Court Opinion

ID: 4370872
Source: CourtListenerOpinion
Date Created: 2019-02-25 20:02:36.84876+00
Date Added: 2024-06-11T11:59:02.079393
License: Public Domain

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          RESTAURANT SUPPLY, LLC v. GIARDI
               LIMITED PARTNERSHIP
                     (SC 20154)
                   Robinson, C. J., and Palmer, D’Auria,
                      Mullins, Kahn and Ecker, Js.

                                  Syllabus

Pursuant to statute (§ 42a-2-328 [3]), a sale of goods by auction is with
   reserve unless the goods are in explicit terms put up without reserve,
   and, in an auction without reserve, after the auctioneer calls for bids,
   the article cannot be withdrawn unless no bid is made within a reason-
   able time.
The plaintiff, R Co., brought an action seeking, inter alia, specific perfor-
   mance of an alleged agreement to purchase certain real property in
   Hartford owned by the defendant G Co. R Co.’s complaint alleged that,
   after G Co. had received multiple offers for its property, it requested
   that all prospective buyers submit their highest and best offers. R Co.
   further claimed that it had submitted the highest and best offer but that
   G Co. did not accept that offer and, instead, accepted a purportedly
   lower offer submitted by H Co. While R Co.’s action was pending, G
   Co. executed a special warranty deed conveying the property to H Co.
   R Co. thereafter added H Co. as a defendant and amended its complaint,
   adding a second count against H Co. G Co. and H Co. thereafter each
   moved to strike the count of the amended complaint directed at them,
   which R Co. opposed. R Co. claimed that, by alleging that G Co. had
   requested that buyers submit their highest and best offers, it had suffi-
   ciently pleaded the existence of an auction without reserve, which con-
   tractually bound G Co. to accept the bid submitted by R Co., the highest
   bidder, and created an enforceable agreement that was an exception to
   the requirement of the statute of frauds that there be a writing signed
   by the party to be charged in order for it to be enforceable. The trial
   court granted the motions to strike, concluding that the statute of frauds
   barred R Co.’s claim and rejecting R Co.’s argument that G Co.’s request
   for the highest and best offers constituted an auction without reserve.
   Held that the trial court properly granted the motions to strike filed by
   G Co. and H Co., R Co. having failed to plead in its amended complaint
   that its offer either complied with the statute of frauds or fell within
   an exception thereto; R Co. acknowledged that it failed to plead that
   G Co. explicitly stated that it was selling its property in an auction
   without reserve, R Co.’s amended compliant failed to mention the words
   ‘‘auction’’ or ‘‘bid,’’ or to describe or attach the document or communica-
   tion constituting the auction or bid, and, even if this court were to
   assume that R Co.’s amended complaint sufficiently alleged an auction,
   R Co.’s allegation that G Co. used the phrase ‘‘highest and best’’ offers,
   without more, did not indicate that G Co. intended to be bound by the
   highest and best offer, and, therefore, R Co.’s allegation was insufficient
   to plead an auction without reserve.
     Argued November 5, 2018—officially released February 12, 2019

                            Procedural History

   Action for, inter alia, specific performance of an
alleged agreement to purchase certain of the named
defendant’s real property, and for other relief, brought
to the Superior Court in the judicial district of Hartford,
where the court, Noble, J., granted the plaintiff’s motion
to add Hartford Auto Park, LLC, as a defendant; there-
after, the plaintiff filed an amended complaint; subse-
quently, the court, Noble, J., granted the defendants’
motions to strike and rendered judgment thereon, from
which the plaintiff appealed. Affirmed.
  Kerry M. Wisser, with whom, on the brief, was Sarah
Black Lingenheld, for the appellant (plaintiff).
  Johanna S. Katz, with whom was Richard C. Rob-
inson, for the appellee (named defendant).
  John F. Conway, with whom was James E. Ringold,
for the appellee (defendant Hartford Auto Park, LLC).
