 790 A.2d 1164 (2002), citing U.S. Bancorp Mortgage Co. v. Bonner Mall Partnership, 513 U.S. 18, 26, 115 S. Ct. 386, 130 L. Ed. 2d 233 (1994) (vacatur appropriate when public interest served). Moreover, although the defendant did not raise any claim on appeal as to the promissory estoppel claim, under all the circumstances present, it would be unfair to bind it to a judgment rendered in error. See Private Healthcare Systems, Inc. v. Torres, 278 Conn. 291, 304-305, 898 A.2d 768 (2006) (equitable considerations regarded in determination to vacate judgment). Last, we note that to leave an inconsistent judgment intact could spawn unwanted legal consequences. See State v. Boyle, supra, 490. Therefore, under the unique circumstances of this case, in which an alternative resolution to this issue may well work mischief on the parties, undermine the public interest in the fair administration of justice and unnecessarily tax our judicial resources, we invoke our inherent supervisory powers and vacate the judgment as to count three of the plaintiff's second amended complaint alleging promissory estoppel.

Next, the defendant claims that the court improperly found a violation of CUTPA because the evidence adduced at trial did not support a finding of unscrupulous and unethical conduct. We disagree.

The court, in its May 23, 2008 memorandum of decision, expressly found that the defendant's conduct was both unethical and unscrupulous and caused a substantial injury to the plaintiff, thereby meeting the second and third prongs of the "cigarette rule." "[General Statutes §] 42-110b (a) provides that [n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce. It is well settled that in determining whether a practice violates CUTPA we have adopted the criteria set out in the cigarette rule by the federal trade commission for determining when a practice is unfair: (1) [W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise — in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers, [competitors or other business persons]." (Internal quotation marks omitted.) Harris v. Bradley Memorial Hospital Health Center, Inc., 296 Conn. 315, 350, 994 A.2d 153 (2010). Moreover, "[a]ll three criteria do not need to be satisfied to support a finding of unfairness. A practice may be unfair because of the degree to which it meets one of the criteria or because to a lesser extent it meets all three. . . . Thus a violation of CUTPA may be established by showing either an actual deceptive practice . . . or a practice amounting to a violation of public policy." (Internal quotation marks omitted.) Glazer v. Dress Barn, Inc., supra, 274 Conn. 82.

"It is well settled that whether a defendant's acts constitute . . . deceptive or unfair trade practices under CUTPA, is a question of fact for the trier, to which, on appellate review, we accord our customary deference. . . . [W]here the factual basis of the court's decision is challenged we must determine whether the facts set out in the memorandum of decision are supported by the evidence or whether, in light of the evidence and the pleadings in the whole record, those facts are clearly erroneous." (Internal quotation marks omitted.) Chamlink Corp. v. Merritt Extruder Corp., 96 Conn. App. 183, 189, 899 A.2d 90 (2006). "The facts found must be viewed within the context of the totality of circumstances which are uniquely available to the trial court." (Internal quotation marks omitted.) Ancona v. Manafort Bros., Inc., 56 Conn. App. 701, 715, 746 A.2d 184, cert. denied, 252 Conn. 953, 749 A.2d 1202 (2000).

On appeal, the defendant claims that there was no evidence in the record to support the court's finding that the defendant's conduct was unscrupulous and unethical, and, therefore, the court improperly found that it had violated CUTPA. We disagree. The court found that the defendant, by its conduct, from September, 2004, through February, 2005, when it breached the reservation agreement, led the plaintiff to believe that an oral modification was entered into by the parties. It further found that the defendant's conduct led the plaintiff to believe that that modification was being honored by the defendant. The court also found that the defendant had knowledge of and assented to the plaintiff's expending money in pursuit of the plans for the home for lot 29. The court found untenable the defendant's contention that it could terminate the agreement because the plaintiff was stalling on the purchase of lot 29 until he sold his existing house.

On the basis of our review of the record, we conclude that the court's finding is supported by the evidence and that the defendant's claim otherwise has no merit. The record amply supports the court's finding of aCUTPA violation. The record reveals that the defendant, during the period when the plaintiff was pursuing the purchase of the lot under the oral modification of the reservation agreement, had knowledge, through its own reappraisals, that several lots in Sherwood Farm had increased in value. Despite this knowledge, its conduct led the plaintiff to believe that the oral modification of the reservation agreement was being honored. Even when the defendant inquired about the plaintiff's progress in December, 2004, it urged him unambiguously to submit the plans as soon as possible in order to avoid a possible price increase. Those plans were submitted eleven days later. Then, after receiving, reviewing and assessing those plans positively, the defendant raised the price for the lot by $400,000. Therefore, the court's findings that the defendant's conduct, in inducing the plaintiff to pursue the design plans and the purchase of lot 29 after the original term of the reservation agreement had expired, and then increasing the price in contravention of that agreement, thus depriving the plaintiff of the benefit of his bargain, was unscrupulous and unethical, are supported by the evidence adduced at trial. Accordingly, we conclude that the court's findings are not clearly erroneous.

