Opinion
No. CV 99-0170845-S
February 1, 2006
MEMORANDUM OF DECISION ON MOTION FOR SUMMARY JUDGMENT (NO. 394)
This action was originally filed on March 5, 1999. The plaintiff, Vincent Larobina, filed a thirteen-count substitute complaint against the defendant, First Union National Bank ("First Union"), on December 28, 2001.
The action involves collection of a debt incurred by Larobina with a predecessor to First Union. Larobina alleges that the loan, incurred pursuant to a home equity line of credit agreement (The "Agreement" or the "Note") and secured by a second mortgage on plaintiff's Stamford home, originally had a maturity date of September 25, 1996. Plaintiff alleges, however that on November 1, 1994 he executed a "secured credit line re-age agreement" with a representative of First Union. The re-age agreement, he claims, changed some terms of the loan and extended the maturity date. Larobina made payments on the loan through October 1998, more than two years past the original maturity date. Thereafter Larobina received a letter from a representative of First Union stating that since the original maturity date of the note had passed, the full balance of the loan remaining was now due. First Union disavowed any connection with the re-age agreement or obligations under it. Larobina then filed this action.
Through a series of assignments the loan, initially given by Union Trust Bank, was assigned to First Union. First Union has now been acquired and taken over by Wachovia Bank. The defendant will be referred to herein as "First Union."
The thirteen-count substitute complaint alleges breach of the payment provisions of the note in count one, breach of the re-age agreement in count two and breach of the note in count three for failing to notify credit agencies that Larobina disputes the debt. Count four alleges that First Union negligently and falsely reported to the credit agencies that it had sued Larobina. Count five alleges defamation and count six alleges that the original method of computing the debt violated 15 U.S.C. § 1647(a) and General Statutes § 36a-678(a). Count seven alleges that the process of executing the re-age agreement consists of mail and wire fraud in violation of 18 U.S.C. § 1341 and is racketeering in violation of 18 U.S.C. § 1961. Count eight alleges that the report to the credit agency consisted of negligent infliction of emotional distress and count nine alleges a violation of the covenant of fair dealing contained in all contracts. Count ten is based on the Connecticut Unfair Trade Practices Act and count eleven alleges that First Union committed negligent misrepresentation. Count twelve alleges that because Larobina relied on the re-age agreement and changed his position, First Union is bound by promissory estoppel. Count thirteen seeks specific performance of the re-age agreement.
On December 6, 2005, First Union moved for summary judgment on counts one through twelve. First Union has filed a memorandum of law and supporting affidavits and exhibits. On January 3, 2006 Larobina filed an opposing memorandum of law with his affidavit and exhibits. Each party has included an identical copy of the line of credit agreement as an exhibit.
Practice Book § 17-49 "provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law . . . In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and that the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." (Citations omitted; internal quotation marks omitted.) Barrett v. Montesano, 269 Conn. 787, 791-92, 849 A.2d 839 (2004).
COUNT ONE: BREACH OF CONTRACT
In count one, Larobina alleges that First Union breached the note by declaring that the full outstanding principal balance of the loan was due. Specifically Larobina alleges that First Union breached § 2.2 of the home equity line of credit agreement. Section 2.2 of the agreement provides, in relevant part: "You [Larobina] must pay an installment by the payment due date shown on your periodic statement for each billing cycle. You must pay at least the minimum installment for the billing cycle, even if you paid more than the minimum installment in an earlier billing cycle. Your minimum installment payment will be 1/240th of your outstanding principal balance plus any finance charges owed on you Account." Larobina claims that First Union breached this provision by issuing a monthly statement in which the minimum amount due was equivalent to the entire outstanding balance of the note, far in excess of the agreed-upon minimum installment of 1/240th of the outstanding principal.
First Union contends that it is entitled to summary judgment because the language of § 2.2 does not mandate that a monthly statement be provided by it to Larobina or that the statement be in the amount of 1/240th of the principal amount due. It argues that it could not breach § 2.2 because the section does not impose any obligations on it. Finally First Union argues that since Larobina has not made any payments since he received notice of the amount due, he has not suffered any damages. Larobina argues that § 2.2 does impose obligations on First Union and he has suffered damages because his credit rating and ability to obtain credit card financing has been adversely affected. In addition, he has not been able to obtain another first mortgage due to his claimed default on this loan.
