text:
    MORTON F. REICH v. IRMA LANGHORST ET AL.
    (14916)
    Dupont, C. J., and Foti and Heiman, Js.
    Argued December 2, 1996
    officially released March 4, 1997

      John A. Stichter, for the appellant (named defendant).

      Jennifer L. Janeiro, with whom, on the brief, was Charles J. Irving, for the appellee (plaintiff).
   FOTI, J.

The defendant appeals from the trial court’s denial of her motion to open a default judgment rendered against her. The defendant claims that the trial court improperly (1) denied her motion as untimely and (2) abused its discretion in denying the motion on the ground that she had not demonstrated that she was prevented from presenting her defenses because of mistake, accident or other reasonable cause. We affirm the judgment of the trial court.

The following facts are relevant to this appeal. This matter arose from a dispute involving a security deposit. The plaintiff, Morton F. Reich, filed a two count complaint against the defendants Irma Langhorst and her son Axel Langhorst, seeking the return of a $1000 security deposit and accrued interest, plus punitive damages pursuant to General Statutes (Rev. to 1995) § 47a-21 (d) (2).

Thereafter, the defendant’s son, who is not a licensed attorney in the state of Connecticut, attempted to file a pro se appearance on behalf of himself and his mother, as well as a joint pro se answer, special defenses and a counterclaim. The trial court granted the plaintiffs motion for default for failure to appear against the defendant Irma Langhorst.

The defendant concedes that she received notice of this default and, thereafter, filed a pro se appearance with the court listing the following as her address: “c/o Eurotest Laboratories Ltd., Mathews Drive, P.O. Box 262, East Haddam, CT., 06423.” The defendant did not, however, file any pleadings. On August 17, 1992, the plaintiff filed a motion for default against the defendant for failure to plead. This motion was improperly denied on August 18, 1992, on the basis of the mistaken belief that the defendant had a proper answer on file in the matter. On November 24,1992, the court, realizing that an error had been made, sent notice to the parties informing them: “The track having expired in this case, the following orders are entered: Defendant Irma Langhorst is defaulted for failure to plead. The case is ordered placed on the non-jury trial list for assignment at a later date. Per order of the court, Arena, J., 11/24/92.”

Notice was then sent to the parties informing them that trial was scheduled to be held before an attorney trial referee. The trial was in fact held. Although the defendant’s son appeared at trial, the defendant did not attend.

On September 29, 1994, the attorney referee’s report was filed with the court. The report recommended that judgment be rendered in favor of the plaintiff and against the defendant on both the first and second counts of the plaintiffs complaint. It recommended that judgment be rendered, however, in favor of the defendant’s son on the plaintiffs complaint. It also recommended that judgment be rendered for the plaintiff on the defendant’s son’s counterclaim.

By letter also filed on September 20, 1994, the attorney referee informed the trial court that copies of her report had been provided “by way of U.S. mail to the plaintiff through his attorney and to the defendants at the address listed on their Appearance.”

On October 11, 1994, the plaintiff filed a motion for judgment on the attorney referee’s report that appeared on the short calendar of October 24,1994. On that date, after reviewing the attorney referee’s report on file, the trial court, Stanley, J., granted the motion (record entry number 121). On October 27, 1994, notice was sent to the parties advising that the plaintiffs motion for judgment on the attorney referee’s report had been granted on October 24, 1994.

On November 8, 1994, the plaintiffs motion for judgment on the attorney referee’s report again appeared on the short calendar. Judge Stanley noted on the report itself the following: “Approved: Judgment per ATR Report. Stanley, J., 11-8-94. See order at #121.”

On or about January 26, 1995, Attorney John A. Stichter filed an appearance in lieu of the pro se defendant and, on March 2, 1995, filed a motion to open the default judgment against her. The trial court denied the defendant’s motion to open the judgment, finding that it lacked jurisdiction because the defendant filed her motion beyond the four month period permitted by General Statutes § 52-212 (a)1 ** and Practice Book § 377. The trial court also determined that, even if the defendant had filed a timely motion to open, it would have been denied because she failed to show that she was prevented from making her defense to the plaintiffs action because of mistake, accident or other reasonable cause. This appeal followed.

We first address the defendant’s claim that the trial court incorrectly determined that it was without jurisdiction to act on her motion to open.

A motion to open must be filed within four months of the date on which judgment was rendered. General Statutes § 52-212 (a); Practice Book § 377. We conclude on the record before us that judgment was rendered on October 24, 1994, the date on which the motion for judgment was granted. Notice of the judgment was sent on October 27,1994. Therefore, the defendant’s motion to open, filed March 2, 1995, was not filed within four months of the judgment. We conclude, therefore, that the trial court correctly determined that it lacked jurisdiction in denying that motion.

Practice Book § 442 provides in pertinent part: “After the expiration of two weeks from the filing of the report . . . either party may . . . claim the case for the short calendar for judgment on the report . . . .” “The court shall render such judgment as the law requires upon the facts in the report as it may be corrected. . . .” Practice Book § 443.

The trial court may render judgment, as a matter of law, from the facts found by the attorney referee. Burt’s Spirit Shop, Inc. v. Ridgway, 215 Conn. 355, 367, 576 A.2d 1267 (1990). Where the factual predicate is clearly set forth by proper factual findings and conclusions from those findings, the trial court should fulfill its function in rendering judgment. See Dills v. Enfield, 210 Conn. 705, 712, 557 A.2d 517 (1989).

The record is clear that the trial court, on October 24,1994, granted the plaintiffs motion for judgment on the attorney referee’s report that was docketed as entry number 121. No further action was required by the trial court. This same motion then came up on the short calendar on November 7. The trial court gratuitously noted, “Approved: Judgment per ATR Report, Stanley, J., 11/8/94. See order at #121.” Because the defendant’s motion to open, filed March 2, 1994, was filed more than four months after the date that judgment was rendered, the trial court was without jurisdiction to hear it and, therefore, properly denied it.

The judgment is affirmed.

In this opinion the other judges concurred.

       Axel Langhorst, who is not a parly to this appeal, was also a defendant. For purposes of this opinion, we will refer to Irma Langhorst as the defendant.

       General Statutes (Rev. to 1995) § 47a-21 (d) (2) provides: “Upon termination of a tenancy, any tenant may notify his landlord in writing of such tenant’s forwarding address. Within thirty days after termination of a tenancy, each landlord other than a rent receiver shall deliver to the tenant or former tenant at such forwarding address either (A) the full amount of the security deposit paid by such tenant plus accrued interest as provided in subsection (i) of this section, or (B) the balance of the security deposit paid by such tenant plus accrued interest as provided in subsection (i) of this section after deduction for any damages suffered by such landlord by reason of such tenant’s failure to comply with such tenant’s obligations, together with a written statement itemizing the nature and amount of such damages. Any such landlord who violates any provision of this subsection shall be liable for twice the value of any security deposit paid by such tenant.”

