Opinion
No. 399294
July 26, 2004
MEMORANDUM OF DECISION
On March 27, 1997, the plaintiff, Water Pollution Control Authority of the City of Bridgeport (plaintiff or WPCA) and the defendant, Professional Services Group, Inc. (PSG) entered into a written agreement in which PSG agreed that based on a schedule of compensation it would operate and maintain the plaintiff's wastewater treatment facilities. The agreement, which was subsequently amended, provided for the arbitration of any disputes between the parties. Disagreements arose between the parties as to the scope of the work and the compensation to which PSG was entitled. PSG filed a claim for arbitration seeking additional compensation and identified itself in the claim as Professional Services Group, Inc. d/b/a/ U.S. Filter. The plaintiff filed a counterclaim against PSG using the same name. The claim and counterclaim were heard together by the same arbitrator. The arbitrator found in favor of PSG on its claim in the amount of $800,000 and in favor of the plaintiff on its counterclaim in the amount of $788,605.00.
The plaintiff brought an application to the superior court to confirm the award in its favor and an application to vacate the award for PSG. Each application was accompanied by civil summons form JD-CV-1. In the space provided on the form designated "first named defendant," the plaintiff's attorney identified the defendant as "PROFESSIONAL SERVICES GROUP, INC., d/b/a/ U.S. Filter 205 Bostwick Avenue, Bridgeport, Ct 06605." In the space just below designated "additional defendant" the plaintiff's attorney stated:
Agent for PSG: Clara Mancini, 900 Chapel St., New Haven, Ct 06510
Agent for U.S. Filter: Salvatore Impellizzeri, 189 Ward St., New Haven, Ct 06519
Service, however, was not made on either agent but rather on a project manager of PSG authorized to accept service.
The applications were assigned separate docket numbers but were tried together. On April 23, 2003, the court rendered judgment granting the application to vacate the award in favor of PSG. That same day, the court issued an order stating that the application to confirm was granted. On May 2, 2003, the plaintiff filed a motion for judgment confirming the arbitration award. On May 19, 2003, that motion was granted by the court.
On September 8, 2003, the plaintiff served executions on the towns of Seymour, Newtown and Naugatuck and the City of Danbury. Danbury and Naugatuck are customers of USFilter Operating Services, Inc. (USFOS), not PSG. In response to objections from PSG, the plaintiff withdrew these executions. However, after serving PSG's counsel with notice of the judgment, the plaintiff again served these towns with executions. In response, PSG moved for a protective order pursuant to General Statutes § 52-400a. After a hearing, the court denied the motion.
On December 24, 2003, USFOS filed a "motion to disgorge," representing that the plaintiff had improperly received approximately $900,000 in assets as a result of having served a third-party execution on the City of Danbury. That motion is now before the court.
In its motion to disgorge, USFOS claims that (1) PSG and USFOS are separate and distinct corporate entities, (2) USFOS' assets are not subject to the judgment, (3) the plaintiff at all times knew that PSG and USFOS were separate entities, (4) the plaintiff directed a marshal to levy on USFOS' assets despite its knowledge that USFOS was not a party to the judgment, and (5) USFOS has been damaged by the execution.
In its objection to the motion to disgorge, the plaintiff contends (1) PSG and USFOS were held out to be the same company and were both party to the arbitration award and confirmation process, (2) the motion to disgorge is an attempt to open the judgment beyond the four-month period for doing so, (3) no motion to disgorge exists in Connecticut law, (4) USFOS has successor liability to PSG, (5) the motion is barred by the doctrine of res judicata.
The court holds that USFOS's motion, despite its appellation, is functionally a motion for the determination of interests in disputed property, pursuant to General Statutes § 52-356c, and That because no judgment was rendered against USFOS no execution could issue against it. Accordingly, the motion to disgorge is granted.
The court first addresses the plaintiff's objections to the motion.
I
The plaintiff first argues that the court may not entertain the instant motion because there is nothing in the Practice Book that provides for a motion to disgorge. The court concludes that while the plaintiff is correct that the Practice Book does not provide USFOS with a procedural mechanism for the relief it seeks, the court nonetheless has jurisdiction to grant such relief, pusuant to General Statutes § 52-356c.
