Opinion
No. HHB CV 09 5013456 S
November 3, 2010
MEMORANDUM OF DECISION RE DEFENDANT'S MOTION TO STRIKE
FACTS:
This is an action for breach of contract and equitable subrogation. In the underlying action, Michelle Roman, an employee of Community Renewal Team ("CRT") was injured while engaging in activities on the Pine Lake Challenge Course in Bristol, Connecticut. CRT was insured by the defendant General Insurance Company of America ("GICA"). The City of Bristol owned the Course and is an insured of the plaintiff, Arrowood Indemnity Company ("Arrowood").
The CRT employee, Roman, asserted an action for negligence against the City of Bristol and its employee. Despite a demand by Bristol to do so, CRT's insurer GICA, did not defend or indemnify Bristol in that action. Bristol's insurer, Arrowood, defended Bristol and settled the case with Roman.
Arrowood originally claimed breach of contract and equitable subrogation against CRT's insurer, GICA, for failing to defend and indemnify. Arrowood claims GICA is obligated under the terms of its policy with CRT to reimburse Arrowood for the sums paid out by Arrowood to defend and settle Roman's case.
Subsequently, Arrowood amended its complaint (#113), adding a third count alleging waiver and a fourth count alleging estoppel. It is to these two new counts that GICA has directed its motion to strike. The defendant's motion is based on the following assertions: (1) Waiver is not a legally cognizable cause of action; (2) The plaintiff failed to plead the necessary elements of estoppel; and (3) Neither waiver nor estoppel can be used to create coverage that otherwise does not exist under the subject policy.
LEGAL STANDARD:
"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). "[F]or the purpose of a motion to strike, the moving party admits all facts well pleaded." RK Constructors, Inc. v. Fusco Corp., 231 Conn. 381, 383 n. 2, 650 A.2d 153 (1994). Accordingly, "[i]f facts provable in the complaint would support a cause of action, the motion to strike must be denied." (Internal quotation marks omitted.) American Progressive Life Health Ins. Co. of New York v. Better Benefits, LLC, 292 Conn. 111, 120, 971 A.2d 17 (2009). When ruling on a motion to strike, the court must "construe the complaint in the manner most favorable to sustaining its legal sufficiency." (Internal quotation marks omitted.) Id.
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).
"A speaking motion to strike is one improperly importing facts from outside the pleadings." Mercer v. Cosley, 110 Conn. App. 283, 292 n. 7, 955 A.2d 550 (2008). "[A] motion to strike is essentially a procedural motion that focuses solely on the pleadings . . . It is, therefore, improper for the court to consider material outside of the pleading that is being challenged by the motion . . . (Citation omitted; internal quotation marks omitted.) Tracy v. New Milford Public Schools, 101 Conn.App. 560, 566, 922 A.2d 280, cert. denied, 284 Conn. 910, 931 A.2d 935 (2007).
ANALYSIS:
I. Waiver
The defendant seeks to strike Count Three of the amended complaint, a claim of waiver, asserting that waiver is not an affirmative cause of action recognized in the State of Connecticut. However, Connecticut courts have recognized waiver as a legally cognizable cause of action. See Fields v. Metropolitan Life Ins. Co., 132 Conn. 588, 592, 46 A.2d 127 (1946) (plaintiff must plead waiver to take advantage of it); Popowicz v. Metropolitan Life Ins. Co., 114 Conn. 333, 335, 158 A. 885 (1932) (same); Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, Superior Court, judicial district of Hartford at New Britain, Docket No. 397087 (February 24, 1993, Dunn, J.), aff'd, 231 Conn. 756, 653 A.2d 122 (1995) (plaintiff asserts waiver as a cause of action).
Although it did not set forth this ground in its motion to strike Count Three, the defendant did state, in a footnote within its memorandum in support of the motion, that the plaintiff has failed to allege the defendant knowingly relinquished its right to deny coverage, which the defendant claims is a necessary element of a claim of waiver.