       A nonattomey may not file an appearance on behalf of another individual, or represent that person in the form of a pleading or otherwise. General Statutes § 51-88 (d) (2); Expressway Associates II v. Friendly Ice Cream Corp., 34 Conn. App. 543, 546, 642 A.2d 62, cert. denied, 230 Conn. 915, 645 A.2d 1018 (1994).

       General Statutes § 52-212 (a) provides: “Anyjudgment rendered or decree passed upon a default or nonsuit in the Superior Court may be set aside, within four months following the date on which it was rendered or passed, and the case reinstated on the docket, on such terms in respect to costs as the court deems reasonable, upon the complaint or written motion of any party or person prejudiced thereby, showing reasonable cause, or that a good cause of action or defense in whole or in part existed at the time of the rendition of the judgment or the passage of the decree, and that the plaintiff or defendant was prevented by mistake, accident or other reasonable cause from prosecuting the action or making the defense.” The words “following the date on which [the decree] was rendered or passed” have been interpreted as meaning the date of notification of the decree. Noethe v. Noethe, 18 Conn. App. 589, 595-96, 559 A.2d 1149 (1989). This interpretation is consistent with the words “succeeding the date on which notice was sent” used in Practice Book § 377.

       Practice Book § 377 provides: “Any judgment rendered or decree passed upon a default or nonsuit may be set aside within four months succeeding the date on which notice was sent, and the case reinstated on the docket on such tercns in respect to costs as the court deems reasonable, upon the written motion of any party or person prejudiced thereby, showing reasonable cause, or that a good cause of action or defense in whole or in part existed at the time of the rendition of such judgment or the passage of such decree, and that the plaintiff or the defendant was prevented by mistake, accident or other reasonable cause from prosecuting or appearing to make the same. Such written motion shall be verified by the oath of the complainant or the complainant’s attorney, shall state in general terms the nature of the claim or defense and shall particularly set forth the reason why the plaintiff or the defendant failed to appear. The court shall order reasonable notice of the pendency of such written motion to be given to the adverse party, and may enjoin that party against enforcing such judgment or decree until the decision upon such written motion.
      “Any motion to open or set aside a dismissal pursuant to Sec. 251 shall be deemed to be granted from the date of filing without placement on the short calendar unless within fourteen days an objection is filed. The objection shall be placed on the short calendar.
      “If the court opens a nonsuit entered pursuant to Sec. 363, the court as part of its order may extend the time for filing pleadings or disclosure.”


source: Caselaw Access Project

author: PER CURIAM.

license: Public Domain

text:
    IGNACIO SANCHEZ v. COMMISSIONER OF CORRECTION
    (15577)
    Landau, Spear and Healey, Js.
    Argued January 28
    officially released March 4, 1997

      Todd A. Edgington, assistant public defender, for the appellant (petitioner).

      Christopher T. Godialis, deputy assistant state’s attorney, with whom, on the brief, were James E. Thomas, state’s attorney, and John Dropiek, assistant state’s attorney, for the appellee (respondent).
   PER CURIAM.

After a review of the record and briefs, and after hearing from the parties at oral argument, we conclude that the petitioner has failed to make a substantial showing that he has been denied a state or federal constitutional right and, further, has failed to sustain his burden of persuasion that the trial court’s denial of certification to appeal was a clear abuse of discretion or that an injustice has been done. See Simms v. Warden, 230 Conn. 608, 612, 646 A.2d 126 (1994); Simms v. Warden, 229 Conn. 178, 189, 640 A.2d 601 (1994); Walker v. Commissioner of Correction, 38 Conn. App. 99, 659 A.2d 195, cert. denied, 234 Conn. 920, 661 A.2d 100 (1995); see also Lozada v. Deeds, 498 U.S. 430, 431-32, 111 S. Ct. 860, 112 L. Ed. 2d 956 (1991). The petitioner has failed to present any issue that is debatable among jurists of reason, amenable to a different resolution or that deserves encouragement to proceed further. See Lozada v. Deeds, supra, 431-32; Simms v. Warden, supra, 230 Conn. 616.

The petitioner filed a petition for a writ of habeas corpus, alleging that he received ineffective assistance of counsel because his attorney failed to pursue his appeal. The habeas court dismissed the petitioner’s writ because it found that the petitioner had dismissed his attorney while the appeal was pending. In making this finding, the habeas court rejected the petitioner’s testimony that he never instructed counsel not to pursue his appeal. The petitioner asserts, without citation to any authority, that the trial court could not properly make credibility determinations without articulating the reasons why one witness was deemed more credible than another.

The petitioner also claims that counsel was ineffective in allowing the appeal to be dismissed in lieu of filing a withdrawal of the appeal pursuant to Practice Book § 4038. This claim was not alleged in the petition, not decided by the trial court and not supported by any authority.

We conclude that the habeas court had before it sufficient evidence to find as it did and that it did not abuse its discretion in denying the petitioner’s petition for certification to appeal.

The appeal is dismissed.

       Practice Book § 4038 provides in pertinent part: “A withdrawal of an appeal . . . shall be filed with the appellate clerk. . .


author: LANDAU, J.

text:
    STEVEN P. BARRENECHEA v. MICHAEL S. LAMONICA
    (14986)
    Dupont, C. X, and Landau and Spear, Js.
    Argued November 13, 1996
    officially released March 4, 1997

      Ben A. Solnit, with whom, on the brief, was Richard W. Bowerman, for the appellant (plaintiff).

      Brendan T. Flynn, with whom, on the brief, was Robert L. Hirtle, for the appellee (defendant).
   LANDAU, J.

In this chiropractic malpractice action, the plaintiff, Steven P. Barrenechea, appeals from the judgment, rendered after a jury trial, for the defendant, Michael S. LaMonica. On appeal, the plaintiff claims that the trial court should have granted his motion to set aside the verdict and to order a new trial because the court improperly (1) failed to instruct the jury on his preexisting neck condition and (2) charged the jury on proximate cause and inferences that it could draw, and failed to charge on the law applicable to out-of-state expert witnesses. We affirm the judgment of the trial court.