                           Opinion

   KAHN, J. The present appeal requires us to consider
whether a plaintiff has sufficiently pleaded that a trans-
action was an auction without reserve by simply alleg-
ing that the owner of the real property for sale sought
highest and best offers from potential buyers and the
plaintiff submitted the highest and best offer, and, if
so, whether an auction without reserve for the sale of
real property creates an enforceable agreement consti-
tuting an exception to the statute of frauds. The plaintiff,
Restaurant Supply, LLC, appeals1 from the trial court’s
judgment rendered after it had granted motions to strike
by the defendants, Giardi Limited Partnership (Giardi)
and Hartford Auto Park, LLC (Hartford Auto Park). The
court determined that the plaintiff failed to allege that
Giardi’s request that potential buyers of its property, 19
and 43 West Service Road, Hartford (property), submit
their highest and best offers constituted an auction
without reserve and, thus, created an exception to the
requirement under the statute of frauds that there be
a ‘‘writing . . . signed by the party . . . to be charged
. . . .’’2 General Statutes § 52-550 (a). The parties dis-
agree as to whether the plaintiff’s allegation that
Giardi’s request for ‘‘ ‘[h]ighest and [b]est’ offers’’ con-
stitutes ‘‘explicit terms’’ that Giardi was putting the
property up for auction without reserve for purposes
of General Statutes § 42a-2-328 (3).3 We conclude that,
under the facts of this case, the plaintiff’s allegations
are insufficient to allege an auction without reserve,
and, as such, we do not resolve the issue of whether
an exception to the statute of frauds should be created
for auctions without reserve.
  The amended complaint alleges the following facts.
Giardi sought to sell its property at an original listing
price of $450,000. In response to this listing, the plaintiff
offered to buy the property for $425,000, with no contin-
gencies, by providing Giardi with a purchase agreement
and a $50,000 deposit check. In response to this and
other offers, Giardi directed all prospective buyers to
resubmit their highest and best offers. In response to
Giardi’s request, the plaintiff submitted a cash offer of
$460,000, with no contingencies, by providing a pur-
chase agreement signed by the plaintiff and redirecting
the prior $50,000 deposit check, which it claims was
the highest and best offer. Giardi did not accept that
offer, however, and instead accepted a purportedly
lower offer presented by Hartford Auto Park.
  In December, 2016, the plaintiff filed a one count
complaint, seeking an order requiring Giardi, which at
that time still owned the property, to convey title to
the property to the plaintiff. The plaintiff claimed that,
by requesting highest and best offers, Giardi was bound
to accept the highest offer and, therefore, entered into
an enforceable contract with the plaintiff for the sale of
the property.4 The plaintiff also requested an injunction,
restraining Giardi from ‘‘conveying, encumbering or in
any manner disposing of the [p]roperty.’’ In addition,
the plaintiff recorded a lis pendens on the land records,
notifying interested parties of the pending action.
   Despite the plaintiff’s actions, in March, 2017, Giardi
sold the property to Hartford Auto Park and executed
a special warranty deed, which conveyed the property
subject to the lis pendens, and Hartford Auto Park
recorded the deed. Thereafter, the plaintiff amended
its complaint, adding Hartford Auto Park as a defendant
and asserting a second count against it.
   In response, Hartford Auto Park moved to strike
count two of the amended complaint pursuant to Prac-
tice Book § 10-39, contending that the statute of frauds
barred the plaintiff’s claim because the purchase
agreement given to Giardi by the plaintiff was not signed
by the party to be charged, namely, Giardi. The plaintiff
opposed the motion, claiming that, by alleging that
Giardi requested ‘‘[h]ighest and [b]est offers,’’ it suffi-
ciently pleaded the existence of an auction without
reserve, which contractually binds the seller to the high-
est bidder and, therefore, according to the plaintiff,
does not require a writing signed by the party to be
charged in order to be enforceable.5
   The trial court granted Hartford Auto Park’s motion
to strike, concluding that the statute of frauds barred
the plaintiff’s claim, and rendered judgment on count
two in favor of Hartford Auto Park.6 In its memorandum
of decision, the trial court rejected the plaintiff’s argu-
ment that Giardi’s request for highest and best offers
constituted an auction without reserve and, as such,
created an exception to the requirement that it produce
a writing signed by the party to be charged, and noted
that none of the cases cited by the plaintiff provided
persuasive authority because they did take into consid-
eration the statute of frauds.7 Thereafter, Giardi moved
to strike count one of the amended complaint. Applying
the same rationale it had used in ruling on Hartford
Auto Park’s motion, the trial court granted Giardi’s
motion and rendered judgment in its favor. This
appeal followed.
