text:
    SUSAN S. STARR v. COMMISSIONER OF ENVIRONMENTAL PROTECTION ET AL.
    (15234)
    Callahan, Borden, Berdon, Norcott and Katz, Js.

      Argued February 16
    officially released April 30, 1996

      John M. Looney, assistant attorney general, with whom, on the brief, was Richard Blumenthal, attorney general, for the appellant-appellee (named defendant).

      Kathleen Eldergill, for the appellee-appellant (plaintiff).
   KATZ, J.

The dispositive issue in this appeal is whether the plaintiff, Susan S. Starr, acquired a polluted 44.3 acre parcel of land by inheritance, thereby making her an innocent landowner pursuant to General Statutes § 22a-452d.

The following facts and procedural history are undisputed. On February 23, 1976, the plaintiffs husband, S. Leger Starr (decedent), died leaving a will that named the plaintiff the executrix of his estate. The will created two trusts, a marital trust and a residuary trust. The decedent’s will gave the plaintiff the discretion to distribute into one of the two trusts what remained of the estate after the payment of funeral expenses and expenses related to the administration of the estate. The will also gave the plaintiff the authority to take assets directly instead of placing them in the marital trust and to transfer property without court approval.

When the decedent died, he was the controlling shareholder of three corporations, Don, Inc., L and S Realty, Inc., and Mountview, Inc. He owned approximately ninety-eight shares of stock in each of these corporations while the plaintiff and her sister each owned one share. These corporations were the title owners of the parcel of land (property) presently at issue. Upon his death, the decedent’s ninety-eight shares became part of his estate. On January 31, 1978, at the advice of her attorneys, the plaintiff, acting as executrix, merged the three corporations into a preexisting corporation, Dale, Inc., which consequently became the owner of the land. Four years later, the plaintiff dissolved Dale, Inc., causing the corporation’s assets to be distributed to the shareholders, which included the decedent’s estate. Thereafter, on January 30,1987, by virtue of a fiduciary deed, the plaintiff transferred the property to herself.

Within a few years, the named defendant, the commissioner of environmental protection (commissioner), began to investigate various complaints of odors emanating from the property. Because the commissioner determined that the plaintiff was maintaining a condition that was reasonably expected to create a source of pollution to the waters of the state in violation of General Statutes § 22a-432, the commissioner issued an order to the plaintiff on July 9, 1990, requiring that she “eliminate soil, surface and groundwater pollution.” Pursuant to General Statutes § 22a-436, the plaintiff requested a hearing to review this order. On June 28, 1991, Lewis J. Miller, a hearingofficer at the department of environmental protection, issued a final decision upholding the order.

Thereafter, the plaintiff appealed to the Superior Court, Maloney, J., which concluded that because the plaintiff had not created the condition that caused the pollution, had not owned the property when it was polluted, and had not acquiesced to its pollution, the commissioner had improperly determined that the plaintiffs passive ownership of the property constituted “maintaining” a condition that reasonably could be expected to create a source of pollution within the meaning of § 22a-432. The trial court further concluded that, because of the commissioner’s failure to comply with the Connecticut Water Pollution Control Act; General Statutes § 22a-416 et seq.; which provides that the commissioner must first attempt to seek reimbursement from those who actually caused the pollution and, only if the commissioner is unsuccessful in securing payment from the polluter can reimbursement be sought from a passive landowner in the form of a lien on the polluted property for the amount of the cleanup costs, the commissioner improperly had found the plaintiff responsible for the cleanup of the property. The commissioner appealed from the judgment of the trial court to this court, and we reversed. See Starr v. Commissioner of Environmental Protection, 226 Conn. 358, 627 A.2d 1296 (1993).

In that case, we concluded that the trial court had failed to give due deference to the commissioner’s interpretation of the word “maintaining” as used in § 22a-432. We reasoned that because “maintaining” is an ambiguous term that can be interpreted to apply to a passive landowner as well as to one who actively created the pollution, and because “it is the well established practice of this court to accord great deference to the construction given [a] statute by the agency charged with its enforcement”; (internal quotation marks omitted) id., 372; the trial court should have deferred to the commissioner’s interpretation. Id., 376. The commissioner’s inteipretation was also supported by the legislative history of the act. Id., 381-90. Additionally, we concluded that neither the language of the act nor its legislative history suggested that the commissioner was required first to attempt to recover from the party responsible for the pollution before the commissioner could impose a lien on the property itself. Rather, we concluded that the intent of the legislature was to provide the commissioner with alternative courses of action and the discretion to choose among them. Id., 390-95. Consequently, we reversed the judgment of the trial court and upheld the commissioner’s order. Id., 395.

While Starr v. Commissioner of Environmental Protection, supra, 226 Conn. 358, was pending before this court, the legislature enacted No. 93-375 of the 1993 Public Acts (P.A. 93-375), entitled “An Act Establishing an Innocent Landowner Defense in Pollution Cases,” codified at General Statutes §§ 22a-452d and 22a-452e. Thereafter, the plaintiff filed a motion for reconsideration pursuant to General Statutes § 4-181a (b) requesting reconsideration of the commissioner’s final decision. That motion was granted and, after a hearing, the commissioner concluded that because the plaintiff had not established that she was an “innocent landowner” within the meaning of the P.A. 93-375, she was therefore fully hable for the cleanup costs. The commissioner reasoned that the plaintiff had not acquired the property by “inheritance or bequest” under § 22a-452d (1) (B) (iii) because, when the decedent died, he did not own the property in question. Rather, the property was owned by three corporations of which the decedent was a majority shareholder. The plaintiff had acquired the property as a result of the dissolution of Dale, Inc., and the distribution of its assets to its shareholders. Consequently, in the commissioner’s view, “the site was not [the decedent’s] to give” and he could not have devised the property to the plaintiff.

Furthermore, the commissioner reasoned that the plaintiff had acquired the property by her own volition in that she willingly had transferred ownership of the property from the estate to herself. According to the commissioner, “[w]hen the legislature enacted P.A. 93-375 limiting the liability of those who acquire polluted land by inheritance or bequest, it surely intended to limit the liability not of those who acquire such land by their own volition, but rather of those upon whom the financial burden of polluted land is involuntarily thrust. Ownership of the polluted land involved here was not thrust by the decedent upon [the plaintiff]; she had the power to dispose of the site entirely as she chose, and she chose to dispose of it by taking title herself.”

Additionally, the commissioner rejected the plaintiffs argument that she did not know, and had no reason to know, of the pollution because she had failed to “[inquire], consistent with good commercial or customary practices, into the previous uses of the property.” General Statutes § 22a-452d (1) (B) (i). The commissioner reasoned that had the plaintiff conducted a reasonable investigation of the property, she would have discovered the pollution.

The plaintiff appealed from the decision of the commissioner to the Superior Court, Hodgson, J., which concluded, inter aha, that although the plaintiff had acquired the property partially by inheritance, because she also had acquired it partially by the liquidation of Dale, Inc., she was not an innocent landowner. Additionally, the trial court determined that because the commissioner had disbelieved the plaintiffs witnesses regarding whether the plaintiff had “inquire[d], consistent with good commercial or customary practices, into the previous uses of the property,” but had failed to present any contrary evidence, the commissioner had improperly relied on evidence not in the record to reach his decision.

In deciding that the plaintiff had not “inherited” the property pursuant to § 22a-452d (1) (B) (iii), the trial court first determined that it was presented with a question of law, namely, whether the plaintiff had inherited the property. The court explained that because “[t]he interpretation of laws concerning inheritance and corporate shares cannot be said to be within the special expertise of the agency headed by the Commissioner of Environmental Protection . . . [the commissioner’s] determination with regard to such issues is not entitled to deference . . . .” Instead, the court independently construed P.A. 93-375 “ ‘to ascertain and give effect to the apparent intent of the legislature.’ ” West Hartford Interfaith Coalition, Inc. v. Town Council, 228 Conn. 498, 507, 636 A.2d 1342 (1994); Vaillancourt v. New Britain Machine/Litton, 224 Conn. 382, 390, 618 A.2d 1340 (1993).

The court then characterized the legal issue before it as “whether the inheritance must be a direct one of land held by the decedent in his own name to an heir, or whether a person who inherits shares that are later converted into real estate has likewise acquired the interest by inheritance.” The trial court concluded that the legislature did not intend the word “inheritance” in § 22a-452d to have the narrow legal definition of intestate distribution of property and that § 22a-452d (1) (B) (iii) does not require that the decedent own the land at the time of his death. The trial court further concluded that “the plaintiffs ownership of the land was at least in part the result of her entitlement pursuant to [General Statutes] § 33-380 to receive a pro rata share of the corporation’s assets corresponding to her pro rata share of the issued stock, and that she [had] acquired this interest by operation of law in her capacity as a shareholder and not by inheritance.” Because the plaintiff owned only one share of stock in the dissolved corporation, however, she necessarily had inherited part of the property through the decedent’s estate, which owned ninety-eight shares. See footnote 1. Having concluded that the plaintiff had acquired the property partially by inheritance and that neither the language of § 22a-452d nor its legislative history indicates that the innocent landowner defense applies to one who acquires land partially by inheritance and partially by other means, the trial court proceeded to evaluate whether the plaintiff was an innocent landowner under § 22a-452d (1) (B) (i) because she had “no reason to know” of the pollution and had “inquire [d], consistent with good commercial or customary practices, into the previous uses of the property.”

