Opinion
LLICV106002865S.
12-11-2012
George SPATTA, Jr. v. AMERICAN CLASSIC CARS, LLC et al.
Randall J. Carreira, New Preston, for George Spatta, Jr. Law Offices of Paul M. Cramer, Fairfield, for American Classic Cars, LLC et al.
UNPUBLISHED OPINION
Randall J. Carreira, New Preston, for George Spatta, Jr.
Law Offices of Paul M. Cramer, Fairfield, for American Classic Cars, LLC et al.
JOHN W. PICKARD, Judge.
This case was tried as a hearing in damages following the defendants' default for lack of discovery compliance. The trial extended over a period of several days. The parties filed post-trial briefs, the last of which was filed on October 29, 2012.
Pursuant to Practice Book §§ 17-34 and 17-35, at a hearing in damages the defendant shall not be permitted to offer evidence to contradict the allegations of the plaintiff's complaint, except as to the amount of damages, unless the defendant has given notice of the intention to contradict the allegations of the complaint within ten days after notice that a default has been entered. In this case, the defendants did not file a timely notice of the intention to contradict the allegations of the complaint. " In an action at law, the rule is that the entry of a default operates as a confession by the defaulted defendant of the truth of the material facts alleged in complaint which are essential to entitle the plaintiff to some of the relief prayed. It is not the equivalent of an admission of all of the facts pleaded. The limit of its effect is to preclude the defaulted defendant from making any further defense and to permit the entry of a judgment against him on the theory that he has admitted such of the facts alleged in the complaint as are essential to such judgment. It does not follow that the plaintiff is entitled to a judgment for the full amount of the relief claimed. The plaintiff must still prove how much of the judgment prayed for in the complaint he is entitled to receive." (Citations omitted.) Whitaker v. Taylor, 99 Conn.App. 719, 726 916 A.2d 834 (2007). A defaulted party who fails to file a timely notice of defenses prior to the hearing in damages " does so at his peril." Bank of New York v. National Funding, 97 Conn.App. 133, 141, 902 A.2d 1073, cert. denied, 280 Conn. 925, 908 A.2d 1087 (2006).
As a consequence of the default and the defendants' failure to file a timely notice of intention to contradict, the court is bound by the material, factual allegations set forth in the plaintiff's complaint. Id., at 727, 908 A.2d 1087. These material factual allegations are set forth below. Additional findings, based upon the evidence, will be set forth later.
The defendant, American Classic Cars, LLC (" ACC"), is a limited liability company engaged in the business of antique car restoration and new vehicle manufacture and/or assembly in New Milford. The defendant, Gus J. Paoli (" Paoli"), is the member and operator of ACC. In March 2007, the plaintiff, George K. Spatta, Jr., met with Paoli two or three times regarding the plaintiff's dream of owning a 1957 Chevrolet Bel Air convertible. Paoli, who represented himself to be an expert at car assembly, offered to build the plaintiff a 1957 Chevrolet Bel Air convertible as a new car for $10,000 over his cost, which he estimated to be $110,000. Paoli further represented that he could complete the vehicle in three months, that it would be new car quality, and that the car would perform as a new car. Paoli represented multiple times that the vehicle would be worth over $250,000. Based upon Paoli's representations, the plaintiff paid the defendants $50,000 as a down payment.
Progress on the assembly of the new car dragged on for the balance of 2007, through 2008 and into 2009. The plaintiff paid the defendants additional money as it was requested. In January 2009, he also paid $3,500 directly to the defendants' upholstery contractor to get the work done. The plaintiff picked up the car on September 5, 2009.
The vehicle overheated, the power steering and power brakes were whining, the emergency brake did not operate and the transmission was not operating properly. The plaintiff returned the car to the defendants. A week later, after picking the car up again, the power windows did not operate and the power top frame became bent when operated, which caused the canvas top to tear. The defendants blamed the plaintiff.
Subsequently, the plaintiff discovered that the metal frame top had been improperly installed, the backseat was not made for this vehicle, the soundproofing was inadequate for the vehicle and the front seat had been incorrectly installed. The plaintiff was required to gut the interior and reassemble it with proper parts.
The plaintiff brought the car back to the defendants on four separate occasions to deal with various defects. The vehicle is not driveable in a safe condition due to defects in the power steering, power brakes, emergency brake, transmission and intake manifold. There is an overheating problem, the doors and trunk lid are not properly aligned, and the doors do not shut when the windows are up. The car has been driven a total of 471 miles and has been parked in the plaintiff's garage for more than two years.
The plaintiff has paid the defendants $175,000 plus sales tax of $10,500. He has also paid directly for parts and repairs. The defendants overcharged the plaintiff by billing him for parts above the defendants' cost for those parts.
Having heard all of the testimony and having reviewed all of the admissible evidence, the court makes the following additional findings of fact. The plaintiff paid directly for various items during assembly of the vehicle in the amount of $10,976.83. He also paid $10,000 to rectify defects in the seats, upholstery and roof frame and top.
