Opinion
No. 565999
December 1, 2003
MEMORANDUM OF DECISION, RE: MOTION TO STRIKE (# 103)
FACTS
Presently before the court is the defendants' motion to strike the plaintiff's petition for a bill of discovery. On June 9, 2003, the plaintiff, Peter Legnos, filed a petition for a bill of discovery against the defendants, ITT Hartford and Twin City Fire Insurance Company.
In the petition, the plaintiff alleges the following facts. The plaintiff had a commercial automobile insurance policy with the defendants, pursuant to which the plaintiff demanded his underinsured motorist claim proceed to arbitration. During the two years that the arbitration proceedings were pending, the defendants refused to enter into settlement discussions with the plaintiff. Throughout the arbitration process, the defendants claimed that the plaintiff was responsible for his injuries and failed to recognize a causal connection between the accident and the plaintiff's injuries. The defendants insisted that the plaintiff reduce his demand before they would engage in settlement discussions.
Additional allegations in the petition are stated "upon information and belief." Specifically, the plaintiff alleges "upon information and belief" that prior to the plaintiff's exhaustion of the available liability coverage, the defendants had reserved the precise amount that the arbitrator eventually award. In addition, the plaintiff alleges "upon information and belief" the defendant performed a "records IME" that was never disclosed because it established causation. The plaintiff further alleges that the defendants' refusal to enter into settlement discussions allowed the defendants to accumulate significant interest income for six years on the reserved amount.
This allegation is followed by a reference to the plaintiff's exhibit B, which is attached to the plaintiff's petition. The court is unable to discern the significance of the exhibit because the plaintiff has not alleged what the exhibit is or how it supports the allegations of the petition.
The plaintiff does not explain what a "records IME" is.
Based on these alleged facts, the plaintiff further alleges that he believes there may be a basis for a cause of action against the defendants for a bad-faith insurance practice. Accordingly, the plaintiff requests in his prayer for relief that "the defendants . . . make [their] employees . . . available to testify under oath by deposition and to produce such documents and written materials as may be required."
On June 11, 2003, the defendants moved to strike the plaintiff's petition on the ground that the plaintiff has failed to allege facts sufficient to demonstrate that he has probable cause to bring a claim for a bad-faith insurance practice. In compliance with Practice Book § 10-42, the defendants have filed a memorandum in support of their motion to strike, and the plaintiff has timely filed a memorandum in opposition.
DISCUSSION
"The purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any complaint . . . to state a claim upon which relief can be granted." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 498, 815 A.2d 1188 (2003). "For the purpose of ruling upon a motion to strike, the facts alleged in a complaint, though not the legal conclusions it may contain, are deemed to be admitted."
(Internal quotation marks omitted.) Murillo v. Seymour Ambulance Ass'n, Inc., 264 Conn. 474, 476, 823 A.2d 1202 (2003).
The role of the trial court in ruling on a motion to strike is "to examine the [complaint], construed in favor of the [plaintiff], to determine whether the [pleading party has] stated a legally sufficient cause of action." (Internal quotation marks omitted.) Dodd v. Middlesex Mutual Assurance Co., 242 Conn. 375, 378, 698 A.2d 859 (1997). "In ruling on a motion to strike, the court is limited to the facts alleged in the complaint." (Internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997). "[I]f facts provable in the complaint would support a cause of action, the motion to strike must be denied." (Internal quotation marks omitted.) Vacco v. Microsoft Corp., 260 Conn. 59, 65, 793 A.2d 1048 (2002).
The defendants argue that the plaintiff has not pleaded sufficient facts to demonstrate probable cause to bring a bad-faith insurance practice claim. Before analyzing the defendants' argument a brief discussion of the bill of discovery is warranted. "The bill of discovery is an independent action in equity for discovery, and is designed to obtain evidence for use in an action other than the one in which discovery is sought . . . As a power to enforce discovery, the bill is within the inherent power of a court of equity that has been a procedural tool in use for centuries . . . The bill is well recognized and may be entertained notwithstanding the statutes and rules of court relative to discovery . . . Furthermore, because a pure bill of discovery is favored in equity, it should be granted unless there is some well founded objection against the exercise of the court's discretion." (Internal quotation marks omitted.) Journal Publishing Co. v. Hartford Courant Co., 261 Conn. 673, 680-81, 804 A.2d 823 (2002).
Early Connecticut case law distinguished between pure bills of discovery and bills for discovery and relief. See Pottetti v. Clifford, 146 Conn. 252, 258, 150 A.2d 207 (1959). "In the latter, the petitioner must show that he has stated a valid cause of action for the equitable relief in support of which he seeks to invoke the equitable powers of the court for a discovery." Id. The present action is for a pure bill of discovery as opposed to a bill for discovery and relief.
"The rationale of the [pure bill of discovery], when used as an auxiliary process in aid of trials at law, is simplicity itself. At times, cases will not be proved, or will be proved clumsily or wastefully, if the litigant is not permitted to gather his evidence in advance. When this necessity is made out with reasonable certainty, a bill in equity is maintainable to give him what he needs . . . Today the remedy survives, chiefly, if not wholly, to give facility to proof." (Citations omitted; internal quotation marks omitted.) Pottetti v. Clifford, 146 Conn. 252, 258-59, 150 A.2d 207 (1959).
