Opinion
No. CV-002-0071112S
January 30, 2004
MEMORANDUM OF DECISION
The plaintiff Richard Preston (Preston) brought this action against the defendant Michael M. Chartkoff d/b/a Branford Life Casualty Agency, Inc. (Chartkoff) and, by way of his third amended complaint, sought recovery in nine counts claiming negligence, breach of contract, malpractice (professional negligence) and CUTPA. Chartkoff filed an answer to the third amended complaint denying its allegations and setting forth a number of special defenses to the first through sixth counts. The parties waived their right to a jury trial and this case was tried before the court on August 26, 27 and 28, 2003. In lieu of closing arguments, the parties have submitted briefs setting forth their positions regarding the claims and defenses made in this case.
The last brief was filed with the court on October 31, 2003.
I. Facts
The court finds the following facts based on the testimony deemed credible and the exhibits submitted into evidence. On or about October 9, 1998 (exhibit 33), Preston purchased property located at 36 Platt Avenue (Platt) in West Haven, Connecticut in the name of Eden Land, LLC., a Delaware corporation. Preston, who was beginning a course of study at the Yale Law School, moved into the premises. The Platt property was a single-family home in a distressed condition and in foreclosure at the time of purchase, although it was habitable. Preston sought to hire a contractor to perform some renovation work including replacing the attic area of the home with a full second story, putting on a new roof and replacing gutters, bringing the wiring up to modern standards, replacing bathroom fixtures, repairing the concrete floor of the garage and removing overgrown shrubs and bushes.
As the post-trial briefs point out, Preston and Chartkoff testified to widely different version of the salient events. The court has credited their testimony only in part, generally when it appears to be supported by other credible evidence. The court has placed greater weight on the testimony of Johnny Bernard Lee, Sr., the contractor who had dealings with both Preston and Chartkoff, because he had nothing to gain from the outcome of this litigation. The court has drawn reasonable inferences from the testimony and exhibits it deems credible.
Preston contacted Johnny Bernard Lee, Sr. (Lee), who was doing business as J.B. Lee Action Builders Construction Company, after seeing a classified advertisement in the newspaper and hired Lee to perform the Platt renovations after Lee quoted him a figure of $9,000.00, including labor and materials, to perform all the work that Preston had specified. Preston did not contact any other contractors and had no other bids for the job. Preston drafted a contract (contract I) containing the specific clauses that he desired and that contract was executed on October 23, 1998 (exhibit 1). A second contract (contract II), also drafted by Preston and specifying additional exterior and interior work for the additional sum of $2,000.00, was executed on October 31, 1998 (exhibit 2).
Contract I provided for the following work in the interior: (1) Removal of an existing toilet and sink and installation of a new toilet, vanity sink and shower unit in the bathroom. (2) Installation of new kitchen sink pressure/cut off valves and repair of broken plaster on all kitchen walls and ceiling. (3) Installation of new 200 amp panel breaker service box and new electrical outlets, switches and wiring to code. (4) Installation of sheet rock and insulation for covered porch/front door area where damaged by leaking roof and repair of water damaged walls and ceiling around front door. It provided for the following exterior work: (1) removal of all trees and shrubs from yard and around house. (2) Repair roof in covered porch area from leaking. (3) Removal and replacement of all gutters and leaders. (4) Installation of an 11 x 20 foot concrete floor in garage. (5) Installation of new rear garage window. (6) Repair of garage door to working order. (7) Repair of garage lighting and electrical wiring, interior and exterior. (8) Add 15 x 27 foot dormer style shed to second floor containing five 8 x 4 windows. (9) Add new dormer to second floor to match existing dormer with two 8 x 4 windows. (10) Replace existing 8 x 4 window with new one. (11) Vinyl siding of second floor. (12) New gutters and leaders for the second floor. (13) Interior wiring for second floor including electrical wall outlets and three ceiling fixtures and 1/2 drywall on ceiling and walls. (14) Removal of existing interior wall and closet walls on second floor. (15) Installation of matching flooring on second floor where needed.
