Opinion
No. CV03-0476394-S
December 18, 2007
CORRECTED MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT #117
FACTS
The plaintiff, Nitin Paul, filed a seven-count complaint on April 16, 2003, alleging that the defendant, Raymond Camp, misappropriated computer files, profits, business opportunities, and trade secrets, breached fiduciary duties, engaged in unfair trade practices, and tortiously interfered with client relationships (the Paul action). On April 29, 2003, Camp filed a separate suit against Paul, alleging breach of contract and, unjust enrichment (the Camp action). Although both suits involved the same parties and were predicated upon the same factual history involving their work for a joint client, the Easton Press division of MBI, Inc. (MBI), the two law suits were not consolidated. Instead, the Camp action was separately tried to the court on September 29, 2006, and a final judgment in favor of Camp was entered on November 29, 2006. See Camp v. Paul, Superior Court, Judicial District of New Haven, Docket No. CV 03 0476870 (November 29, 2006, Thompson, J.). While Camp appeared and testified at that trial, Paul appeared only through his counsel.
The following facts, found by Judge Thompson in the Camp action, provide a useful backdrop to the present case and are relevant to the dispositive issue in this motion. Camp, a graphic designer, and Paul, a direct mail service provider, began jointly soliciting business together during the mid-1990s, and in the spring of 1997, secured an agreement with MBI to design its catalogs on a catalog-by-catalog basis. Camp and Paul did not have a standing contract with MBI. The original agreement between Camp and Paul was to deduct their expenses and then to share the profits equally. This changed in the fall of 2002, however, when it became clear that Camp was doing roughly 95% of the work on the MBI account. Under the new arrangement between Camp and Paul, Camp was to receive twenty dollars off the top, and then an additional twenty-five dollars per hour worked on the project, before splitting the remaining profits with Paul. Subsequently, in November of 2002, Camp indicated to Paul both his desire to terminate their business relationship and his intention to solicit MBI's business on his own. The 2003 winter catalog was their last collaborative effort for MBI, and they submitted an invoice to MBI in the amount of $12,115.00 for that work. Although Paul collected those fees from MBI, he did not distribute any portion of it to Camp. The present case and the Camp action followed shortly thereafter.
In response to the complaint filed in the Camp action, Paul filed an answer and claimed a setoff, which essentially denied the allegations set forth in the complaint and claimed that the value of any damages arising from the Camp action would be exceeded by those damages sought in connection with the Paul action. Specifically, Paul's setoff in the Camp action stated: "The value, if any, to the Defendant for efforts/attributable, to the Plaintiff with regard to the services was exceeded by the damage incurred by the Defendant due to the Plaintiff's derogation of his duties to the Defendant and his interference in the business relationship between the Defendant and his client." After hearing the evidence presented in the Camp action, Judge Thompson held that Paul, not having appeared or testified at trial other than through counsel, had not proven the allegations of his setoff. Camp v. Paul, supra, Superior Court, Docket No. CV 03 0476870. No appeal of the Camp action was taken.
On June 8, 2007, Camp filed a motion for summary judgment in this case, arguing that the current action is barred by the doctrine of res judicata because the same claims were previously resolved in the Camp action by virtue of Paul's asserted setoff. In support of his motion, Camp filed a memorandum of law, various pleadings from the Camp action, a copy of Judge Thompson's memorandum of decision in the Camp action, and excerpts from the trial transcript in the Camp action. Paul then moved for and received a timely extension to reply to the motion for summary judgment, and subsequently filed his memorandum in opposition to summary judgment on November 5, 2007. In support of his memorandum, Paul submitted a copy of his answer and setoff in the Camp action, a copy of his complaint in the present action, and a copy of Judge Thompson's memorandum of decision in the Camp action.
