Franchi v. Farmholme, Inc.
Franchi v. Farmholme, Inc.
Opinion of the Court
On June 30, 1977, the defendant, Farmholme, Inc. (Farmholme), purchased a 200 acre estate in Stonington for $300,000, financed by $280,000 in mortgages'. This property included a main house, a guest house, a caretaker’s cottage and various outbuildings. Thereafter, around June, 1978, and for some time prior to September 6,1979, the defendant John W. S.
Under an arrangement between the parties, McCormick and his family continued to remain on the premises in the main house. Franchi occupied the guest home on occasion. Pursuant to an undertaking by McCormick to maintain the property, he hired Robert Conley as caretaker. Early in 1980, relations between McCormick
On March 24, 1980, the defendants instituted eviction proceedings against Conley, and on May 13,1980, they cut off the utilities to his house. On May 16,1980, the plaintiffs sought and obtained an ex parte injunction from Judge Spallone, who waived the requirement of a bond.
Both parties, by subsequent pleadings including the defendants’ special defense of equitable mortgage and their counterclaim,
On appeal, the defendants have claimed a number of errors in the trial court. They are: (1) that the original writ, summons and complaint presented by the plaintiffs to Judge Spallone was void ab initio and furnished no legal basis for issuing an injunction or any order; (2) that the striking of the defendants’ timely claim for the jury docket denied them their constitutional right to a trial by jury; and (3) that the transaction between the parties involved an equitable mortgage as a matter of law. An additional claim regarding an evidentiary ruling we do not consider for failure of the defendants to comply with Practice Book § 3060F (c) (3). The remaining claims are subsumed under the three categories set forth above.
We first take up the claim in which the defendants attack jurisdiction. See Salamandra v. Kozlowski, 173 Conn. 136, 139, 376 A.2d 1103 (1977); Atwood v. Regional School District No. 15, 169 Conn. 613, 616, 363 A.2d 1038 (1975). They argue that General Statutes § 52-185 requires a bond for prosecution “before proc
Section 52-185 (a) provides in part that “[i]f the plaintiff in any civil action is not an inhabitant of this state . . . the plaintiff shall, before the process is signed, enter into a recognizance to the adverse party with a financially responsible inhabitant of this state as surety . . . that the plaintiff shall prosecute his action to effect and answer all costs for which judgment is rendered against him. . . .” Initially, the plaintiffs did not comply with this provision. After the defendants filed their motion to dismiss, but before a decision thereon, the plaintiffs filed a recognizance in the statutory form. See General Statutes § 52-185 (b). They did this pursuant to General Statutes § 52-128 and Practice Book §175. This statute permits the plaintiff to “amend any
It must be recognized that even under our state constitution no party has a right to trial by jury in an equitable action.
Our case law has spoken to the resolution of factual issues in the context of actions essentially equitable or essentially cognizable at law. In National Bank of Commerce of New London v. Howland, supra, 310, we said: “Where incidental issues of fact are presented in an action essentially equitable, the court may determine them without a jury in the exercise of its equitable powers. Doris v. McFarland, 113 Conn. 594, 608, 156 Atl. 52 [1931]. Where, however, the essential basis of the action is such that the issues presented would be
Against the background of the foregoing principles, we look to the pleadings in this case. “[T]he true test of a right to a jury trial is whether the cause of action stated (rather than merely the relief claimed) is essentially legal as distinguished from essentially equitable.” Flanigan v. Foley, 20 Conn. Sup. 12, 13, 119 A.2d 741 (1955); see National Bank of Commerce of New London v. Howland, supra; LaFrance v. LaFrance, supra, 152; Berry v. Hartford National Bank & Trust Co., supra, 618. “Under our law the form of relief demanded makes little difference on the question of whether a case is entitled to a jury trial.” Fitzgerald v. Sullivan, 12 Conn. Sup. 206, 206-207 (1943).
Both the complaint as amended and the counterclaim must be examined. An inspection of the complaint as amended discloses that the plaintiffs claimed ownership of the premises by a warranty deed in September, 1979, from Farmholme, that by verbal agreement between the plaintiffs and Farmholme the defendants McCormick “were to be allowed to continue to live” in one of the houses (the main house) on the premises
In passing, we do note that their original complaint asked for permanent and temporary injunctive relief.
The defendants filed an answer admitting the conveyance to the plaintiffs as alleged and putting in issue the remaining allegations of the complaint. They interposed a special defense alleging their ownership, that the deed alleged was not intended as an absolute conveyance but was intended as a mortgage to secure a debt and that the deed was a vehicle used to evade the usury statutes.
