Opinion
No. CV 065001808 S
March 20, 2007
MEMORANDUM OF DECISION RE MOTION TO STRIKE #111
On January 13, 2006, the plaintiff, Winifred Nevile, filed a four-count complaint against the defendants, Attorney Alan Solomon, and the law firm of Solomon, Krupnikoff Wyskiel, P.C. A revised complaint was filed with the court on April 19, 2006 and again on August 15, 2006. Count one alleges fraudulent concealment. Count two alleges a violation of the Connecticut Unfair Trade Practice Act (CUTPA), General Statutes §§ 42-110a et seq. Count three alleges legal malpractice and count four alleges breach of contract.
The plaintiff alleges the following facts in her complaint. The defendants represented the plaintiff in a divorce proceeding from June 1992 until February 1993 when the divorce was finalized. As part of the separation agreement, the plaintiff's husband agreed to convey $20,000 of his TIAA/CREF retirement account to the plaintiff by a qualified domestic relations order (QDRO). It was the defendants' responsibility to file this order. The money was to be paid when the plaintiff reached the age of fifty-five, but upon attaining this age, the plaintiff did not receive the funds. She later discovered that the retirement funds had been seized by the IRS when her former spouse failed to pay his taxes. She was informed that a QDRO was not on record for that account. The plaintiff then contacted Attorney Frattione, the counsel who replaced Attorney Solomon upon his retirement, and was told that the matter would be investigated if the plaintiff paid a $750 retainer. The plaintiff contacted the TIAA/CREF account and was informed that the qualified domestic relations order was filed in 1993, but was subsequently returned to the defendants for revisions, which were never completed and refiled. As a result of the defendant's conduct, the plaintiff alleges that she has substantial damages.
On August 24, 2006, the defendants filed a motion to strike the first, second and fourth counts of the plaintiff's revised complaint, accompanied by a memorandum of law. The plaintiff filed a memorandum in opposition on September 28, 2006. The defendants filed a reply to the plaintiff's memorandum in opposition on October 18, 2006.
DISCUSSION
"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). 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). "[When the] issues concern the granting of a motion to strike, [the court is] limited to and must accept as true the facts alleged in the. . . complaint. . ." (Internal quotations omitted.) Craig v. Driscoll, 262 Conn. 312, 315 n. 4, 813 A.2d 1003 (2003). "[I]f facts provable in the complaint would support a cause of action, the motion to strike must be denied." (Internal quotation marks omitted.) Rizutto v. Davidson Ladders, Inc., 280 Conn. 225, 229, 905 A.2d 1165 (2006).
1. Count One — Fraudulent Concealment
Count one of the plaintiff's complaint alleges that the defendants failed to inform the plaintiff of the status of her case, including the status of the QDRO, the action taken in relation to the filing of the order, and any problems that may have arisen that would ultimately affect her ability to receive the funds to which she was entitled to pursuant to the separation agreement. The plaintiff further alleges that the defendants' misrepresentation of their actions from 1993 through 2005 amounts to fraudulent concealment of their legal malpractice, thereby denying her the opportunity to recover for their misconduct. In their memorandum in support of the motion to strike, the defendants argue that the plaintiff has not pleaded the essential elements to support a claim of fraudulent concealment.
Under General Statutes § 52-595, "[i]f any person, liable to an action by another, fraudulently conceals from him the existence of the cause of such action, such cause of action shall be deemed to accrue against such person so liable therefor at the time when the person entitled to sue thereon first discovers its existence." In actions involving allegations of fraudulent concealment, "[t]he question before [the court] is whether the plaintiffs have adduced any credible evidence that any of the defendants fraudulently concealed the existence of the plaintiffs' cause of action. To meet this burden, it [is] not sufficient for the plaintiffs to prove merely that it [is] more likely than not that the defendants [have] concealed the cause of action. Instead, the plaintiffs [must] prove fraudulent concealment by the more exacting standard of clear, precise, and unequivocal evidence. In order to establish a claim for fraudulent concealment, the plaintiff must show: "(1) a defendant's actual awareness, rather than imputed knowledge, of the facts necessary to establish the [plaintiff's] cause of action; (2) that defendant's intentional concealment of these facts from the plaintiff, and (3) that defendant's concealment of the facts for the purpose of obtaining delay on the [plaintiff's] part in filing a complaint on [her] cause of action." Bartone v. Robert L. Day Co., 232 Conn. 527, 533, 656 A.2d 221 (1995).