The defendant also claims that the court improperly found violations of CIOA and the implied duty of good faith and fair dealing because the evidence adduced at trial did not support a finding of bad faith on the defendant's part. We disagree.

"The duty of good faith under General Statutes § 47-211 requires that [e]very contract or duty governed by [CIOA] imposes an obligation of good faith in its performance or enforcement. The common-law duty of good faith and fair dealing implicit in every contract requires that neither party [will] do anything that will injure the right of the other to receive the benefits of the agreement. . . . Essentially it is a rule of construction designed to fulfill the reasonable expectations of the contracting parties as they presumably intended." (Internal quotation marks omitted.) Elm Street Builders, Inc. v. Enterprise Park Condominium Assn., Inc., 63 Conn. App. 657, 664-65, 778 A.2d 237 (2001). "To constitute a breach of [the implied covenant of good faith and fair dealing], the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith." (Internal quotation marks omitted.) De La Concha of Hartford, Inc. v. Aetna Life Ins. Co., 269 Conn. 424, 433, 849 A.2d 382 (2004). Whether a party has acted in bad faith is a question of fact, subject to the clearly erroneous standard of review. Renaissance Management Co. v. Connecticut Housing Finance Authority, 281 Conn. 227, 240, 915 A.2d 290 (2007).

The court based its finding of bad faith on the same conduct that it concluded was unscrupulous and unethical in its holding on the plaintiff's CUTPA claim. For the reasons set forth in part III of this opinion, we conclude that the court's finding of bad faith on the part of the defendant is supported by the evidence and that the defendant's claim otherwise has no merit. The record amply supports a finding of a violation of the obligation of good faith imposed pursuant to CIOA as well as the common-law duty of good faith and fair dealing implicit in every contract.

Last, the defendant claims that the court improperly awarded damages. We disagree.

As a general rule, the determination of damages involves a question of fact that will not be overturned on appeal unless it is clearly erroneous. Gerber Hurley, Inc. v. CCC Corp., 36 Conn. App. 539, 545, 651 A.2d 1302 (1995). On the basis of our review of the record, we conclude that the court's determination of damages was not clearly erroneous.

Initially, we note that at the outset of the trial, the parties stipulated that the value of the lot at the time of the breach was $1.6 million. The price of the lot set out in the reservation agreement was $1.2 million. The court found damages to be $400,000 — an amount equal to the difference between those two figures.

On appeal, the defendant claims that the plaintiff should be limited to reliance damages. It argues, essentially, that even if the reservation was a valid contract extended properly by an oral modification, the plaintiff was not entitled to the full value of the contract as damages because he had not fulfilled his contractual obligations under that agreement. This argument, in essence, maintains that the defendant's actions did not amount to a breach, but, rather, the plaintiff, by not fulfilling his obligations, effectively rescinded the contract. See Winchester v. McCue, 91 Conn. App. 721, 733, 882 A.2d 143 ("[A] lawful rescission of an agreement puts an end to it for all purposes, not only to preclude the recovery of the contract price, but also to prevent the recovery of damages for breach of the contract. An election to rescind a contract waives the right to sue upon it. After rescission for a breach, there is no right to sue on the contract for damages for such breach."), cert. denied, 276 Conn. 922, 888 A.2d 91 (2005).

In part I A of this opinion, we concluded that the reservation agreement was an option contract under which the plaintiff had the option of purchasing the lot for the set price by complying with the conditions of the reservation agreement. As a result, we conclude that the defendant breached that contract when it raised the reserved price for the lot, which relieved the plaintiff of performing his obligations under the agreement. See Shah v. Cover-It, Inc., 86 Conn. App. 71, 75, 859 A.2d 959 (2004) (general rule of contract law that total breach of contract by one party relieves injured party of any further duty to perform further obligations under contract). Moreover, "[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. . . . Damages for breach of contract are to be determined as of the time of the occurrence of the breach." (Citations omitted; emphasis added; internal quotation marks omitted.) O'Hara v. State, 218 Conn. 628, 642, 590 A.2d 948 (1991); see also Robert Lawrence Associates, Inc. v. Del Vecchio, 178 Conn. 1, 22, 420 A.2d 1142 (1979) (measure of damages for breach of option is difference in value between purchase price recited in option agreement and actual value of option subject). As a result, we conclude that the court's determination that damages were equal to the difference between the stipulated value of the lot on the date of the breach and the reserved price was not clearly erroneous.

The judgment is vacated only as to the third court of the second amended complaint alleging promissory estoppel. The judgment is affirmed in all other respects.

In this opinion the other judges concurred.