They also filed a counterclaim alleging that they still own the property and are in possession, that the warranty deed given the plaintiffs was really a mortgage and served to carry out the plaintiffs’ unconscionable “loan.” They allege that the option agreement to repurchase was part of the plaintiffs’ plan to “evade usury laws and to defraud defendants.” They also claim that Franchi, “by false representations and guile,” got permission to occupy the guest home temporarily “as a guest”; that he now claims the rights to permanent occupation; and that he has harassed the McCormick family and that he has conspired with Conley, whom he now employs, and others to prevent the defendants from the use and enjoyment of their home, “all of which was planned and contrived to defraud the defendants.”
By way of relief the defendants asked for a judgment holding that the transaction between the parties was an equitable mortgage and declaring that it was
In this case legal title is not in dispute. In paragraph 1 of the complaint the plaintiffs allege that Farmholme conveyed the subject property to the plaintiffs by warranty deed. “To ‘convey’ real estate is, by an appropriate instrument, to transfer the legal title to it from the present owner to another.” Abendroth v. Greenwich, 29 Conn. 356, 365 (1860). In their answer the defendants admitted this paragraph and such admission was conclusive upon them. Lutkus v. Kelly, 170 Conn. 252, 257, 365 A.2d 816 (1976); Bridgeport v. Stratford, 142 Conn. 634, 646, 116 A.2d 508 (1955).
The essence of the dispute is contained in the defendants’ special defense. Paragraph 1 of the defense alleges that the defendants are “the owners of and in possession of all the premises described in the complaint.” Paragraph 2 spells out the quality of that ownership. It alleges that “[t]he deed referred to in paragraph 1 of the complaint was delivered to the plaintiffs for grossly inadequate consideration, was never intended as an absolute conveyance; was, in fact, intended as security for a debt and therefore must be regarded as a mortgage.” Here again the defendants concede that they intended to transfer legal title to the plaintiffs but only as security for a debt. They allege that the deed, though absolute on its face, must be regarded as a mortgage.
Ordinarily when we refer to a person as having title to land we mean that he has both the legal and beneficial interests in it. Consolidated Diesel Electric Corporation v. Stamford, 156 Conn. 33, 38, 238 A.2d 410 (1968). “He who has the possession, the right of possession and the right of property has a perfect title.” Shelton v. Alcox, 11 Conn. 240, 249 (1836). But the legal and beneficial interests are not one and the same. The trial court observed that the dispute involved the issue of ownership of the subject premises, and in one sense that is so. When one person has legal title and the other claims to have equitable title which the first person denies, there is a dispute about ownership but that dispute does not necessarily involve legal title especially if legal title is admitted. It is only when legal title is in dispute that the issue of fact in that dispute is triable by jury. Indeed in an action of ejectment if the plain
The principal defendant is Farmholme. The other defendants are Lewis Payton, president of Farmholme, and John and Victoria McCormick. Although the McCormicks reside on the property they assert no independent right of possession. Thus the claims of Payton and the McCormicks rise or fall with Farmholme’s. Whether viewed on the basis of the state of the pleadings or of the claims advanced at the trial there was no issue of fact properly triable by jury.
The defendants assert finally that the transaction was intended to be an equitable mortgage. They claim that the evidence presented to the court could not possibly lead to any other logical conclusion than that the entire transaction was intended to be refinancing or an equitable mortgage. We are unpersuaded.
At the outset we note that the defendants do not seriously challenge the legal principles applied by the trial court. In essence the defendants ask us to retry the case. This we will not do. “The controlling consideration in determining whether a transaction is a sale or a mortgage is the intention of the parties, ascertained in view of all the circumstances, as to the purpose which the transaction is to effectuate.” Guilford-Chester Water Co. v. Guilford, 107 Conn. 519, 527, 141 A. 880 (1928). Intention is an inference of fact. Hughes v. Contemporary Mission, Inc., 180 Conn. 150, 152, 429 A.2d 827 (1980). As such, the findings of the trial court
On the evidence before it, the trial court could reasonably have found, as it did, that this transaction was a sale of real estate between the parties with an option to repurchase that had expired rather than an equitable mortgage.
There is no error.
In this opinion Shea and Borden, Js., concurred.
At the trial, McCormick testified that his business was that of a “real estate broker.”
This option was never exercised.