"The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages." (Internal quotation marks omitted.) Rosato v. Mascardo, 82 Conn.App. 396, 411, 844 A.2d 893 (2004). "Whether there was a breach of contract is ordinarily a question of fact . . ." (Internal quotation marks omitted.) Czaplicki v. Ogren, 87 Conn.App. 779, 785, 868 A.2d 61 (2003). Although the language of § 2.2 imposes minimum payment obligations on the borrower, it must be read as a part of the entire agreement. § 9.5 of the Agreement provides: "This agreement will stay in effect for 10 years after the date you sign this agreement. After that, you will no longer be able to use your Account or write Checks on your Account. You will then be required to repay the total outstanding balance owed on your Account, without our having to notify you or demand payment at that time."
Whether or not the defendant breached the agreement by sending a statement in 1998 demanding payment of the full balance of the line of credit is a matter of contract interpretation. Although contract interpretation, being ultimately a question of the parties' intent can be an issue of fact to be tried to the jury, when the parties' intent is clear from the unambiguous provisions of the agreement, contract interpretation is a matter of law for the court to decide.
The interpretation and construction of a written contract present only questions of law, within the province of the court . . . so long as the contract is unambiguous and the intent of the parties can be determined from the agreement's face. (Internal quotation marks omitted; citation omitted.) Gould v. Mellick Sexton, 263 Conn. 140, 150 (2003).
See, also, Poole v. Waterbury, 266 Conn. 68, 87-88 (2003).
There is no issue as to the timing of the demand for full payment. It was made in 1998, more than 10 years after the line of credit agreement was entered into in September of 1986. At that time, by the clear and unambiguous provision of the Agreement, the court finds that § 9.5 would supplant § 2.2 of the Agreement, and the demand for payment of the full balance is specifically allowed, but not required, under § 9.5. The demand for full payment made in 1998 therefore would not, as a matter of law, violate § 2.2. The defendant has demonstrated the absence of any material issue of fact as to this point and is entitled to judgment as a matter of law; the plaintiff has failed to demonstrate the evidentiary foundation to demonstrate the existence of a genuine issue of material fact. Summary judgment is granted as to Count One.
COUNT TWO: BREACH OF CONTRACT
In count two, Larobina alleges that First Union breached the re-age agreement by refusing to abide by its terms. Specifically the count alleges that the agreement extended the maturity date of the note and altered the amount of the monthly payments. In exchange for this extension, Larobina forfeited the right to seek future advances under the original line of credit. In addition, the count alleges that Larobina made payments under the re-age agreement almost two years beyond the original maturity date under the original note. The plaintiff has submitted a copy of the re-age agreement as Exhibit D to his affidavit. It is dated November 3, 1994 and provides that, in return for a re-age fee of $50 paid by the borrower, and the waiver of any further right to additional credit under the loan, the borrower shall pay at least the minimum monthly payments due under the loan documents, and agrees ". . . to pay on each successive monthly billing date, at least the minimum monthly payments due under the Loan Documents until such time as the Loan has been repaid in full." (§ 2) and in § 4 provides that ". . . the only term [of the 1986 Loan Documents] being modified being the time available for repayment."
First Union, which denies that it or its predecessor entered into the re-age agreement by an authorized signatory, contends that it is entitled to summary judgment because Larobina does not identify any part of the re-age agreement that is claimed to be violated and this count is merely repetitive and duplicative of count one. Larobina counters that the re-age agreement was breached in its entirety.
The court finds that the very existence of the re-age agreement, the authority of the lender signatory thereto, and its binding effect on the defendant are material issues of fact presented by the moving and opposing papers. Summary judgment is therefore denied as to Count Two.
COUNT THREE: BREACH OF CONTRACT
In count three, Larobina alleges that First Union breached the Note by reporting to credit reporting agencies that Larobina was in default under the note without also telling the agencies that he disputed First Union's allegation that he was in default. The specific provision of the Note which is claimed to have been breached provides: "If you fail to pay the amount that we think you owe, we may report you as delinquent. However, if our explanation does not satisfy you and you write to us within ten days telling us that you still refuse to pay, we must tell anyone we report you to that you have a question about your bill. And, we must tell you the name of anyone we reported you to. We must tell anyone we report you to that the matter has been settled between us when it finally is."