The jury could reasonably have found the following facts. In January, 1989, the plaintiff visited the defendant, complaining of lower back and neck pain. He reported that the lower back pain had existed for a few weeks, and the neck pain had existed for approximately six months. After examining the plaintiff and taking two X rays, which showed degenerative changes in the plaintiffs C-5 and C-6 intervertebral disc space, the defendant diagnosed the plaintiffs condition as a disc compression or subluxation of the cervical spine, outlined a course of treatment and proceeded to treat him. In late March, after a lack of improvement and further X rays, the defendant recommended that the plaintiff submit to magnetic resonance imaging (MRI), but the plaintiff declined and continued treatment. On May 4, 1989, the plaintiff finally underwent an MRI, which revealed a herniated disc. Thereafter, the defendant advised the plaintiff to see a neurologist and the plaintiff refused. On June 14 and June 26, 1989, the defendant urged the plaintiff to consult with a neurosurgeon. In late June, the plaintiff saw a neurologist. Following another MRI, the plaintiff was admitted to a hospital on July 11,1989, where Gerard A. Sava, a neurosurgeon, removed a ruptured disc and fused the space between the C-5 and C-6 vertebrae with a bone graft. Although the operation was successful, the plaintiff was left with a permanent partial disability of his cervical spine.

In his complaint, the plaintiff alleged that the defendant (1) failed to evaluate the plaintiffs condition properly, (2) failed to obtain the plaintiffs informed consent before commencing treatment by failing to disclose adequately the nature, risks and hazards, alternatives and anticipated benefits of chiropractic treatment, and (3) improperly continued to manipulate the plaintiff s neck, despite the development of severe neck pain. The defendant denied the allegations of malpractice in the complaint and raised the special defenses of contributory negligence and failure to mitigate damages, asserting that the plaintiff failed to follow the defendant’s recommendation that he undergo an MRI and ignored the defendant’s instructions to see a physician about his neck condition.

The jury returned a verdict for the defendant. Its interrogatory responses reveal that it found that the defendant did not breach the standard of care for chiropractic physicians in his evaluation of the plaintiffs initial symptoms before commencing treatment or in obtaining informed consent before commencing treatment, but that he did breach the chiropractic standard of care by persisting in the manipulation of the plaintiffs neck despite the development of severe pain. It further found, however, that this breach of the standard of care was not a proximate cause of the plaintiffs injuries. In addition, the jury found that the plaintiff failed to follow the defendant’s instructions to have an MRI performed in a timely fashion and that that failure constituted contributory negligence, but that the contributory negligence was not a proximate cause of his injuries. The jury also found tihat the plaintiff did not fail to mitigate his damages by not following the defendant’s instructions to have an MRI performed or to consult with a neurologist in a timely fashion.

I

The plaintiff first claims that the trial court improperly refused to charge the jury regarding his preexisting neck condition. The plaintiff contends that the requested instruction relates to issues of liability and damages. He requested that the trial court instruct the jury that they must consider that the “plaintiff is entitled to recover full compensation for all damages proximately resulting from the defendant’s negligence even though his injuries might be more serious than they would otherwise have been, because of the preexisting physical condition of the plaintiff. . . . [T]he defendant takes the plaintiff as he finds him.” He argues that there was ample evidence that entitled him to that charge. When the defendant commenced treatment, the plaintiff had been experiencing neck pain for approximately six months. In addition, the defendant testified that he believed the X rays taken on the intake day showed degeneration of the disc in the neck and the defendant’s expert witness, Lewis R. Labbadia, a chiropractor, agreed. Sava testified that when he first examined the plaintiff, he exhibited symptoms of early degenerative changes in the disc.

The defendant argues that the requested charge goes solely to the issue of damages and, because the jury found that the defendant’s actions were not the proximate cause of the plaintiffs injuries, the jury did not reach the issue of damages. The defendant further argues that the plaintiff was not entitled to that charge because he did not plead an aggravation of a preexisting condition as one of his injuries and, finally, that the requested charge is incorrect as a matter of law.

“To comply with our rules, a request to charge must be relevant to the evidence and issues presented in court. State v. Falcone, 191 Conn. 12, 26, 463 A.2d 558 (1983). The trial court should instruct the jury on only those issues that are relevant to the facts in issue. State v. Santangelo, 205 Conn. 578, 599, 534 A.2d 1175 (1987); Bonner v. Winter, 175 Conn. 41, 48, 392 A.2d 436 (1978).” Felsted, v. Kimberly Auto Services, Inc., 25 Conn. App. 665, 672, 596 A.2d 14, cert. denied, 220 Conn. 922, 597 A.2d 342 (1991).

The plaintiff argues for the first time on appeal that the requested instruction relates to issues of liability and damages. The plaintiff contends that the issue of whether he suffered from a preexisting condition was “inextricably intertwined” with the issue of proximate cause and he was, therefore, entitled to the requested charge. Our review of the requested charge indicates that it focuses on damages and not on liability as the plaintiff now claims. The charge refers to compensation for damages resulting from the defendant’s alleged negligence, rather than liability for those damages. This is an important distinction because the jury did not reach the issue of damages. In response to the interrogatories, the jury found that the defendant’s actions were not the proximate cause of the plaintiffs injuries. Thus, we conclude that the trial court properly refused to give the requested charge.

This conclusion, however, does not end our analysis. The thrust of the plaintiffs claim is that the trial court improperly charged the jury on the issue of proximate cause and, more specifically, should have charged on the effect a preexisting condition has on the determination of whether proximate cause exists. The plaintiff did request a charge on proximate cause, but the charge made no reference to a preexisting condition.

Although this claim was not preserved at trial, we address this issue to determine whether plain error exists. This court “may in the interest of justice notice plain error not brought to the attention of the trial court.” Practice Book § 4061. “Such review is reserved for truly extraordinary situations where the existence of the error is so obvious that it affects the fairness and integrity of and public confidence in the judicial proceedings. ... An important factor in determining whether to invoke the plain error doctrine is whether the claimed error resulted] in an unreliable verdict or a miscarriage of justice.” (Internal quotation marks omitted.) DiNapoli v. Cooke, 43 Conn. App. 419, 426, 682 A.2d 603, cert. denied, 239 Conn. 951, 686 A.2d 124 (1996), quoting State v. Knight, 29 Conn. App. 675, 676-77, 617 A.2d 913 (1992). Our review of the record reveals that the plaintiff did not seek a charge on aggravation of a preexisting injury, and that, even if the plaintiffs complaint is read to include an allegation that the defendant’s negligence consisted of such an aggravation, the evidence was insufficient for the jury to conclude that such negligence was the proximate cause of the plaintiffs injuries. In fact, the jury found it was not. Thus, the trial court’s charge did not result in an unreliable verdict or a miscarriage of justice. Accordingly, we conclude that the trial court did not commit plain error.

II

The plaintiffs remaining claims are all directed to the alleged failure of the trial court to charge the jury properly. The plaintiff claims that the trial court inadequately charged the juiy on the issue of proximate cause, that the trial court’s charge on inferences was erroneous, and that the trial court failed to charge on the law applicable to out-of-state expert witnesses.

