Opinion
No. 09-5013282
February 10, 2010
MEMORANDUM OF DECISION RE DEFENDANTS' MOTION TO DISMISS-#108
I. History and Nature of the Proceedings
The plaintiff, P P Quick-Sett Services, Inc., (P P) commenced this action against the defendants, Manafort Brothers, Inc. (Manafort Brothers) and Federal Insurance Company (Federal Insurance). The five-count complaint alleges breach of contract, quantum meruit, unjust enrichment and a violation of the Connecticut Unfair Trade Practices Act (CUTPA) against Manafort Brothers and breach of contract against Federal Insurance. The defendants responded to the complaint by filing a motion to dismiss challenging P P's standing. Specifically, the defendants argue that P P is a Delaware corporation whereas the corporation named on the contract is a Massachusetts corporation. Furthermore, the defendants argue that while the names of the plaintiff and the Massachusetts corporation may be similar, they are still two separate entities. Specifically, at oral argument the defendants maintained that the alleged Delaware corporation is incorporated under the name "P and P `Quick-sett' Services, Inc." whereas the Massachusetts corporation is incorporated as "P P Quick-sett Services, Inc."
In response, P P maintains that it attempted to file in Massachusetts as a foreign corporation doing business in the Commonwealth. However, P P maintains that due to a scrivener's error the incorrect paperwork was filed for incorporation in Massachusetts, which P P promptly corrected within two days. P P states that the Massachusetts entity was dissolved. In regard to the contract at issue, P P argues that the Massachusetts corporation was incorrectly listed by Manafort Brothers on the contract when, in fact, P P was the intended party to the contract and did perform all the required work under the contract. Thus, P P argues it has standing in this action because it alleges that it was the intended party to the contract and that it has suffered harm that was caused by the defendants' failure to pay P P for the work it performed. Furthermore, P P argues that the Massachusetts entity is only named in the recital portion of the contract, which while useful in interpreting the contract, does not confer any rights beyond the operative terms of the contract.
In support of its arguments, P P attached an affidavit submitted by Angelo Scola, the president of P P; a certificate of incorporation for P P in Delaware; a business inquiry printed from the Connecticut secretary of state's commercial recording division website, showing P P's mailing address is in Framingham, Massachusetts and that it is incorporated in Delaware; and a copy of a letter stating that filing for incorporation as a domestic corporation in Massachusetts was a mistake and that P P intended to file as a foreign corporation in Massachusetts along with a new application to file as such and a print out from the Massachusetts secretary of the commonwealth's corporations division showing P P is a foreign corporation registered in Massachusetts.
After an extensive review of the court file, in particular, the allegations contained in the plaintiff's complaint, the memoranda and accompanying documents filed by each of the parties, the cases cited by each and giving due consideration to the arguments of counsel, the court will, for reasons hereinafter stated, deny the defendants' motion to dismiss.
II. Motion to Dismiss
"A motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Caruso v. Bridgeport, 285 Conn. 618, 627, 941 A.2d 266 (2008); R.C. Equity Group, LLC v. Zoning Commission, 285 Conn. 240, 248, 939 A.2d 1122 (2008). "The issue of standing implicates subject matter jurisdiction and is therefore a basis for granting a motion to dismiss. Practice Book § 10-31(a)." (Internal quotation marks omitted.) May v. Coffey, 291 Conn. 106, 113, 967 A.2d 495 (2009). "When a [trial] court decides a jurisdictional question raised by a pretrial motion to dismiss, it must consider the allegations of the complaint in their most favorable light . . . In this regard, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader." (Internal quotation marks omitted.) State v. Marsh McLennan Cos., 286 Conn. 454, 464, 944 A.2d 315 (2008).