  In resolving whether the trial court properly granted
the motions to strike filed by Hartford Auto Park and
Giardi, we begin with the general principles that guide
our review of a trial court’s decision to grant a motion
to strike. ‘‘A motion to strike challenges the legal suffi-
ciency of a pleading . . . and, consequently, requires
no factual findings by the trial court. As a result, our
review of the [trial] court’s ruling is plenary. . . . We
take the facts to be those alleged in the complaint that
has been stricken and we construe the complaint in the
manner most favorable to sustaining its legal suffi-
ciency. . . . [I]f facts provable in the complaint would
support a cause of action, the motion to strike must be
denied. . . .Thus, we assume the truth of both the spe-
cific factual allegations and any facts fairly provable
thereunder. In doing so, moreover, we read the allega-
tions broadly . . . rather than narrowly.’’ (Internal
quotation marks omitted.) Giacalone v. Housing
Authority, 306 Conn. 399, 403–404, 51 A.3d 352 (2012).
It is well settled, however, that ‘‘[t]he failure to include
a necessary allegation in a complaint precludes a recov-
ery by the plaintiff under that complaint . . . .’’ (Inter-
nal quotation marks omitted.) Sturm v. Harb
Development, LLC, 298 Conn. 124, 130, 2 A.3d 859
(2010).
   The issue of whether the plaintiff’s allegation that
Giardi’s request for ‘‘ ‘[h]ighest and [b]est’ offers’’ con-
stitutes ‘‘explicit terms’’ that Giardi was putting the
property up for auction without reserve8 for purposes
of § 42a-2-328 presents a question of statutory interpre-
tation, over which we exercise plenary review, guided
by well established principles regarding legislative
intent. See, e.g., Kasica v. Columbia, 309 Conn. 85, 93,
70 A.3d 1 (2013) (explaining plain meaning rule under
General Statutes § 1-2z and setting forth process for
ascertaining legislative intent). We begin with the statu-
tory language. Our sale by auction statute, § 42a-2-328,
which our legislature adopted verbatim from § 2-328 of
the Uniform Commercial Code, provides that an auction
can be held ‘‘with reserve’’ or ‘‘without reserve.’’ Section
42a-2-328 (3) provides that ‘‘a sale is with reserve unless
the goods are in explicit terms put up without reserve.’’
(Emphasis added.) A comment to § 42a-2-328 explains
that the drafters intended the language to ‘‘make it
clear’’ that ‘‘[a]n auction ‘with reserve’ is the normal
procedure. . . . The prior announcement of the nature
of the auction . . . as . . . without reserve will, how-
ever, enter as an ‘explicit term’ in the ‘putting up’ of
the goods and conduct thereafter must be governed
accordingly. . . .’’ Conn. Gen. Stat. Ann. § 42a-2-328
(West 2009), comment (2).
   In the present case, the plaintiff acknowledges that
it failed to plead that Giardi explicitly stated that it was
selling its property in an auction ‘‘without reserve’’ but
asks this court to hold that its allegation that Giardi
requested ‘‘ ‘[h]ighest and [b]est’ offers’’ was sufficient
to plead an auction without reserve. Although this court
has never resolved whether the phrase ‘‘highest and
best’’ constitutes ‘‘explicit terms’’ sufficient to create
an auction without reserve, ‘‘precedents from other
jurisdictions are helpful in construing [uniform] act[s].’’