“In reviewing a challenge to jury instructions, we must examine the charge in its entirety. State v. Grullon, 212 Conn. 195, 204, 562 A.2d 481 (1989). While the instructions need not be exhaustive, perfect or technically accurate, they must be correct in law, adapted to the issues and sufficient for the guidance of the jury.” (Internal quotation marks omitted.) Felsted v. Kimberly Auto Services, Inc., supra, 25 Conn. App. 668. “The court is under no duty at any time to charge in the exact language requested. . . . Failure to charge precisely as proposed by a [party] is not error where the point is fairly covered in the charge.” (Citations omitted.) Tomczuk v. Alvarez, 184 Conn. 182, 190, 439 A.2d 935 (1981). The trial court’s instructions on proximate cause and the jury’s ability to draw inferences from the evidence were fully consistent with the applicable principles of law and fairly presented the issues to the jury.

The plaintiffs final instructional claim concerns defense counsel’s closing argument. He asserts that because defense counsel improperly attacked plaintiffs chiropractic expert’s credibility, he was entitled to his requested charge concerning out-of-state expert witnesses. We are unpersuaded.

The trial court expressly cautioned the jury that arguments of counsel were not evidence and that they were to be guided by their own recollection of the facts. 6In addition, when instructing the jury on expert witnesses, the trial court spoke of the experts collectively, treated them equally and drew no distinctions between them. The trial court concluded by emphasizing that it was up to the jury, and to no one else, to decide how much weight to accord each witness’ testimony. The plaintiffs argument that defense counsel’s comments in closing argument somehow placed in the jurors’ minds a notion that they could discount the out-of-state expert’s Holland’s testimony on standard of care and causation because he came from Caseyville, Illinois, has no basis or foundation in the record. We conclude that the trial court properly instructed the jury.

The judgment is affirmed.

In this opinion the other judges concurred.

       The plaintiff requested the following charge: “The plaintiff is entitled to recover full compensation for all damages proximately resulting from the defendant’s negligence even though his injuries might be more serious than they would otherwise have been, because of the pre-existing physical condition of the plaintiff. If the wrongful acts of the defendant were a substantial factor in producing the plaintiffs condition, the plaintiff is entitled to recover full damages for the disability so caused. This is so even though his injuries and the effects thereof are more serious and will be more prolonged than they otherwise would have been, because of his pre-existing health condition. In other words, ‘the defendant takes the plaintiff as he finds him.’ If you find that Dr. LaMonica was negligent and his negligence was a substantial factor in causing Mr. Barrenechea’s disability, Dr. LaMonica cannot excuse his actions because [of] Mr. Barrenechea’s pre-existing neck condition. [D.] Wright & [W.] Ankerman, Connecticut Jury Instructions (4th Ed.), § 235.” (Emphasis in original.)

       The plaintiff requested the following charge: “If you find that Dr. LaMonica violated the standard of ordinary and reasonable care in one or more respects as alleged in the complaint and that this violation or these violations were a substantial factor in causing injuries to Steven Barrenechea, then your verdict must be for the plaintiff. The plaintiff does not have to prove the causal relationship with 100 percent certainty or that defendant’s negligence was the only cause of his injuries. The plaintiff only has to prove the allegations by a preponderance of the evidence, or in other words, the better or weightier evidence and only has to prove that defendant’s negligence was a substantial factor in ipjuring him. The plaintiff does not have to exclude or explain every other possible hypothesis. Proof of causation by the plaintiff need not be conclusive; it is sufficient if the plaintiff proves that it is more likely than not that his injuries resulted from the defendant’s negligence.” (Emphasis in original.)

       As a result of the foregoing, we do not reach the defendant’s claims that the plaintiff failed to plead an aggravation of a preexisting condition and that the requested charge was incorrect as a matter of law.

       The plaintiffs expert witness, Wilbur Holland, a chiropractor who testified as to both standard of care and causation, was from Illinois. Conversely, the defendant’s expert witness practices in Middletown. In defense counsel’s closing argument, he said, “[Wilbur Holland] comes from a place called Caseyville, Illinois, which honestly, I never heard of. ... I don’t know what the standard of medicine is in Caseyville, Illinois, and I don’t know what Dr. Holland does in his practice. ... I think he was a nice fellow, nice sort of country chiropractor, but I don’t think he added to our store of knowledge here at all. He couldn’t tell you what the standard of care was.”

       The trial court instructed the jury as foEows: “[T]he remarks of counsel in closing arguments do not constitute evidence. If in those remarks counsel stated any facts which do not comport with your recollection of the facts, you should be governed by your own recoEection.”


author: HENNESSY, J.

text:
    RALPH PASCARELLI v. MOLITERNO STONE SALES, INC., ET AL.
    (15266)
    Dupont, C. X, and Landau and Hennessy, Xs.
    Argued December 12, 1996
    officially released March 4, 1997

      Anselmo M. Delia, with whom were Paul J. Dorsi and, on the brief, William Rocco, for the appellant (plaintiff).

      Jaimes D. Moran, Jr., for the appellee (defendant).
   HENNESSY, J.

The plaintiff, Ralph Pascarelli, appeals from the decision of the compensation review board of the workers’ compensation commission (review board). The review board affirmed the finding of the workers’ compensation commissioner for the fourth district and his dismissal of the plaintiff’s request for modification of the parties’ voluntary agreement. The plaintiff sought to modify the compensation rate set in the voluntary agreement by including in his base wage rate the total employer contributions to his pension, health and welfare fund, and to his annuity. On appeal, the plaintiff claims that the review board improperly (1) affirmed the commissioner’s decision denying the plaintiffs request for modification and (2) accepted the commissioner’s reliance on the distinction between the definition of “wages” in General Statutes (Rev. to 1989) § 31-310 and the definition of “income” in General Statutes (Rev. to 1989) § 31-275 (14).

The commissioner found the following relevant facts. The plaintiff suffered a compensable injury on May 2, 1989. By voluntary agreement, Pascarelli and the defendant Molitemo Stone Sales, Inc., agreed to a compensation wage rate of $613.87 per week, approved by the commissioner on April 7, 1991. Subsequently, the parties entered into another voluntary agreement that set the compensation rate at $655.79 per week. The commissioner also noted that the defendant had filed for Chapter 11 bankruptcy and had been placed under receivership by the Rhode Island Superior Court.

Furthermore, the commissioner concluded that there was a distinction between the definition of “income” in General Statutes (Rev. to 1989) § 31-275 (14) and the use of the word “wages” in General Statutes § 31-310 and that wages are exclusive of the fringe benefits claimed by the plaintiff. He also found that the plaintiff could not proceed on the modification without obtaining relief from the automatic stay created by the defendants’s bankruptcy proceeding. On the basis of these findings, the commissioner denied the plaintiffs request for modification.