Taking the facts alleged in the complaint to be true, and construing such facts in favor of the plaintiff, the court finds that the plaintiff has sufficiently pleaded a cause of action for fraudulent concealment. In her complaint, the plaintiff alleges that "the defendants never made the required revisions in the QDRO, never contacted the plaintiff and never obtained court approval of the QDRO." The plaintiff further alleges that "[t]he defendants from 1993 through 2005 failed to inform the plaintiff regarding the status of the QDRO, their communications with TIAA/CREF, whether they had filed the QDRO in court, whether the QDRO had been approved by TIAA/CREF and the court or any information regarding their failure to take any necessary actions regarding the QDRO and in 2005 acting through and by Attorney Frattione the defendants misrepresented to the plaintiff that the defendants would have done what they needed to do to set up the QDRO." If these allegation are taken as true, as required on a motion to strike, the allegations state sufficient facts to demonstrate the defendant's actual knowledge of the facts underlying the plaintiff's claim. A copy of the QDRO was sent to the defendants for revision, thereby placing the defendants on notice that the filing of the QDRO was defective. Furthermore, the complaint alleges that the plaintiff contacted the defendant firm to inquire about the status of the QDRO, and was told that she needed to pay an additional retainer in order for the matter to be addressed. This allegation serves to establish a potential intentional concealment of the legal malpractice. Therefore, the court finds the facts alleged to be sufficient to survive a motion to strike. The defendants' motion to strike count one of the plaintiff's revised complaint is denied.
2. Count Two — CUTPA violation
Count two of the plaintiff's revised complaint alleges that the defendants' acts and omissions violate CUTPA, General Statutes § 42-110 et seq. In the memorandum in support of a motion to strike, the defendants argue that count two of the plaintiff's complaint should be stricken due to the fact that the plaintiff has failed to allege any facts implicating the entrepreneurial or commercial aspects of the defendants' practice necessary to support a cause of action under CUTPA.
Section 42-110b(a) provides 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." This has been interpreted to create three relevant criteria. "It is well settled that in determining whether a practice violates CUTPA we have 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.) Hanford Electric Supply Co. v. Allen-Bradley Co., 250 Conn. 334, 367-68, 736 A.2d 824 (1999).
Although CUTPA has been interpreted broadly to cover a wide range of actions, the Supreme Court has held that allegations of professional medical or legal negligence or malpractice cannot support a CUTPA claim. "[P]rofessional negligence — that is, malpractice — does not fall under CUTPA. Although physicians and other health care providers are subject to CUTPA, only the entrepreneurial or commercial aspects of the profession are covered, just as only the entrepreneurial aspects of the practice of law are covered by CUTPA." Haynes v. Yale-New Haven Hospital, 243 Conn. 17, 34, 699 A.2d 964 (1997). "The noncommercial aspects of lawyering — that is, the representation of the client in a legal capacity — should be excluded for public policy reasons." Id., 35. See also Beverly Hills Concepts, Inc. v. Schatz Schatz, Ribicoff Kotkin, 247 Conn. 48, 79, 717 A.2d 724 (1998).
To determine whether the activities of a professional give rise to a CUTPA claim, courts must determine "whether the allegedly improper conduct is part of the attorney's professional representation of a client or is part of the entrepreneurial aspect of practicing law." Suffield Development Associates, Ltd. Partnership v. National Loan Investors, L.P., 260 Conn. 766, 781 (2002). The Supreme Court has discussed the scope of the entrepreneurial exception to CUTPA and has stated that "although all lawyers are subject to CUTPA, most of the practice of law is not. The `entrepreneurial' exception is just that, a specific exception from CUTPA immunity for a well-defined set of activities advertising and bill collection, for example. See Haynes v. Yale-New Haven Hospital, 243 Conn. 17, 34-38, 699 A.2d 964 (1997) (reasoning that practice of law and medicine may give rise to CUTPA claims only for entrepreneurial aspects, such as solicitation of business and billing, and not for claims involving issues of competence and strategy). It is not a catch-all provision intended to subject any arguably improper attorney conduct to CUTPA liability. Therefore, the mere fact that the actions of the attorney and the law firm might have deviated from the standards of their profession does not necessarily make the actions entrepreneurial in nature." Suffield Development Assoc. v. National Loan Investors, 260 Conn. 766, 782, 802 A.2d 44 (2002).
