Opinion
No. FST CV 05 4003913
March 7, 2006
MEMORANDUM OF DECISION RE MOTION TO STRIKE
On March 16, 2005, the plaintiff, MMC Webreporter Systems.com, Inc., filed a four-count complaint against the defendant, NST Systems, Inc., alleging breach of contract, unjust enrichment, breach of an implied duty of good faith and fair dealing and a violation of General Statutes § 42-110a et seq., the Connecticut Unfair Trade Practices Act (CUPTA).
The plaintiff alleges that on or around July 2, 2004, the plaintiff and the defendant, a computer services and website consulting firm, entered into an agreement under which the defendant would provide the plaintiff with computer consulting services. In exchange for these services, the plaintiff was to compensate the defendant. The defendant provided services to the plaintiff for which it was compensated. The plaintiff further alleges that the defendant did not provide services in the manner agreed to under the contract, or to the satisfaction of the plaintiff.
On June 10, 2005 the defendant filed a revised three-count counterclaim against the plaintiff. The defendant alleges that on June 11, 1998, it agreed to provide computer support services to Management and Marketing Corporation International (MMCI). MMCI assigned the assets and benefits of the contract to the plaintiff, who allegedly requested that the defendant provide the services contracted for under the agreement. The defendant alleges it provided services to the plaintiff for which it is owed a balance of $16,921.27. The defendant asserts breach of contract, quantum meruit and unjust enrichment in its counterclaim.
On June 13, 2005, the plaintiff filed motion #106 to strike all three counts of the defendant's counterclaim on the ground that each count fails to state a proper cause of action. The matter appeared on the law or motion short calendar of November 21, 2005. (Col. 4; pos. 32.)
"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). "A motion to strike challenges the legal sufficiency of a pleading, and, consequently, requires no factual findings by the trial court." (Internal quotation marks omitted.) Ventres v. Goodspeed Airport, LLC, 275 Conn. 105, 154, 881 A.2d 937, (2005). "The role of the trial court [is] to examine the pleading], construed in favor of the [pleading party], 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). "[A] counterclaim is a cause of action existing in favor of the `defendant against the plaintiff and on which the defendant might have secured affirmative relief had he sued the plaintiff in a separate action . . . A motion to strike tests the legal sufficiency of a cause of action and may properly be used to challenge the sufficiency of a counterclaim." (Citations omitted; internal quotation marks omitted.) Fairfield Lease Corp. v. Romano's Auto Service, 4 Conn.App. 495, 496, 495 A.2d 286 (1985).
The plaintiff argues that the defendant fails to state a cause of action in all three counts of its counterclaim. It argues that the breach of contract count is invalid because the contract at issue was between the defendant and a third party. Although the defendant alleges that the plaintiff ratified the contract between the defendant and MMCI, the count contains no allegations regarding the plaintiff's knowledge of or intent to ratify that contract.
The plaintiff argues that the defendant fails to properly allege quantum meruit. It argues that in order to properly plead quantum meruit, the allegations must be sufficient to show that the plaintiff knowingly accepted the defendant's services, and represented that it would compensate it, thereby impliedly promising to pay for services rendered. The plaintiff argues that the defendant did not do so.
Finally, the plaintiff argues that the unjust enrichment count is improper because this cause of action only applies when the benefit conferred is money or property, not when the only benefits allegedly conferred are services, as in the present case.
The defendant counters that it has properly pleaded all three counts of its counterclaim. First, it argues that it has pleaded sufficient facts for the breach of contract claim. In 1998, the defendant entered into a contract with MMCI. It further contends that MMCI and the plaintiff are owned by the same individual, Edward Valentine, who requested that the defendant provide services pursuant to the agreement. The defendant also alleges that the plaintiff requested services from the defendant pursuant to the agreement. The defendant further alleges that MMCI assigned its assets and benefits of that contract to the plaintiff. The defendant also argues that the plaintiff accepted the defendant's services which constitutes a ratification of the contract and it breached the contract by failing to compensate the defendant for services provided.
Second, the defendant argues that it has properly alleged a claim for quantum meruit. The defendant avers that an implied contract for services existed between the parties because the plaintiff requested consulting services through Valentine, its president, from the defendant, and the defendant conferred this benefit upon the plaintiff. Therefore, the defendant argues that the plaintiff's course of conduct implied a promise to pay for the services the defendant provided.
Lastly, the defendant argues that it has sufficiently alleged a claim for unjust enrichment. It argues that unjust enrichment is a proper cause of action for services rendered under a contract, not solely when the receipt of money or property is at issue as the plaintiff has argued.
BREACH OF CONTRACT
The legal standard for contract ratification is well established in Connecticut. "As a general rule, [r]atification is defined as the affirmance by a person of a prior act which did not bind him but which was done or professedly done on his account . . . Ratification requires acceptance of the results of the act with an intent to ratify, and with full knowledge of all the material circumstances." (Internal quotation marks omitted.) II Giardino, LLC v. Belle Haven Land Co., 254 Conn. 502, 530, CT Page 4759 757 A.2d 1103 (2000).