The plaintiff appealed to the review board from the commissioner’s decision. The review board affirmed the commissioner’s findings and dismissal. The plaintiff now appeals the review board’s decision.

Subsequent to the review board’s decision, the plaintiff learned and the defendant conceded that there was no federal bankruptcy stay in effect. The plaintiff claims that because the commissioner relied on this mistake of fact, the review board’s affirmation of the commissioner’s decision should be reversed. The defendant, however, argues that this issue is moot because the commissioner also found in favor of the defendant on the merits of the case. We find that the review board properly affirmed the commissioner’s finding on the merits of the case and conclude that the issue of the commissioner’s allegedly improper reliance on a bankruptcy stay is moot.

The dispositive issue in this case, therefore, is whether the review board improperly relied on the commissioner’s distinction between “income” as defined in § 31-275 (14) and “wages” as used in § 31-310 to conclude that the compensation wage rate did not include the fringe benefits remuneration asserted by the plaintiff. We conclude that the review board correctly affirmed the commissioner’s decision on this issue.

At the time of the plaintiffs injury, income was defined in § 31-275 (14) to include “wages, accident and health insurance coverage, life insurance coverage and employee welfare plan contributions.” Section 31-310, however, provided that in order to calculate the claimant’s average weekly wage and base compensation rate, wages received by an employee during the twenty-six weeks prior to the date of injury are to be used. “It is fundamental that statutory construction requires us to ascertain the intent of the legislature and to construe the statute in a manner that effectuates that intent. . . . It is well settled that a statute must be applied as its words direct.” (Citations omitted; internal quotation marks omitted.) All Brand Importers, Inc. v. Dept. of Liquor Control, 213 Conn. 184, 194, 567 A.2d 1156 (1989). From the use of the term wages instead of income in § 31-310, it is clear that the legislature intended that fringe benefits remuneration, such as health coverage and employee welfare plan contributions, were not to be included in calculating the plaintiffs base compensation rate.

The plaintiff claims that in the alternative, he should be entitled to open the voluntary agreement because it was premised on General Statutes (Rev. to 1989) § 31-284b, a statute that was subsequently preempted by §514 (a) of the federal Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1144 (a). See District of Columbia v. Greater Washington Board of Trade, 506 U.S. 125, 113 S. Ct. 580, 121 L. Ed. 2d 513 (1992). The plaintiff claims that the preemption constituted a mutual mistake of material fact on which the parties relied in entering the voluntary agreement. He further claims that on the basis of the “date of injury rule,” he is entitled to receive benefits governed by the statutes in force at the time of his injury even if the statute is subsequently preempted by federal law. The plaintiff, however, failed to assert these claims at the hearing before the commissioner or the review board and makes no argument that these claims are of constitutional magnitude. Because we have consistently held that we are not bound to review on appeal unpreserved, non-constitutional claims, we decline to review the plaintiffs claim. See State v. Kulmac, 230 Conn. 43, 74, 644 A.2d 887 (1994); State v. Hammond, 221 Conn. 264, 289, 604 A.2d 793 (1992).

The decision of the compensation review board is affirmed.

In this opinion the other judges concurred.

       General Statutes (Rev. to 1989) § 31-310 provides in pertinent part: “For the purposes of this chapter, the average weekly wage shall be ascertained by dividing the total wages received by the injured worker from the employer in whose service he is injured during the twenty-six calendar weeks immediately preceding that during which he was injured, by the number of calendar weeks during which, or any portion of which, such worker was actually employed by such employer, but, in making such computation, absence for seven consecutive calendar days, although not in the same calendar week, shall be considered as absence for a calendar week . . . .”

       General Statutes (Rev. to 1989) § 31-275 (14) provides: “ ‘Income’ means all forms of remuneration to an individual from his employment, including wages, accident and health insurance coverage, life insurance coverage and employee welfare plan contributions.”

       The Second Injury and Compensation Assurance Fund is a named party to this appeal but did not file a brief or appear at oral argument. We refer in this opinion to Molitemo as the defendant.

       The plaintiff argues that the commissioner should have applied the test as articulated in Thibeault v. General Outdoor Advertising Co., 114 Conn. 410, 158 A. 912 (1932), to determine which benefits should be included in wages. In Thibeault, the Supreme Court held that the “test to be applied is, does the allowance represent a real and reasonably definite economic gain to the employee, reasonably within, or at least not contrary to, the fair intent of the parties . . . .” Id., 414. We need not apply the test provided in Thibeault, however, because it is clear from the statutory language that “wages” for purposes of § 31-310 do not include the fringe benefits asserted by the plaintiff. See New Haven v. United Illuminating Co., 168 Conn. 478, 485, 362 A.2d 785 (1975) (if statutory language clear and unambiguous, there is no room for construction).

       General Statutes (Rev. to 1989) § 31-284b (a) provides: “In order to maintain, as nearly as possible, the income of employees who suffer employment-related iryuries, any employer, as defined in section 31-275, who provides accident and health insurance or life insurance coverage for any employee or makes payments or contributions at the regular hourly or weekly rate for full-time employees to an employee welfare fund, as defined in section 31-53, shall provide to such employee equivalent insurance coverage or welfare fund payments or contributions while the employee is eligible to receive or is receiving workers’ compensation payments pursuant to this chapter, or while the employee is receiving wages under a provision for sick leave payments for time lost due to an employment-related injury.”
      General Statutes § 31-53 (h) defines employee welfare fund as “any trust fund established by one or more employers and one or more labor organizations to provide from moneys in the fund, whether through the purchase of insurance or annuity contracts or otherwise, benefits under an employee welfare plan . . . .”

       The Supreme Court applied the “date of injury rule” in lacomacci v. Trumbull, 209 Conn. 219, 550 A.2d 640 (1988). Under this common-law rule, “new workers’ compensation legislation affecting rights and obligations as between the parties and not specifying otherwise [applies] only to those persons who received injuries after the legislation became effective, and not to those injured previously.” Id., 222.

       Even if we were to review the plaintiffs unpreserved claims, we would conclude that these claims have no merit. The plaintiffs claim that the voluntary agreement was premised on a mutual mistake of fact fails because the preemption occurred after the parties had entered into the agreement. His “date of injury rule” claim also fails because this rule applies only when there has been subsequent legislation, not when legislation has been preempted by federal law.


author: FOTI, J.

text:
    SAMUEL P. MILAZZO v. BARRY S. SCHWARTZ ET AL.
    (15579)
    O’Connell, Foti and Hennessy, Js.
    Argued December 5, 1996
    officially released March 11, 1997

      Dana P. Lonergan, for the appellants (defendants).

      Robert R. Petrucelli, for the appellee (plaintiff).
   FOTI, J.