III. Standing
"It is a basic principle of law that a plaintiff must have standing for the court to have jurisdiction. Standing is the right to set judicial machinery in motion. One cannot rightfully invoke the jurisdiction of the court unless he has, in an individual or representative capacity, some real interest in the cause of action, or a legal or equitable right, title or interest in the subject matter of the controversy." (Internal quotation marks omitted.) Chiulli v. Zola, 97 Conn.App. 699, 704, 905 A.2d 1236 (2006). "Standing is established by showing that the party claiming it is authorized by statute to bring an action, in other words statutorily aggrieved, or is classically aggrieved . . . The fundamental test for determining [classical] aggrievement encompasses a well-settled twofold determination: [F]irst, the party claiming aggrievement must successfully demonstrate a specific, personal and legal interest in [the challenged action], as distinguished from a general interest, such as is the concern of all members of the community as a whole. Second, the party claiming aggrievement must successfully establish that this specific personal and legal interest has been specially and injuriously affected by the [challenged action] . . . Aggrievement is established if there is a possibility, as distinguished from a certainty, that some legally protected interest . . . has been adversely affected." (Internal quotation marks omitted.) Id., 704-05. "In the determination of standing the primary focus is on whether the party bringing the complaint, is the proper party to request an adjudication of the issue and, not whether the issue itself is justiciable." Civil Service Commission v. Pekrul, 41 Conn.Sup. 302, 307, 571 A.2d 715 (1989), aff'd, 221 Conn. 12, 601 A.2d 538 (1992).
IV. Breach of Contract
Counts one and four allege a breach of contract as against Manafort Brothers and Federal Insurance respectively. "The elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages." (Internal quotation marks omitted.) Bross v. Hillside Acres, Inc., CT Page 4825 92 Conn.App. 773, 780-81, 887 A.2d 420 (2006). In this case, P P has alleged that it was the party to the contract, it performed the work required under the written contract and that neither of the defendants compensated P P for its performance and, thus, breached that contract. The defendants responded by essentially claiming its agreement was not with P P, but with a similarly named Massachusetts corporation.
In support of its argument, the defendant cites to Cardi Materials Corp. v. Connecticut Landscaping Bruzzi Corp., 77 Conn.App. 578, 823 A.2d 1271 (2003). In Cardi Materials Corp., a contract existed between two corporations, Cardi Corporation and Connecticut Landscaping Bruzzi Corporation. Id., 580. However, a third similarly named yet legally separate, corporation, Cardi Materials Corporation, sued on that contract. Id., 579-80. Considering the plaintiff, Cardi Materials Corporation, conceded at oral argument that it was a distinct and legally separate entity from the Cardi Corporation named in the written contract, the court in found that there was no standing. Id. 582.
Conversely, the court in Marlin Broadcasting, LLC v. Law Office of Kent Avery, LLC, 101 Conn.App. 638, 643-45, 922 A.2d 1131 (2007), found that the plaintiff corporation had standing to bring a breach of contract claim even though the plaintiff corporation was not named on the written contract. The court differentiated this result from Cardi because it could not "discern from the limited record before [the court] that the plaintiff [and the corporation named in the contract were] separate and distinct legal entities." Id., 645. Rather, there was evidence that the named corporation was a wholly owned subsidiary of the plaintiff. Id., 645 n. 3. Furthermore, the court found that "the plaintiff presented evidence that it suffered direct injury by way of economic losses . . . from outstanding invoices that the defendants have failed to pay to the plaintiff." Id., 645. "Relying on this evidence, the [trial] court properly found that the plaintiff had standing to pursue the matter." Id.
In light of the Marlin case and applying the two-step analysis for standing, P P has met its burden. In regard to the first prong, P P has shown that its alleged interest in the construction project is personal as opposed to one that all community members share. P P has alleged that it approved the work to be performed under the contract as well as all additional work requested by Manafort Brothers. Unlike the Cardi Materials case, where the plaintiff agreed that the two corporations were separate and succinct entities, P P has argued that here they never intended to create a separate and distinct Massachusetts entity. Furthermore, P P alleges that the Massachusetts corporation created in error was dissolved prior to the formation of this contract. Therefore, no such entity existed to enter into this contract and thus P P, whose president allegedly agreed to the contract, has a real interest in this contract. Second, P P has met the second prong of showing it has been specially and injuriously affected by the challenged action because it has not received payment for the work it performed as required by the contract. Taking the pleadings in their light most favorable, P P has shown that it has a real interest in the contract at issue. Thus, the motion to dismiss must be denied as to counts one and four.