It also should be noted that describing the misconduct in terms of profit does not, in and of itself, transform a professional misconduct claim into a claim arising from the entrepreneurial aspects of law. For example, the court in Suffield refused to apply the entrepreneurial exception to a claim that the defendant lawyer violated CUTPA by intentionally profiting from his own misconduct. The court found that "[m]any decisions made by attorneys eventually involve personal profit as a factor, but are not considered part of the entrepreneurial aspect of practicing law." Id., 783. Furthermore, "[u]sing an attorney's financial considerations as a screening mechanism for separating professional actions from entrepreneurial ones would dissolve the distinction between the two, subjecting attorneys to CUTPA claims for any decision in which profit conceivably could have been a factor." Id.
In count two, the plaintiff alleges that "the conduct of the defendants. . . constituted a business decision of the defendants in order to avoid the monetary expense to the business of compensating the plaintiff for legal malpractice." The complaint further alleges that "the fraudulent concealment of the legal malpractice was an entrepreneurial business decision of the defendants in order to avoid the business expense of compensating the plaintiff for the legal malpractice and thereby increase the defendant's income from the business." Although these allegations have been stated in the business context, they remain, at the core, to be allegations arising from the professional representation of the client. Therefore, while the complaint may contain allegations of actionable professional misconduct, it does not allege misconduct in the entrepreneurial aspects of the practice of law. For this reason, the motion to strike count two must be granted as the plaintiff has failed to assert a legally recognizable cause of action under CUTPA.
3. Count Four — Breach of Contract
Count four of the revised complaint, raises allegations that the defendants are liable for breach of contract. The plaintiff alleges that "the defendants breached their contract with the plaintiff in the following ways: (a) by failing to file a QDRO that complied with the requirements of and was approved by the TIAA/CREF pension plan and the Superior Court; (b) by failing to notify the plaintiff that revisions needed to be made to the QDRO originally filed with the TIAA/CREF; (c) by failing to revise the QDRO as required by TIAA/CREF." As a result of this alleged misconduct, the plaintiff alleges that she has suffered direct and consequential monetary damages. The defendants move to strike this count on the grounds that a breach of contract claim predicated on negligent conduct is legally insufficient.
A plaintiff may assert a claim against an attorney for negligence and breach of contract. However, the contract claim will not be permitted where it is merely a negligence claim, cloaked in contract language. See Caffery v. Stillman, 79 Conn.App. 192, 197, 829 A.2d 881 (2003). "[A] claim that a defendant promised to work diligently or in accordance with professional standards is not made a contract claim simply because it is couched in the contract language of promise and breach." Id.
In Gazo v. Stamford, 255 Conn. 245, 266, 765 A.2d 505 (2001), the Supreme Court held that the trial court had properly granted a motion to strike a claim sounding in negligence. The court stated that "although the plaintiff has cast this claim [his] claim in contractual language, in essence he seeks a tort recovery." In making this conclusion, the court found it significant that the plaintiff sought recovery for physical and mental pain, lost wages and medical expenses, rather than contract damages. Furthermore, the plaintiff had openly admitted that the only practical difference between his negligence and contract claims was the application of different statutes of limitations on each respective claim. "In sum, where, as in this case, the plaintiff's allegations of both liability and damages sound in tort, and the only practical effect of permitting a contract claim to lie would be to extend the tort statute of limitations, and common sense strongly counsels otherwise, the plaintiff may not be permitted to transform his tort claim into a contract claim merely by alleging that it is such a claim." In contrast, the court in Hill v. Williams, 74 Conn.App. 654, 813 A.2d 130 (2003) allowed a claim for breach of contract to go forward, finding that the allegations contained in the complaint went beyond merely being couched in contract language. The court found it significant that the complaint contained specific allegations of actions that the defendant failed to do, resulting in a breach of the contract for legal representation. Id., 659-60. See also Bross v. Hillside Acres, Inc., 92 Conn.App. 773, 786, 887 A.2d 420 (2006) (refusing to "pierce the pleading veil" by interpreting a contract claim as a negligence claim when the language of the complaint and the damages requested did not contain any language indicating a tort cause of action).
Construing the facts broadly and in the light most favorable to sustaining their validity, the court finds that the plaintiff has pleaded a legally sufficient cause of action for breach of contract. Similar to the allegations in Hill, the complaint in the present case does not rely solely on a breach of the requisite standard of care. Instead, the plaintiff has alleged specific acts that the defendant has failed to do, resulting in a breach of the parties' contract for legal representation. The motion to strike count four of the plaintiff's revised complaint is, therefore, denied.