The defendants took on the job hoping it would give them a finished product which could be used in advertising, but they had never built a car from scratch and did not have the experience or skill to successfully complete this project. There was no written contract between the parties. All of the parts installed in the car were new with the exception of a few small trim items. The plaintiff told the defendants that he wanted a larger engine than had been standard equipment on the 1957 Chevrolet.
The defendants took the vehicle to the Motor Vehicle Department to have it inspected and registered before it was delivered to the plaintiff. The vehicle passed the inspection and was registered. Despite that fact, the vehicle which the defendants delivered to the plaintiff in September 2009, was unsafe in several respects. On this issue, the court found highly credible the testimony of the plaintiff's automotive expert, Roland Corsi. The safety issues which Mr. Corsi identified are verified by photographs which demonstrate the following.
1. The gas pedal is mounted so that it is actually under the right side of the brake pedal. This can prevent quick application of the brake because the foot may strike the underside of the brake pedal.
2. Both steering universal joints are not secured correctly. Two of the lock nuts are missing and the center set screws are not protruding past the lock nuts as they should be. Also, the steering shaft hits the header when the engine torques up in the drive position.
3. The gasoline filter is mounted directly over the exhaust system with the mounting screws protruding into the filter base. This can cause a crack in the filter housing, resulting in a leak which can cause the gas to ignite from the heat of the exhaust.
4. The rear brake hoses are curled causing them to hit the rear coil over the shocks. The brake line going to the rear of the vehicle is improperly centered through the hole in the frame, which will eventually wear through the brake line.
5. The main power cable is mounted so it rubs on the transmission housing, which can cause a fire when the cable hits ground.
6. The power windows have power to them at all times, thereby causing a fire hazard. The on/off switch in the trunk is inadequate.
7. The emergency brake was not installed correctly and is inoperative.
8. The headlights are not adjusted properly and made driving at night almost impossible.
9. The steering lines were incorrectly installed to the reservoir resulting in unstable braking, with hard and unsafe steering.
10. The oil pan was installed improperly, the rear main seal is leaking as is the oil pan gasket. The engine overheated leading to the potential for serious engine damage.
11. The frame was improperly attached to the body because of improper body mounts and hardware. When the body bolts loosen, the body will move around. This has caused the intake manifold to hit the front hood and to cause the misalignment of the doors and hood.
12. The improper fastening of the body to the frame also created inadequate spacing for the fuel lines and exhaust placement. This creates a fire hazard. The power steering lines were reversed, causing a whine and a potentially disastrous safety issue.
13. The exhaust pipes are larger than necessary and are bent incorrectly so that they hit other parts of the vehicle in every location possible.
14. Both front windows do not open or close at all. If the passenger side window is in the up position, the passenger side rear window closes over the door glass. The driver's rear window makes a very bad grinding noise when being raised or lowered past halfway.
The court accepts Mr. Corsi's opinion that, in order to correct the problems and defects in the vehicle, it will have to be taken apart and put back together again. The frame must be re-attached to the body using the proper grommets to prevent movement and misalignment. Many of the components which were improperly installed will need to be replaced. The court finds credible Mr. Corsi's opinion that the cost to disassemble and then reassemble the vehicle so that it is safe and proper will be close to the original amount that was spent, i.e., about $200,000.
The plaintiff's complaint sets forth eleven separate causes of action. Although some of these counts may be contradictory, the court is obligated to enter judgment in favor of the plaintiff on all of the counts and restrict its inquiry to the amount of damages the plaintiff may recover. Catalina v. Nicolelli, 90 Conn.App. 219, 225-26, 816 A.2d 588 (2005). The court does not agree with the defendants that the plaintiff failed to prove fraud, misrepresentation, or violation of CUTPA or the Lemon Law, and that the plaintiff is not entitled to damages on the counts pertaining to those claims. The defendants' default requires the court to accept, as true, the essential allegations of all of the counts and to enter judgment on all the counts. In addition, the plaintiff actually proved the allegations of all counts.
Paoli argues that he should not be held liable for anything and that liability should be against ACC only. This argument must be rejected. The allegations of all the counts are directed against both defendants. The default was against both defendants. There is no basis for the court to exempt the individual defendant from liability following the default.
The defendants argue that the court cannot award damages on count eleven, the claim based upon the Connecticut Lemon Law, General Statutes § 42-179, because the vehicle is not a " new motor vehicle" and neither defendant is a " manufacturer" as those phrases are used in the statute. This claim must be rejected. The facts proven at the trial lead the court to conclude that the vehicle is a " new vehicle" and the defendants are the " manufacturers." Further, the default obligates the court to accept the essential allegations of the complaint. In paragraph eleven, the plaintiff specifically alleged that the defendants are the manufacturers and that the vehicle is a new motor vehicle.
The plaintiff has submitted an affidavit of attorneys fees in the amount of $15,040.50 calculated at $185 per hour. These fees are fair and reasonable.
The plaintiff makes a claim for recovery of $5,471.50 which he has paid for insurance on the vehicle while it has been inoperable and stored in his garage. He also seeks to recover $2,619.12 which he paid for property taxes during the same period. Finally, he seeks to recover $700 paid to Mr. Corsi to inspect the vehicle and prepare a report. These expenses will not be awarded in this case. The first two expenses are the costs of ownership. The third expense is the cost of an expert witness and is properly awarded as an item within a bill of costs.