Practice Book § 1-1(a) states in relevant part: "The rules for the superior court govern the practice and procedure in the superior court in all civil . . . actions whether cognizable as cases at law, in equity or otherwise . . ." No Practice Book provision provides for a motion to disgorge or specifically addresses the relief that USFOS seeks.
However, there is no appellate authority for the proposition on which the plaintiff implicitly relies, that a Practice Book rule must exist before a party may invoke a statutory right. General Statutes § 51-14(a) provides in part that the Practice Book "rules shall not abridge, enlarge or modify any substantive right nor the jurisdiction of any of the courts." At least where the exercise of that right in the present procedural context does not clearly conflict with a Practice Book provision, the absence of a pleading in the Practice Book entitled "motion to disgorge" is no barrier to the court's entertaining such a motion so long as it has jurisdiction to act. See Zadravecz v. Zadraveca, 39 Conn.App. 28, 30, 664 A.2d 303 (1995). The court turns to that issue.
"Jurisdiction involves the right to adjudicate concerning the subject matter in a given case. For the establishment of this right there are three essentials: first, the court must have cognizance of the class of cases to which the one to be adjudged belongs; second, the proper parties must be present; and third, the point decided must be, in substance and effect, within the issue." Telesco v. Telesco, 187 Conn. 715, 719-20, 447 A.2d 752 (1982).
First, the court has cognizance of the class of cases to which these proceedings belong, pursuant to General Statutes § 52-356c. General Statutes §§ 52-350a to 52-400f address postjudgment procedures. The substantive right to the relief that USFOS seeks is conferred by General Statutes § 52-356c. General Statutes § 52-356c(a) provides in part: "Where a dispute exists between the judgment debtor or judgment creditor and a third person concerning an interest in personal property sought to be levied on, or where a third person claims that the execution will prejudice his superior interest therein, the judgment creditor or third person may, within twenty days of service of the execution or upon application by the judgment creditor for a turnover order, make a claim for determination of interests pursuant to this section." Here, a dispute exists between a judgment creditor, the plaintiff and a third person, USFOS, concerning an interest in personal property, debts ostensibly owed by the City of Danbury to USFOS.
General Statutes § 52-356c provides in its entirety:
(a) Where a dispute exists between the judgment debtor or judgment creditor and a third person concerning an interest in personal property sought to be levied on, or where a third person claims that the execution will prejudice his superior interest therein, the judgment creditor or third person may, within twenty days of service of the execution or upon application by the judgment creditor for a turnover order, make a claim for determination of interests pursuant to this section.
(b) The claim, which shall constitute the appearance of any third-person claimant, shall be filed with the Superior Court, on a prescribed form as a supplemental proceeding to the original action. The claim shall contain a description of the property in which an interest is claimed and a statement of the basis for the claim or of the nature of the dispute.
(c) On filing of the claim, the clerk of the court shall assign the matter for hearing on a date certain and order that notice of the hearing be served by the claimant on all persons known to claim an interest in the disputed property.
(d) Pending the hearing on the claim and subject to further order of the court, any property in dispute shall continue to be held by the person then in possession and shall not be transferred to any person who is not a party to the supplemental proceeding. If previously seized by or delivered to a levying officer, the property shall remain in the custody of the levying officer.
(e) Unless the judgment creditor waives such rights as he may have to execute against the contested property, the claim shall be deemed controverted and the issues shall be joined without further pleading by any party. The court may permit or require such further pleadings, amendments and notices and may make such further orders as justice or orderly administration requires. Prior to hearing the claim, the court may in its discretion: (1) Require the judgment creditor to post a bond in favor of a third person claimant for any damages which may accrue as a result of the outstanding execution and any subsequent proceedings, (2) on substitution by the third person of a bond as security for the property, allow the third person to obtain release of the property pending determination of the claim, or (3) direct that other known nonexempt property of the judgment debtor first be executed against. CT Page 11649
(f) After hearing, the court shall render judgment determining the respective interests of the parties and may order the disposition of the property or its proceeds in accordance therewith.