"Waiver is the intentional relinquishment of a known right . . . A waiver occurs, therefore, only if there is both knowledge of the existence of the right and intent to relinquish it." (Citations omitted.) Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, supra, 231 Conn. 777. "In order to prove waiver, the plaintiff must show that the defendants engaged in conduct that may reasonably be found to have constituted [an] intentional relinquishment of a known right . . . Waiver does not have to be express, but may consist of acts or conduct from which waiver may be implied . . ." Heyman Associates No. 1 v. Ins. Co. of Pennsylvania, supra, Superior Court, Docket No. 397087.
The plaintiff in Count Three has failed to assert that the defendant engaged in conduct that may reasonably be found to have constituted an intentional relinquishment of a known right. Therefore, for that reason, the defendant's motion to strike Count Three is granted.
II. Estoppel
The defendant seeks to strike Count Four of the amended complaint, a claim of estoppel, on the ground that the plaintiff has failed to sufficiently allege the elements of estoppel. The defendant states the plaintiff failed to allege that the defendant did or said something intended or calculated to induce the plaintiff to believe in the existence of certain fact and that the plaintiff acted upon that belief. The defendant further asserts that the plaintiff failed to allege that the plaintiff changed its position or did something it otherwise would not have done.
"Estoppel has its roots in equity and stems from the voluntary conduct of a party whereby he is absolutely precluded, both at law and in equity, from asserting rights which might perhaps have otherwise existed . . . as against another person, who has in good faith relied upon such conduct, and has been led thereby to change his position for the worse . . . The modern estoppel in pais is of equitable origin, though of equal application in courts of law. It is much more than a rule of evidence. It establishes rights; it determines remedies. An equitable estoppel does not so much shut out the truth as let in the truth, and the whole truth. Its office is to show what equity and good conscience require, under the particular circumstances of the case . . ." (Citations omitted; internal quotation marks omitted.) Boyce v. Allstate Ins. Co., 236 Conn. 375, 383-84, 673 A.2d 77 (1996).
"[E]stoppel always requires proof of two essential elements: the party against whom estoppel is claimed must do or say something calculated or intended to induce another party to believe that certain facts exist and to act on the belief; and the other party must change its position in reliance on those facts, thereby incurring some injury . . . Moreover, it is the burden of the person claiming the estoppel to show that he exercised due diligence to ascertain the truth and that he not only lacked knowledge of the true state of things but had no convenient means of acquiring that knowledge." (Citations omitted; internal quotation marks omitted.) Id., 385-86; see Johnnycake Mountain Associates v. Ochs, 104 Conn.App. 194, 209, 932 A.2d 472 (2007) ("the essential elements of an equitable estoppel . . . as related to the party to be estopped, are: (1) conduct which amounts to a false representation or concealment of material facts, or, at least, which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) the intention, or at least the expectation, that such conduct shall be acted upon by, or influence, the other party or persons; and (3) knowledge, actual or constructive, of the real facts"). "Estoppel rests on the misleading conduct of one party to the prejudice of the other. In the absence of prejudice, estoppel does not exist." Breen v. Aetna Casualty Surety Co., 153 Conn. 633, 643, 220 A.2d 254 (1966). "In an appropriate case the doctrine of equitable estoppel can apply to actions against insurance companies who refuse to cover a loss." Hamden Sand Stone, Inc. v. Great American Life Ins. Co. of New York, Superior Court, judicial district of New Haven, Docket No. CV 01 0454482 (February 25, 2004, Corradino, J.) [ 36 Conn. L. Rptr. 636]. "It is well settled that the acts of an insurer which led the insured to believe he is covered under the policy estop the insurer from denying coverage under the policy." Val Drugs, Inc. v. Lynn, 402 F.Sup. 174, 177 (W.D.N.Y. 1975).
In Val Drugs, the defendant was estopped from denying coverage where it failed to inform the plaintiff, in a timely manner that the insured property did not conform to policy specifications. Id., 177.
In the present matter, the plaintiff has failed to allege that the defendant engaged in conduct which amounts to a false representation or concealment of material facts, or which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the plaintiff or Bristol subsequently attempted to assert. The plaintiff has failed to allege that the defendant had the intention, or at least the expectation, that such conduct would be acted upon by, or influence, the plaintiff, CRT or Bristol. The plaintiff has failed to allege the defendant had actual or constructive knowledge of the real facts. The plaintiff has failed to allege that the defendant's misleading conduct prejudiced the plaintiff. All are necessary elements to be pled in an action sounding in estoppel. As the necessary elements of estoppel have not been plead, the defendant's motion to strike Count Four is granted.