The plaintiff, Samuel Milazzo, sought judgment of strict foreclosure of two mortgages that he held on property of the defendants, Barry Schwartz and Creative Food and Beverage, Inc. On appeal, the defendants claim that the trial court improperly (1) concluded that the parties’ oral agreement violated the statute of frauds, (2) concluded that the defendants were estopped from pursuing their special defenses and counterclaims against the plaintiff as a result of a previously entered stipulation, and (3) awarded interest to the plaintiff. We affirm the judgment of the trial court.

The plaintiff agreed to sell his meatpacking business, including the structure and real property known as 1013-1017 Housatonic Avenue and 1027 Housatonic Avenue in Bridgeport, to the defendants. The parties signed a purchase agreement dated August 3, 1989. The agreement, which was introduced at trial, set out a sales price of $450,000, $25,000 due upon signing, $225,000 due at closing, $100,000 due on or about March 1, 1991, and $100,000 due on or about September 1, 1994. The agreement refers to two $100,000 mortgage notes and a lease as schedules or exhibits. The lease set out the terms of a lease arrangement with Creative Food and Beverage, Inc., as landlord, and Samuel Milazzo, as tenant. The plaintiff was to pay the defendants a minimum of $2550 per month. The parties were to sign the notes and lease at the closing, but they failed to do so.

The court took judicial notice of an earlier foreclosure action that the plaintiff had brought in 1991 concerning the same property and parties, Milazzo v. Schwartz, Superior Court, judicial district of Fairfield, Docket No. CVBR9109-01428. The defendants had filed essentially the same answer, special defenses and counterclaim in the prior matter as they did in this case. On March 18, 1992, the parties entered into a stipulation in the prior action.

The stipulation provided that the defendants had four months from the date of the execution of mortgage and notes to pay $100,000. If the defendants failed to pay the sum, the plaintiff reserved the right to foreclose on the notes and mortgages due pursuant to the agreement.

The defendants did not make the $100,000 payment due pursuant to the stipulation. The plaintiff did not pay rent to the defendants after they told him that they could not make the payment due. The plaintiff then brought this foreclosure action. The trial court rendered judgment of strict foreclosure for the plaintiff and further determined that he was entitled to interest on the judgment. This appeal followed.

I

We first address the defendants’ claim that the trial court improperly ruled that they were estopped from pursuing their special defenses and counterclaim against the plaintiff. At the outset, we note that the trial court never expressly addressed whether the defendants could pursue their special defenses. The trial court, however, considered and rejected the defendants’ special defenses when it found that the lease agreement on which their special defenses were based was unenforceable. In view of the trial court’s consideration of the substance of the defenses, we conclude that the trial court implicitly found that the defendants were not barred from pursuing their special defenses.

II

Having so concluded, we now turn to the defendants’ claim that the trial court improperly found that the lease agreement between the parties violated the statute of frauds. The defendants alleged in their special defenses that the plaintiff initially breached the original purchase agreement between the parties by failing to pay rent under the subsidiary lease agreement. The trial court found no merit to this claim because it concluded that the lease violated the statute of frauds.

General Statutes § 52-550, Connecticut’s codification of the statute of frauds, provides in relevant part: “(a) No civil action may be maintained in the following cases unless the agreement, or a memorandum of the agreement, is made in writing and signed by the party ... to be charged ... (4) upon any agreement for the sale of real property or any interest in or concerning real property . . . .” Our Supreme Court, however, has set out an exception to the requirements of the statute of frauds: “We have held that acts on the part of the promisee may be sufficient to take a contract out of the statute if they are such as clearly refer to some contract in relation to the matter in dispute. . . . The doctrine of part performance arose from the necessity of preventing the statute against frauds from becoming an engine of fraud. . . . [T]he acts of part performance generally must be such as are done by the party seeking to enforce the contract . . . and with the design of carrying the same into execution, and must also be done with the assent, express or implied, or the knowledge of the other party, and be such acts as alter the relations of the parties. . . . The acts must also be of such a character that they can 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 . . . .” (Citations omitted; internal quotation marks omitted.) Ubysz v. DiPietro, 185 Conn. 47, 54, 440 A.2d 830 (1981).

The defendants contend that the doctrine of part performance removes the transaction from the application of the statute of frauds. They claim that the transfer of the property and the plaintiff’s payment of $3000 per month to them from October, 1989, through November, 1990, constitutes performance of the contract sufficient to make the contract enforceable. The defendants claim that the trial court made factual findings consistent with a part performance, but that it erroneously concluded that the agreement was not enforceable as a matter of law.

In its memorandum of decision, the trial court found that “the unsigned lease violates the statute of frauds.” The trial court did not explicitly address the issue of part performance. The parties dispute whether the transfer of possession and the payment of $3000 complied with the explicit terms of the lease agreement. Whether these actions constituted part performance was a factual determination to be made by the trial court. See Fleet Bank, N.A. v. Galluzzo, 33 Conn. App. 662, 666, 637 A.2d 803, cert. denied, 229 Conn. 910, 642 A.2d 1206 (1994). The trial court may have refused to invoke this equitable doctrine for a number of reasons. It may have determined, for example, that the defendants’ actions could be naturally and reasonably accounted for in some way other than by the existence of a contract in relation to the subject matter in dispute. See Union Trust Co. v. Jackson, 42 Conn. App. 413, 418, 679 A.2d 421 (1996). Alternatively, it may have determined that the actions did not so change the defendants’ position that a failure to enforce the agreement would work a fraud, injustice or hardship on them. See Harmonie Club, Inc. v. Smirnow, 106 Conn. 243, 248-49, 137 A. 769 (1927). We are unable to discern from the record before us the basis of the trial court’s conclusion that the agreement violated the statute of frauds.

The defendants did not file a motion for articulation or rectification pursuant to Practice Book § 4061. It is their burden to furnish an adequate record for review. Centerbank v. Gross, 31 Conn. App. 38, 39, 622 A.2d 1066 (1993). We axe therefore unable to review the defendants’ claim that part performance made the agreement enforceable despite the fact that it violated the statute of frauds.

Ill

The defendants claim that the trial court should not have awarded interest to the plaintiff. The defendants support their claim that an award of interest is improper because it was not their conduct, but the plaintiffs conduct, that was wrongful.

General Statutes § 37-1 provides: “(a) The compensation for forbearance of property loaned at a fixed valuation, or for money, shall, in the absence of any agreement to the contrary, be at the rate of eight per cent a year; and, in computing interest, three hundred and sixty days may be considered to be a year, (b) Unless otherwise provided by agreement, interest at the legal rate from the date of maturity of a debt shall accrue as an addition to the debt.” General Statutes § 37-3a provides for the legal rate of 10 percent.