At the administrative hearing, the plaintiff had presented the only evidence of what constituted “good commercial or customary practices,” which she claims to have performed in making her inquiries. The commissioner determined “that the plaintiffs witnesses were not credible, that [the commissioner] did not believe their statements to the effect that a cursory investigation was the prevalent practice in and before 1987, and that the plaintiff therefore did not prove her entitlement to immunity by a preponderance of the evidence.” The trial court inferred, therefore, that the commissioner had found that the customary practice was other than what had been described by the plaintiffs witnesses. Because the commissioner, however, had not presented any evidence to confirm what the appropriate customary practice was, which the plaintiff could then have attempted to rebut, the trial court concluded that the commissioner had relied on evidence not in the record and, consequently, that “the [c]ommissioner’s determination that the plaintiff had not proven that she was an innocent landowner pursuant to [§ 22a-452d (1) (B) (i)] was made upon unlawful procedure.” The trial court remanded the case for further proceedings on the issue of whether the plaintiffs inquiry into the previous uses of the property was “consistent with good commercial or customary practices.”

The commissioner appealed and the plaintiff cross appealed from the judgment of the trial court to the Appellate Court, and we transferred the appeal and cross appeal to this court pursuant to Practice Book § 4023 and General Statutes § 51-199 (c). On appeal, the commissioner argues primarily that the trial court incorrectly decided that the commissioner’s determination that the plaintiff had failed to prove that she had inquired into the previous uses of the property consistent with good commercial and customary practices was based on unlawful procedure. In her cross appeal, the plaintiff argues that the trial court incorrectly concluded that she did not acquire the property completely by inheritance and, therefore, incorrectly remanded the case for further proceedings instead of remanding the case with direction that she be afforded the status of innocent landowner. Because we agree with the plaintiff and conclude that she had acquired the property by inheritance as contemplated by § 22a-452d (1) (B) (iii), and because our resolution in favor of the plaintiff on her cross appeal is dispositive of the case, we need not address the issues raised by the commissioner’s appeal.

In deciding whether the plaintiff is an innocent landowner, we must interpret the statute. “Ordinarily, this court affords deference to the construction of a statute applied by the administrative agency empowered by law to cariy out the statute’s purposes. Police Department v. State Board of Labor Relations, [225 Conn. 297, 300, 622 A.2d 1005 (1993)]; Crocetto v. Lynn Development Corporation, 223 Conn. 376, 381, 612 A.2d 1212 (1992). [A]n agency’s factual and discretionary determinations are to be accorded considerable weight by the courts. Lieberman v. State Board of Labor Relations, 216 Conn. 253, 262, 579 A.2d 505 (1990). This case, however, presents a pure question of law, and therefore invokes a broader standard of review than is ordinarily involved in deciding whether, in light of the evidence, the agency has acted unreasonably, arbitrarily, illegally or in abuse of its discretion. Id., 263; State Medical Society v. Board of Examiners in Podiatry, 208 Conn. 709, 718, 546 A.2d 830 (1988). Furthermore, when a state agency’s determination of a question of law has not previously been subject to judicial scrutiny, as in this case, the agency is not entitled to special deference. Lieberman v. State Board of Labor Relations, supra [263]; Connecticut Light & Power Co. v. Department of Public Utility Control, 210 Conn. 349, 357, 554 A.2d 1089 (1989).” (Internal quotation marks omitted.) Dept. of Administrative Services v. Employees’ Review Board, 226 Conn. 670, 678-79, 628 A.2d 957 (1993).

The plaintiff argues in her cross appeal that she is an innocent landowner pursuant to § 22a-452d (1) (B) (iii) because she inherited the property in question. She further argues that the trial court mistakenly concluded that she only partially inherited the property because part of her interest in the property was the result of the dissolution of Dale, Inc. The commissioner, in contrast, maintains that the plaintiff did not inherit the property, but, rather, that she had acquired it by dissolving Dale, Inc., and distributing the corporate assets to its shareholders. We conclude that although the plaintiff did not take title to the property exclusively by inheritance, because her ownership interest in the coiporation was a de minimis formal requirement, she falls within the class of people intended to be protected by the innocent landowner defense.

“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. ... In seeking to discern that intent, we look to the words of the statute itself, to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation. ... In order to determine the meaning of a statute, we must consider the statute as a whole when reconciling its separate parts in order to render a reasonable overall interpretation. . . .” (Citations omitted; internal quotation marks omitted.) Murchison v. Civil Service Commission, 234 Conn. 35, 45, 660 A.2d 850 (1995).

The words of the statute plainly state that one who acquires an interest in real estate after the date of a spill or discharge is not liable for that spill or discharge if the person acquires the interest by “inheritance” or “bequest.” We note first, and the parties no longer dispute, that, in enacting this statute, the legislature did not intend to impose strict legal definitions on the operative words “inheritance” and “bequest.” First, because the legal definition of “bequest” is “[a] gift (transfer) by will of personal property”; Black’s Law Dictionary (6th Ed. 1990); and the statute refers to the acquisition of land, it would be nonsensical to apply the legal definition of “bequest.” Second, if the term “bequest” were so limited, and the legal definition of “inheritance” were used, the statute would apply to acquisitions of land only if the decedent died intestate. There is no reason to believe that the legislature intended such a limited and technical application of the statute. Rather, we view § 22a-452d (1) (B) (iii) as affording the innocent landowner defense to one who acquires land either through the will of a decedent or by the laws of intestate succession. Therefore, the fact that the plaintiff acquired the property through the decedent’s will does not deprive her of the innocent landowner defense.

The legislative history of the statute unequivocally makes clear that it was intended to protect people who have the ownership of polluted property involuntarily thrust upon them, such as those who inherit property. One of the goals of the statute is “to find a balance between, on the one hand, protecting taxpayers from the responsibility of cleaning up private land and, on the other hand, protecting owners who do not cause or contribute to pollution on their land.” Conn. Joint Standing Committee Hearings, Environment, Pt. 2,1993 Sess., p. 613. As Senator John A. Kissel stated, “the case that pulls at our heartstrings is the individual that gains land by inheritance . . . .” 36 S. Proc., Pt. 13, 1993 Sess., p. 4806. Representative Richard D. Tulisano stated that “the bill before us deals with setting up a system in which individuals who otherwise had no control over certain pollution . . . will no longer be hable for cleaning it up.” 36 H.R. Proc., Pt. 32, 1993 Sess., p. 11,440. Representative Tulisano further explained that “[i]t only applies to those people who fit the definition of an innocent landowner. And it is a person who either inherited it, without any knowledge or a trustee who takes in something like that and they are not going to [be] personally liable.” 36 H.R. Proc., Pt. 34, 1993 Sess., pp. 12,275-76. “The innocent landowner is by definition innocent, a stranger to the pollution, as it were. Not one who caused the condition although he or she now owns land . . . that is subject to pollution . . . .’’Id., p. 12,297, remarks of Representative Dale W. Radcliffe. Representative Richard O. Belden agreed with Representative Tulisano that if the land is inherited, “the person who inherited it is free and clear even though the previous owner may have in fact, been a party to [the] pollution . . . .” Id., p. 12,279.

Additionally, the legislative history indicates that even if the person inheriting the land had some knowledge that the land was polluted, that individual would still be entitled to the innocent landowner defense. Representative Angelo M. Fusco had asked: “ [I]f the person knew that the land that they inherited had some contamination, really doesn’t understand the extent or the environmental issue, but they inherited it and . . . weren’t involved in the contamination, this [statute] would give them some protection?” Id., p. 12,287. Representative Tulisano responded to that question by stating “[t]hat is what it is designed to protect.” Id., p. 12,288.

During the Senate debates, Senator Kissel asked whether it is “correct to interpret that this bill, without an inquiry as to whether they knew or reasonably knew of the existence of contamination, that if they acquire the land through inheritance, they are immediately placed in the class of innocent landowner despite any knowledge or reasonableness of their lack of knowledge that may exist . . . .” 36 S. Proc., Pt. 13, 1993 Sess., p. 4804. Senator George C. Jepsen responded that “[i]f they’re already liable for acts they may have committed, they would have remained liable. You cannot cleanse them of that, but apart from that exception, that would be correct.” Id. Senator Kissel further inquired: “Why are we absolving people who acquire the land through inheritance? Why are we not asking whether they knew or had a reasonable belief of lack of knowledge? Why are they being targeted as a class to be immediately made innocent landowners . . . ?” Id. Senator Jepsen replied: “Number one, it conforms with the federal law, and number two, if you think it through, that would be quite a treat to inherit a piece of polluted land from Uncle Bill and find that the — let’s say it was worth a million bucks and there was a $2 million liability for cleanup and what you would in fact inherit, as what Senator Kissel has suggested, is that you would inherit not only the million dollars of land, but the $2 million in cleanup costs. I’m not sure that that’s correct. That’s a nice present from Uncle Bill.” Id., p. 4805.

The commissioner’s argument that the plaintiff did not acquire the property completely by inheritance depends upon the fact that the plaintiff owned one share of Dale, Inc., and, upon its dissolution, received a 1 percent interest in the property. During oral argument, the commissioner agreed that had the decedent owned 100 percent of the shares of stock of the corporations that owned the property at the time of his death, and, consequently, had his estate owned 100 percent of the shares of Dale, Inc., then the plaintiffs acquisition of the property through the estate of the decedent after the dissolution of Dale, Inc., would have conferred upon her the status of an innocent landowner because she would have obtained the property entirely through the decedent’s estate.

We cannot draw a different conclusion on the basis of the technicality that the plaintiff was a 1 percent shareholder because the underlying reality of the transaction is that she acquired the property through the decedent’s estate. Although the legislative history of § 22a-452d (1) (B) (iii) does not expressly address the present situation, we discern from that history that the legislature’s intent in creating the innocent landowner defense was to protect people who have polluted land involuntarily thrust upon them. The plaintiff is one such person. But for the decedent’s death and the distribution of his assets according to the terms of his will, the plaintiff would not have acquired the property. Her 1 percent ownership in the corporations was a mere formality, undoubtedly necessitated by the legal requirement that corporations formed in the 1950s have at least three shareholders. See General Statutes (Rev. to 1958) §§ 33-12 through 33-144; Bator v. United Sausage Co., 138 Conn. 18, 21-22, 81 A.2d 442 (1951); S. Cross, Connecticut Corporation Law and Practice (1994) § 2.4, pp. 30-31 n.45. Although the decedent had given one share of stock to the plaintiff and one to her sister as statutorily required, it is undisputed that he maintained complete control over the corporations. Because we refrain from exalting form over substance, we look to the essence of the transaction. Upon the decedent’s death, the ownership of Don, Inc., Mountview, Inc., and L and S Realty, Inc., fell into his estate. Those corporations were subsequently merged into Dale, Inc., which, consequently, owned the property. Thereafter, the plaintiff transferred ownership of the property to the estate by dissolving Dale, Inc., and then distributed an asset — the property — from the estate to herself, as she was permitted to do under the terms of the will.