(g) This section does not affect any interest in property of any person who is not a party to a determination pursuant to the provisions of this section.
Even before the enactment of that statute, it was recognized that "courts have a general supervising control over the processes of execution, and for the purpose of preventing injustice, an execution is within the inherent, equitable control of the court . . . And equity will interfere if it appears that the execution would be against good conscience." Goodlatte v. Liberty Mutual Ins. Co., 27 Conn.Sup. 382, 385, 239 A.2d 546 (1967). "The Superior Court has broad subject matter jurisdiction over legal and equitable rights. General Statutes § 52-1." Davis v. Board of Education, 3 Conn.App. 317, 321, 487 A.2d 1114 (1985). "[A] trial court is vested with broad authority to fashion equitable relief." Elm City Cheese Co. v. Federico, 251 Conn. 59, 94, 752 A.2d 1037 (1999). "`Once a right and a violation have been shown, the scope of a . . . court's equitable powers to remedy past wrongs is broad, for breadth and flexibility are inherent in equitable remedies.' Swann v. Board of Education, 402 U.S. 1, 15, 91 S.Ct. 1267, 28 L.Ed.2d 554 (1971)." Pamela B. v. Ment, 244 Conn. 296, 315, 709 A.2d 1089 (1998).
General Statutes § 52-350a(16) states: "`Property' means any real or personal property in which the judgment debtor has an interest which he could assign or transfer, including (A) any present or future right or interest, whether or not vested or liquidated, (B) any debt, whether due or to become due, and (C) any cause of action which could be assigned or transferred." No real property is at issue in these proceedings.
Second, the proper parties are present. General Statutes § 52-350d(a) provides: "For the purposes of postjudgment procedures, the superior court shall have jurisdiction over all parties of record in an action until satisfaction of the judgment or, if sooner, until the statute limiting execution has run . . ." A "postjudgment procedure" is defined to include a property execution; General Statutes § 52-350a(15); and "property" is defined in General Statutes § 52-350a(16) to include "any debt, whether due or to become due" in which the judgment debtor has an interest which he could assign or transfer. While General Statutes § 52-350e prescribes a particular service of process concerning a postjudgment procedure, the plaintiff does not challenge the manner in which it was served with the motion to disgorge or the process with which it was served. "`It is fundamental that jurisdiction over a person can be obtained by waiver.' United States Trust Co. v. Bohart, 197 Conn. 34, 39, 495 A.2d 1034 (1985) ('[u]nlike subject matter jurisdiction . . . personal jurisdiction may be created through consent or waiver')." Connor v. Statewide Grievance Committee, 260 Conn. 435, 445, 797 A.2d 1081 (2002). By failing to raise any issue of personal jurisdiction and participating in the hearing on the intervenor's motion, the plaintiff waived any claim of lack of personal jurisdiction. See, e.g., Connecticut Light Power Co. v. St. John, 80 Conn.App. 767, 769 n. 2, 772 n. 7, 837 A.2d 841 (2004); In re Deana E., 61 Conn.App. 185, 192, 763 A.2d 37 (2000). Therefore, the court has post-judgment jurisdiction over the plaintiff and PSG. The court has jurisdiction over USFOS since, by filing the motion to disgorge, USFOS has submitted to the jurisdiction of the court. See General Statutes § 52-356c(b) ("The claim . . . shall constitute an appearance of any third-person claimant . . ."). Finally, by order of the court, the City of Danbury has been given due notice of these proceedings and the opportunity to participate fully. On July 26, 2004, Danbury availed itself of that opportunity and was heard, as were the plaintiff and PSG.
The final element for jurisdiction is that "the point decided must be, in substance and effect, within the issue." Telesco v. Telesco, supra, 187 Conn. 720. "What is in issue is determined by the pleadings and these must be in writing." Id. What is in issue here is contained in the motion to disgorge of USFOS. While USFOS manuscripted its motion rather than using the prescribed Judicial Department form, JD-CV-5c, for a claim under General Statutes § 52-356c, the plaintiff has not made an affirmative showing of prejudice, such as an absence of notice as to the nature of the proceedings or that date of the hearings. Under these circumstances, the use of the improper form does not deprive the court of jurisdiction. Cf. Chestnut Realty, Inc. v. CHRO, 201 Conn. 350, 357, 514 A.2d 749 (1986). Accordingly, the court has jurisdiction to entertain USFOS' motion.