Cain v. Moore, 182 Conn. 470, 473, 438 A.2d 723 (1980),
cert. denied, 454 U.S. 844, 102 S. Ct. 157, 70 L. Ed.
2d 129 (1981). Other jurisdictions that have adopted
identical language to § 42a-2-328 have held that ‘‘[t]he
statement that the sale [will] be made to the highest
bidder is not the equivalent of an announcement that the
auction [will] be without reserve.’’ (Internal quotation
marks omitted.) Wells Fargo Bank, N.A. v. Holdco Asset
Management, L.P., 729 Fed. Appx. 124, 126 (2d Cir.
2018); id., 125 (applying New York’s sale by auction
statute that contains language identical to § 42a-2-328);
see also, e.g., Sly v. First National Bank of Scottsboro,
387 So. 2d 198, 200 (Ala. 1980) (applying identical lan-
guage and concluding that seller’s use of phrase ‘‘ ‘high-
est, best and last bidder’ ’’ did not transform auction
into auction without reserve).
   The plaintiff in the present case alleged merely that
Giardi requested ‘‘ ‘[h]ighest and [b]est’ offers,’’ not that
Giardi indicated that it intended to be bound by the
highest and best offer.9 Moreover, the plaintiff’s
amended complaint failed to mention the words ‘‘auc-
tion’’ or ‘‘bid,’’ or even to describe or attach the docu-
ment or communication constituting the auction or bid,
calling into question whether the plaintiff sufficiently
alleged that Giardi’s request for offers constituted an
auction at all. Even if we assume, arguendo, that the
amended complaint sufficiently alleged an auction, we
conclude that the plaintiff’s allegation that Giardi used
the phrase ‘‘ ‘[h]ighest and [b]est’ offers,’’ without more,
is insufficient to plead an auction without reserve. Con-
sequently, because the plaintiff failed to plead compli-
ance with or any exception to the statute of frauds,
we conclude that the trial court properly granted the
motions to strike filed by Hartford Auto Park and Giardi.
      The judgment is affirmed.
      In this opinion the other justices concurred.
  1
     The plaintiff appealed from the judgment of the trial court to the Appellate
Court, and we transferred the appeal to this court pursuant to General
Statutes § 51-199 (c) and Practice Book § 65-2.
   2
     The plaintiff was aggrieved by the decision of the trial court to strike
its amended complaint and, as such, has standing to bring this appeal. See
General Statutes § 52-263 (party that is ‘‘aggrieved’’ by final judgment of
trial court may bring appeal).
   3
     Giardi and Hartford Auto Park initially contend that § 42a-2-328, which
adopted § 2-328 of the Uniform Commercial Code (UCC), applies only to
the sale of goods and not to the sale of real estate. Although this court has
not decided that issue, we have held that ‘‘precedents from other jurisdictions
are helpful in construing [uniform] act[s].’’ Cain v. Moore, 182 Conn. 470,
473, 438 A.2d 723 (1980), cert. denied, 454 U.S. 844, 102 S. Ct. 157, 70 L. Ed.
2d 129 (1981). We observe that other jurisdictions have applied § 2-328 of
the UCC to the sale of real estate. See, e.g., Forbes v. Wells Beach Casino,
Inc., 307 A.2d 210, 219 (Me. 1973) (‘‘we consider the principle announced
by [§ 2-328 (4) of the UCC] eminently applicable to protect the rights of the
highest good-faith bidder in a sale of real estate’’). Even if we were to agree
that that section of the UCC was applicable to the sale of real estate, however,
both defendants argue that the plaintiff in the present case failed to allege
that Giardi used ‘‘explicit terms’’ to put the property up without reserve,
under either § 42a-2-328 or § 2-328 of the UCC.
   4
     Although not averred in the complaint or in the amended complaint, the
plaintiff argued in its opposition to Hartford Auto Park’s motion to strike
that, by requesting highest and best offers, Giardi offered to sell the property
to the highest bidder, transforming the plaintiff’s offer into an acceptance
and creating an enforceable agreement.