III. Creating Coverage Where It Does Not Exist
The third reason posited by the defendant in moving to strike Counts Three and Four of the plaintiff's amended complaint is that neither waiver nor estoppel can be used to create coverage that otherwise does not exist under the insurance policy. The defendant argues that its policy does not provide coverage for the plaintiff's underlying claims because they were excluded under the terms of the extended coverage endorsement. In a footnote in its supporting memorandum of law, the defendant provides the language of the endorsement. The plaintiff's amended complaint does allege that the insurance policy included an extended coverage endorsement but it does not allege the contents of that endorsement. Moreover, a copy of the insurance policy was not attached as an exhibit to the amended complaint.
According to the defendant, the extended coverage endorsement provides in relevant part: "This insurance does not apply to `bodily injury' or `property damage' arising out of the sole negligence of such person or organization."
In ruling on a motion to strike, "[t]he role of the trial court [is] to examine the [complaint], construed in favor of the [plaintiff], to determine whether the [plaintiff 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). "It is well established that a motion to strike must be considered within the confines of the pleadings and not external documents . . . We are limited . . . to a consideration of the facts alleged in the complaint." (Internal quotation marks omitted.) Zirinsky v. Zirinsky, 87 Conn. App. 257, 268 n. 9, 865 A.2d 488, cert. denied, 273 Conn. 916, 871 A.2d 372 (2005); see also Rowe v. Godou, 209 Conn. 273, 278, 550 A.2d 1073 (1988). "Where the legal grounds for . . . a motion [to strike] are dependent upon underlying facts not alleged in the plaintiff's pleadings, the defendant must await the evidence which may be adduced at trial, and the motion should be denied." (Internal quotation marks omitted.) Commissioner of Labor v. C.J. M. Services, Inc., 268 Conn. 283, 293, 842 A.2d 1124 (2004). "[A] motion to strike is essentially a procedural motion that focuses solely on the pleadings . . . It is, therefore, improper for the court to consider material outside of the pleading that is being challenged by the motion." Giacalone v. Housing Authority of Town of Wallingford, 122 Conn.App. 120, 123, 998 A.2d 222 (2010).
A motion to strike is denied as an improper speaking motion when the grounds for the motion are "based entirely on consideration of language in a contract that is not part of the original complaint." Edward J. Smith Co. v. Palmieri, Superior Court, judicial district of Ansonia-Milford, Docket No. CV 07 5003216 (March 14, 2008, Moran, J.T.R.). Where a plaintiff's complaint does not reference or incorporate specific contract language, the proper remedy is for the defendant to request that the plaintiff revise the complaint to identify the specific contract language that gives rise to the grounds for the defendant's motion to strike. See Gandolfo v. Barker, Superior Court, judicial district of Hartford, Docket No. CV 06 5003862 (July 25, 2007, Wiese, J.) (holding that the plaintiff's motion to strike the defendant's counterclaim was an improper speaking motion where the plaintiff quoted contract language not specifically alleged in the defendant's counterclaim).
Here, the defendant's motion constitutes an improper speaking motion because it seeks to import facts not alleged in the plaintiff's amended complaint, specifically the contents of the extended coverage endorsement. As such, the defendant should have requested that the plaintiff revise the amended complaint to identify the specific language of the extended coverage endorsement. The Court cannot rule on the defendant's assertion in the motion to strike Counts Three and Four of the plaintiff's amended complaint that neither waiver nor estoppel can be used to create coverage that otherwise does not exist under the insurance policy because the defendant's motion on this issue constitutes an improper speaking motion. The defendant's assertion that the plaintiff is attempting to create coverage by waiver or estoppel where it does not exist in the policy is, therefore, not reached.
ORDER:
The defendant's motion to strike Counts Three and Four of the plaintiff's amended complaint is granted on the basis that the plaintiff has failed to allege the necessary elements of waiver and estoppel.