The commissioner additionally argues that the plaintiff did not have the ownership of the property involuntarily thrust upon her because she could have either left the property in the estate or renounced the gift. Because she voluntarily transferred the property to herself, the commissioner contends that the plaintiff is not an innocent landowner. We disagree. We cannot fault the plaintiff for doing what the will gave her the authority to do, namely, to distribute assets of the estate to herself. The statute does not place any conditions on the plaintiffs decision to take what she is entitled to under the will. Additionally, according to the legislative history, one of the purposes of the legislature in enacting this statute was to protect those who inherit property, even if they knew that the property was polluted, as long as they had no role in causing the pollution. See 36 H.R. Proc., Pt. 34,1993Sess.,pp. 12,287-88, remarks of Representatives Angelo M. Fusco and Richard D. Tulisano; 36 S. Proc., Pt. 13, 1993 Sess., pp. 4804-4805, remarks of Senators JohnA. Kissel and George Jepsen. There is no indication that the legislature intended that someone who inherits property must first examine the property and his or her options under a will before deciding whether to take the property. Accordingly, because the plaintiff “acquire [d] the interest in real estate by inheritance or bequest” pursuant to § 22a-452d (1) (B) (iii), she is an innocent landowner and is not personally liable for the cost of cleaning up the polluted land.

The judgment is reversed and the case is remanded to the trial court with direction to render judgment for the plaintiff.

In this opinion the other justices concurred.

       The commissioner claims that the distribution of ownership of shares is unclear because the inventory in the Probate Court indicated that the decedent owned between forty-nine and fifty-nine shares of stock in each of these corporations. Because the commissioner adopted the plaintiffs testimony regarding the ownership of these shares, however, it is a finding of fact to which we are bound. See Dalia v. Lawrence, 226 Conn. 51, 71, 627 A.2d 392 (1993); United Parcel Service, Inc. v. Administrator, 209 Conn. 381, 385, 551 A.2d 724 (1988).

       The property is a 44.3 acre parcel located on the east side of Simon Road in Enfield.

       General Statutes § 22a-432 provides: “Order to correct potential sources of pollution. If the commissioner finds that any person has established a facility or created a condition before or after June 25,1985, or is maintaining any facility or condition which reasonably can be expected to create a source of pollution to the waters of the state, he may issue an order to such person to take the necessary steps to correct such potential source of pollution. Any person who receives an order pursuant to this section shall have the right to a hearing and an appeal in the same manner as is provided in sections 22a-436 and 22a-437. If the commissioner finds that the recipient of any such order fails to comply therewith, he may request the attorney general to bring an action in the superior court for the judicial district of Hartford-New Britain to enjoin such person from maintaining such potential source of pollution to the waters of the state or to take the necessary steps to correct such potential source of pollution. All actions brought by the attorney general pursuant to the provisions of this section shall have precedence in the order of trial as provided in section 52-191.”
      Section 22a-432 has been amended by Nos. 95-190 and 95-218 of the 1995 Public Acts, which added language at the end of the text. Those amendments, however, are not relevant to this appeal.

       General Statutes § 22a-436 provides: “Hearing on order to abate. Each order to abate pollution issued under section 22a-428 or 22a-431 or decision to deny under subsection (b) or (c) of section 22a-430 shall be sent by certified mail, return receipt requested, to the subject of such order or decision to deny and shall be deemed issued upon deposit in the mail. Any person who or municipality which is aggrieved by any such order or decision to deny an application without prior hearing under subsection (b) of section 22a-430 may, within thirty days from the date such order or decision is sent, request a hearing before the commissioner. The commissioner shall not grant any request for a hearing at any time thereafter. Alter such hearing, the commissioner shall consider the facts presented to him by the person or municipality, including, but not limited to, technological feasibility, shall consider the rebuttal or other evidence presented to or by him, and shall then revise and resubmit the order to the person or municipality, or inform the person or municipality that the previous order has been affirmed and remains in effect. The request for a hearing as provided for in this section or a decision under subsection (b) of section 22a-430 made after a public hearing shall be a condition precedent to the taking of an appeal by the person or municipality under the provisions of section 22a-437. The commissioner may, after the hearing provided for in this section, or at any time after the issuance of his order, modify such order by agreement or extend the time schedule therefor if he deems such modification or extension advisable or necessary, and any such modification or extension shall be deemed to be a revision of an existing order and shall not constitute a new order. There shall be no hearing subsequent to or any appeal from any such modification or extension.”

       The plaintiff appealed from the commissioner’s final decision to the Superior Court pursuant to General Statutes §§ 22a-437 and 4-183.
      General Statutes § 22a-437 provides: “Appeal, (a) Any person who or municipality which is aggrieved by a decision under subsection (b) of section 22a-430 or by any order of the commissioner other than an order under section 22a-6b, to abate pollution may, after a hearing by the commissioner as provided for in section 22a-436 or subsection (b) of section 22a-430, appeal from the final determination of the commissioner based on such hearing to the superior court as provided in chapter 54. Such appeal shall have precedence in the order of trial as provided in section 52-192.
      “(b) Notwithstanding the provisions of any other statute to the contrary, any appeal by a person or municipality aggrieved by an order of the commissioner to abate pollution, other than an order under section 22a-6b, or by a decision under subsection (b) of section 22a-430, shall be pursuant to this section.”
      General Statutes § 4-183 provides in relevant part: “Appeal to superior court, (a) A person who has exhausted all administrative remedies available within the agency and who is aggrieved by a final decision may appeal to the superior court as provided in this section. The filing of a petition for reconsideration is not a prerequisite to the filing of such an appeal.”

       General Statutes (Rev. to 1991) § 22a-451 provides in relevant part: “Liability for pollution, contamination or emergency. Emergency spill response fund, (a) Any person, firm or corporation which directly or indirectly causes pollution and contamination of any land or waters of the state or causes an emergency through the discharge, spillage, uncontrolled loss, seepage or filtration of oil or petroleum or chemical liquids or solid, liquid or gaseous products or hazardous wastes or which owns any hazardous wastes deemed by the commissioner to be a potential threat to human health or the environment and removed by the commissioner shall be liable for all costs and expenses incurred in containing, removing, monitoring or mitigating such pollution and contamination, emergency or hazardous waste, provided, if such pollution or contamination or emergency was negligently caused, such person, firm or corporation may, at the discretion of the court, be liable for damages equal to one and one-half times the cost and expenses incurred and provided further if such pollution or contamination or emergency was wilfully caused, such person, firm or corporation may, at the discretion of the court, be liable for damages equal to two times the cost and expenses incurred. Upon request of the commissioner, the attorney general shall bring a civil action to recover all such costs and expenses.
      “(b) If the person, firm or corporation which causes any discharge, spillage, uncontrolled loss, seepage or filtration does not act immediately to contain and remove or mitigate the effects of such discharge, spillage, loss, seepage or filtration to the satisfaction of the commissioner, or if such person, firm or corporation is unknown, and such discharge, spillage, loss, seepage or filtration is not being contained, removed or mitigated by the federal government, a state agency, a municipality or a regional or interstate authority, the commissioner may contract with any person issued a permit pursuant to section 22a-454 to contain and remove or mitigate the effects of such discharge, spillage, loss, seepage or filtration. The commissioner may contract with any person issued a permit pursuant to said section 22a-454 to remove any hazardous waste that he deems to be a potential threat to human health or the environment.
      “(c) Whenever the commissioner incurs contractual obligations pursuant to subsection (b) of this section and the responsible person, firm or corporation or the federal government does not assume such contractual obligations, the commissioner shall request the attorney general to bring a civil action pursuant to subsection (a) of this section to recover the costs and expenses of such contractual obligations. If the responsible person, firm or corporation is unknown, the commissioner shall request the federal government, to assume such contractual obligations to the extent provided for by the federal Water Pollution Control Act.”

       General Statutes § 22a-452a provides in relevant part: “State lien against real estate as security for amounts paid to clean up hazardous waste, (a) On and after June 3,1985, any amount paid by the commissioner of environmental protection pursuant to subsection (b) of section 22a-451 to contain and remove or mitigate the effects of a spill shall be a lien against the real estate on which the spill occurred or from which it emanated in accordance with the provisions of this section, except that such lien against real estate which has been transferred in accordance with the provisions of sections 22a-134 to 22a-134d, inclusive, shall not have priority over any previous transfer or encumbrance.”

       General Statutes § 22a-452d provides: “Innocent landowner defense: Definitions. As used in this section, section 22a-452e and section 22a-433:
      “(1) ‘Innocent landowner’ means: (A) A person holding an interest in real estate, other than a security interest, that, while owned by that person, is subject to a spill or discharge if the spill or discharge is caused solely by any one of or any combination of the following: (i) An act of God; (ii) an act of war; (iii) an act or omission of a third party other than an employee, agent or lessee of the landowner or other than one whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the landowner, unless there was a reasonably foreseeable threat of pollution or the landowner knew or had reason to know of the act or omission and failed to take reasonable steps to prevent the spill or discharge, or (iv) an act or omission occurring in connection with a contractual arrangement arising from a published tariff and acceptance for carriage by a common carrier by rail, unless the landowner knew of the act or omission and failed to take reasonable steps to prevent the spill or discharge; or (B) a person who acquires an interest in real estate, other than a security interest, after the date of a spill or discharge if the person is not otherwise liable for the spill or discharge as the result of actions taken before the acquisition and, at the time of acquisition, the person (i) does not know and has no reason to know of the spill or discharge, and inquires, consistent with good commercial or customary practices, into the previous uses of the property; (ii) is a government entity; (iii) acquires the interest in real estate by inheritance or bequest; or (iv) acquires the interest in real estate as an executor or administrator of a decedent’s estate or as a trustee that receives the interest in real estate from a decedent’s estate, provided such decedent was the person holding the interest in real estate.
      “(2) ‘Discharge’ means a discharge causing pollution, as those terms are defined in section 22a-423.
      “(3) ‘Spill’ means a spill as defined in section 22a-452c.”
      Although § 22a-452d (1) (A) (iv) has been amended by No. 95-190, § 7, of the 1995 Public Acts, the amendments are not relevant to this appeal.