DISCUSSION
Before turning to the merits, it is first necessary to consider the relevant standard of review. "Practice Book § [17-49] provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . ." (Citation omitted; internal quotation marks omitted.) Johnson v. Atkinson, 283 Conn. 243, 253, 926 A.2d 656 (2007). Moreover, "[t]he courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law." Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006). Finally, "[b]ecause res judicata or collateral estoppel, if raised, may be dispositive of a claim, summary judgment [is] the appropriate method for resolving a claim of res judicata." Jackson v. R.G. Whipple, Inc., 225 Conn. 705, 712, 627 A.2d 374 (1993).
With respect to "[t]he principles underlying the doctrine of res judicata, or claim preclusion, [they] are well settled. [A] valid, final judgment rendered on the merits by a court of competent jurisdiction is an absolute bar to a subsequent action between the same parties, or those in privity with them, upon the same claim or demand . . . Furthermore, the doctrine of claim preclusion . . . bars not only subsequent relitigation of a claim previously asserted, but subsequent relitigation of any claims relating to the same cause of action which were actually made or which might have been made. [T]he appropriate inquiry with respect to [claim] preclusion is whether the party had an adequate opportunity to litigate the matter in the earlier proceeding . . . The rule of claim preclusion prevents reassertion of the same claim regardless of what additional or different evidence or legal theories might be advanced in support of it." (Citations omitted; internal quotation marks omitted.) Sotavento Corp. v. Coastal Pallet Corp., 102 Conn.App. 828, 833-34, 927 A.2d 351 (2007).
Moreover, understanding the need to determine whether an action involves the same claim as an earlier action for res judicata purposes, courts have been usefully guided by a transactional test to evaluate the various claims. Cadle Co. v. Gabel, 69 Conn.App. 279, 296-97, 794 A.2d 1029 (2002). Under this test, "[t]he claim [that is] extinguished [by the judgment in the first action] includes all rights of the plaintiff to remedies against the defendant with respect to all or any part of the transaction, or series of connected transactions, out of which the action arose. What factual grouping constitutes a `transaction,' and what groupings constitute a `series,' are to be determined pragmatically, giving weight to such considerations as whether the facts are related in time, space, origin, or motivation, whether they form a convenient trial unit, and whether their treatment as a unit conforms to the parties' expectations or business understanding or usage . . . In applying the transactional test, we compare the complaint in the second action with the pleadings and the judgment in the earlier action." Id.
Turning to the present case, the defendant asserts that (1) Paul's setoff in the Camp action subsumed the claims asserted in the present case, (2) Judge Thompson's judgment in the Camp action was final, and (3) res judicata, therefore, forecloses further action in this ease. By contrast, the plaintiff argues that (1) the claims presented by the two cases were different, (2) he did not have an opportunity in the Camp action to fully litigate the issues now before the court, (3) preclusion of the claims in this case did not conform to his expectations regarding the resolution of the Camp action, and (4) his claimed setoff was immaterial because it failed to assert a claim for liquidated damages. The court now examines each of these arguments in turn.
With respect to whether this case involves the same claims at issue in the Camp action, it is apparent that they are monovular because they arise out of the same operative facts between the same parties and Paul's setoff in that case effectively annexed the claims asserted here. Both the Camp action and this case involve the same two parties and arise out of the same dispute concerning their business relationship with one another and the work they did for MBI. The two actions, therefore, involve "facts [that] are related in time, space, origin, or motivation," and additionally form a "convenient trial unit." Cadle Co. v. Gabel, supra, 69 Conn.App. 296. Furthermore, "[i]n cases of set-off the defendant is treated as a plaintiff in respect to his claim, and his case must be made out in the same manner, and may be met by the same defenses, as if he had brought a separate suit against the plaintiff upon his claim." Gorham v. Bulkley, 49 Conn. 91, 92 (1881). Accordingly, because the allegations advanced by Paul's setoff in the Camp action are treated as a separate and discrete suit, that setoff must now be reviewed to determine its similarity to the claims alleged in this case.