First Union argues that before it has any obligation to notify credit agencies that Larobina questioned his bill, Larobina must prove that he notified First Union in writing that he disputed the amount due. Larobina does not state in his affidavit that he gave the written notice to the bank. First Union's successor's Vice-President, Donna Batchley does not state in her affidavit that the written notice was or was not received. First Union relies exclusively on excerpts from the transcript of an incomplete deposition of Larobina, commenced on November 10, 2005 but not yet completed, not signed by Larobina although he had not waived his right to review and sign, to support its position that the requisite notice was not given. But the deposition transcript cannot be used to support the defendant's motion for summary judgment because the court has sustained the plaintiff's Objection Use of Plaintiff's Deposition in Wachovia's [successor to First Union] Motion for Summary Judgment dated January 2, 2006. Absent the deposition transcript, there is no factual record as to the notice issue. The defendant therefore has not sustained its initial burden of showing the absence of a material issue of fact and summary judgment is denied as to Count Three.
COUNTS FOUR, FIVE AND EIGHT NEGLIGENCE, DEFAMATION AND NEGLIGENT INFLICTION OF EMOTIONAL DISTRESS
In count four, Larobina alleges that First Union was negligent in reporting to credit reporting agencies that it had brought foreclosure proceedings against Larobina, when, in fact, no proceedings had been commenced. In addition, plaintiff alleges that First Union let the false information remain on Larobina's credit report until it was removed in response to in stipulated a junction entered in this case. In count five, Larobina alleges that First Union committed defamation, in reporting inaccurately to credit reporting agencies that it had instituted foreclosure proceedings against Larobina. In count eight, Larobina alleges that the actions of First Union as outlined in counts four and five consist of negligent infliction of emotional distress. Larobina contends that as to all three counts, First Union acted with wanton, willful and/or malicious intent.
First Union argues that it is entitled to summary judgment on all three counts because these state law claims are preempted by a section of the Fair Credit Reporting Act (FCRA), 15 U.S.C. § 1681t(b)(1)(F). Larobina argues that the issue of preemption should be governed by 15 U.S.C. § 1681h(e). He also reviews the three different approaches that District Courts apply in determining preemption under the FCRA. This court hereby adopts as the law of this case the so-called "temporal approach" used by this court in earlier proceedings in this case denying the plaintiff's motions to strike statute of limitations special defenses directed to these counts on the ground of federal preemption under FCRA. Larobina v. First Union National Bank, 2004 WL1664230 (Conn.Super.) Docket No. CV99-01708455, Superior Court, Judicial District of Stamford/Norwalk at Stamford (D'Andrea, J.T.R., June 28, 2004) ( 37 Conn. L. Rptr. 509). An analysis under the temporal approach relies on the language of § 1681t(b)(1)(F) to conclude that § 1681t(b)(1)(F) should only be used to preempt state actions premised upon a credit furnisher's conduct occurring after the furnisher receives notice of a dispute. Larobina, supra at * 6. It is therefore necessary to determine if there is a material issue of fact presented as to any facts necessary for the application of the "temporal approach" to the claim federal preemption of counts four, five, and eight. The plaintiff has alleged in Count Four (and incorporated into Counts Five and Eight) that the defendant, starting in April 1999 ". . . reported to Experian, Trans Union, and Equifax credit reporting agencies that the defendant had instituted foreclosure proceedings against the plaintiff . . ." These allegations in the complaint are binding on the plaintiff. See Danko v. Redway Enterprises, Inc., 254 Conn. 369, 375 (2000). There is therefore no material issue as to the defendant's status as falling within the class of ". . . persons who furnish information to consumer reporting agencies . . ." under § 1681t(b)(1)(F). But the court finds that there is a material issue as to the other factual requirement under the "temporal approach" to preemption claims under § 1681t(b)(1)(F), namely that the state action to be preempted must be premised on a credit furnisher's conduct occurring after the furnisher ". . . has been notified by the consumer that specific information is inaccurate or notified by a consumer reporting agency that a dispute over the accuracy of information has arisen" Larobina, supra, *6. There is no indication whatsoever in the moving or opposing papers of any notification to First Union coming from a consumer reporting agency. The defendant claims, however, citing the allegations Count One of the complaint, that the plaintiff admits that in 1998, after receiving First Union's letter claiming that the full balance of the Note was due and payable, the plaintiff contacted First Union and contested the claim that the full Note balance was due because of the re-age agreement. The issue is whether or not that "notification" (which preceded the alleged providing of information to the credit reporting agencies starting in April of 1999) amounted to notification that "specific information is inaccurate." The court holds, based on the record presented for purposes of this motion, that it does not. There is notification of disagreement with the bank's ultimate legal conclusion that the Note balance was due, but there is no indication of any complaint by the plaintiff that any "specific information" was in error and certainly no prior notification that no foreclosure proceedings were pending against the plaintiff, as was to be reported. Since there remains an issue of fact as to whether or not any notice of inaccuracy of "specific information" was given prior to April of 1999, the motion for summary judgment is denied as to Counts Four, Five, and Eight.
