Opinion
No. CV-08-5018837-S
November 13, 2008
MEMORANDUM OF DECISION ON MOTION TO STRIKE
The defendant, GEICO Indemnity Company, has moved to strike the Second Count of the complaint on the grounds that it fails to state a cause of action.
Allegations of the Complaint
This case arises out of a two-vehicle accident which allegedly occurred on April 12, 2006 in the Virgin Islands. The plaintiff alleges that he was a passenger in an automobile which was struck from behind by a vehicle operated by Harold Willocks, Jr. and owned by Yvette Stanley Willocks. The plaintiff claims that he settled his claim with Mr. Willocks for $10,000, the policy limit.
The complaint further alleges that at the time of the accident the plaintiff was insured on a policy issued by the defendant to Eva Ekman. The First Count of the complaint seeks to recover underinsured motorist benefits. In the Second Count the plaintiff alleges that the defendant made false statements and misrepresented that the plaintiff was not covered by the policy, disseminated false information to the plaintiff about his coverage and engaged in unfair claim settlement practices by denying the plaintiff coverage, all in violation of the Connecticut Unfair Insurance Practices Act (CUIPA).
Discussion of the Law and Ruling
The function of a motion to strike is to test the legal sufficiency of a pleading. Practice Book § 10-39; Ferryman v. Groton, 212 Conn. 138, 142, 561 A.2d 432 (1989); Mingachos v. CBS, Inc., 196 Conn. 91, 108, 491 A.2d 368 (1985). In deciding a motion to strike the trial court must consider as true the factual allegations, but not the legal conclusions set forth in the complaint. Liljedahl Bros., Inc. v. Grigsby, 215 Conn. 345, 348, 576 A.2d 149 (1990); Blancato v. Feldspar Corp., 203 Conn. 34, 36, 522 A.2d 1235 (1987).
The court should view the facts in a broad fashion, not strictly limited to the allegations, but also including the facts necessarily implied by and fairly provable under them. Dennison v. Klotz, 12 Conn.App. 570, 577, 532 A.2d 1311 (1987). In ruling on a motion to strike, the court must take as admitted all well-pled facts, and those necessarily implied thereby, and construe them in the manner most favorable to the pleader. Norwich v. Silverberg, 200 Conn. 367, 370, 511 A.2d 336 (1986).
Although not yet conclusively decided by the Connecticut Supreme Court, most federal and Connecticut state courts have determined that the Connecticut Unfair Insurance Practices Act ("CUIPA") — the only law employed by the plaintiffs that was enacted for the purpose of regulating insurance — does not provide a private cause of action. See, e.g., Peterson v. Provident Life Acc. Ins. Co., No. 3:96 CV 2227, 1997 WL 527369 at *1-2 (D.Conn. July 17, 1997); Casey v. Reliance Nat'l Indem. Co., No. CV 970140513, 1998 WL 211838 at *2 (Conn.Super.Ct. April 22, 1998); Joseph v. Hannan Agency, Inc., No. 323310, 1997 WL 15424, at *1 (Conn.Super.Ct. Jan. 9, 1997) [ 18 Conn. L. Rptr. 552]; Stabile v. S. Conn. Hosp. Sys., Inc., No. 326120, 1996 WL 651633, at *3 n. 6 (Conn.Super.Ct. Oct. 31, 1996) [ 18 Conn. L. Rptr. 157]; Brothers v. Am. Home Assurance Co., No. 94-0364725-S, 1995 WL 519881, at *2-3 (Conn.Super.Ct. Aug. 24, 1995) [ 15 Conn. L. Rptr. 4]. While we must defer to the Connecticut Supreme Court on issues of state law, "where there is no decision by the state's highest court then federal authorities must apply what they find to be the state law after giving proper regard to relevant rulings of other courts of the State." Travelers Ins. Co. v. 633 Third Assocs., 14 F.3d 114, 119 (2d Cir. 1994) (quoting Comm'r v. Estate of Bosch, 387 U.S. 456, 465, 87 S.Ct. 1776, 18 L.Ed.2d 886 (1967)). Moreover, in Mead v. Burns, 199 Conn. 651, 509 A.2d 11, 15-16 (Conn. 1986), the Connecticut Supreme Court characterized CUIPA as a penal statute requiring a construction "limiting rather than expanding civil liability" — further supporting the proposition that no private cause of action is available under the statute.