       General Statutes § 22a-452e, as amended by Nos. 95-190, § 8, and 95-218, § 17, of the 1995 Public Acts, provides: “Innocent landowner defense: Liability, (a) An innocent landowner holding or acquiring an interest in real estate that has been subjected to a spill or discharge shall not be liable, except through imposition of a lien against that real estate under section 22a-452a, for any assessment, fine or other costs imposed by the state for the containment, removal or mitigation of such spill or discharge or for any order of the commissioner to abate or remediate such spill or discharge which order was issued on or before August 1,1990, and is subject to appeal as of July 1, 1995, and after July 1,1996, for any order to abate or remediate such spill or discharge which order is issued by the commissioner after July 1, 1996. A person claiming immunity under this subsection must establish that he is an innocent landowner by a preponderance of the evidence. In determining whether a person is an innocent landowner, a court may take into account any specialized knowledge or experience of the person, the relationship of the consideration paid for the interest in the real estate to the value of such interest if the real estate were not polluted, commonly known or reasonably ascertainable information about the real estate, the obviousness of the presence or likely presence of the spill or discharge and the ability to detect such spill or discharge by appropriate inspection.
      “(b) Notwithstanding the provisions of subsection (a) of this section: (1) Any amount paid by the commissioner of environmental protection pursuant to subsection (b) of section 22a-451 to contain, remove or mitigate the effects of the spill or discharge shall be a lien against the real estate, as provided by section 22a-452a, in an amount not to exceed the value of the land appraised as if it were uncontaminated and (2) an innocent landowner who sells an interest in real estate that has been subjected to a spill or discharge shall be liable, to the extent of the net proceeds of such sale, for the costs of containing, removing or mitigating the effects of such spill or discharge. For the purposes of this subsection, ‘net proceeds’ means proceeds received by the person after payment of the reasonable expenses of the sale.
      “(c) The liability of a person holding a security interest in real estate who acquires title to the real estate by virtue of a foreclosure or tender of a deed in lieu of foreclosure shall be limited as provided in section 22a-452b.
      “(d) This section shall apply to any spill or discharge which occurred before or after July 6, 1995, except that it shall not affect any enforcement or cost recovery action if such action has become final, and is no longer subject to appeal, prior to July 6, 1995.”

       General Statutes § 4-181a (b) provides: “On a showing of changed conditions, the agency may reverse or modify the final decision, at any time, at the request of any person or on the agency’s own motion. The procedure set forth in this chapter for contested cases shall be applicable to any proceeding in which such reversal or modification of any final decision is to be considered. The party or parties who were the subject of the original final decision, or their successors, if known, and intervenors in the original contested case, shall be notified of the proceeding and shall be given the opportunity to participate in the proceeding. Any decision to reverse or modify a final decision shall make provision for the rights or privileges of any person who has been shown to have relied on such final decision.”

       The plaintiff also claimed in the trial court that the commissioner’s decision was the product of bias and impermissible ex parte communications. Because these issues are not relevant to the appeal before us, we do not discuss the trial court’s disposition of them.

       The court noted § 22a-452d (1) (B) (iv), in contrast, which provides the innocent landowner defense to those who acquire an “interest in real estate as an executor or administrator of a decedent’s estate or as a trustee that receives the interest in real estate from a decedent’s estate, provided such decedent was the person holding the interest in real estate." (Emphasis added.) Because subsection (1) (B) (iii) of that statute does not impose the requirement that the decedent own the real estate at the time of his death, the trial court concluded that ownership of the land by the corporations at the time of the decedent’s death did not affect the plaintiffs status as an innocent landowner under that subsection. Although the commissioner argued in the trial court that corporate ownership of the land meant that it was not the decedent’s to devise to the plaintiff, he does not reassert that claim in this court.

       General Statutes § 33-380 provides in relevant part: “Liquidating distribution of assets, (a) When a dissolved corporation has paid, satisfied and discharged or made adequate provision for all its liabilities and obligations, it shall distribute the remainder of its assets, either in cash or in kind, in one or more liquidating distributions among its shareholders according to their respective rights and interests.”

       The court noted that “[t]he Connecticut Supreme Court has consistently held that in contested cases, [b]efore an administrative agency may lawfully rely on material nonrecord facts within its special knowledge and experience or which it has learned through investigation, it must allow a party adversely affected thereby an opportunity to rebut at an appropriate stage of the proceedings. New England Rehabilitation Hospital of Hartford, Inc. v. Commission on Hospitals & Health Care, 226 Conn. 105, 142, 149 [627 A.2d 1257] (1993) . . . (Citations omitted; internal quotation marks omitted.)

       The plaintiff must establish that she is an innocent landowner by a preponderance of the evidence. See General Statutes § 22a-452e (a).

       The parties do not dispute that the plaintiff acquired the property “after the date of a spill or discharge . . . [and] is not otherwise liable for the spill or discharge as the result of actions taken before the acquisition . . . .” General Statutes § 22a-452d (1) (B).

       We presume that the legislature intended to use the word “devise,” which is the equivalent to “bequest” except that it applies to land. “Devise” is defined as “[a] testamentary disposition of land or realty; a gift of real property by the last will and testament of the donor.” Black’s Law Dictionary (6th Ed. 1990).

       The legal definition of “inheritance” is “[pjroperty which descends to heir on the intestate death of another.” Black’s Law Dictionary (6th Ed. 1990).

       We note that even the legal field has recognized the common usage of the term inheritance. Black’s Law Dictionary provides that the term “inherit” has “also come to mean to receive by devise (i.e., by will).”

         A similar innocent landowner defense provision exists in federal law, as part of the Comprehensive Environmental Response Compensation and Liability Act. 42 U.S.C. § 9601 et seq. (1988).
      Title 42 of the United States Code, § 9607 (b) (1988), provides: “Defenses. There shall be no liability under subsection (a) of this section for a person otherwise liable who can establish by a preponderance of the evidence that the release or threat of release of a hazardous substance and the damages resulting therefrom were caused solely by—
      “(1) an act of God;
      “(2) an act of war;
      “(3) an act or omission of a third party other than an employee or agent of the defendant, or than one whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the defendant (except where the sole contractual arrangement arises from a published tariff and acceptance for carriage by a common carrier by rail), if the defendant establishes by a preponderance of the evidence that (a) he exercised due care with respect to the hazardous substance concerned, taking into consideration the characteristics of such hazardous substance, in light of all relevant facts and circumstances, and (b) he took precautions against foreseeable acts or omissions of any such third party and the consequences that could foreseeably result from such acts or omissions; or
      “(4) any combination of the foregoing paragraphs.”
      Title 42 of the United States Code, § 9601 (1988), provides in relevant part: “For purposes of this subchapter . . .
      “(35) (A) The term ‘contractual relationship,’ for the purpose of section 9607 (b) (3) of this title, includes, but is not limited to, land contracts, deeds or other instruments transferring title or possession, unless the real property on which the facility concerned is located was acquired by the defendant after the disposal or placement of the hazardous substance on, in, or at the facility, and one or more of the circumstances described in clause (i), (ii), or (iii) is also established by the defendant by a preponderance of the evidence:
      “(i) At the time the defendant acquired the facility the defendant did not know and had no reason to know that any hazardous substance which is the subject of the release or threatened release was disposed of on, in, or at the facility.
      “(ii) The defendant is a government entity which acquired the facility by escheat, or through any other involuntary transfer or acquisition, or through the exercise of eminent domain authority by purchase or condemnation.
      “(iii) The defendant acquired the facility by inheritance or bequest.
      “In addition to establishing the foregoing, the defendant must establish that he has satisfied the requirements of section 9607 (b) (3) (a) and (b) of this title.
      “(B) To establish that the defendant had no reason to know, as provided in clause (i) of subparagraph (A) of this paragraph, the defendant must have undertaken, at the time of acquisition, all appropriate inquiry into the previous ownership and uses of the property consistent with good commercial or customary practice in an effort to minimize liability. For purposes of the preceding sentence the court shall take into account any specialized knowledge or experience on the part of the defendant, the relationship of the purchase price to the value of the property if uncontaminated, commonly known or reasonably ascertainable information about the property, the obviousness of the presence or likely presence of contamination at the property, and the ability to detect such contamination by appropriate inspection.”
      Neither our research nor the parties’ briefs reveal any cases that have interpreted § 9601 (35) (A) (iii).

       In making this argument, the commissioner necessarily agrees that § 22a-452d (1) (B) (iii) does not require that the decedent own the land at the time of his death or that the land be in the decedent’s estate at the time of his death. Cf. General Statutes § 22a-452d (1) (B) (iv); see footnote 12.

       Dale, Inc., was incorporated in 1955, Mountview, Inc., was incorporated in 1957, Don, Inc., was incorporated in 1958, and L and S Realty, Inc., was incorporated in 1959.

       The plaintiff testified during the second hearing before the commissioner that “[i]n 1950, [the decedent] went into business, and I started to raise a family, so he said to me, ‘You raise the family and take care of the house and keep your nose . . . out of my business,’ and that’s exactly how it was to the day he died.”