“The allowance of prejudgment interest under § 37-3a is a matter within the discretion of the trial court. . . . This allowance turns on whether the detention of the money is or is not wrongful under the circumstances. ...” (Citations omitted; internal quotation marks omitted.) Patron v. Konover, 35 Conn. App. 504, 517, 646 A.2d 901, cert. denied, 231 Conn. 929, 648 A.2d 879 (1994).

After a hearing on January 3, 1996, the trial court awarded prejudgment interest to the plaintiff. The defendants did not appear at the hearing and did not contest the award until this appeal. We conclude that the trial court properly determined that the defendants breached the agreement by not paying amounts due pursuant to the mortgage notes and, therefore, that the detention of the money was wrongful. Accordingly, we conclude that the trial court did not abuse its discretion in its award of interest.

The judgment is affirmed.

In this opinion the other judges concurred.

       The lease provided for rent of $400 per month plus ten cents per pound of meat fabricated by and or for the tenant. The tenant guaranteed that he would fabricate at least 5000 pounds of meat per week yielding a minimum total monthly rental of $2550.

       The stipulation, as stated on the record, provided: “It is hereby stipulated and agreed by and between the parties that the defendant, Barry Schwartz, individually and as president of Creative Foods and Beverage, Inc., will execute the mortgage and notes—mortgages and notes, originally agreed to be executed as per the contract dated 8/3/89, which is exhibit A, in this law suit. Said mortgages and notes will be prepared and recorded by Attorney Stanley Goldstein of our office within ten days of today’s date. Upon execution and recording of said mortgage, notes and deeds, the plaintiff, Milazzo, will withdraw the instant action against Barry Schwartz, Creative Foods and Beverage, Inc and Dana Lonergan and the defendants Barry Schwartz and Creative Foods and Beverages, Inc., will withdraw the counterclaim against the plaintiff, Samuel Milazzo. Barry Schwartz and Creative Foods and Beverage, Inc. will seek to refinance the mortgage presently on 1013-1017 Housatonic Avenue, Bridgeport, and pay to the plaintiff the sum of one hundred thousand dollars in accordance with the notes and—the notes and mortgage . . . which was due 3/1/91. The defendants, Barry Schwartz and Creative Foods and Beverage, Inc., have four months from the date of the execution of the mortgage and notes—mortgage, notes and deeds, to pay said one hundred thousand dollars. If said one hundred thousand dollars is paid, by the defendants, to the plaintiff, Samuel Milazzo will convey by warranty deed, all of his right, title and interest in and to 1027 Housatonic Avenue, Bridgeport, to Creative Foods and Beverages, Inc. If it is not paid by the defendants within said four month period, Samuel Milazzo reserves the right and is hereby given the right by the defendants to foreclose the note and mortgage due 3/1/91 and the note and mortgage due 9/1/9—Did I say 9/1?—The note and mortgage due 3/1/91 and the note and mortgage due 9/1/94. Period.”
      Both parties accepted this agreement.

       We note that sometime prior to trial, the plaintiff filed for bankruptcy protection under Chapter 13 of the federal Bankruptcy Code. The filing of a bankruptcy petition creates an automatic stay against the commencement or continuation of all actions against the debtor that were, or could have been, filed against the debtor prior to the bankruptcy filing. 11 U.S.C. § 362. Here, the automatic bankruptcy stay did not prohibit the foreclosure action from proceeding because it was not an “action against the debtor.” The counterclaim for breach of contract, however, was an action against the debtor and, in the absence of a specific order lifting the stay, should not have proceeded. We, therefore, regard the trial court’s ruling insofar as it resolves the counterclaim as a nullity.


author: STOUGHTON, J.

text:
    CADLE COMPANY OF CONNECTICUT, INC. v. C.F.D. DEVELOPMENT CORPORATION ET AL.
    (15676)
    O’Connell, Schaller and Stoughton, Js.
    Argued December 10, 1996
    officially released March 11, 1997

      Bruce L. Elstein, with whom were StephenP. Wright and, on the brief, Henry Elstein, for the appellants (defendant Jan E. Cohen et al.).

      Steven M. Basche, with whom, on the brief, was David M. Barry, Jr. for the appellee (plaintiff).
   STOUGHTON, J.

This is an appeal from a judgment rendered on a jury verdict in favor of the holder of a promissory note against the guarantors. The principal issue is whether, under the circumstances of this case, the guarantors are liable on the guarantee if the maker of the note is not liable to the holder of the note. We conclude that they are not. We, therefore, reverse the judgment of the trial court with respect to the defendant guarantors.

The pleadings establish that by a note dated October 19, 1987, the named defendant, C.F.D. Development Corporation (CFD), promised to pay $1,900,000 plus interest and costs of collection to the order of Shawmut Home Bank (Shawmut). The defendants Arnold H. Foster, Jan E. Cohen and Mario DiRienzo III (guarantors) guaranteed payment and performance of the note by an instrument also dated October 19, 1987. The note fell into default. The plaintiff, Cadle Company of Connecticut, Inc., alleged that the note was assigned to it, that it became the actual bona fide owner of the note and beneficiary of the guarantee, and that at the time it instituted action against CFD and the guarantors, there was due and owing the sum of $1,461,017.67 plus interest, reasonable attorney’s fees and costs.

The defendants denied that the amount claimed was due and that the plaintiff was the beneficiary of the guarantee. They alleged that they had no knowledge that Shawmut had exercised its option to declare all sums immediately due and payable and that the note and guarantee had been assigned to the plaintiff. The defendants also filed several special defenses, including a claim that Connecticut National Bank (CNB), a former holder, had impaired the value of the collateral by taking no action for an unreasonable time and allowed the value of the collateral to decrease significantly,* and a claim that CNB, by refusing to accept title to the collateral when its appraised value was in excess of $2,000,000, had breached its covenant of good faith and fair dealing. None of the other special defenses went to the jury.

At the conclusion of the trial, the jury returned a plaintiffs general verdict form, showing a recovery for the plaintiff from each of the defendants in the amount of $1,539,114.32. In addition, the following interrogatories were answered as indicated and returned by the jury: “1. Do you find that Connecticut National Bank, after commencing its foreclosure action against the defendants and during the term of a Receiver appointed by the Court, took actual or constructive possession of the subject property (Phoenix Landing Condominiums)? Yes.

“2. Do you find that the bank acted unreasonably or failed to act reasonably in prosecuting the foreclosure action which it initiated in November, 1989? Yes.

“If your answer to question No. 2 is affirmative, please proceed to question No. 3. If your answer is ‘No,’ then you are to proceed to question 5.

“3. Do you find that the bank’s conduct after bringing the foreclosure action was a proximate cause of a decline in value of the subject property (Phoenix Landing Condominiums)? No. . . .