Lander v. Hartford Life Annuity Ins. Co., 251 F.3d 101, 118-19 (2nd Cir. 2001) (footnotes omitted).
Neither our Supreme Court nor our Court of Appeals have ruled on whether a private right of action exists under CUIPA. While the Superior Courts which have considered the question are divided, a majority have determined that no private right of action exists. Szlachetka v. Mullen, Superior Court, judicial district of New Britain at New Britain, Docket No. CV 02 0513409S (Feb. 25, 2003, Dunnell, J.). The consensus of these courts may be summarized as follows: 1) there is no express authority under CUIPA for private causes of action; 2) CUIPA is not ambiguous; 3) the regulatory scheme under CUIPA contemplates investigation and enforcement actions to be taken by the insurance commissioner; and 4) consequently there is no private cause of action under CUIPA. See, for example, Gianetti v. Greater Bridgeport Individual Practice Ass'n., Superior Court, Judicial District of Fairfield D.N. 02 0396581 (May 28, 2004, Doherty, J.) Fedora v. Worchester Insurance Co., Superior Court, Judicial District of New Haven D.N. 03 0285288 (September 28, 2004, Tanzer, J.).
A number of courts have taken particular note of the express private right of action provided under CUTPA and the absence of similar provisions under CUIPA. 1049 Asylum L.P. v. Kinney Pike Ins., Superior Court, Judicial District of Hartford, Docket No. CV 020816344 (May 30, 2003, Booth, J.) ( 34 Conn. L. Rptr. 723). This court finds the reasoning of the majority of Superior Courts to be compelling and joins with them in ruling that no private cause of action exists under CUIPA. Accordingly the defendant's motion to strike the fourth count of the plaintiff's complaint must be granted.
Tomonto v. Progressive Northern Insurance Company, 2005 Ct.Sup. 4332 (Tobin, J.)
This court agrees with the holdings and rationale of the courts in Lander and Tomonto and the cases cited therein that there is no private right of action under CUIPA.
The defendant argues as an additional ground for the motion, that even if a private right of action is allowed under CUIPA, the Second Count fails to state a cognizable claim because it fails to allege sufficient facts to establish that the defendant engaged in unfair insurance practices with such frequency to establish a general business practice.
Under Connecticut General Statutes § 38a-816(6), "a plaintiff must allege and prove facts sufficient to show that the insurer was committing or performing [acts]with such frequency as to indicate a general business practice." Heyman Asociates No. 1 v. Insurance Co. of Pennsylvania, 231 Conn. 756, 796, 653 A.2d 122 (1995). In Mead v. Burns, 199 Conn. 651, 509 A.2d 11 (1986), the Court summarily rejected the plaintiffs' argument that CUIPA was designed to address single acts of unfair insurance practices, stating, "Looking at the statute as a whole, we believe that claims of unfair settlement practices under CUIPA require a showing of more than a single act of insurance misconduct." 199 Conn. at 659.
In Quimby v. Kimberly Clark Corporation, 28 Conn.App. 660, 672 (1992), the Court stated:
Under the guidelines set forth in Mead v. Burns, supra, for a plaintiff to allege CUIPA and CUTPA violations successfully the plaintiff must allege more than a singular failure to settle a plaintiff's claim fairly. The plaintiff must allege that the defendant has committed the alleged wrongful acts with such frequency as to indicate a general business practice. Here, the plaintiff's complaint is based wholly on the defendant's alleged failure to settle only the plaintiff's workers' compensation claim properly. She makes no allegations that the defendant has similarly failed to settle similar claims presented by other claimants properly and, accordingly, has failed to allege properly that the defendant has committed the alleged wrongful acts "with such frequency as to indicate a general business practice." Her claim, therefore, must fail.
In this case, the plaintiff's claim arises out of a single automobile accident. There is no allegation of a general business practice. The only allegations pertain to the defendant's actions in denying the plaintiff's claim with respect to the accident in question.
For the foregoing reasons, the motion to strike the Second Count of the complaint is granted.