       Indeed, the duty to inquire as to the previous uses of the property involves a separate provision of the innocent landowner defense. See General Statutes § 22a-452d (1) (B) (i).


source: Caselaw Access Project

author: PER CURIAM.

license: Public Domain

text:
    FEDERAL DEPOSIT INSURANCE CORPORATION v. STEPHEN C. BOMBERO
    (15285)
    Peters, C. J., and Callahan, Borden, Katz and Palmer, Js.
    Argued March 20
    officially released April 30, 1996

      Robert C. Pinciaro, with whom, on the brief, were Serge G. Mihaly and Richard G. Kascak, for the appellant (defendant).

      Jonathan S. Bowman, with whom were Monte E. Frank and, on the brief, Alexander H. Schwartz, for the appellee (plaintiff).
   PER CURIAM.

The only issue in this certified appeal is whether, under the circumstances of this case, a foreclosing mortgagee was entitled to a court order discharging the lien of a junior judgment lienholder who mistakenly had been omitted from the foreclosure proceedings. The plaintiff, the Federal Deposit Insurance Corporation, is the successor in interest to BankMart, which held a defaulted first mortgage on property owned by Gary Knauf. The defendant, Stephen C. Bombero, is a judgment creditor of Knauf who recorded on the Knauf property a judgment lien that was junior to three previously recorded encumbrances on that property. The plaintiff filed an application to discharge the defendant’s lien on moneys that, by stipulation of both parties, had been placed in escrow in substitution for the defendant’s recorded judgment lien on the Knauf property. The trial court rendered a judgment granting the plaintiffs application. The defendant then appealed to the Appellate Court, which affirmed the judgment of the trial court. Federal Deposit Ins. Corp. v. Bombero, 37 Conn. App. 764, 657 A.2d 668 (1995). Although we thereafter granted the defendant’s petition for certification to challenge the propriety of the discharge of his lien, we now hold that our grant of certification was improvident. The defendant’s appeal therefore must be dismissed.

After examining the record on appeal and after considering the briefs and the arguments of the parties, we have concluded that the record in this case does not afford us an opportunity to undertake a searching examination of the statutory or common law rights of mistakenly omitted lienholders in foreclosure proceedings. The Appellate Court determined that the trial court had properly found that, at all relevant times, the defendant’s lien, although valid as a matter of law, was worthless as amatter of fact. Id., 769-71. We have not certified a further examination of this fact-bound issue. The Appellate Court properly relied on this factual finding in rejecting the defendant’s contention that, by stipulating to the substitution of moneys in escrow for the defendant’s recorded lien on the Knauf property, the plaintiff had automatically conferred upon the defendant the right to recover the full face amount of his hen. Id., 772-73. On this record, we are persuaded that further amplification of the certified issue would serve no useful purpose. See Transportation General, Inc. v. Dept. of Insurance, 236 Conn. 75, 77, 670 A.2d 1302 (1996); State v. Laccone, 235 Conn. 746, 747, 669 A.2d 1213 (1996).

The appeal is dismissed.

       We granted the petition of the defendant for certification to appeal, limited to the following issue: “In the circumstances of this case, did the Appellate Court properly affirm the discharge of the lien of a judgment lienholder who had mistakenly been omitted from foreclosure proceedings?” Federal Deposit Ins. Corp. v. Bombero, 234 Conn. 908, 659 A.2d 1208 (1995).


text:
    RONALD NASH ET AL. v. THE WEED AND DURYEA COMPANY ET AL.
    (15284)
    Peters, C. J., and Callahan, Borden, Katz and Palmer, Js.
    Argued March 20
    officially released April 30, 1996

      Brace L. Elstein, with whom, on the brief, was Henry Elstein, for the appellants (named defendant et al.).

      Kenneth E. Lenz, for the appellee (named plaintiff).
   PER CURIAM.

The sole issue in this appeal is whether the trial court abused its discretion in granting a prejudgment remedy in an action to recover unpaid commissions. The plaintiffs, Ronald Nash and Scaizo Realty, Inc., brought an action in several counts against the defendants, The Weed and Duryea Company, Peter G. Huidekoper, Jan E. Cohen and Arnold H. Foster, for breach of contract, unjust enrichment and tortious interference with the plaintiffs’ rights to commissions arising out of the sale of the business and assets of The Weed and Duryea Company. Pursuant to General Statutes § 52-278d, the plaintiffs filed an application for a prejudgment remedy. After a hearing, the trial court issued an order granting a prejudgment remedy to Nash in the amount of $150,000 and denying a prejudgment remedy to Scalzo Realty. In accordance with General Statutes § 52-2781, the defendants filed a timely appeal in the Appellate Court, which we transferred to this court pursuant to Practice Book § 4023 and General Statutes § 51-199 (c). We affirm the judgment of the trial court.

The defendants argue that the trial court improperly ordered a prejudgment remedy in favor of Nash because, in their view, Nash had no right, as a matter of law, to a commission on the sale of the business and assets of The Weed and Duryea Company. This argument is premised on the proposition that the sale of The Weed and Duryea Company principally involved the sale of real estate, and on the fact that Nash admittedly has no license to broker or to sell real estate in Connecticut. See General Statutes § 20-325a.

The trial court, however, agreed with Nash that the business sales contract on which Nash seeks to recover a commission “does not concern real property.” The contract between Nash and The Weed and Duryea Company expressly provided that any part of the overall sales transaction affecting the transfer of real property would be covered under a separate real estate addendum. Accordingly, the defendants thereafter entered into a separate contract with Scalzo Realty, Inc., a licensed real estate broker, for the sale of the real estate. Furthermore, the trial court found that the commission claimed by Nash “does not include the value of the real property . . . .” On this basis, the trial court determined that there was “sufficient evidence to find probable cause that Nash will be successful on his commission claim.”

In the absence of a procedural flaw in prejudgment remedy proceedings; see, e.g., Hotz Corp. v. Carabetta, 226 Conn. 812, 816-17, 629 A.2d 377 (1993); appellate courts have only a limited role to play in reviewing a trial court’s broad discretion to deny or to grant a prejudgment remedy. “It is the trial court that must determine, in light of its assessment of the legal issues and the credibility of the witnesses, whether a plaintiff has sustained the burden of showing probable cause to sustain the validity of its claim. We decide only whether the determination of the trial court constituted clear error.” Greenberg, Rhein & Margolis, Inc. v. Norris-Faye Horton Enterprises, Inc., 218 Conn. 162, 166, 588 A.2d 185 (1991); Bank of Boston Connecticut v. Schlesinger, 220 Conn. 152, 156-57, 595 A.2d 872 (1991); New England Land Co. v. DeMarkey, 213 Conn. 612, 620-21, 569 A.2d 1098 (1990); Augeri v. C. F. Wooding Co., 173 Conn. 426, 429, 378 A.2d 538 (1977). The defendants in this case have not sustained their burden of showing clear error.

The judgment is affirmed.

       General Statutes § 52-278d provides in relevant part: “Hearing on prejudgment remedy application. Determination by the court. Service of process. Stay of order. Posting of bond by plaintiff, (a) The defendant shall have the right to appear and be heard at the hearing. The hearing shall be limited to a determination of (1) whether or not there is probable cause that a judgment in the amount of the prejudgment remedy sought, or in an amount greater than the amount of the prejudgment remedy sought, taking into account any defenses, counterclaims or set-offs, will be rendered in the matter in favor of the plaintiff, (2) whether payment of any judgment that may be rendered against the defendant is adequately secured by insurance, (3) whether the property sought to be subjected to the prejudgment remedy is exempt from execution, and (4) if the court finds that the application for the prejudgment remedy should be granted, whether the plaintiff should be required to post a bond to secure the defendant against damages that may result from the prejudgment remedy or whether the defendant should be allowed to substitute a bond for the prejudgment remedy. If the court, upon consideration of the facts before it and taking into account any defenses, counterclaims or set-offs, claims of exemption and claims of adequate insurance, finds that the plaintiff has shown probable cause that such a judgment will be rendered in the matter in the plaintiffs favor in the amount of the prejudgment remedy sought and finds that a prejudgment remedy securing the judgment should be granted, the prejudgment remedy applied for shall be granted as requested or as modified by the court. . . .”

       General Statutes § 52-278Í provides in relevant part: “Appeal, (a) An order (1) granting or denying a prejudgment remedy following a hearing under section 52-278d . . . shall be deemed a final judgment for purposes of appeal.
      “Ob) No such appeal shall be taken except within seven days of the rendering of the order from which the appeal is to be taken.”

       General Statutes § 20-325a provides in relevant part: “Actions to recover commissions arising out of real estate transactions. ... (a) No person who is not licensed under the provisions of this chapter, and who was not so licensed at the time he performed the acts or rendered the services for which recovery is sought, shall commence or bring any action in any court of this state, after October 1,1971, to recover any commission, compensation or other payment in respect of any act done or service rendered by him, the doing or rendering of which is prohibited under the provisions of this chapter except by persons duly licensed under this chapter.”


author: PETERS, C. J.

text:
    HERBERT S. NEWMAN AND PARTNERS, P.C. v. CFC CONSTRUCTION LIMITED PARTNERSHIP ET AL.
    (15197)
    Peters, C. J., and Borden, Berdon, Norcott and Katz, Js.

      Argued February 13
    officially released April 30, 1996

      Richard C. Robinson, with whom, on the brief, was Susan S. Chambers, for the appellants (defendants).

      Thomas J. Shortell, with whom, on the brief, was Kerry R. Callahan, for the appellee (plaintiff).
   PETERS, C. J.