V. Quantum Meruit
In count two P P alleges a right to recovery in quantum meruit against Manafort Brothers. "[Q]uanturn meruit literally means as much as he has deserved . . ." (Internal quotation marks omitted.) Shapero v. Mercede, 262 Conn. 1, 7, 808 A.2d 666 (2002). Quantum meruit "is the form of action which has been utilized when the benefit received was the work, labor, or services of the party seeking restitution." (Internal quotation marks omitted.) Morgan Building Spas, Inc. v. Dean's Stoves Spas, Inc., 58 Conn.App. 560, 563, 753 A.2d 957 (2000). For example, in Chiulli v. Zola, supra, 97 Conn.App. 700-02, the plaintiff, who was also the owner of a home improvement company, brought suit against the defendant homeowner for compensation for various home improvements the plaintiff had provided pursuant to a verbal agreement and sought to foreclose on the home pursuant to a mechanic's lien. The court determined that the plaintiff could not bring an action to foreclose on the lien because the plaintiff's company maintained the lien on the defendant's property and such an action would have to be brought by the plaintiff as a company president or shareholder. Id., 705-06. Regardless, the court found that the plaintiff did have standing for breach of an oral contract, quantum meruit and unjust enrichment as the party who negotiated and contracted with the defendant. Id., 705.
Here, P P has alleged that Manafort Brothers' authorized representatives requested work from P P, which was later codified by the contract, and they subsequently requested additional work from P P. P P alleges it performed all of this work for Manafort Brothers' benefit, but never received compensation for its performance as agreed. Applying the two-part test for standing, P P has met its burden of proving that it has standing as against Manafort Brothers because it has demonstrated a personal interest in the litigation, as the party who performed work for the benefit of Manafort Brothers at Manafort Brothers' request, and has demonstrated that it has been injured by being denied payment for its performance. Thus, P P has standing to assert a claim of quantum meruit against Manafort Brothers.
VI. Unjust Enrichment
P P brings a claim for unjust enrichment in count four. "Unjust enrichment is, consistent with the principles of equity, a broad and flexible remedy . . . Plaintiff seeking recovery for unjust enrichment must prove (1) that the defendants were benefitted, (2) that the defendants unjustly did not pay the plaintiffs for the benefits, and (3) that the failure of payment was to the plaintiffs' detriment." (Internal quotation marks omitted.) Chiulli v. Zola, supra, 97 Conn.App. 708.
Similar to the reasoning above for quantum meruit, P P has standing regarding its claim for unjust enrichment. P P, as the party who allegedly performed work for the defendant's benefit, has a personal interest in this action. Further, P P has demonstrated injury by alleging that the defendant has refused to provide compensation for P P's work. Thus, P P has standing to bring a claim of unjust enrichment.
VII. CUTPA
Lastly, count five is for a violation of CUTPA against Manafort Brothers. "[I]t strains credulity to conclude that CUTPA is so formless as to provide redress to any person, for any ascertainable harm, caused by any person in the conduct of any trade or commerce." Vacco v. Microsoft Corp., 260 Conn. 59, 88, 793 A.2d 1048 (2002). "[N]otwithstanding the broad language and remedial purpose of CUTPA, we have applied traditional common-law principles of remoteness and proximate causation to determine whether a party has standing to bring an action under CUTPA." (Internal quotation marks omitted.) Stevenson Lumber Co.-Suffield v. Chase Ass'n., 284 Conn. 205, 214, 932 A.2d 401 (2007). "[The Supreme Court has] employed a three part policy analysis used by the [federal] courts in their application of the general principle that plaintiffs with indirect injuries lack standing to sue . . . First, the more indirect an injury is, the more difficult it becomes to determine the amount of [the] plaintiff's damages attributable to the wrongdoing as opposed to other, independent factors. Second, recognizing claims by the indirectly injured would require courts to adopt complicated rules apportioning damages among plaintiffs removed at different levels of injury from the violative acts, in order to avoid the risk of multiple recoveries. Third, struggling with the first two problems is unnecessary whe[n] there are directly injured parties who can remedy the harm without these attendant problems." Vacco v. Microsoft Corp., supra, 89.
In the present case, P P has alleged a direct injury to itself caused by Manafort Brothers, which satisfies the remoteness and proximate cause standing requirement of CUTPA. P P alleges that Manafort Brothers practiced an unfair or deceptive act in the conduct of trade or commerce when it agreed to pay for services, but then failed to pay once those services were rendered, which caused damage to P P. Thus, P P has not alleged a remote injury, but rather alleged its injury of lost profits and expenses was the proximate cause of Manafort Brothers' unfair or deceptive act of requesting work with a false promise of payment. Thus, P P has standing to bring a claim under CUTPA.
VIII. Conclusion
For the foregoing reasons, the motion to dismiss is denied for all five counts against both defendants.