Town of Canton v. Cadle Properties of Connecticut, Inc.
Connecticut General Statutes §12-163a, entitled "Receivership of rents for the collection of delinquent taxes," does not authorize a receiver to do more than collect rents that are to be used first to pay taxes due after the receiver's appointment date and, then, to pay for electric, gas, telephone, water or heating oil supplied on or after said date. Under C.G.S. §12-163a, Canton petitioned for the appointment of a receiver of rents for property owned by Cadle Properties of Connecticut, alleging a failure to pay real property taxes of $362,788.59, plus interest and lien penalties totaling $884,263.04. Without notice to the tenant, the court held a hearing and appointed Boardwalk Realty Associates, LLC, as receiver. The court granted the receiver's motion to modify the orders and granted the receiver certain authority, including to evict the tenant and to seek back rent. The tenant, M&S Associates, LLC, moved to intervene. The court granted intervention but denied the tenant's motions for reconsideration of the appointment and modification and to remove the receiver. The tenant appealed, first challenging the court's jurisdiction to appoint the receiver. Canton claimed that subject matter jurisdiction was lacking over the interlocutory appeal. Finding jurisdiction, the Appellate Court affirmed and reversed the judgment, in part. The motion to remove the receiver was the functional equivalent of a motion to open the judgment. The denial of a motion to open a judgment is an appealable final judgment. Further, the tenant's lack of notice of the action did not deprive the trial court of subject matter jurisdiction to appoint the receiver. While the initial appointment was proper, in granting the modification, the trial court improperly expanded the receiver's authority beyond the scope of C.G.S. §12-163a. As in the 1994 Supreme Court decision in Connecticut Light & Power Co. v. DaSilva, concerning virtually identical language in C.G.S. §16-262f, for the appointment of a receiver regarding utilities, under C.G.S. §12-163a, the trial court had no discretion to broaden the scope of the receiver's duties. C.G.S. §12-163a does not authorize a receiver to do more than collect rents, used first to pay taxes due after the receiver's appointment and, then, to pay for certain utilities supplied on or after that date. The receiver may collect rents forthcoming on or after its appointment, not rents allegedly overdue.