"To sustain the bill, the petitioner must demonstrate that what he seeks to discover is material and necessary for proof of, or is needed to aid in proof of or in defense of, another action already brought or about to be brought . . . Discovery is confined to facts material to the plaintiff's cause of action and does not afford an open invitation to delve into the defendant's affairs . . . The plaintiff who brings a bill of discovery must demonstrate by detailed facts that there is probable cause to bring a potential cause of action." (Citation omitted; internal quotation marks omitted.) Journal Publishing Co. v. Hartford Courant Co., supra, 261 Conn. 681. Allegations that are mere "speculations and suspicions . . . are not sufficient as facts to establish that probable cause exists to bring a potential cause of action." Nestor v. Travelers Indemnity Co., 41 Conn. App. 625, 631, 677 A.2d 475, cert. denied, 239 Conn. 903, 682 A.2d 1004 (1996).
"Probable cause is the knowledge of facts sufficient to justify a reasonable man in the belief that he has reasonable grounds for presenting an action . . . Its existence or nonexistence is determined by the court on the facts found . . . Moreover, the plaintiff who seeks discovery in equity must demonstrate more than a mere suspicion; he must also show that there is some describable sense of wrong . . . Whether particular facts constitute probable cause is a question of law." (Citation omitted; internal quotation marks omitted.) Id., 681-82. "[T]here is a distinction between a would-be plaintiff having to demonstrate the need for the information to determine whether a particular cause of action is worthy of being pursued and a plaintiff having to prove definitively that he has a cause of action and that he will probably prevail ultimately at the trial on the merits." Berger v. Cuomo, 230 Conn. 1, 9, 644 A.2d 333 (1994). A pure bill of discovery is used to obtain information necessary to ascertain whether one has a cause of action. See id.
Turning to the alleged prospective bad-faith insurance practice claim, "[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." (Internal quotation marks omitted.) Gupta v. New Britain General Hospital, 239 Conn. 574, 598, 687 A.2d 111 (1996). Specifically, the Supreme Court has extended the implied covenant of good faith and fair dealing to insurance contracts. See Verrastro v. Middlesex Ins. Co., 207 Conn. 179, 190, 540 A.2d 693 (1988). The violation of this implied covenant is subject to tort liability. See L.F. Pace Sons, Inc. v. Travelers Indemnity Co., 9 Conn. App. 30, 46, 514 A.2d 766, cert. denied, 201 Conn. 811, 516 A.2d 886 (1986); Black v. Goodwin, Loomis Britton, Inc., Superior Court, judicial district of New London, Docket No. 519101 (April 19, 1995, Hendel, J.) ( 13 Conn. L. Rptr. 574, 576), aff'd, 239 Conn. 144, 681 A.2d 293 (1996).
The defendants in their memorandum of law in support of the motion to strike assert that the plaintiff has failed to demonstrate probable cause to sustain a claim under the Connecticut Unfair Insurance Practices Act (CUIPA), General Statutes § 38a-815 et seq., or the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. "In a CUTPA or CUIPA claim, the insurer's liability is ordinarily based on its conduct in settling or failing to settle the insured's claim and on its claims settlement policies in general. The factual inquiry focuses, not on the nature of the loss and the terms of the insurance contract, but on the conduct of the insurer." (Internal quotation marks omitted.) Heyman Associates No. 1 v. Insurance Co. of Pennsylvania, 231 Conn. 756, 790, 653 A.2d 122 (1995). Although it is not clear from the plaintiff's petition whether he plans to pursue a claim under CUIPA or CUTPA, the court's reasoning applies equally to a potential common law claim for breach of the implied covenant of good faith and fair dealing and a potential claim under CUIPA or CUTPA.
"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." (Citation omitted; internal quotation marks omitted.) Habetz v. Condon, 224 Conn. 231, 237, 618 A.2d 501 (1992).
As noted earlier, the plaintiff has alleged "upon information and belief" that the defendants conducted a "records IME" that established causation and that the defendants had reserved the precise amount that the arbitrators eventually awarded. The plaintiff does not offer any factual basis to support these allegations. Mere speculations and suspicions are insufficient to establish probable cause. See Nestor v. Travelers Indemnity Co., supra, 41 Conn. App. 631-32. Consequently, the court will not consider the plaintiff's allegations that a "records IME" was conducted or that the amount eventually awarded had been held in reserve by the defendant.
It is worth restating that in petitioning the court for a bill of discovery, "[t]he plaintiff need not . . . state each claim with technical precision; he need only set forth facts that fairly indicate that he has some potential cause of action. Pottetti v. Clifford, supra, 146 Conn. 259." Berger v. Cuomo, supra, 230 Conn. 8. If proven, the allegations of which the plaintiff would have firsthand knowledge; i.e., the defendants' refusal to participate in settlement negotiations, the requirement that the plaintiff reduce his demand, the prolonging of the settlement process, the failure to recognize a causal connection between the accident and the plaintiff's injuries and blaming the plaintiff for his injuries, would sufficiently demonstrate probable cause to bring a bad-faith insurance practice claim.
In accordance with the foregoing discussion, the defendants' motion to strike is denied.
D. MICHAEL HURLEY, JUDGE TRIAL REFEREE.