II
The plaintiff claims that U.S. Filter has "successor liability" to PSG. This claim is not briefed. Absent adequate briefing the claim cannot be adequately analyzed by the court and, accordingly, is not considered.
III
The plaintiff claims that the motion to disgorge is an untimely attempt to open the judgment beyond the four months permitted by General Statutes § 52-212a. The court disagrees.
General Statutes § 52-212a provides in relevant part: "Unless otherwise provided by law and except in such cases in which the court has continuing jurisdiction, a civil judgment or decree rendered in the Superior Court may not be opened or set aside unless a motion to open or set aside is filed within four months following the date on which it was rendered or passed."
General Statutes § 52-356a(1) provides in relevant part: "On application of a judgment creditor or his attorney, stating that a judgment remains unsatisfied and the amount due thereon, and subject to the expiration of any stay of enforcement and expiration of any right of appeal, the clerk of the court in which the money judgment was rendered shall issue an execution pursuant to this section against the nonexempt personal property of the judgment debtor other than debts due from a banking institution or earnings." (Emphasis added.) General Statutes § 52-350(a)(11) states: "`Judgment debtor' means a person against whom a money judgment was rendered." The motion here ultimately seeks not to disturb any terms of the judgment but to determine who the judgment debtor is. Moreover, since an execution to enforce a judgment may be issued for up to twenty years from the date the judgment was entered; General Statutes § 52-598; there is no time limit from the date of the judgment constraining when a claim pursuant to General Statutes § 52-356c may be made. The motion to disgorge is not an untimely attempt to open the judgment beyond the four months permitted by General Statutes § 52-212a.
General Statutes § 52-598 provides:
(a) No execution to enforce a judgment for money damages rendered in any court of this state may be issued after the expiration of twenty years from the date the judgment was entered and no action based upon such a judgment may be instituted after the expiration of twenty-five years from the date the judgment was entered, except that there shall be no time limitation on the issuance of such execution or the institution of such action if the judgment was rendered in an action to recover damages for personal injury caused by sexual assault where the party legally at fault for such injury was convicted of a violation of section 53a-70 or 53a-70a.
(b) No execution to enforce a judgment for money damages rendered in a small claims session may be issued after the expiration of ten years from the date the judgment was entered, and no action based upon any such judgment may be instituted after the expiration of fifteen years from the date the judgment was entered.
IV
The plaintiff argues that USFOS's motion is barred by the doctrine of res judicata. Clearly, it is not.
The facts relevant to this issue are as follows. On September 8, 2003, the plaintiff served executions on the towns of Seymour, Newtown and Naugatuck and the City of Danbury. Danbury and Naugatuck are customers of USFOS not PSG. In response to objections from PSG, the plaintiff withdrew these executions. However, after serving PSG's counsel with notice of the judgment, the plaintiff again served the towns of Seymour and Newtown with executions. In response, PSG moved for a protective order pursuant to General Statutes § 52-400a. The grounds of the motion were that (1) the arbitration was still unresolved and the plaintiff continued to face an exposure (or as PSG characterized it, an "indebtedness") to PSG of $800,000, (2) PSG was will to post a bond "to satisfy any legitimate claims," (3) the executions would cause PSG embarrassment, undue burden and expense, and (4) because of PSG's longstanding presence in Connecticut execution against monies owed PSG by third parties was unnecessary to secure the debt owing the plaintiff.
General Statutes § 52-400a provides:
(a) On motion of a judgment debtor or third person from whom discovery is sought and for good cause shown, or on its own motion, the court may make any order which justice requires to protect such debtor or third person from annoyance, embarrassment, oppression or undue burden or expense.
(b) On motion of a judgment debtor alleging that the judgment creditor is engaged in any illegal levy or in any other practices for the purpose of collecting his judgment which violate state or federal law, or on its own motion, the court may render such protective order as justice requires.