The principal issue in this appeal is whether contracting parties who, pursuant to General Statutes § 49-41, execute a public works construction payment bond may expand the coverage of the bond beyond the coverage required by the statute. The plaintiff, Herbert S. Newman and Partners, P.C., is an architectural firm that rendered services in connection with a public works project. The plaintiff brought an action against the defendants, CFC Construction Limited Partnership (CFC), which was the successor in interest to the general contractor on the public works project and the principal on the payment bond for the project, and National Union Fire Insurance Company of Pittsburgh, Pennsylvania (National Union), the surety on the bond. The plaintiff asserted a claim for damages against CFC for breach of contract and sought payment under the bond from both defendants for services it had rendered pursuant to the contract. The defendants denied the plaintiffs claim that it was owed compensation for services rendered. After a hearing, the trial court rendered judgment for the plaintiff. The defendants appealed jointly from the judgment of the trial court to the Appellate Court, and we transferred the appeal to this court pursuant to Practice Book § 4023 and General Statutes § 51-199 (c). We affirm the judgment of the trial court.

The following facts are undisputed. In 1986, Chase Enterprises authorized the plaintiff to begin rendering architectural services for the development of a design concept for a new city hall building in New Haven. On February 11, 1988, Enterprise Construction Company, Inc. (Enterprise), an entity affiliated with Chase Enterprises, entered into an owner-contractor agreement with the city of New Haven for the construction of the new city hall building. The owner-contractor agreement identified the plaintiff as the architect on the project.

CFC, another entity affiliated with Chase Enterprises, subsequently assumed Enterprise’s obligations under the owner-contractor agreement. Pursuant to § 49-41, CFC furnished the city with a payment bond in the amount of $11,827,644. Under the terms of the payment bond, CFC, as principal, and National Union, as surety, bound themselves to make payments promptly to all claimants supplying labor, services or materials for the city hall project. The payment bond incorporated by reference the owner-contractor agreement and expressly provided that the bond was furnished pursuant to § 49-41. On July 13, 1989, the city consented to CFC’s substitution as general contractor on the city hall project. On July 14, 1989, the city and CFC amended the owner-contractor agreement to reflect the assumption by CFC of Enterprise’s obligations under the agreement.

On June 21,1990, the city sent CFC a notification that it was terminating CFC’s status as general contractor on the city hall project, effective seven days after CFC’s receipt of the notification. On June 25, 1990, CFC received the city’s notice of termination. On July 2,1990, in accordance with the city’s notice of termination, CFC relinquished control of the project to the city. Additional facts will be discussed as they become relevant to the issues before us.

On June 25,1991, the plaintiff commenced this action against the defendants, seeking payment of its invoices, interest, costs and attorney’s fees. The plaintiffs amended complaint alleged that CFC, as principal, and National Union, as surety, were liable to the plaintiff under the terms of the payment bond for services that the plaintiff had rendered pursuant to its contract with CFC. The defendants denied that they owed the plaintiff compensation for those services, raised several special defenses to the plaintiffs claims and filed a counterclaim against the plaintiff for indemnity for any sums awarded against them in pending litigation.

Specifically, the defendants claimed that the plaintiff was barred from recovering under its contract with CFC because, inter aha: (1) the plaintiff had failed to obtain a necessary contract modification for payment of the services for which it sought compensation; and (2) CFC’s obhgations under the contract had been discharged under the doctrine of accord and satisfaction. The defendants also claimed that, even if CFC were hable under its contract with the plaintiff, the plaintiff was not entitled to rehef under the payment bond because: (1) the plaintiff had failed to estabhsh that its services fell within the coverage of the bond; and (2) the plaintiff had failed to commence its action on the bond in a timely manner. The defendants further claimed that, even if the plaintiff could recover under the payment bond, the plaintiff was not entitled to recover under the bond for services that it had rendered after the city had terminated the owner-contractor agreement.

The trial court concluded that CFC had failed to perform its contract with the plaintiff. The trial court also concluded that the defendants were hable to the plaintiff on the payment bond for services that the plaintiff had rendered pursuant to its contract with CFC and for which it had not received compensation. The trial court rendered judgment for the plaintiff on both the complaint and the counterclaim, and awarded the plaintiff $184,793.02, plus costs and interest.

I

The defendants’ primary claim is that the work performed by the plaintiff is not covered by the payment bond that CFC furnished for the city hall project. The defendants contend that, as a matter of law, the coverage of a payment bond executed pursuant to § 49-41 cannot be broader than the coverage required by the statute, and that the statute expressly protects only “persons supplying labor or materials.” The defendants further contend that the plaintiff can recover on the payment bond as a “[person] supplying labor or materials” only for services that it rendered on the project job site and that, because the plaintiff did not distinguish between services it had rendered at the job site and services it had rendered away from the job site, it failed to establish its entitlement to recovery on the bond. We need not determine whether the defendants’ interpretation of § 49-41 is correct, however, because we conclude that the coverage of a payment bond executed pursuant to § 49-41 can be broader than the coverage required by the statute and that in this case the bond executed by the defendants expressly covered the services rendered by the plaintiff.

We first address the defendants’ claim that a payment bond executed pursuant to § 49-41 cannot establish broader protection than that required by the statute. Our analysis of this issue “is guided by well established principles of statutory construction. Statutory construction is a question of law and therefore our review is plenary. . . . [0]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature. ... In seeking to discern that intent, we look to the words of the statute itself, to the legislative history and circumstances surrounding its enactment, to the legislative policy it was designed to implement, and to its relationship to existing legislation and common law principles governing the same general subject matter.” (Citations omitted; internal quotation marks omitted.) State v. Burns, 236 Conn. 18, 22-23, 670 A.2d 851 (1996); HUD/Barbour-Waverly v. Wilson, 235 Conn. 650, 656, 668 A.2d 1309 (1995).

“As with any issue of statutory interpretation, our initial guide is the language of the statute itself.” HUD/ Barbour-Waverly v. Wilson, supra, 235 Conn. 656; see Frillici v. Westport, 231 Conn. 418, 430, 650 A.2d 557 (1994). Section 49-41 sets forth the requirements for a public works construction payment bond. We have consistently recognized that the provisions of § 49-41 are to be incorporated into a payment bond that is executed pursuant to the statute. See American Masons’ Supply Co. v. F. W. Brown Co., 174 Conn. 219, 225, 384 A.2d 378 (1978); International Harvester Co. v. L. G. DeFelice & Son, Inc., 151 Conn. 325, 333, 197 A.2d 638 (1964); New Britain Lumber Co. v. American Surety Co., 113 Conn. 1, 5, 154 A. 147 (1931). In accordance with the plain and unambiguous language of § 49-41, however, the coverage of a payment bond need not be limited to the coverage required by the statute. With exceptions not at issue in this case, § 49-41 (b) provides that “[njothing in this section or sections 49-41a to 49-43, inclusive, shall be construed to limit the authority of any contracting officer to require a performance bond or other security in addition to the bond herein referred to .. . .” (Emphasis added.) Thus, § 49-41 expressly contemplates that the parties to a payment bond, although they must provide the coverage required by the statute, may incorporate additional provisions that expand the coverage required by the statute. See New Britain Lumber Co. v. American Surety Co., supra, 6-7.

The legislative purpose in enacting § 49-41 supports the conclusion that a payment bond executed pursuant to § 49-41 may provide protection that is broader than that required by the statute. Section 49-41 is a remedial statute enacted to protect workers and materials suppliers on public works projects who cannot avail themselves of otherwise available remedies such as mechanic’s liens. See Okee Industries, Inc. v. National Grange Mutual Ins. Co., 225 Conn. 367, 373, 623 A.2d 483 (1993); Nor’easter Group, Inc. v. Colossale Concrete, Inc., 207 Conn. 468, 477-79, 542 A.2d 692 (1988); Pelton & King, Inc. v. Bethlehem, 109 Conn. 547, 556, 147 A. 144 (1929). The statute’s provisions are to be liberally construed to effect its remedial purpose. Okee Industries, Inc. v. National Grange Mutual Ins. Co., supra, 373; International Harvester Co. v. L. G. DeFelice & Son, Inc., supra, 151 Conn. 333. The construction of § 49-41 proffered by the defendants, which would limit payment bond coverage for those parties whom § 49-41 was enacted to protect to the coverage expressly required by the statute, would frustrate the very purpose that the statute was designed to further.

Moreover, federal precedents reflect the principle that statutory requirements establish only a floor of protection beneath which the coverage of a payment bond cannot fall, rather than an upper limit upon the scope of a bond’s coverage. Because § 49-41 was patterned after and operates in general conformity with federal legislation popularly known as the Miller Act; 40 U.S.C. §§ 270a through 270e; “we have regularly consulted federal precedents to determine the proper scope of our statute.” Okee Industries, Inc. v. National Grange Mutual Ins. Co., supra, 225 Conn. 374; see O & G Industries, Inc. v. New Milford, 229 Conn. 303, 309, 640 A.2d 110 (1994); American Masons' Supply Co. v. F. W. Brown Co., supra, 174 Conn. 223-24. As the United States Supreme Court observed in United States v. Car ter, 353 U.S. 210, 215-16, 77 S. Ct. 793, 1 L. Ed. 2d 776 (1957), “liability on a Miller Act bond must be at least coextensive with the obligations imposed by the Act if the bond is to have its intended effect.” (Emphasis added.)

Thus, in light of the plain language of § 49-41, the purposes underlying the statute, and the United States Supreme Court’s construction of the Miller Act, we are persuaded that contracting parties who execute a payment bond pursuant to § 49-41 have the authority to expand coverage beyond that required by the statute. Accordingly, we must examine the terms of the payment bond executed by the defendants in this case in order to ascertain the extent of protection afforded therein to the plaintiff.

The payment bond that CFC furnished for the city hall project provided in relevant part: “Any party, whether a subcontractor or otherwise, who furnishes materials or supplies or performs labor or services in the prosecution of the work under said contract, and who is not paid therefor, may bring a suit on this bond in the name of the person suing, prosecute the same to a final judgment, and have execution thereon for such sum or sums as may be justly due.” (Emphasis added.) By including services as well as labor, without limitation to where the services were to be rendered, the terms of the payment bond afforded protection for the services rendered by the plaintiff. We conclude, therefore, that the payment bond’s explicit language permits the plaintiff to recover under the bond for the architectural services it rendered.