A comparison of the complaint in this case with Paul's setoff in the Camp action confirms that the same causes of action are at issue. In this case, the plaintiff's complaint alleges that the defendant misappropriated computer files, profits, business opportunities, and trade secrets, as well as to breach fiduciary duties, engage in unfair trade practices, and tortuously interfere with client relationships. Similarly, Paul's setoff in the Camp action asserted that the value of any damages sought in connection with that case would be less than the value of damages stemming from Camp's "derogation of his duties to [Paul] and his interference in the business relationship between the [Paul] and [MBI]." The broad language employed in the setoff is, therefore, fatal to Paul because it effectively annexes the allegations set forth in his complaint in this case. Indeed, both the complaint and setoff allege breach of duty due to Camp's ongoing possession of various business files related to their joint work for MBI and Camps's interference with Paul's business relationships by virtue of his soliciting MBI's business independently of Paul.
Moreover, even if the setoff in the Camp action were not read so broadly, res judicata would still bar the current action because Paul had the opportunity in that case to plead and litigate each of the current claims now before the court. "The doctrine of res judicata provides that a former judgment serves as an absolute bar to a subsequent action involving any claims related to such cause of action which were actually made or which might have been made." (Citation omitted; emphasis added; internal quotation marks omitted.) Gagne v. Norton, 189 Conn. 29, 32, 453 A.2d 1162 (1983); see also Dunham v. Dunham, 221 Conn. 384, 392, 604 A.2d 347 (1992) ("a party should not be able to relitigate a matter which it already had an opportunity to litigate"); Sachem Enterprises v. Southern Gas Co., 44 Conn.Sup. 163, 168, 674 A.2d 874 (1994); aff'd, 41 Conn.App. 161, 674 A.2d 872, cert denied, 237 Conn. 931, 677 A.2d 1372 (1996) (res judicata "precludes not simply the precise claims made in the earlier litigation, but the claims that could have been made concerning the same occurrence by a party that chose to file a cross complaint"). In the Camp action, Paul not only had an opportunity to specifically plead each of the claims asserted in this case to maximize the potential size of his setoff, but he also had an opportunity to litigate these causes of action as a counterclaim or special defense. Consequently, Paul previously enjoyed an adequate opportunity to litigate the claims asserted in this action.
Additionally, Judge Thompson's memorandum of decision in the Camp action was a final judgment for res judicata purposes. Indeed, where claim preclusion is concerned, "a judgment will ordinarily be considered final if it is not tentative, provisional, or contingent and represents the completion of all steps in the adjudication of the claim by the court, short of any steps by way of execution or enforcement that may be consequent upon the particular kind of adjudication." (Internal quotation marks omitted.) CFM of Connecticut, Inc. v. Chowdhury, 239 Conn. 375, 398-99, 685 A.2d 1108 (1996), overruled on other grounds by, State v. Salmon, 250 Conn. 147, 735 A.2d 333 (1999). In this case, the memorandum of decision in the Camp action terminated the rights of the parties such that further proceedings could not effect them. The decision in the Camp action found that Paul had not proven the allegations of his setoff, and entered a judgment in favor of Camp in the amount of $9,508.41. That decision was final and not subject to further proceedings in the underlying action between the parties. Accordingly, there was nothing tentative or conditional about Judge Thompson's decision in the Camp action, and it was a final judgment for purposes of res judicata.
