Opinion
No. 4002239
April 3, 2006
MEMORANDUM OF DECISION RE MOTION TO STRIKE #111
The plaintiffs, Daniel Lilly and Daniel Lilly doing business as Stonington Steel commenced this action on January 28, 2005, by service of process on the defendants M.A. New England (New England) and Centennial Insurance Company for the alleged failure of New England to pay $21,699 for the supplies and materials the plaintiffs provided on the firehouse project. In their complaint, the plaintiffs allege a breach of contract claim, a violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. and a violation of General Statutes § 49-92, the right of payment for materials supplied to the defendants.
On April 20, 2005, New England impleaded Sturdy Concrete Company as a third-party defendant and thereafter filed a third-party complaint. In it, New England alleges a claim for indemnification in count one and a breach of contract claim in count two. In addition, the following facts are alleged in the complaint. New England entered into a contract with Sturdy Concrete in which Sturdy Concrete agreed to provide certain goods and services for the firehouse project. Change orders, caused by some additional work, had to be made to the contract between the plaintiffs and New England, which in turn increased the cost of the contract that was owed the plaintiffs by New England. These change orders were a part of the remedial work necessary because of Sturdy Concrete's failure to properly execute its obligations under its contract with New England. As a result of Sturdy Concrete's deficient performance on its contract to correct the defective work it had created, New England has not fully paid the plaintiffs.
On September 6, 2005, Sturdy Concrete filed an answer, special defenses and two counterclaims. In count one of the counterclaim, Sturdy Concrete alleges a claim for breach of contract and in count two, a CUTPA claim. On September 16, 2005, New England filed a motion to strike Sturdy Concrete's second counterclaim and request for common-law punitive damages as legally insufficient. The court, Hurley, J.T.R., granted the motion by agreement of the parties. Sturdy Concrete, on November 4, 2005, then filed a revised answer, with special defenses and two counterclaims. The counterclaims are identical to the ones filed in the first answer submitted by Sturdy Concrete. On December 2, 2005, New England again filed a motion to strike Sturdy Concrete's second counterclaim and the request for relief thereunder as legally insufficient. It submitted a memorandum of law in support of the motion. On December 13, 2005, Sturdy Concrete filed an opposition to the motion to strike. The matter was heard on the short calendar on January 30, 2006.
Practice Book § 10-39 provides in relevant part: "(a) Whenever any party wishes to contest (1) the legal sufficiency of the allegations of any . . . counterclaim . . . or (2) the legal sufficiency of any prayer for relief . . . that party may do so by filing a motion to strike the contested pleading . . ." "The purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any [pleading] . . . 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). "Practice Book . . . § 10-39, allows for a claim for relief to be stricken only if the relief sought could not be legally awarded." Pamela B. v. Ment, 244 Conn. 296, 325, 709 A.2d 1089 (1998). "It is fundamental that in determining the sufficiency of a [pleading] challenged by a [party's] motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted." (Internal quotation marks omitted.) Commissioner of Labor v. C.J.M. Services, Inc., 268 Conn. 283, 292, 841 A.2d 1124 (2004). "The court must construe the facts in the [pleading] most favorably to the [pleader.]" (Internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997).
New England moves to strike the second counterclaim of Sturdy Concrete's answer on the ground that the CUPTA claim is legally insufficient because the acts alleged therein are not acts or practices in the conduct of any trade or commerce, but instead, relate to New England's exercise of its legal rights, which are outside the purview of CUTPA. In particular, New England argues that Sturdy Concrete's incorporation of the allegations of the first count of its counterclaim for a breach of contract into the second count of the counterclaim, and then merely alleging a violation of CUTPA by New England for exercising its right to litigate against Sturdy Concrete fails to allege facts supporting a CUTPA claim. New England maintains that its exercise of its legal rights due to a disagreement is neither an act or practice in the conduct of any trade or commerce nor a breach of contract. In addition, New England requests that if the court strikes the CUTPA claim, it should also strike the remedies permitted by the statute as listed in Sturdy Concrete's request for relief.
In response and without citation to any authority or a cogent analysis, Sturdy Concrete argues that New England withheld payment without any justification when it knew that Sturdy Concrete had fulfilled its obligations under the contract and the work had been signed as acceptable by New England. Specifically, Sturdy Concrete counters that CUTPA can be applied because a "[r]efusal to pay to force [it] to initiate litigation after acknowledgment of satisfaction of the work to cover for increased expenses created by itself or another party is an act of trade or commerce."