COUNT SIX: VIOLATION OF 15 U.S.C. § 1647(a) AND GENERAL STATUTES § 36a-678a
In count six, Larobina alleges that the manner in which the interest rate was calculated under the original Note violates 15 U.S.C. § 1647(a). Specifically Larobina alleges that paragraph 4.2 of the Note defines the rate of interest in terms of First Union's "loan pricing rate." Paragraph 4.3 of the note provides: "Our loan pricing rate is a standard we use for setting interest rates. It is not necessarily our lowest rate. The loan pricing rate is set in the ordinary course of business in accordance with changes in economic and market conditions." The relevant portion of 15 U.S.C. § 1647(a) provides: "[T]he index or other rate of interest to which changes in the annual percentage rate are related shall be based on an index or rate of interest which is publicly available and is not under the control of the creditor." Larobina contends that the manner of computing interest under paragraph 4.3 was not publicly available and was under the control of First Union.
General Statutes § 36a-678(a) makes this section applicable to loans in Connecticut.
First Union argues that this claim violates the statute of limitations, as it was not brought within one year of the date of the occurrence of the violation, as required by 15 U.S.C. § 1640(e) and General Statutes § 36a-683(e). It argues that the date of the violation should be as early as the date of the note, but certainly no later than the dates of the cash advances, all occurring in 1986 and far beyond the one-year date from when this action was commenced.
Larobina argues that the limitations period should be tolled on public policy grounds due to fraudulent concealment by First Union. No evidence of fraudulent concealment has been presented. He also argues that he did not notice the illegality until this action commenced. Larobina finally argues that this case should be governed by the continuing course of conduct doctrine. No evidence has been presented which would show a special relationship between the parties or later wrongful conduct by First Union which would bring this case within the continuing course of conduct doctrine. See Navin v. Essex Savings Bank, CT Page 2535 82 Conn.App. 255, 262, 843 A.2d 679, cert. denied, 271 Conn. 902, 859 A.2d 563 (2004).
It is undisputed that the loan was an open ended home equity line of credit. "In close end credit transactions, the statute begins to run from the date the contract for the extension of credit is executed . . . In open end credit arrangements, the statute begins to run when the consumer is on notice that a violation has occurred." (Citation omitted.) Larobina v. First Union National Bank, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV99 0170845 (December 13, 2001, Karazin, J.). "[T]he starting point for the limitation period is deemed to be the date when there has been a finance charge which puts the consumer on notice that a violation has occurred." Baskin v. G. Fox Co., 550 F.Sup. 64, 67 (D.Conn. 1982).
Although Larobina argues that he did not have notice of any violation until he reviewed the note when this action began, he should have been on notice by initially reading the note at the time of its execution or possibly at the time of the subsequent advances. At the latest, the statute should have begun to run on the date of the last advance and his payment on that last advance in 1986. (Affidavit of Donna Bachety, 11/30/05 ¶¶ 10, 11). Under the rule of Baskin v. Fox Co., supra, there is no material issue of fact as to when the limitations period commenced to run. Summary judgment is granted on Count Six as the action was commenced beyond the period of the statute of limitations.
COUNT SEVEN: RICO
First Union argues that summary judgment must be granted as to Count Seven of Larobina's complaint because he has failed to present evidence to satisfy the distinctness requirement of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1962(c). 18 U.S.C. § 1962(c) provides: "It shall be unlawful for any person employed by or associated with any enterprise to engage in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." Thus, in order to have a valid claim there must be two separate and distinct entities, the RICO person and the RICO enterprise.