The issue is whether the defendant's factual allegations are legally sufficient to demonstrate that the plaintiff ratified the contract between the defendant and MMCI. The defendant has alleged in its counterclaim that the plaintiff requested that the defendant provide services pursuant to the agreement. The defendant has also alleged that it provided these services to the plaintiff, and the plaintiff accepted them. If, as the defendant alleges, the plaintiff requested and accepted the defendant's services "pursuant to the agreement," the plaintiff accepted the defendant's services with full knowledge of the material circumstances and with the intent to ratify the agreement. The agreement would inform the plaintiff of the material circumstances of the contract and the plaintiff's acceptance of the services demonstrates the intent to ratify.
Accordingly, the defendant has alleged sufficient facts for ratification. The counterclaim alleges that through its course of conduct, the plaintiff ratified the agreement, and then, by refusing to pay the defendant for the services provided, it breached the contract. Although the plaintiff argues that the defendant has failed to plead ratification because its counterclaim contains no allegations of the plaintiff's knowledge of or intent to ratify the agreement, the defendant has alleged sufficient facts to prove the contrary. The defendant also alleges that the plaintiff did not compensate it for the services rendered, which is sufficient to plead a breach of contract claim. Therefore, the plaintiff's motion to strike the first count of the defendant's counterclaim is denied.
QUANTUM MERUIT
" Quantum meruit is the remedy available to a party when the trier of fact determines that an implied contract for services existed between the parties, and that, therefore, the plaintiff is entitled to the reasonable value of services rendered . . . Such contracts are determined from evidence of the parties' course of conduct which implies a promise to pay for the services rendered. The pleadings must allege facts to support the theory that the defendant, by knowingly accepting the services of the plaintiff and representing to her that she would be compensated in the future, impliedly promised to pay her for the services she rendered . . . If the allegations do support the theory, then the plaintiff was entitled [on the basis of] quantum meruit for the recovery of the value of the services rendered." (Citations omitted.) Burns v. Koellmer, 11 Conn.App. 375, 383-84, 527 A.2d 1210 (1987). " Quantum meruit . . . is the form of action which has been utilized when the benefit received was the work, labor, or services of the party seeking restitution." (Internal quotation marks omitted.) Louis Gherlone Excavating, Inc. v. McLean Co., Superior Court, judicial district of New Haven, Docket No. CV 04 0490449 (May 20, 2005, Martin, J.).
The defendant has alleged sufficient facts to properly plead quantum meruit. The plaintiff impliedly promised to pay for benefits it received, and the defendant may be awarded damages based on quantum meruit. The defendant has alleged that it provided services to the plaintiff at the request of Edward Valentine, who is purportedly the plaintiff's president. The plaintiff knowingly accepted these services.
The plaintiff has not questioned Edward Valentine's authority to engage in binding business transactions on behalf of the plaintiff.
By requesting and accepting services from the defendant, the plaintiff made an implied promise to pay for the services and the defendant may be entitled to the reasonable value for services provided. The plaintiff's course of conduct implies a promise to pay the defendant for the services it provided. Thus, the plaintiff's motion to strike the second count of the defendant's counterclaim is denied.
UNJUST ENRICHMENT
"Unjust enrichment applies whenever justice requires compensation to be given for property or services rendered under a contract, and no remedy is available by an action on the contract." (Internal quotation marks omitted.) Gagne v. Vaccaro, 255 Conn. 390, 401, 766 A.2d 416 (2001). "[A] right of recovery under the doctrine of unjust enrichment is essentially equitable, its basis being that in a given situation it is contrary to equity and good conscience for one to retain a benefit which has come to him at the expense of another . . . Unjust enrichment is a very broad and flexible equitable doctrine that has as its basis the principle that it is contrary to equity and good conscience for a defendant to retain a benefit that has come to him at the expense of the plaintiff. The doctrine's three basic requirements are that (1) the defendant was benefitted, (2) the defendant unjustly failed to pay the plaintiff for the benefits, and (3) the failure of payment was to the plaintiff's detriment. All the facts of each case must be examined to determine whether the circumstances render it just or unjust, equitable or inequitable, conscionable or unconscionable, to apply the doctrine." (Citations omitted; internal quotation marks omitted.) Id., 408-09. "This doctrine is based upon the principle that one should not be permitted unjustly to enrich himself at the expense of another but should be required to make restitution of or for property received, retained or appropriated." Douaihy v. Integrated Quality Systems, Inc., Superior Court, judicial district of Litchfield, Docket No. CV93 063411 (May 26, 1994) ( 9 C.S.C.R. 643).
The defendant has alleged sufficient facts to meet the three requirements of unjust enrichment. The defendant has alleged that the plaintiff was benefitted by the services provided by the defendant, the plaintiff unjustly failed to pay the defendant for these services, and this failure to pay was detrimental to the defendant in that it suffered a monetary loss. Although the plaintiff argues that unjust enrichment is a proper cause of action only when the benefit conferred is money or property, the Supreme Court has applied this cause of action to services rendered. The plaintiff's motion to strike the third count of the defendant's counterclaim is denied.
See Gagne v. Vaccaro, supra, 255 Conn. 390 (unjust enrichment theory applied to claim for compensation for legal services rendered).
In conclusion, the plaintiff's motion to strike all three counts of the defendant's counterclaim is denied for the reasons stated.