Practice Book § 10-42 provides: "(a) Each motion to strike must be accompanied by an appropriate memorandum of law citing the legal authorities upon which the motion relies." "[W]e are not required to review issues that have been improperly presented to this court through an inadequate brief . . . Analysis, rather than mere abstract assertion, is required in order to avoid abandoning an issue by failure to brief the issue properly . . . Where a claim is asserted in the statement of issues but thereafter receives only cursory attention in the brief without substantive discussion or citation of authorities, it is deemed to be abandoned." (Internal quotation marks omitted.) Connecticut Light Power Co. v. Dept. of Public Utility Control, 266 Conn. 108, 120, 830 A.2d 1121 (2003).
Section 42-110b(a) of CUTPA states that "[n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce." "It is well settled that in determining whether a practice violates CUTPA, [the Connecticut Supreme Court has] adopted the criteria set out in the `cigarette rule' by the federal trade commission for determining when a practice is unfair: (1) [w]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise — in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers, [competitors or other businesspersons] . . . All three criteria do not need to be satisfied to support a finding of unfairness. A practice may be unfair because of the degree to which it meets one of the criteria or because to a lesser extent it meets all three. (Internal quotation marks omitted.) Wilow Springs Condominium Ass'n., Inc. v. Seventh BRT Development Corp., 245 Conn. 1, 43, 717 A.2d 77 (1998); accord Bluezone Foundation v. Paradise Properties, Superior Court, judicial district of New London, Docket No. CV 0555904 (July 24, 2001, Hurley, J.T.R.).
"A simple breach of contract, even if intentional, does not amount to a violation of [CUTPA]; a [claimant] must show substantial aggravating circumstances attending the breach to recover under the Act . . . Where the plaintiff alleges sufficient aggravating circumstances, beyond a mere breach of contract that may bring the case within the cigarette rule, the CUTPA claim may withstand a motion [to strike] . . . Moreover, [a] simple contract breach is not sufficient to establish a violation of CUTPA . . . where a count simply incorporates the reference to the breach of contract claim and does not set forth how or in what respect the defendant's activities are either immoral, unethical, unscrupulous, or offensive to public policy." (Internal quotation marks omitted.) Bluezone Foundation. v. Paradise Properties, supra, Superior Court, Docket No. CV 0555904. Thus, to fall with the ambit of CUTPA, "a [claimant] must show substantial aggravating circumstances attending the breach to recover under the Act." (Internal quotation marks omitted.) Milltex Properties v. Johnson, Superior Court, judicial district of New London, Docket No. CV 0565866 (March 15, 2004, Hurley J.T.R.) ( 36 Conn. L. Rptr. 784, 785).
To withstand a motion to strike, this court must determine whether Sturdy Concrete has alleged sufficient aggravating factors beyond a mere simple breach of contract. In its second counterclaim, Sturdy Concrete incorporates the allegations of the first count for a breach of contract and further alleges that: New England "is involved in [a] trade or commerce as defined by Connecticut General Statutes [§] 42-110a et seq.; [New England's] actions in withholding payment and instituting an action against Sturdy are unethical, immoral, oppressive and unduly burdensome in each of the following ways both separately and collectively: (a) [New England] unilaterally and without justification refused to pay Sturdy the balance owed even though [New England] acknowledged that its original refusal was without merit and there was no other basis for refusing payment; (b) [New England] refused to pay merely to require Sturdy to file this action and hire an attorney to recover the funds owed in order to secure a profit at Sturdy's expense; (c) [New England] brought Sturdy into this action knowing that Sturdy neither had the responsibility to perform the duties alleged and that it had failed to perform its duties based on industry standards and contractual obligations; [and] (d) [New England's] actions will further increase [the] costs to Sturdy despite the fact [New England] knows that it does not have a viable cause of action. As a result of the aforesaid, [New England's] actions violated the Connecticut Unfair Trade Practices Act, [§]42-110[a] et seq. [i]n that the acts alleged have violated the statutes, common law or its penumbras. As a result of the aforesaid violations, Sturdy has suffered a[n] ascertainable loss."
The entirety of Sturdy Concrete's counterclaim focuses on New England's intentional breach of contract between the two entities requiring Sturdy to avail itself of the legal system to procure payment for fulfilling its contractual obligations. The basis of Sturdy Concrete's claims stems from the original contract between New England and Stonington Steel that necessitated certain additions to that contract, which resulted in remedial work for which Sturdy Concrete was responsible and a party to a contract with New England. This is a simple breach of contract that arises from a disagreement as to the liability of the additional work performed as a result of the change orders after the completion of the initial contract between New England and Stonington Steel. As this court has stated before, substantial aggravating circumstances must accompany a breach of contract before CUPTA can be called upon for relief. Here, Sturdy Concrete has not alleged the substantial aggravating factors necessary to show a CUTPA violation. Accordingly, New England's motion to strike count two of the counterclaim is granted as is the request for relief pursuant to § 42-110g(d).