Here, Larobina alleges in his complaint that First Union (including 3 of its employees) has engaged in activity in violation of 18 U.S.C. § 1964(c). While a RICO person and RICO enterprise can partially overlap in that "a defendant may be a RICO person and one of a number of members of the RICO enterprise . . . alleging a RICO enterprise that consists merely of a corporate defendant associated with its own employees or agents carrying on the regular affairs of the defendant, [will not satisfy] the distinctness requirement . . ." (Citation omitted; internal quotation marks omitted.) Riverwoods Chappaqua v. Marine Midland Bank, 30 F.3d 339, 344 (2nd Cir. 1994). Larobina has done just this. He concedes this fact in his memorandum in opposition to the motion acknowledging that he has not named any additional parties in the enterprise as defendants to this action. Larobina further states in his memorandum in opposition that he "surrenders" to First Union's motion as to this count. Therefore, there are no genuine issues as to any material fact and First Union is entitled to judgment as a matter of law. Accordingly, the motion for summary judgment, as to count seven, is granted.
COUNT NINE: BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING
In count nine, Larobina essentially alleges that in denying the existence of the alleged re-age agreement First Union breached its implied covenant of good faith and fair dealing. First Union counters that Larobina's underlying claim for breach of contract cannot be maintained and therefore this count must fail as well. First Union also takes issue with Larobina's incorporation of various allegations from count four which it has argued is preempted by the FRCA.
"[E]very contract carries an implied covenant of good faith and fair dealing requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement . . . To constitute a breach of that covenant, the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith . . . Bad faith in general implies both actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake as to one's rights or duties, but by some interested or sinister motive . . . Bad faith means more than mere negligence; it involves a dishonest purpose." (Internal quotation marks omitted.) Jones v. H.N.S Management Co., 92 Conn.App. 223, 227, 883 A.2d 831 (2005).
Contrary to First Union's argument, genuine issues of material fact do exist, as to Larobina's breach of contract claims made in Counts Two and Three, and it is not entitled to judgment as a matter of law as to those claims. As for First Union's argument that this count incorporates allegations from Counts Four, Five, and Eight that are preempted by the FCRA, the court has denied the motion for summary judgment as to those counts, and they remain viable. In any event, a preemption of a claim would have had no reflection on the merits of the claim but simply on the constitutional priority of the chosen forum to which it was brought.
Notably, First Union does not put forth evidence to belie Larobina's allegations of bad faith. As such it has not met its initial burden of showing the absence of any issue of material fact as to whether or not it engaged in bad faith in denying the existence of the re-age agreement. Accordingly, the motion for summary judgment is denied as to Count Nine.
COUNT TEN: CUTPA
In count ten, Larobina essentially re-alleges his previous counts and claims that the actions of First Union constitute a violation of the Connecticut Unfair Trade Practices Act (CUTPA). First Union argues that it is entitled to summary judgment as to each count that count ten is predicated upon and therefore it should be entitled to summary judgment as to count ten, as well. First Union further argues that what lies at the heart of Larobina's claim is that he disagrees with First Union's position that the balloon payment was due as of September 25, 1996. First Union contends that this difference of opinion, or for that matter a simple breach of contract, does not amount to an actionable CUTPA claim.
General Statutes §§ 42-110a through 42-115u.
Larobina counters that he has alleged much more than a disagreement. He maintains, that in attempting to collect this debt, First Union employed abusive, harassing, fraudulent, deceptive and/or misleading means; thus, constituting a CUTPA violation. Larobina further argues that his allegations establish sufficient aggravating circumstances to negate First Union's argument that this is a mere breach of contract claim.
"[General Statutes §] 42-110b(a) provides that [n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce. It is well settled that in determining whether a practice violates CUTPA we have adopted the criteria set out in the cigarette rule by the federal trade commission for determining when a practice is unfair: (1) [W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise — in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers, [competitors or other businesspersons] . . . All three criteria do not need to be satisfied to support a finding of unfairness. A practice may be unfair because of the degree to which it meets one of the criteria or because to a lesser extent it meets all three." (Internal quotation marks omitted.) Ventres v. Goodspeed Airport, 275 Conn. 105, 154-55, 881 A.2d 937 (2005). "[A] violation of CUTPA may be established by showing either an actual deceptive practice . . . or a practice amounting to a violation of public policy . . . Furthermore, a party need not prove an intent to deceive to prevail under CUTPA." (Internal quotation marks omitted.) Larobina v. First Union National Bank, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV 99 0170845 (December 13, 2001, Karazin, J.).