(c) On motion of the judgment debtor or an interested third person, the court may direct the order of execution against specified property of the judgment debtor.
On December 18, 2003, after a hearing, the court denied the motion. In a written articulation of its ruling, the court stated that it had denied the motion for three reasons. First, subsection (a) of the statute was inapplicable because the plaintiff was not seeking discovery. "Second, there [had] been no showing that the plaintiff was engaged in an illegal levy or other illegal practice within the meaning of subsection (b)." Third "there [had] been no showing that injustice or inequity would befall the defendant if the plaintiff is permitted to execute on its judgment now." See Memorandum of Decision, January 8, 2004.
"The doctrine of res judicata holds that an existing final judgment rendered upon the merits without fraud or collusion, by a court of competent jurisdiction, is conclusive of causes of action and of facts or issues thereby litigated as to the parties and their privies in all other actions in the same or any other judicial tribunal of concurrent jurisdiction . . . If the same cause of action is again sued on, the judgment is a bar with respect to any claims relating to the cause of action which were actually made or which might have been made." (Citations omitted.) Wade's Dairy, Inc. v. Fairfield, 181 Conn. 556, 559-60, 436 A.2d 24 (1980). "Collateral estoppel, or issue preclusion, is that aspect of res judicata which prohibits the relitigation of an issue when that issue was actually litigated and necessarily determined in a prior action between the same parties upon a different claim . . . For an issue to be subject to collateral estoppel, it must have been fully and fairly litigated in the first action. It also must have been actually decided and the decision must have been necessary to the judgment." (Emphasis in original; internal quotation marks omitted.) RR Pool Patio, Inc. v. Zoning Board of Appeals, 257 Conn. 456, 466, 778 A.2d 61 (2001). "Furthermore, [t]o invoke collateral estoppel the issues sought to be litigated in the new proceeding must be identical to those considered in the prior proceeding." (Internal quotation marks omitted.) Pitchell v. Williams, 55 Conn.App. 571, 578, 739 A.2d 726 (1999), cert. denied, 252 Conn. 925, 746 A.2d 789 (2000).
At the time of the court's decision denying PSG's motion for protective order, USFOS had not yet appeared in these proceedings. Even assuming that USFOS is in privity with PSG, the critical issue now before the court — who is the defendant — was neither raised nor decided in the denial of PSG's motion for protective order. Accordingly, the denial of that motion is neither res judicata nor collateral estoppel of these proceedings.
V
The court finally addresses the principal issue raised by the motion to disgorge, whether the plaintiff may execute against the property of USFOS. The court holds that it may not.
A.
Preliminarily, the court addresses the plaintiff's arguments that PSG and USFOS were held out to be the same company and were both party to the arbitration award and confirmation process.
PSG is a Minnesota corporation that has contracts to do wastewater treatment in forty-four states. When the plaintiff first contracted with PSG, PSG was a wholly owned subsidiary of a foreign corporation, Vivendi. PSG and USFOS were competitors until 1999 when Vivendi acquired USFOS. Thereafter, USFOS entered into a contractual agreement with PSG to perform the latter's contract with the plaintiff. It is for this reason, and because Vivendi wished to advance the USFOS name in the United States, that PSG's application for arbitration in this mater listed it as Professional Services Group, Inc. d/b/a/ US Filter. At all times, however, Vivendi, PSG and USFOS were separate corporate entities. The plaintiff, moreover, knew they were separate entities, since its attorney called the Office of the Secretary of State for the State of Connecticut, confirmed that PSG and USFOS were separate corporations and obtained the names and addresses of the agents for service for each corporation.
In January 2004, USFOS changed its name to Veola Water. Vivendi is now known as Veola Environmental.
The court further finds that in January, February and March 2000, the names "USFilter" and "Vivendi Water Company" appeared on the cover of monthly reports to the plaintiff that had previously borne the name PSG. In these months, the name PSG was not on the cover. The January 2000 and March 2000 monthly reports also contain a memo to the plaintiff from the Project Manager on USFilter letterhead.
Finally, the court finds that PSG no longer has any employees. USFOS' management manages PSG's commitments. Any monies received by PSG are forwarded to its parent company.