General Statutes § 52-472 provides: “Sec. 52-472. bond on issue of temporary injunction. No temporary injunction may be granted, except in favor of the state or of a public officer thereof in respect to any matter of a public nature, until the party making application therefor gives bond, with surety satisfactory to the court or judge granting the injunction, to the opposite party, to answer all damages in case the plaintiff fails to prosecute the action in which the injunction is applied for to effect; provided a bond need not be required when, for good cause shown, the court or a judge is of the opinion that a temporary injunction ought to issue without bond.”
The recognizance appended to the “amendment” was the following:
“You, Thomas A. Bishop, a substantial inhabitant of this state, acknowledge yourself bound to the defendants in this action in a recognizance of $150 that the plaintiffs in this action shall prosecute the action which they have commenced against the said defendants at the superior court to be holden at New London, in and for the Judicial District of New London, on June 24, 1980, to full effect and that they shall pay any costs for which judgment may be rendered against them thereon.
“Taken and acknowledged at Groton, Connecticut, on the 18th day of June A.D., 1980, before me, Thomas B. Wilson, Commissioner of the Superior Court.”
The return date was June 24, 1980.
In the record the counterclaim is sometimes referred to as the cross complaint.
The plaintiffs’ “Motion to Strike from Jury Docket” noted the following:
“The plaintiffs in the above entitled action move to strike the case from
the jury docket for the reason that the case presents questions properly cognizable in equity and is not triable by jury under § 52-215 of the general statutes.
“A memorandum in support of this motion is attached hereto.
THE PLAINTIFFS By James F. Brennan, Jr.
Their Attorney”
The application for the ex parte temporary injunction included a “Motion for Waiver of Bond” which the court, Spallone, J., granted. That motion recited the following:
“The plaintiffs, by their attorney, respectfully request that the court waive any requirement that they post a bond in this matter because
“(1) they are both presently in California;
“(2) the relief sought will not cause any monetary loss to the defendants even if the plaintiffs do not prevail;
“(3) they will upon proper motion by the defendant post any bond the court may order.
“WHEREFORE, the plaintiffs respectfully request that the requirement of the bond be waived as permitted by Section 52-472 of the Connecticut General Statutes.”
We note that what is now § 52-185 (d) was added to this statute in 1939, some years after the decision in Morse v. Rankin, 51 Conn. 326 (1883), cited as authority by the defendants. See also 1 Stephenson, Conn Civ. Proc. (2d Ed. 1970) § 79 (g).
As of July 1,1978, the plea in abatement as well as the motion to erase are no longer permitted under our rules of practice. The motion to dismiss was properly utilized by the defendants in asserting this claim.
The United States constitutional guarantee of a right to a jury trial established by the seventh amendment applies only in the federal courts. See Olesen v. Trust Co. of Chicago, 245 F.2d 522, 524 (7th Cir.), cert. denied, 355 U.S. 896, 78 S. Ct. 270, 2 L. Ed. 2d 193 (1957); Gluck v. Gluck, 181 Conn. 225, 227, 435 A.2d 35 (1980).
The United States Supreme Court has said that “the Seventh Amendment was never intended to establish the jury as the exclusive mechanism for factfinding in civil cases.” Atlas Roofing Co. v. Occupational Safety & Health Review Commission, 430 U.S. 442, 460, 97 S. Ct. 1261, 51 L. Ed. 2d 464 (1977).
The relief sought was the following: restraining the defendants and their representatives “from preventing or interfering with” the efforts of the plaintiffs and their representatives to provide electrical and water service to the caretaker’s house and the guest house; restraining the defendants and their representatives from “locking or otherwise preventing . . . access” by the plaintiffs and their representatives to the well house, bam
Dissenting Opinion
(dissenting). I dissent because I believe that the defendants were denied their constitutional right of trial by jury.
The majority states that the legal title is not in issue and, in doing so, points to the admission of paragraph 1 of the complaint as being conclusive upon them. They “show” this admission up by pointing out that the “essence of the dispute” is in the defendants’ special defense which “spells out the quality of that ownership” they allege in paragraph 1 of that defense.