First Union's first argument fails because many of Larobina's claims remain viable. As to First Union's second argument "it is correct that a simple breach of contract does not offend traditional notions of fairness, and . . . standing alone does not offend public policy to invoke CUTPA . . . However, [w]here the plaintiff alleges sufficient aggravating circumstances, beyond a mere breach of contract that may bring the case within the cigarette rule, the CUTPA claim may withstand a motion [for summary judgment]." (Citations omitted, internal quotation marks omitted.) Id.
This is not simply a breach of contract case. Larobina has alleged that in attempting to collect this debt First Union has conducted itself in an abusive, harassing, fraudulent, deceptive and misleading manner which includes but is not limited to his breach of contract claim. Thus, Larobina has implicated CUTPA and First Union's second argument fails, as well. See, Judge Karazin's earlier ruling in this case, denying defendant's motion to strike this Tenth Count. Larobina v. First Union National Bank, 2001 Ct. Sup. 16562, 16570 Docket No. CV99-0170845S, Superior Court, Judicial District of Stamford/Norwalk at Stamford (December 13, 2001, Karazin, J.)
First Union has not met its initial burden of demonstrating that no genuine issues exist as to any material fact. First Union relies on Larobina's deposition testimony to prove that Larobina did not believe that the September 30, 1998 letter was abusive, misleading or deceptive, but the court has granted Larobina's motion to exclude the use of that deposition testimony for purposes of this motion. This evidence is insufficient for two reasons. First, as explained above, this count is not based solely on an allegation that the September 30, 1998 letter constitutes an unfair trade practice. Larobina's complaint alleges numerous interactions with First Union and its representatives regarding the collection of this debt. Notwithstanding its attempts, First Union has not presented any evidence to negate Larobina's allegations that in trying to collect this debt it acted unfairly, deceptively, and caused Larobina damages in violation of CUTPA. The motion for summary judgment is denied as to Count Ten.
COUNT ELEVEN: NEGLIGENT MISREPRESENTATION
Count eleven of Larobina's complaint alleges that the November 1, 1994 re-age agreement constituted a negligent misrepresentation, that Larobina relied on this negligent misrepresentation and First Union's continued monthly billings, believing that the original maturity date of the Note had been "re-aged." He further alleges that he relied on First Union's misrepresentations to his detriment.
First Union argues that summary judgment should be granted as to count eleven because Larobina's claims are barred by the applicable statute of limitations, General Statutes § 52-577. Larobina counters that the statute of limitations is tolled by the continuing course of conduct doctrine, and, as such, the statute does not begin to run until that course of conduct is completed. Thus, Larobina maintains that the statute of limitations would not begin to run until July of 1998, when he received the Elmore letter demanding the balloon payment or August of 1998, when he received the last monthly billing statement, as each monthly statement was a negligent misrepresentation.
General Statutes § 52-577 provides in relevant part that: "No action founded upon a tort shall be brought but within three years from the date of the act or omission complained of." Larobina's claim originates from the execution of the alleged re-age agreement in November of 1994. Nevertheless, the running of the statute of limitations was tolled until July of 1998.
"When the wrong sued upon consists of a continuing course of conduct, the statute does not begin to run until that course of conduct is completed . . . [I]n order [t]o support a finding of a continuing course of conduct that may toll the statute of limitations there must be evidence of the breach of a duty that remained in existence after commission of the original wrong related thereto . . . Where [our Supreme Court has] upheld a finding that a duty continued to exist after the cessation of the act or omission relied upon, there has been evidence of either a special relationship between the parties giving rise to such a continuing duty or some later wrongful conduct of a defendant related to the prior act . . . [T]he doctrine is generally applicable under circumstances where [i]t may be impossible to pinpoint the exact date of a particular negligent act or omission that caused injury or where the negligence consists of a series of acts or omissions and it is appropriate to allow the course of [action] to terminate before allowing the repose section of the statute of limitations to run . . ." (Internal quotation marks omitted.) Navin v. Essex Savings Bank, 82 Conn.App. 255, 262-63, 843 A.2d 679, cert. denied, 271 Conn. 902, 859 A.2d 563 (2004).
The continuing course of conduct doctrine is implicated in this case. Larobina alleges a continuing course of negligent misrepresentation beginning with the alleged re-age agreement and persisting with every monthly billing statement thereafter. The continuing course ended upon the first demand for the full balloon payment. First Union does not deny that it continued to send Larobina monthly billing statements for almost two years after the original maturity date, nor does it offer any evidence that Larobina did not rely on the monthly billing statements as confirmation of the alleged re-age agreement. Thus, Larobina's negligent misrepresentation claim was tolled until July of 1998 when First Union first made a demand for the balloon payment. The court in this regard also relies upon Judge Karazin's 2001 decision in this case, denying the defendant's motion to strike this Count Eleven on grounds of the statute of limitations. Larobina v. First Union National Bank, 2001 Ct.Sup. 16562, supra, at 16571.