“5. What is the total amount, including interest, that you find is due and owed to the plaintiff?:

“By Defendant C.F.D. Development Corporation, Inc., $0.

“By Guarantor Defendants (Cohen, Foster and DiRienzo) $1,539,114.32.”

A motion to set aside the verdict, for entry of judgment and in arrest of judgment was filed on behalf of all defendants. In addition, CFD filed a separate motion to set aside the verdict and for judgment. The trial court granted the motion to set aside the verdict as against CFD, corrected the general verdict and rendered judgment for CFD. No appeal was timely taken from this judgment in favor of CFD. The motion of the remaining defendants to set aside the verdict was denied and judgment was rendered against them on the verdict. Because the judgment of the trial court setting aside the verdict and rendering judgment in favor of CFD has not been appealed, it must stand. See Southport Manor Convalescent Center, Inc. v. Foley, 20 Conn. App. 223, 565 A.2d 878 (1989), rev’d on other grounds, 216 Conn. 11, 578 A.646 (1990); Skut v. Hartford Indemnity Co., 142 Conn. 388, 114 A.2d 681 (1955). The guarantors, however, appeal from the trial court’s judgment against them, claiming that, in the absence of any debt due from the makers on the note, the guarantors cannot be held liable.

There are three possible bases on which CFD could have prevailed. We consider each of those bases in turn to determine whether the judgment against the guarantors can be reconciled with the judgment for CFD and the responses to the interrogatories. If they cannot be reconciled, the judgment against the guarantors must be reversed. Mallinson v. Black, 41 Conn. App. 373, 381, 675 A.2d 937 (1996).

First, CFD would have prevailed if the jury had found that the plaintiff failed in its proof of the allegation that there was an amount due and owing from CFD to the lender on the note. In that case, there would be no basis for a judgment against the guarantors on the note or the guarantee because the liability of the guarantor is based on the liability of the debtor. Murphy v. Schwaner, 84 Conn. 420, 425, 80 A. 295 (1911); Bernd v. Lynes, 71 Conn. 733, 43 A. 189 (1899). If failure of the plaintiffs proof was the basis of the judgment for CFD, therefore, the guarantors would have had to prevail.

Second, a special defense might have been the basis for the judgment in favor of CFD. Two special defenses were presented, and we address each in turn. The first special defense was impairment of the collateral. Logically, however, that could not have been the basis of the judgment in favor of CFD. The jury stated in its answer to interrogatory one that the lender took actual or constructive possession of the property only after the foreclosure action was commenced. In its answer to interrogatory three, the jury stated that the bank’s conduct after the foreclosure was filed did not impair the value of the collateral. The collateral, therefore, was not impaired by the bank after it took either actual or constructive possession of the collateral. Thus the defense of impairment of collateral could not have been the basis of the judgment in favor of CFD regardless of the judgment with respect to the guarantors.

Finally, CFD might have prevailed because the defendants also proved that the bank violated the covenant of good faith and fair dealing. In answer to interrogatory two, the jury stated that the bank acted unreasonably or failed to act reasonably in prosecuting the foreclosure action; it is, therefore, possible that the special defense of violation of the covenant of good faith and fair dealing was the basis of the judgment for CFD. “Because a guarantor’s contract is ancillary to that of the debtor, suretyship law [permits] the surety to assert the defenses or the discharge of his debtor unless the very purpose of the suretyship was to shift the risk of this event from the creditor to the surety,” as in the event of bankruptcy or infancy of the debtor. American Oil Co. v. Valenti, 179 Conn. 349, 353, 426 A.2d 305 (1979). In the present case, shifting the risk of loss that might result from the lender’s violation of the duty of good faith and fair dealing could not reasonably have been the “very purpose of the surety-ship,” because implicit in every contract is an obligation of good faith and fair dealing. Gupta v. New Britain General Hospital, 239 Conn. 574, 687 A.2d 111 (1996). Neither infancy nor bankruptcy was involved here. See American Oil Co. v. Valenti, supra, 353. Thus, if violation of the covenant of good faith and fair dealing was the basis of the judgment for CFD, that special defense would have been available to the guarantors as well, and they would have had to prevail.

Because the judgment in favor of CFD has not been appealed and because the only two possible bases on which CFD could have prevailed necessitate that the guarantors also prevail, the judgment against the guarantors cannot stand.

The judgment with respect to the guarantors is reversed and the case is remanded with direction to render judgment in favor of the defendant guarantors.

In this opinion the other judges concurred.

       The guarantee executed by the three guarantors was in the form of a letter to Shawmut, providing that each of the guarantors “unconditionally guarantees . . . the payment and performance from or by the Borrower of any and all obligations from the Borrower to the Lender. . . .’’The guarantee defines obligations as “the Loan evidenced by the Note and any and all interest, commissions, obligations, liabilities, indebtedness, charges and expenses now or hereafter chargeable against the Borrower by the Lender or owing by the Borrower to the Lender with respect to the Loan, whether any of the foregoing are direct or indirect, joint or several, absolute or contingent, due or to become due, now existing or hereafter arising with respect to the Loan no matter how or when arising and whether under any present or future agreement or instrument between the Borrower and the Lender or otherwise, and the performance and fulfillment by the Borrower of all of the terms, conditions, promises, covenants, agreements and provisions contained in said Note or in any documents evidencing, relating to or securing the Loan ... or in any present or future agreement or instrument between the Borrower and the Lender with respect to the Loan.”

       In the first special defense, the defendants claimed: “1. The C.N.B. (‘Former Plaintiff) has impaired the collateral of the Defendants in this matter in that it has done nothing with regards to this action or the subject property for an unreasonable period of time and has allowed the value of the subject property to decrease significantly while the interest allegedly accruing as to the Defendants has continued to increase, during which time the Former Plaintiffs agent, receiver for the subject property, has done nothing with regards to renting, marketing or maintaining the subject property in a proper and value maximizing manner.
      “3. Plaintiff purchased debt instruments upon which this action is based with knowledge of this defense or is chargeable with knowledge of this defense and therefore took the alleged debt instruments subject to this defense.”

       In the second special defense the defendants claimed: “1. Due to the Former Plaintiffs actions in this matter with regards to its dilatory posture in same and its refusal to accept title to the subject properly or respond to any of these Defendants’ proposals as far back as 1988 when the property had an appraised value in excess of $2.0 million by the Former Plaintiffs own appraiser, it has breached the covenant of good faith and fair dealing which exists in every contract and due to the bad faith of the Plaintiff any judgment against the Defendants arising from the alleged indebtedness.
      ‘‘2. Plaintiff purchased debt instruments upon which this action is based with knowledge of this defense or is chargeable with knowledge of this defense and therefore took the alleged debt instruments subject to this defense.”