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Supreme Court of Connecticut
November 16, 2021, Argued; May 10, 2022, Decided
[*312] ROBINSON, C. J. In the earliest months of the COVID-19 public health emergency, Governor Ned Lamont issued numerous executive orders that closed or severely restricted the operation of various businesses, including bars and restaurants, in order to stem the spread of the virus at that time. This appeal requires us to consider how those executive orders affected the enforceability of a commercial lease agreement for premises in South Norwalk that the defendants, Downtown Soho, LLC (Downtown Soho), and Edin Ahmetaj, leased from the plaintiff, AGW Sono Partners, LLC, for their fine dining restaurant. The defendants appeal, and the plaintiff cross [*313] appeals,1 from the judgment of the trial court awarding the plaintiff $200,308.76 in damages for the defendants' breach of that lease agreement. In their appeal, the defendants claim, inter alia, that the trial court incorrectly concluded that the common-law doctrines of impossibility and frustration of purpose did not relieve them of their obligations under the lease agreement, given the damaging economic [**10] effects of the various executive orders on their restaurant's business. In its cross appeal, the plaintiff claims that, in calculating the damages award, the trial court improperly allocated the burden of proof in determining whether the plaintiff had mitigated its damages when it leased the premises to a new tenant at a lesser rent than the defendants had paid. We conclude that the trial court correctly determined that the economic effects of the executive orders did not relieve the defendants of their obligations under the lease agreement but that a new damages hearing is required because the trial court improperly allocated the burden of proof as to mitigation in determining the damages award. Accordingly, we reverse in part the judgment of the trial court.
The record reveals the following facts, as found by the trial court, and procedural history. In December, 2018, TR Sono Partners, LLC (TR Sono), entered into a lease agreement with Downtown Soho, under which Downtown Soho would use and occupy premises located at 99 Washington Street in South Norwalk (premises) for a ten year period beginning on January 1, 2019. Section 4 (a) of the lease agreement provides in relevant part that [**11] the defendants "shall use the [p]remises for the operation of a restaurant and bar selling food, beverages, and related accessories, togetherwith uses incidental thereto, and for no other purpose. . . ."2 Under the terms of the [*314] lease agreement, Downtown Soho was obligated to pay both base monthly and percentage rent,3 along with additional rent to cover its apportioned amounts of the plaintiff's insurance, common area expenses and real estate taxes, commencing on July 1, 2019, and concluding on December 31, 2028. On December 20, 2018, Ahmetaj, who is the managing member of Downtown Soho, executed a guarantee agreement pursuant to which he personally guaranteed all of Downtown Soho's obligations under the lease agreement. In December, 2019, the plaintiff purchased six commercial properties, including the premises, from TR Sono, which assigned all of its rights and obligations under the lease and guarantee agreements for those properties to the plaintiff.
Full case includes Shepard's, Headnotes, Legal Analytics from Lex Machina, and more.
343 Conn. 309 *; 2022 Conn. LEXIS 125 **; 273 A.3d 186
AGW SONO PARTNERS, LLC v. DOWNTOWN SOHO, LLC, ET AL.
Prior History: [**1] Action to recover damages for, inter alia, breach of a lease agreement, and for other relief, brought to the Superior Court in the judicial district of Stamford-Norwalk, Housing Session at Norwalk, and tried to the court, Spader, J.; judgment for the plaintiff, from which the defendants appealed and the plaintiff cross appealed.
AGW Sono PArtners. LLC v. Soho, 2021 Conn. Super. LEXIS 1057 (Conn. Super. Ct., Mar. 8, 2021)
Disposition: Reversed in part; further proceedings.
lease, lease agreement, damages, trial court, restaurant, executive order, mitigate, premises, impossibility, rent, landlord, pandemic, dining, frustrated, tenant, frustration of purpose, burden of proof, obligations, impracticability, special defense, quotation, marks, default, excused, defendants', bistro, circumstances, breached, parties, new tenant
Business & Corporate Compliance, Breach, Breach of Contract Actions, Elements of Contract Claims, Civil Procedure, Appeals, Standards of Review, Clearly Erroneous Review, Contracts Law, Contract Interpretation, Questions of Fact & Law, De Novo Review, Responses, Defenses, Demurrers & Objections, Affirmative Defenses, Evidence, Burdens of Proof, Allocation, Standards of Performance, Impossibility of Performance, Frustration of Purpose, Contracts Law, Impracticability, Impossibility of Performance, Remedies, Damages, Avoidable Consequences, Real Property Law, Types of Damages, Compensatory Damages, Measurement of Damages, Mitigation, Landlord & Tenant, Landlord's Remedies & Rights, Rent Recovery, Limitations on Damages, Trials, Jury Trials, Province of Court & Jury, Damages, Lease Agreements, Residential Leases, Mitigated Damages