   5
     Specifically, the plaintiff argued that an auction without reserve consti-
tutes an exception to the writing requirement under the statute of frauds,
because the plaintiff’s purportedly highest and best offer created an accep-
tance and the plaintiff’s delivery of a purchase agreement constituted partial
performance of their agreement, which ‘‘is an essential element of the estop-
pel exception to the statute of frauds.’’ Glazer v. Dress Barn, Inc., 274 Conn.
33, 63, 873 A.2d 929 (2005).
   6
     The plaintiff failed to file a new pleading against Hartford Auto Park
within the fifteen day period required under Practice Book § 10-44, which
provides in relevant part: ‘‘[When] the party whose pleading or a count
thereof has been so stricken fails to file a new pleading within that fifteen
day period, the judicial authority may, upon motion, enter judgment against
said party on said stricken complaint . . . .’’ The plaintiff additionally claims
that the trial court’s grant of the motions to strike by Hartford Auto Park
and Giardi prevented it from developing ‘‘a full factual record’’ that would
have helped this court ‘‘fully [address] the circumstances under which an
agreement may be created by a without reserve auction.’’ Hartford Auto
Park challenges the plaintiff’s preservation of this claim on the ground that
the plaintiff did not raise this issue at the trial court. Notwithstanding that
challenge, we observe that the plaintiff had an opportunity to expand the
factual record through amending its complaint.
   7
     We observe that, in one of the cases cited by the plaintiff in its opposition
to Hartford Auto Park’s motion to strike, Pyles v. Goller, 109 Md. App. 71,
674 A.2d 35 (1996), the court did address the issue of whether, even though
there was no written agreement between the parties to satisfy the statute
of frauds, a seller still may be ordered to specifically perform on a sale
conducted in an auction without reserve. Id., 88. As we explain in footnote
9 of this opinion, however, Pyles is distinguishable from the present case
because the plaintiff in that case sufficiently pleaded the existence of an
auction without reserve. Id., 80, 83.
   8
     General Statutes § 42a-2-328 (3) provides in relevant part: ‘‘In an auction
with reserve the auctioneer may withdraw the goods at any time until he
announces completion of the sale. In an auction without reserve, after the
auctioneer calls for bids on an article or lot, that article or lot cannot be
withdrawn unless no bid is made within a reasonable time. In either case
a bidder may retract his bid until the auctioneer’s announcement of comple-
tion of the sale, but a bidder’s retraction does not revive any previous bid.’’
   9
     This point distinguishes the present case from the cases and secondary
sources on which the plaintiff relies. For example, in Jenkins Towel Service,
Inc. v. Fidelity-Philadelphia Trust Co., 400 Pa. 98, 101, 161 A.2d 334 (1960),
the seller’s letter at issue specifically stated that ‘‘ ‘an [a]greement of [s]ale
[would be] tendered to the highest acceptable bidder’ . . . .’’ (Emphasis
added.) See also, e.g., Forbes v. Wells Beach Casino, Inc., 307 A.2d 210, 216
(Me. 1973) (‘‘contract provide[d] that the highest qualified cash offer ‘shall
be accepted’ ’’ [emphasis altered]); Pyles v. Goller, 109 Md. App. 71, 77, 674
A.2d 35 (1996) (lots sold in auction in which ‘‘ ‘high bidder wins the right
to choose a lot’ ’’); Short v. Sun Newspapers, Inc., 300 N.W.2d 781, 784
(Minn. 1980) (letter stated that ‘‘ ‘[t]he newspapers will be sold . . . to the
highest bidder’ ’’ [emphasis added]); 1 Restatement (Second), Contracts
§ 28, illustration (3) p. 81 (1981) (‘‘I offer my farm Blackacre for sale to
the highest cash bidder and undertake to make conveyance to the person
submitting the highest bid received’’ [emphasis added]).