The court rejects Paul's argument that the claims asserted in this case are fundamentally different from those alleged in the Camp action because the relief sought in the two cases is different. In the Camp action, Paul alleged only monetary damages in his setoff, whereas he seeks both monetary damages and injunctive relief in this case. These differences are of no moment, though, as a party "cannot split his cause of action . . . [by] su[ing] for part of his claim in one action and then su[ing] for the balance in another action." Gagne v. Norton, supra, 189 Conn. 32; see also Bridgeport Hydraulic Co. v. Pearson, 139 Conn. 186, 197, 91 A.2d 778 (1952) ("even though a single group of facts may give rise to rights for several different kinds of relief it is still a single cause of action"). In this respect, Duhaime v. American Life Ins. Co., 200 Conn. 360, 511 A.2d 333 (1986) is particularly instructive. In that case, the court held that res judicata foreclosed a plaintiff from bringing a second suit to seek statutory relief available under CUPTA because he had already won a previous case predicated upon the same events for breach of a common law duty. Duhaime v. American Life Ins. Co., supra, 200 Conn. 366. In this case, the plaintiff similarly wishes to litigate new theories of his claim in this action, having already lost on the claims he asserted in his setoff. Thus, the plaintiff in this case endeavors to "relitigate a single claim under a new theory in order to obtain an additional remedy, and this he may not do." Id.
Equally unavailing is the plaintiff's argument that res judicata is inapplicable to this case because it was filed prior to the Camp action, and is therefore not "subsequent litigation" for res judicata purposes. Indeed, the crucial factor for determining whether an action between two parties is "subsequent" to a separate action is to ascertain whether a final judgment has already been rendered between the parties, not to discern which of the various actions was filed first. See, e.g., DaCruz v. State Farm Fire Casualty Co., 268 Conn. 675, 846 A.2d 849 (2004) (holding that action to determine insurance company's contractual obligation to provide defense, which was brought after personal injury suit had already commenced, nevertheless precluded certain issues in personal injury suit because court had already rendered final judgment in contract case). Consequently, because the Camp action has already been decided, this case is "subsequent" to that action for res judicata purposes, and the judgment in the Camp action may preclude claims asserted in this case.
The court is also not persuaded by the plaintiff's argument that he did not expect the rendering of a final judgment in the Camp action to impact the claims presented in this case. The trial transcript from the Camp action establishes that all parties were advised by Judge Thompson that he would be "called upon to make some determinations that are directly relevant to the [ Paul action]." Although Paul objected through his attorney to moving forward at that time, the bench trial in the Camp action was held three years after the two cases had first commenced, and Paul had ample opportunity at that time to present his case. Moreover, if the plaintiff disagreed with the court's decision to move forward in the Camp action, knowing that it would impact this case, "the proper method of attack would have been to appeal that decision rather than attempting to relitigate the issues by way of a second trial." Blonder v. Heath, Superior Court, judicial district of Tolland at Rockville, Docket No. CV 90 0045252 (January 29, 1992, McWeeny, J.). Accordingly, the court believes that the treatment of these two cases as a single unit conforms to the party's expectations.
Similarly, the plaintiff's argument that his setoff in the Camp action should not have been addressed by that court is also misplaced in this action. The plaintiff argues that the court in Camp should have rejected his asserted setoff because it did not properly allege a debt that was then due and arising from a liquidated claim but instead impermissibly asserted potential damages that were not yet due and payable. Id. As previously noted, however, even if Paul had not asserted a setoff at all, the fact that he enjoyed an opportunity to argue the claims made in this case as a counterclaim in the Camp action is all that is necessary to bar the present action. See Sachem Enterprises v. Southern Gas Co., supra, 44 Conn.Sup. 168. Moreover, any alleged errors by the court in the Camp action were appealable, and the plaintiff's decision not to avail himself of the appellate process in that case does not justify this court offering him an opportunity to relitigate those same claims in this case. See Blonder v. Heath, supra, Superior Court, Docket No. CV 90 0045252.
See Mikkelson v. Allen, Russell Allen, Inc., Superior Court, judicial district of Hartford at New Britain, Docket No. CV 93 0458824 (May 2, 1994, Lavine, J.)
CONCLUSION
For the foregoing reasons, the final judgment rendered in the Camp action resolved the claims now alleged by the plaintiff. Further litigation of this case is therefore foreclosed by res judicata. Accordingly, for the reasons set forth in the Memorandum of Decision dated December 11, 2007, the motion for summary judgment is granted.