B.
General Statutes § 52-356a(1) provides in relevant part: "On application of a judgment creditor or his attorney, stating that a judgment remains unsatisfied and the amount due thereon, and subject to the expiration of any stay of enforcement and expiration of any right of appeal, the clerk of the court in which the money judgment was rendered shall issue an execution pursuant to this section against the nonexempt personal property of the judgment debtor other than debts due from a banking institution or earnings." (Emphasis added.) "`Judgment debtor' means a person against whom a money judgment was rendered." General Statutes § 52-350a(11). Thus, in general, an execution may issue only against a party against whom a money judgment has been rendered. 33 C.J.S., Executions § 21 (1998); 30 Am.Jur.2d, Executions etc. § 9 (1994).
The judgment in this action was rendered against one party only. "[T]he settled law is that an action is commenced by service upon the defendant." Valley Cable Vision, Inc. v. Public Utilities Commission, 175 Conn. 30, 34 (1978). "The parties a suit are made by the writ of process . . ." Goodrich v. Alfred, 72 Conn. 257, 261, 43 A. 1041 (1899). The writ or summons in this action identifies the defendant as "PROFESSIONAL SERVICES GROUP, INC., d/b/a/ U.S. FILTER."
"The use of d/b/a or `doing business as' to associate a tradename with the corporation using it does not create a legal entity separate from the corporation but is merely descriptive of the corporation." Bauer v. Pounds, 61 Conn.App. 29, 36, 762 A.2d 499 (2000); see Mathis v. Chung, Superior Court, Judicial District of Ansonia-Milford, No. 080879 (Sept. 4, 2003); Solar Sheet Metal Pomazi Roofing v. Caprio, Superior Court, Judicial District of Fairfield, No. 318253 (Nov. 28, 1994). Thus, the inclusion of the words "d/b/a US Filter" in the arbitration papers and on the summons form to this action did not make USFOS a party to either proceeding. Also, that the reference to "d/b/a U.S. Filter" may have misdescribed PSG's relationship with USFOS does not alter the fact that only one defendant was named, and that party was clearly understood in the proceedings before the court, as well as those before the arbitrator, to be PSG. That the summons also listed the agents for both PSG and USFOS was merely informational for the serving [or is it servicing?] Marshall, who in fact never served the agent for USFOS.
Pursuant to General Statutes § 52-356a(a), the issuance of an execution is generally, a function of the clerk of the court. "The clerk of a court derives his authority to grant execution from a record . . ." Mallory v. Hartman, 86 Conn. 615, 619, 86 A. 567 (1913). "That an execution must conform to the judgment upon which it is predicated is undoubtedly correct as a general statement of principle . . ." Sibley v. Krauskopf, 118 Conn. 158, 164, 171 A. 4 (1934).
Even if the court were to look beyond the summons for a description of the defendant; see e.g., Norville v. Bellsouth Advertising and Publishing Corp., 664 So.2d 16 (Fl.App. 1995), reh. den., 675 So.2d 119 (Fl.App. 1995); the pleadings throughout the record make clear that the parties understood that there was one defendant to this action, and that the defendant was PSG.
The execution here did not conform to the judgment. USFOS was never made a party to this action, did not have a judgment rendered against it and, therefore, did not become a judgment debtor. The plaintiff could not, in effect, make USFOS a party by obtaining an execution on which USFOS' name appeared. Cf. Joblin v. LaBow, 33 Conn.App. 365, 367, 635 A.2d 874 (1993), cert. denied, 229 Conn. 912, 642 A.2d 1207 (1994).
Finally, it is true that this court has "equitable authority to protect the integrity of its judgments." In re Haley B., 262 Conn. 406, 413-14, 815 A.2d 113 (2003). If, however, the plaintiff believed that personal property was being held by or in the name of USFOS in which PSG had an interest, the plaintiff's remedy was not the extrajudicial issuance of a property execution against USFOS, a non-party to this action, but an application to the court pursuant to General Statutes § 52-356c.
The motion to disgorge is granted.
BY THE COURT
Bruce L. Levin Judge of the Superior Court