One issue that must be resolved are allegations in paragraphs 27 and 39 of the complaint. Paragraph 27 states: " The vehicle was appraised again by the same appraiser upon completion at $113,750.00." Paragraph 39 states: " As a result of plaintiff's reliance upon Defendants' representations aforesaid, the plaintiff paid the defendant far more money than said vehicle was reasonably worth at the time said payments were made. The final appraisal in late September of 2009, for the vehicle was $113,750.00." There was no evidence offered at the trial concerning these allegations. In their post-trial brief, the defendants argued that the court must accept the figure of $113,750 as the value of the vehicle delivered to the plaintiff and that this would place a limit on the potential damages, i.e., purchase price of $175,000 less appraised value of $113,750 equals $61,250.00. The plaintiff filed a reply brief on October 29, 2012, but did not address this argument. However, on November 5, 2012, the plaintiff filed a request for leave to amend the complaint to remove the references to the " appraised value" of $113,750. The request also proposes to add allegations concerning defects about which there was evidence but which were not specifically alleged in the complaint. Finally, the plaintiff proposes to correct a typographical error. The defendants filed a timely objection.
Practice Book § 10-62 provides, in part, that: " In all cases of any material variance between allegation and proof, an amendment may be permitted at any stage of the trial." " It is beyond dispute that a trial court may allow, in its discretion, an amendment to pleadings before, during, or as here, after trial to conform to the proof." Saphir v. Neustadt, 177 Conn. 191, 206, 413 A.2d 843 (1979). Here, the court will exercise its discretion to permit the amendment. The meaning of the allegation that the appraised value was $113,750 is not clear to the court. Since neither party chose to offer evidence about it, the court would have been left with a quandary as to what use to make of the allegation which it would have to accept as true. The court agrees with the plaintiff that it makes sense to have the allegations of the complaint conform to the proof by having the references to the " appraised value" removed. Also, the amendment will cause no real prejudice to the defendants because the primary remedy to be awarded by the court is rescission and restitution, a remedy which does not require to court to make a finding as to the value of the vehicle. The two other proposed amendments are also appropriate. The defendants' objection to the request for leave to amend is overruled.
Finally, the defendants argue that no damages can be awarded under the Lemon Law because the plaintiff did not provide the defendants with a reasonable opportunity to cure any alleged defect. This argument must be rejected for the same reasons that the defendants' other arguments have been rejected. First, the evidence supports the plaintiff's claim that the he made a reasonable number of attempts to have the defects repaired by the defendants as is required by General Statutes § 42-179(d). Second, the plaintiff specifically alleged, in count eleven, that: " The manufacturer defendant was unable to conform the vehicle to such warranties, despite the vehicle being repeatedly returned to enable the defendants to do so." The court must accept this allegation as true.
There are eleven counts in the amended complaint. There is duplication in some of the counts and it is hard to distinguish differences among them. The first, third and eighth counts are founded on fraudulent misrepresentations. As a remedy, the plaintiff seeks monetary damages, including punitive damages and attorney's fees, as well as rescission of the contract and restitution. The second and fourth counts are also based on fraudulent misrepresentations but seek only monetary damages as a remedy. The fifth count is based on CUTPA and seeks monetary damages, including punitive damages and attorneys fees. The sixth, seventh, ninth and tenth counts are based on breach of warranty. The sixth and ninth counts seek only monetary damages, and the seventh and tenth counts seek monetary damages as well as restitution. The eleventh count is based on the Connecticut Lemon Law, General Statutes § 42-179, and seeks monetary damages as well as rescission and restitution.
Thus, the plaintiff has presented the court with two distinct options regarding the award of damages. The first option would be to award monetary damages on all counts. The second option would be to issue the remedy of rescission and restitution on all of the counts which would permit it, and monetary damages on the other counts. The plaintiff has indicated that he prefers the second option. For these reasons, the court has decided to award rescission and restitution where appropriate and monetary damages on the other counts. Because many of the counts are based upon fraud, proof of the damages has been by clear and convincing evidence. Further, under the Lemon Law, the court may award the plaintiff his costs and reasonable attorneys fees. General Statutes § 42-180.
Accordingly, on the first, third, seventh, eighth, tenth and eleventh counts the court finds that the agreement between the parties should be rescinded and that the plaintiff should transfer the vehicle to the defendants upon the payment of the following: purchase price of $175,000, plus the amount spent directly by the plaintiff of $10,976.83, plus the amount spent on interior repairs of $10,000, plus reasonable attorneys fees in the amount of $15,040.50. The total of these sums is $211,017.33. The plaintiff may submit a bill of costs as well.
Because the court is obligated to enter judgment on all counts, the court will award damages on the second, fourth, fifth, sixth and ninth counts. The court does not expect the plaintiff to seek to collect these damages, as he indicated in his brief that rescission and restitution was his preferred remedy. The monetary damages shall be the costs to repair of $175,000 plus the amount spent to repair the interior of $10,000 for a total of $185,000 plus costs.