If the last billing statement of July 1998 is considered to be a negligent misrepresentation, the claim is within the statute of limitations without employing the continuing course of conduct doctrine.
This action was originally filed on March 5, 1999, well within three-year statute of limitations provided for by § 52-577. Accordingly, the motion for summary judgment is denied as to Count Eleven.
First Union claims that the negligent misrepresentation claim was not asserted until January of 2000. This date is still well within the applicable statute of limitations.
COUNT TWELVE: PROMISSORY ESTOPPEL
Larobina's count twelve essentially alleges that First Union made a promise to him in the form of the re-age agreement, that he reasonably changed his position in reliance on the promise and he did so to his detriment. First Union argues that summary judgment should be granted as to this count because Larobina has not presented evidence of: 1) a clear and definite promise and 2) that injustice can be avoided only by enforcement of the promise. Essentially, First Union argues that if the re-age agreement is found to be a valid contract they are entitled to judgment as a matter of law as to this count. Conversely, if it is found not to be a valid contract then they are not bound by it and Larobina has no basis to rely on the promise. Consequently, First Union maintains it is entitled to judgment as a matter of law in either situation. Larobina counters that First Union's argument is misplaced and that if the re-age agreement is not found to be a contract, then, alternatively, promissory estoppel is implicated and the agreement still constitutes a promise upon which he detrimentally relied.
"Under the law of contract, a promise is generally not enforceable unless it is supported by consideration . . . [The] court has recognized, however, the development of liability in contract for action induced by reliance upon a promise, despite the absence of common-law consideration normally required to bind a promisor . . . Section 90 of the Restatement [(Second) of Contracts] states that under the doctrine of promissory estoppel [a] promise which the promisor should reasonably expect to induce action or forbearance on the part of the promisee or a third person and which does induce such action or forbearance is binding if injustice can be avoided only by enforcement of the promise . . . A fundamental element of promissory estoppel, therefore, is the existence of a clear and definite promise which a promisor could reasonably have expected to induce reliance. Thus, a promisor is not liable to a promisee who has relied on a promise if, judged by an objective standard, he had no reason to expect any reliance at all." (Citation omitted, internal quotation marks omitted.) Stewart v. Cendant Mobility Services Corp., 267 Conn. 96, 104-05, 837 A.2d 736 (2003).
First Union is correct that the viability of Larobina's promissory estoppel claim first hinges on a finding that the re-age agreement was not a valid contract. Nevertheless, First Union did not meet its burden of demonstrating the absence of any material fact as to Larobina's breach of contract claims with respect to the alleged breach of the re-age agreement. See, this court's ruling as to Count Two, supra. Thus, whether the re-age agreement is a valid contract or not is still an issue that needs to be determined. As such, Larobina's promissory estoppel claim is still an appropriate alternative theory of liability.
As for First Union's argument that Larobina has not put forth evidence of a sufficiently clear or definitive promise, it is submitted that sufficient evidence has been presented. Larobina has alleged that First Union promised that the original maturity date on the note would be re-aged. He further alleges that he relied on this promise in the form of forbearance, as he did not pay the balance of the note on the original maturity date. Finally, he alleges that his reliance caused him a detriment as he is now allegedly in default. These allegations are sufficient to maintain this claim. See Judge Karazin's 2001 ruling in this case denying the defendant's motion to strike this Count Twelve. Larobina, supra, 2001 Ct.Sup at 16572-573. First Union has not presented evidence to demonstrate the absence of genuine issues as to any material fact relating to this count of the complaint. Accordingly, the court denies the motion for summary judgment as to Count Twelve.
Order
For the foregoing reasons the Defendant's Motion for Summary Judgment dated December 2, 2005 (No. 394) is granted as to Counts One, Six, and Seven of the Substitute Complaint dated September 27, 2001, and judgment may enter for the defendant on those counts.
The motion for summary judgment is denied as to Counts Two, Three, Four, Five, Eight, Nine, Ten, Eleven, and Twelve of the Substitute Complaint.
So Ordered.