Opinion
No. X08 CV 03 4001935 S
July 10, 2006
MEMORANDUM OF DECISION RE MOTION TO DISMISS (152.00)
The defendant, United States Fidelity Guaranty Co. (USFG) moves to dismiss the complaint by Paradigm Contract Management Co. (Paradigm) which seeks payment for labor and material provided in connection with a project to close and cap the City of Danbury Landfill. The subject complaint was served in February 2003 but it was preceded by substantially the same complaint in an earlier action commenced by Paradigm in 1999. The earlier action (CV 99 0336073) was withdrawn when Paradigm and USFG, apparently not ready when the court scheduled trial, entered into an agreement tolling the statute of limitations. In that agreement USFG stated that it
waives, and is estopped from asserting, any and all defenses or bans based upon any statute of limitations, or based on any theory premised on laches or delay or lapse of time . . .
The tolling agreement was effective for one year and based upon its existence Paradigm withdrew the earlier action in April 2002.
The present Paradigm complaint alleges that Metcalf Eddy (ME), an engineering and contracting firm, entered into a contract for work at the Danbury landfill and in connection with that project furnished a labor and material payment bond executed by the defendant USFG. Paradigm alleges it is unpaid for its work and sues to collect for its unpaid work as a claimant and beneficiary of the bond.
In its motion to dismiss, USFG notes that its bond was procured and executed pursuant to the provisions of General Statutes §§ 49-41 through 49-43 requiring contractors of public works projects larger than $50,000 to put up a surety bond protecting labor and material suppliers. Section 49-42 provides that lawsuits may be brought by persons who supplied work or materials for the project to recover on the bond and such suits must be commenced within one year of the supplying of work or material.
General Statutes §§ 49-41 through 49-43 are often referred to as the Little Miller Act because they substantially mirror the provision of the Federal Miller Act, 40 U.S.C. §§ 270a-207e, a statute which was repealed in 2002.
USFG contends that the one-year provision in Section 49-42 is a substantive limitation on Paradigm's right to recover on the bond and therefore, the court lacks subject matter jurisdiction over this case because it was filed after the expiration of the one-year period. In American Masons' Supply Co. v. F.W. Brown Co., 174 Conn. 219 (1978), the Connecticut Supreme Court said that the provision of Section 49-42 setting forth the time limitation "is not to be treated as an ordinary statute of limitations, but as a jurisdictional requirement establishing a condition precedent to maintaining an action under that section. Id. 224. From this USFG argues that the tolling agreement is not effective in waiving the one-year time period contained in Section 49-42 and since the present action was not filed within that statutory period the jurisdictional predicate for the action is not present, and the case must be dismissed.
Paradigm counters by arguing that more recent Connecticut Supreme Court cases have established that the requirements of the Little Miller Act "established only a floor of protection beneath which the coverage of the payment bond cannot fall rather than an upper limit upon the scope of the bond's coverage," Herbert S. Newman Partners P.C. v. CFC Construction Ltd. Partnership, 236 Conn. 750, 757 (1996); and "the provisions of the payment bond may create more extensive liability for the surety than that required by the act." Blakslee Arpaia Chapman, Inc. v. E.I. Contractors, Inc., 239 Conn. 708, 717 (1997). Paradigm argues that it is suing USFG under the provisions of the payment bond and not under the provisions of the Little Miller Act. It points out that the bond itself has a one-year limitation period similar to that contained in Section 49-42, and contends this contractual provision can be waived like any other contractual provision.
The court generally agrees with this assessment and argument. While it may appear that this conclusion simply circumvents the statute, it should be noted that it is uncontested that Paradigm filed its initial suit within the one-year period and in full compliance with the statute. In 2002 the parties negotiated an agreement, the obvious and undisputed intent of which was to allow Paradigm to withdraw and subsequently refile the action within one year. The Connecticut Supreme Court has said the bond required by the Little Miller Act can provide benefits to contractors greater than required by the Act. One can fairly imply that other agreements between the parties may do so as well.
This conclusion is fortified by Superior Court cases. In Ten Hoeve Brothers, Inc. v. Hartford, Superior Court, judicial district of Hartford, CV 93 0704020 (May 13, 1996, Corradino, J.) ( 17 Conn. L. Rptr. 173), the court held, as a matter of law, that the Little Miller Act was not the exclusive remedy for an unpaid subcontractor. A similar conclusion was reached in Wolverine Fire Protection Co. v. Tougher Industries, Superior Court, judicial district of Hartford, CV 01 08055 54 (June 20, 2001, Hale, J.) ( 29 Conn. L. Rptr. 731) (also noting federal and other Connecticut cases to the same effect).
The court concludes that the broad and inclusive tolling agreement between the parties is effective in tolling the time limitation provision in the USFG bond, thereby allowing Paradigm to seek payment under the bond.
Based on the preceding discussion the court determines it has subject matter jurisdiction and the motion to dismiss is denied.