The defendants claim, however, that other language, elsewhere in the payment bond, restricts the bond’s coverage to that required by § 49-41. The defendants focus on the following provision of the payment bond: “NOW, THEREFORE, the condition of this obligation is such that, if the said Principal shall promptly pay for all materials furnished and labor supplied or performed in the prosecution of the work included in and under the aforesaid contract, whether or not the material or labor enters into and becomes a component part of the real asset, then this obligation shall be null and void, otherwise it shall remain and be in full force and effect.” We agree with the plaintiff that, at most, this provision, when read together with the other provisions of the payment bond, raises an ambiguity concerning the scope of the bond’s coverage. “Since the bond was furnished by the defendants, it must be inteipreted most strongly against them.” Brookfield v. Greenridge, Inc., 177 Conn. 527, 535, 418 A.2d 907 (1979); see Mongillo v. Commissioner of Transportation, 214 Conn. 225, 231, 571 A.2d 112 (1990); Hartford Electric Applicators of Thermalux, Inc. v. Alden, 169 Conn. 177, 182, 363 A.2d 135 (1975). In accordance with this rule of construction, we construe the payment bond’s “labor or services” provision as the controlling coverage provision in the bond. The architectural services rendered by the plaintiff, therefore, fall within the scope of the payment bond’s coverage.

Although the defendants could have limited the coverage of the payment bond to the terms set forth in § 49-41, they did not do so. “[I]n private disputes, a court must enforce the contract as drafted by the parties and may not relieve a contracting party from anticipated or actual difficulties undertaken pursuant to the contract, unless the contract is voidable on grounds such as mistake, fraud or unconscionability.” Holly Hill Holdings v. Lowman, 226 Conn. 748, 756, 628 A.2d 1298 (1993); see Collins v. Sears, Roebuck & Co., 164 Conn. 369, 377, 321 A.2d 444 (1973). The defendants are knowledgeable and commercially sophisticated parties. They do not claim that there were improprieties in the contract formation process. In the absence of any other countervailing policy reason, they are bound by the express terms of the payment bond that they themselves drafted and executed. It is axiomatic that courts do not rewrite contracts for the parties. Heyman v. CBS, Inc., 178 Conn. 215, 227, 423 A.2d 887 (1979); see Bank of Boston Connecticut v. Schlesinger, 220 Conn. 152, 159, 595 A.2d 872 (1991); Jay Realty, Inc. v. Ahearn Development Corp., 189 Conn. 52, 55, 453 A.2d 771 (1983). Accordingly, we will give effect to the payment bond’s express terms, which extend protection on the bond to those parties, such as the plaintiff, who “performfed] labor or services in the prosecution of the work under” the owner-contractor agreement.

II

The defendants have raised several additional claims challenging the liability of CFC under its contract with the plaintiff and the liability of both defendants on the payment bond. The trial court rejected each of these other claims and concluded that the plaintiff was entitled to relief under the contract and on the payment bond. We are not persuaded by any of the defendants’ arguments to the contrary.

A

The defendants claim that the trial court improperly concluded that CFC had failed to perform its contract with the plaintiff. Specifically, the defendants contend that payment for the services for which the plaintiff sought compensation required a modification of the contract. The defendants further contend that because CFC and the plaintiff had never modified the contract, CFC never became obligated to pay the plaintiff for those services. We are unpersuaded.

The following additional facts are relevant to this issue. The plaintiff seeks compensation for services defined in the contract as “project representation beyond basic services.” The contract specified that the plaintiff and CFC were required to modify the contract before such services would be compensable. On June 30,1988, CFC acceded to the plaintiffs request for compensation for project representation beyond basic services, and the parties agreed that the plaintiffs invoices for such services would not exceed $6000 per month.

Subsequent to the June 30, 1988 modification, however, the plaintiffs monthly invoices for project representation beyond basic services consistently exceeded $6000. CFC consistently paid these invoices without protest until the beginning of 1990. The trial court found that the plaintiffs billing and CFC’s payment in excess of the $6000 per month spending cap constituted a valid modification that abrogated the spending cap. We agree with the trial court.

For a valid modification to exist, there must be mutual assent to the meaning and conditions of the modification and the parties “must assent to the same thing in the same sense.” (Internal quotation marks omitted.) Lar-Rob Bus Corp. v. Fairfield, 170 Conn. 397, 402, 365 A.2d 1086 (1976); see First Hartford Realty Corp. v. Ellis, 181 Conn. 25, 33, 434 A.2d 314 (1980). Modification of a contract may be inferred from the attendant circumstances and conduct of the parties. See Rowe v. Cormier, 189 Conn. 371, 372-73, 456 A.2d 277 (1983); Malone v. Santora, 135 Conn. 286, 292, 64 A.2d 51 (1949).

Whether the parties to a contract intended to modify the contract is a question of fact. Three S. Development Co. v. Santore, 193 Conn. 174, 177-78, 474 A.2d 795 (1984); Rowe v. Cormier, supra, 189 Conn. 373. “The resolution of conflicting factual claims falls within the province of the trial court. . . . The trial court’s findings are binding upon this court unless they are clearly erroneous in light of the evidence and the pleadings in the record as a whole. . . . We cannot retry the facts or pass on the credibility of the witness.” (Citations omitted; internal quotation marks omitted.) Nor’easter Group, Inc. v. Colossale Concrete, Inc., supra, 207 Conn. 473.

Upon review of the entire record, we can find no reason to disturb the trial court’s finding that the plaintiff and CFC modified, through their course of conduct, the June 30, 1988 agreement. The trial court’s factual findings and ultimate conclusion are adequately supported by the record and are not clearly erroneous. Practice Book § 4061; see Pandolphe’s Auto Parts, Inc. v. Manchester, 181 Conn. 217, 221-22, 435 A.2d 24 (1980). Accordingly, the condition precedent to CFC’s payment obligations under the contract occurred, and CFC’s subsequent failure to satisfy its obligations constituted a breach of contract.

B

The defendants also claim that the trial court improperly determined that the plaintiff and CFC had not executed an accord that effectively discharged CFC’s obligations under its contract with the plaintiff. We agree with the trial court that the defendants failed to establish the existence of a valid accord.

The following additional facts are relevant to this issue. Beginning in early 1990, CFC disputed the plaintiffs claims for compensation for architectural services and refused to pay the plaintiffs invoices. The parties subsequently negotiated with one another in an attempt to resolve their disagreement over the plaintiffs compensation. On March 27, 1990, the plaintiff agreed to accept and CFC agreed to pay $200,000 to settle their dispute.

On April 6, 1990, CFC tendered to the plaintiff a $100,000 check, which represented the first of three payments. A letter that accompanied the check stated that the remaining $100,000 due the plaintiff pursuant to the parties’ March 27,1990 agreement would be paid in two installments of $50,000 each. The letter stated that CFC would pay the first $50,000 at the end of April, 1990, and the second $50,000 “upon substantial completion of the [city hall] project.” CFC believed that the $200,000 payment would compensate the plaintiff for future services as well as for all outstanding invoices. The plaintiff cashed the $100,000 check. On April 12,1990, the plaintiff wrote a letter to CFC, notifying it that the letter that had accompanied the $100,000 payment had inaccurately described the March 27,1990 agreement. According to the plaintiffs letter, the second $50,000 payment was due on May 28, 1990, rather than, as CFC had claimed, upon substantial completion of the project. The plaintiffs letter also disputed CFC’s calculation of the amount that it had paid the plaintiff for architectural services. The parties subsequently communicated with one another, but never resolved these issues.

In early May, 1990, CFC tendered, and the plaintiff accepted, the first $50,000 payment. CFC never tendered the second $50,000 payment. When CFC failed to pay the second $50,000 according to the plaintiffs understanding of the March 27, 1990 agreement, the plaintiff credited the $150,000 that it had received against CFC’s outstanding balance and resumed its prior billing process.

“When there is a good faith dispute about the existence of a debt or about the amount that is owed, the common law authorizes the debtor and the creditor to negotiate a contract of accord to settle the outstanding claim.” County Fire Door Corp. v. C. F. Wooding Co., 202 Conn. 277, 281, 520 A.2d 1028 (1987). “An accord is a contract between creditor and debtor for the settlement of a claim by some performance other than that which is due. Satisfaction takes place when the accord is executed.” W. H. McCune, Inc. v. Revzon, 151 Conn. 107, 109, 193 A.2d 601 (1963). Without a mutual assent, or a “meeting of the minds,” there cannot be a valid accord. Crucible Steel Co. v. Premier Mfg. Co., 94 Conn. 652, 656, 110 A. 52 (1920).

The trial court found that there had been no mutual assent between the plaintiff and CFC in the discussions that had led to the March 27,1990 purported settlement agreement, and therefore concluded that the parties had not entered into a valid accord. The trial court’s finding is amply supported by the evidence, which established that the parties had disputed the terms of the settlement agreement. The letter sent by the plaintiff in response to CFC’s letter that accompanied its $100,000 payment recited a disagreement as to the timing of the second $50,000 payment, and a further disagreement as to the compensation that CFC had previously paid the plaintiff. In light of this evidence, the trial court’s finding that there was no mutual assent between the parties, a necessary predicate for the existence of a valid accord, was not clearly erroneous.

