DocketNumber: No. CV 90 0110054
Citation Numbers: 1996 Conn. Super. Ct. 3978
Judges: LEWIS, JUDGE.
Filed Date: 4/26/1996
Status: Non-Precedential
Modified Date: 4/17/2021
The defendants filed an answer denying that the conveyance described in the complaint was fraudulent as claimed by the plaintiff. The plaintiff subsequently withdrew the suit as to the defendant Glass.
This case was referred to Attorney Dennis G. Eveleigh, an attorney trial referee, in accordance with General Statutes §
The attorney trial referee concluded on the basis of the above findings of fact that: (1) Galasso received no consideration from his wife for the transfer to her of the Haviland Road premises; (2) there was no evidence of fraudulent intent on the part of either Galasso; (3) the plaintiff did not prove by clear and convincing evidence that the conveyance to Mrs. Galasso rendered Galasso insolvent or unable to pay his debts at the time of said transfer; and (4) his contingent liabilities, which were not in default at the time of the transfer, should not be considered in determining whether Galasso was insolvent.
The plaintiff moved to correct the report pursuant to Practice Book § 438. It sought corrections to reflect that: (1) Galasso signed a personal financial statement that as of August 30, 1988, indicated that he still owned the Haviland Road premises, although he had previously, on August 10, 1988, quit-claimed his interest therein to his wife, Suzanne Galasso, and that the plaintiff relied on this representation of ownership in accepting a personal guarantee from Galasso; (2) Galasso had a continuing obligation to make his financial statement accurate CT Page 3981 because the statement itself provides that the plaintiff "may consider this statement as continuing to be true and correct until a written notice of a change is given to you by the undersigned," and that Galasso never advised the plaintiff at the time of the loan to Jeda in January, 1989, of the conveyance to his wife; (3) the plaintiff acted in a commercially reasonable manner in accord with industry practices in relying on a financial statement that was less than six months old at the time the loan to Jeda closed; and (4) contingent liabilities should be considered in analyzing Galasso's financial condition, citingTachten v. Boyarsky,
In response to the motion to correct filed by the plaintiff, the attorney trial referee declined to make any changes in his report or recommendation that judgment enter in favor of the Galassos with respect to the claim of a fraudulent conveyance. The referee did, however, discuss the claims asserted by the plaintiff, and correctly pointed out that the complaint does not allege a cause of action in fraud or misrepresentation with respect to the personal financial statement executed by Galasso, nor does the complaint allege a failure of Galasso to update his financial statement by disclosing the quit-claim deed to his wife. The complaint seeks to set aside the deed to Mrs. Galasso on the ground that it was a fraudulent conveyance. The issue in this regard, according to the referee, was whether the conveyance rendered Galasso unable to meet his financial obligations. The referee reiterated his factual finding that even subtracting the value of the Haviland Road premises, Galasso still had over $400,000 of assets at the time of his financial statement, and also when the loan to Jeda closed.
As to the claim that contingent liabilities should be counted in determining Galasso's financial status, the referee found as a fact that these liabilities were not in default at the time of the loan to Jeda, and he added that the plaintiff had not presented any evidence as to the amount of security Galasso might have posted to secure such "construction loans" and therefore such security could be a higher amount than the contingent liabilities themselves.
The plaintiff then filed exceptions to the referee's report pursuant to Practice Book § 439. The exceptions repeat the CT Page 3982 claims asserted in its motion to correct. The file, however, does not indicate that the plaintiff included a transcript with its exceptions, as required by Practice Book § 439. This means that the referee's findings of fact must stand uncorrected and may not be disturbed. Without a transcript, these findings cannot be evaluated to determine whether they find support in the transcript. Hence, the referee's report must be viewed as if no exceptions had been filed. A failure to file valid exceptions constitutes in effect a waiver of the right to "attack the subordinate factual findings contained in the report." SeeBernard v. Gershman,
As to this court's scope of review of an attorney trial referee's report regarding the facts of a given case, the Supreme Court has stated that: (1) the trial court may not "retry the case"; and (2) a court may not find additional facts or reject facts found by the referee unless, in the words of Practice Book § 439, "a material fact has been found without evidence or the [referee] has failed to find an admitted or undisputed fact, or has found a fact in such doubtful language that its real meaning does not appear." Dills v. Enfield,
In addition to determining whether "there was . . . evidence to support the attorney trial referee's factual findings," the second task of the reviewing court is to decide whether "the conclusions reached were in accordance with the applicable law."Thermoglaze, Inc. v. Morningside Gardens. Co.,
The file, however, indicates that the plaintiff did not file objections to the acceptance of the referee's report, Practice Book § 440, meaning that the plaintiff has waived any right to claim that the referee's conclusions were not properly reached CT Page 3983 on the basis of the subordinate facts that were found, or that there were errors in rulings on the admission of evidence or in other rulings. Rostenberg-Doern Co. v. Weiner,
In any event, after hearing the evidence, the attorney trial referee found that Galasso was not rendered unable to pay his obligations when he transferred the family home to his wife. The conveyance in this case occurred in 1988, and thus preceded the enactment of Public Act No. 91-297, codified as General Statutes §
A leading case interpreting §
With respect to counting contingent liabilities, the two cases cited by the plaintiff are not applicable to this case. The court in Tachten v. Boyarsky, supra,
Based on the standard of review in Dills v. Enfield,
supra,
The referee recommended that judgment should enter in favor of the plaintiff against the named defendant, Jeda, the exact amount of which to be determined by this court upon the filing by the plaintiff of a current affidavit of debt, which would include interest, late charges, etc., as provided in said promissory note. The referee also recommended that judgment enter against the plaintiff and in favor of the Galassos in connection with the claim of a fraudulent conveyance. These recommendations are accepted and judgment enters in accordance therewith, except to add that judgment in the same amount entered in the first count against Jeda should also enter against defendant Daniel Galasso, Jr., who, according to the referee, personally guaranteed payment of said note.
Costs are to be taxed by the clerk.
So Ordered.
Dated at Stamford, Connecticut, this 26th day of April, 1996.
William B. Lewis, Judge CT Page 3985