The trial court’s memorandum of decision begins by stating clearly that “the case has resolved itself to the issue of ownership of the premises and which party should be made to vacate the premises,” and it ends by stating that “[¡'Judgment will enter for the plaintiff with the right of exclusive ownership and possession of the premises as against the defendants . . . .’’The judgment file demonstrates exactly the same. In addition, the plaintiffs’ brief states that “[bjoth parties, by subsequent pleadings, claimed title to and exclusive possession of the property and each sought an order directing their opponents to vacate the premises.” Significantly, and it cannot be oversight, the plaintiffs never suggested in their brief nor in argument that the defendants’ answer to paragraph 1 put the issue of title to rest at all. We are not, under such circumstances,
In fairness to the litigants, it can be said that the determination of whether a claim is legal or equitable is an “elusive question,” and it requires an appraisal of the basic nature of the issues presented, including the relief sought. Flanigan v. Foley, 20 Conn. Sup. 12, 119 A.2d 741 (1955); Cyr v. Cote, 396 A.2d 1013 (Me. 1979); Portland Pipe Line Corporation v. Environmental Improvement Commission, 307 A.2d 1 (Me.), appeal dismissed, 414 U.S. 1035, 94 S. Ct. 532, 38 L. Ed. 2d 326 (1973). It is crucial, however, to remember, as the majority have not, that “the constitu
In this case, in the trial court and in this court basically, without labels, “[t]he question involved was one of title, which ordinarily equity will not try; nor will it take property out of the possession of one and put it in the possession of another, but will leave the parties to settle their doubtful right first at law.” Welbrot v. Levenberg, 98 Conn. 217, 222, 118 A. 911 (1922); see Lacassagne v. Chapuis, 144 U.S. 119, 124, 12 S. Ct. 659, 36 L. Ed. 368 (1892); National Bank of Commerce of New London v. Howland, 128 Conn. 307, 310, 22 A.2d 773 (1941); Roy v. Moore, supra, 162; Robinson v. Robinson, 73 Me. 170,176 (1882); Glickmah v. Kastel, 323 Mass. 148, 149-50, 80 N.E.2d 469 (1948); 1 High, Injunctions (2d Ed.) § 355. No one claims that the judgment, as well as the trial court’s memorandum of decision, was not responsive to the relief sought, ownership and possession. See Linahan v. Linahan, 131 Conn. 307, 330, 39 A.2d 895 (1944). Would the majority, therefore, deny that had the trial court decided for the defendants and not the plaintiffs it would have found ownership and possession in the defendants? The
The constitutional right to trial by jury cannot be abridged in those cases where the right existed when the 1818 constitution was adopted. Gentile v. Altermatt, 169 Conn. 267, 298-99, 363 A.2d 1 (1975), appeal dismissed, 423 U.S. 1041, 96 S. Ct. 763, 46 L. Ed. 2d 631 (1976); Swanson v. Boschen, 143 Conn. 159, 162, 120 A.2d 546 (1956); La Croix v. County Commissioners, 50 Conn. 321, 327 (1882). “The right to a jury trial of the issues of title and possession existed prior to the adoption of our Constitution, and hence exists now. La Croix v. County Commissioners, 50 Conn. 321, 327 [1882].” Roy v. Moore, supra, 167. The majority not only abridges this right but endorses its violation.
I dissent, and I would find error and remand for a new trial before a jury.
Paragraph 1, in fu]l, alleges: “At all times pertinent, defendants were and still are the owners of and in possession of all the premises described in the complaint.”
“ ‘A counterclaim is a cause of action existing in favor of a defendant and against a plaintiff which a defendant pleads to diminish, defeat or otherwise affect a plaintiffs claim and also allows a recovery by the defendant.’ ” Nickerson v. Martin, 34 Conn. Sup. 22, 28, 374 A.2d 258 (1976); see Williams v. Dumais, 34 Conn. Sup. 247, 250, 385 A.2d 686 (1977); Seligson v. Chase Manhattan Bank, National Assn., 50 App. Div. 2d 206, 376 N.Y.S.2d 899 (1975).
Dissenting Opinion
(dissenting). I concur in the dissenting opinion of Justice Healey and respectfully register my dissent for additional reasons.
The majority concedes that when legal title is the issue of fact, the issue as to the fact is triable by a jury. That is the issue in this case. It is not an “incidental” issue of fact as suggested by the majority and thus equitable in nature. The majority thereupon notes that the defendants admit to having conveyed a warranty deed. Such an allegation is not necessarily binding upon the trier and it may be disregarded. Peiter v. Degenring, 136 Conn. 331, 338, 71 A.2d 87 (1949). The entire pleadings and all the issues raised are to be examined and not merely one part of a party’s pleadings. 47 Am. Jur. 2d, Jury § 39.
Reference
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- Sergio Franchi Et Al. v. Farmholme, Inc., Et Al.
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