The defendants claim that, even if the plaintiff and CFC did not execute a valid accord on March 27, 1990, the plaintiffs subsequent cashing of the $100,000 check constituted an acceptance of the terms contained in the letter that accompanied the check. We disagree. If a creditor knowingly cashes or otherwise exercises full dominion over a check explicitly tendered in full satisfaction of an unliquidated debt, the creditor cannot disown any conditions upon which the check has been tendered. County Fire Door Corp. v. C. F. Wooding Co., supra, 202 Conn. 281, 291-92; see General Statutes § 42a-3-311. In this case, however, the $100,000 check was neither tendered in Ml satisfaction of CFC’s debt to the plaintiff nor tendered on condition of the terms contained in the letter that accompanied the check. The $100,000 check, by CFC’s own admission, was tendered as a partial payment of the debt owed to the plaintiff. Moreover, the letter that accompanied the check merely stated CFC’s understanding of the parties’ purported settlement agreement, and neither the letter nor the check conditioned acceptance of the check on the terms contained in the letter. Because conditions necessary for a valid accord have not occurred, the defendants’ claim of accord and satisfaction premised on the plaintiffs cashing of the $100,000 check must fail.

C

The defendants further claim that, even if the services rendered by the plaintiff fall within the scope of the payment bond, the trial court improperly found that the plaintiff had commenced its action on the bond within the one year time limitation prescribed by General Statutes § 49-42 (b). We are unpersuaded.

Section 49-42 (b) requires a claimant to commence a suit on a payment bond within one year of the day that the claimant last performed work or supplied materials on the bonded project. See footnote 7; see also American Masons' Supply Co. v. F. W. Brown Co., supra, 174 Conn. 222. The plaintiff commenced its action on June 25, 1991, the date on which it caused its complaint to be served on each of the defendants. Rana v. Ritacco, 236 Conn. 330, 337, 672 A.2d 946 (1996) (action commenced when process served on defendant). The trial court found that the plaintiff had rendered necessary services on the city hall project pursuant to its contract with CFC within one year of this date. The trial court’s findings are supported by the testimony of Rai Muhlbauer, an employee of the plaintiff who worked on the city hall project. Muhlbauer testified that on June 25, 1990, prior to the effective termination date of the owner-contractor agreement, he had performed various tasks at the project job site pursuant to the owner-contractor agreement. The trial court credited Muhlbauer’s testimony. Although the defendants contend that the testimony of another employee of the plaintiff established that the plaintiff had not been working pursuant to the owner-contractor agreement after June 21, 1990, this court cannot retry the facts or pass on the credibility of witnesses. Holy Trinity Church of God in Christ v. Aetna Casualty & Surety Co., 214 Conn. 216, 223, 571 A.2d 107 (1990); Kimberly-Clark Corp. v. Dubno, 204 Conn. 137, 153, 527 A.2d 679 (1987).

In light of the trial court’s findings, which have not been shown to be clearly erroneous, the plaintiff worked on the city hall project, pursuant to the owner-contractor agreement and to its contract with CFC, within one year of the commencement of its action against the defendants. Accordingly, the plaintiff timely commenced its action against the defendants for compensation under the payment bond.

D

Lastly, the defendants claim that, even if they are liable on the payment bond, the plaintiff is not entitled to recover on the bond for services that it rendered after the owner-contractor agreement had terminated on July 2, 1990. The defendants contend that when the city terminated the owner-contractor agreement, services subsequently rendered by the plaintiff on the city hall project were outside of that agreement. The trial court determined that the defendants were estopped from raising this claim. We agree with the trial court.

The following additional facts are relevant to this issue. Both defendants protested the city’s termination of CFC as general contractor on the city hall project. The defendants also informed the city and the plaintiff that the city’s termination of the owner-contractor agreement had no legal effect. Subsequent to CFC’s receipt of the city’s notice of termination, CFC directed the plaintiff to continue working on the project pursuant to the owner-contractor agreement.

It is well established that any recovery premised on estoppel must be supported by proof of two essential elements: (1) the party against whom estoppel is claimed must be shown to have done or said something calculated or intended to induce another party to believe that certain facts exist and to act on that belief; and (2) the other party must be shown to have changed its position in reliance on those facts, thereby incurring some injury. Lunn v. Tokeneke Assn., Inc., 227 Conn. 601, 607, 630 A.2d 1335 (1993); O’Sullivan v. Bergenty, 214 Conn. 641, 648, 573 A.2d 729 (1990). An estoppel is predicated on proof of misleading conduct resulting in prejudice to the other party. John F. Epina Realty, Inc. v. Space Realty, Inc., 194 Conn. 71, 85, 480 A.2d 499 (1984). The party claiming estoppel has the burden of proof, and whether it has met that burden in a particular case is an issue of fact. Middlesex Mutual Assurance Co. v. Walsh, 218 Conn. 681, 699, 590 A.2d 957 (1991).

The trial court found that the defendants, through their conduct, had induced the plaintiff to continue working on the city hall project. The trial court also found that the plaintiff, on the basis of the defendants’ conduct, had continued to render services pursuant to the owner-contractor agreement after CFC’s status as general contractor had terminated on July 2, 1990, and that the plaintiff had been injured thereby. In light of these findings, which the defendants have not demonstrated to be clearly erroneous, the trial court properly determined that the defendants were estopped from denying payment for work performed by the plaintiff after July 2, 1990. The plaintiff, therefore, was entitled to recover on the payment bond for services that it rendered after the city had terminated the owner-contractor agreement.

The judgment is affirmed.

In this opinion the other justices concurred.

       General Statutes § 49-41 provides: “Public structures. Bonds for protection of employees and materialmen, (a) Each contract exceeding twenty-five thousand dollars in amount for the construction, alteration or repair of any public building or public work of the state or of any subdivision thereof shall include a provision that the person to perform the contract shall furnish to the state or the subdivision on or before the award date, a bond in the amount of the contract which shall be binding upon the award of the contract to that person, with a surety or sureties satisfactory to the officer awarding the contract, for the protection of persons supplying labor or materials in the prosecution of the work provided for in the contract for the use of each such person, provided no such bond shall be required to be furnished (1) in relation to any general bid in which the total estimated cost of labor and materials under the contract with respect to which such general bid is submitted is less than twenty-five thousand dollars, (2) in relation to any sub-bid in which the total estimated cost of labor and materials under the contract with respect to which such sub-bid is submitted is less than fifty thousand dollars, or (3) in relation to any general bid or sub-bid submitted by a design professional, as defined in section 4b-55. Any such bond furnished shall have as principal the name of the person awarded the contract.
      “(b) Nothing in this section or sections 49-41a to 49-43, inclusive, shall be construed to limit the authority of any contracting officer to require a performance bond or other security in addition to the bond herein referred to, except that no such officer shall require a performance bond in relation to any general bid in which the total estimated cost of labor and materials under the contract with respect to which such general bid is submitted is less than twenty-five thousand dollars or in relation to any sub-bid in which the total estimated cost of labor and materials under the contract with respect to which such sub-bid is submitted is less than fifty thousand dollars.”

       The defendants’ amended answer alleged that the city had asserted claims against CFC for untimely performance on the city hall project. The answer further alleged that the plaintiff was liable to CFC for indemnity in that litigation because the plaintiffs failure to perform or, in the alternative, negligent performance had caused any untimely performance by CFC.

       Because the terms of the payment bond executed by the defendants expressly extended the bond’s protection to services without restricting the location of performance, we need not decide in this case whether, as the defendants assert, the statutory protection for “persons supplying labor or materials” in § 49-41 (a) encompasses only those persons who render professional services at a project site.

       The order in which we address the various remaining issues raised in this appeal is not the order in which the parties addressed the issues. If CFC had no contractual obligation to the plaintiff, however, the plaintiff would not be entitled to compensation under the payment bond. See American Oil Co. v. Valenti, 179 Conn. 349, 352-53, 426 A.2d 305 (1979); Murphy v. Schwaner, 84 Conn. 420, 425, 80 A. 295 (1911). Accordingly, we address the defendants’ claims based on the contract between the plaintiff and CFG before we address the defendants’ remaining claims based on the payment bond.

       The plaintiff and CFC never fully executed an agreement for architectural services. The parties did, however, adopt as their contract the proposed architectural services agreement that the plaintiff had sent to Chase Enterprises on June 30, 1988, and both the plaintiff and CFC performed their obligations pursuant to the terms of that agreement. The defendants do not dispute that a valid contract existed between the plaintiff and CFC.

       General Statutes § 42a-3-311 provides: “Accord and satisfaction by use of instrument, (a) If a person against whom a claim is asserted proves that (i) that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, (ii) the amount of the claim was unliquidated or subject to a bona fide dispute, and (iii) the claimant obtained payment of the instrument, the following subsections apply.
      “(b) Unless subsection (c) applies, the claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.
      “(c) Subject to subsection (d), a claim is not discharged under subsection (b) if either of the following applies:
      “(1) The claimant, if an organization, proves that (i) within a reasonable time before the tender, the claimant sent a conspicuous statement to the person against whom the claim is asserted that communications concerning disputed debts, including an instrument tendered as full satisfaction of a debt, are to be sent to a designated person, office, or place, and (ii) the instrument or accompanying communication was not received by that designated person, office, or place.
      “(2) The claimant, whether or not an organization, proves that within ninety days after payment of the instrument, the claimant tendered repayment of the amount of the instrument to the person against whom the claim is asserted. This paragraph does not apply if the claimant is an organization that sent a statement complying with paragraph (1) (i).
      “(d) A claim is discharged if the person against whom the claim is asserted proves that within a reasonable time before collection of the instrument was initiated, the claimant, or an agent of the claimant having direct responsibility with respect to the disputed obligation, knew that the instrument was tendered in full satisfaction of the claim.”

       General Statutes § 49-42 provides in relevant part: “Enforcement of right to payment on bond. Suit on bond, procedure and judgment. . . .
      “(b) Every suit instituted under this section shall be brought in the name of the person suing, in the superior court for the judicial district where the contract was to be performed, irrespective of the amount in controversy in the suit, but no such suit may be commenced after the expiration of one year after the applicable payment date provided for in subsection (a) of section 49-41a, or, in the case of a person supplying materials or performing subcontracting work not included on a requisition or estimate, no such suit may be commenced after the expiration of one year after the date such materials were supplied or such work was performed.”