Contract II provided for the following additional work in the interior: (1) Construction of a second floor walk-in closet. (2) Installation of sheet rock, electrical outlets and ceiling light in additional dormer space, as well as flooring to match existing flooring. (3) Construction of a bathroom. (4) Installation of baseboard heating elements for second floor (5) Installation of a water heater in basement to replace existing boiler. (6) Removal of wall between covered patio and living room. It provided for the following exterior work: (1) Extension of the northeast dormer. (2) Installation of 8 foot sliding glass window to southwest dormer. (3) Construction of a deck to cover porch-roof area. (4) Installation of vinyl siding for dormer extension.
Both contracts contained clauses requiring that Lee furnish Preston with a surety bond and provide liability insurance (clauses VI and VII). At the time the contracts were executed, neither Lee nor his business was insured and Lee's home improvement contractor license had lapsed. Preston was aware of these facts. According to Preston, he would not permit Lee to begin any work at Platt until he had obtained his license and insurance and a permit had been issued by the City of West Haven. Preston gave Lee money toward the renewal of his license and for liability insurance.
Lee went about obtaining his license renewal and seeking insurance. He originally went to his former insurance agent who referred him to Chartkoff at Branford Life Casualty in Hamden. Chartkoff was able to obtain liability insurance for Lee with United National Insurance Company (United National) through a wholesale broker known as Agency Intermediaries, Inc. with an effective date of October 30, 1998 (exhibit 4). Chartkoff also took steps to obtain a performance bond in the amount of $9,800.00 by contacting Western Surety Company (Western Surety) on October 24, 1998 (exhibit 23) and having Lee complete and sign Western's standard form application for bond on October 29, 1998 (exhibit 7). Chartkoff sent to bond application to Western Surety which rejected it. Ultimately, Chartkoff obtained a quote for a bond from Atlantic Surety for a premium in the amount of $980.00.
What happened regarding the performance bond from this point forward is less than clear. Chartkoff maintains that he did not have any contact with Preston concerning the performance bond and that he only spoke with Lee, who told him he would do the job without the bond. Preston maintains that he spoke with Chartkoff in detail about the bond, that he sent Chartkoff a check for $900.00 on November 5, 1998 (exhibit 29) to cover the cost of the bond, although the check was never cashed, and that Chartkoff sent him a letter by facsimile on November 6, 1998 (exhibit 5) regarding the bond. Lee told Preston that he could not get a bond. He remembers that Preston spoke with Chartkoff about the bond. Lee never gave Chartkoff any money to obtain a bond. No performance bond was obtained.
Meanwhile, Lee's initial application for a building permit was turned down because Lee did not have the proper credentials or documentation. In order to obtain a permit for the work specified in contracts I and II, Lee had to register as a home improvement contractor and also had to submit certain drawings. On November 3, 1998, the West Haven building department issued a permit for the removal of the roof only (exhibit 9). The department was still reviewing the drawings and on November 9, 1998 it drew up a list of deficiencies with respect to the drawings that Lee needed to address.
Nonetheless, Lee began to work at the Platt site. There is credible evidence to support the conclusion that he began work even before West Haven issued the roof removal permit. On November 10, 1998, an assistant building inspector went to the Platt site and discovered that Lee had performed work in violation of the roof removal permit. A "Stop Order" was issued (exhibit 10) which required Lee to cease work. At the time the stop work order was issued, Lee had done extensive exterior and interior work including removing the roof shingles and the top layer of the roof framing part of the second-floor area, removing an interior wall, working on a bathroom and electrical work.
Preston testified that he did not permit Lee to perform any work at Platt other than the removal of some shrubbery before he received confirmation from Chartkoff that a performance bond was going to be in place. According to Preston, he received a fax from Chartkoff dated November 6, 1998 (exhibit 5), a fact Chartkoff vehemently disputes, and Lee started his work a day or two after that. That would have given Lee approximately four days, at most, including a Saturday and a Sunday, before the stop work order was issued. Preston's testimony is not credible and is contradicted by the testimony of Richard Gladwin, the building official, and by Lee that work began before the roof removal permit was issued. Furthermore, Preston's testimony is contradicted by the allegation contained in his complaint that Lee commenced work on November 4, 1998.
When Lee left the Platt site he had covered the roof with a tarpaulin. He returned on a number of occasions at Preston's request to adjust the covering. Nonetheless, leakage occurred and there was significant water damage to the premises and Preston's personal property, much of it recorded on November 20 and 26, 1998 by Preston on a video tape that the court viewed during trial (exhibit 22). Initially, Preston did not hire anyone to secure the premises, but in mid-December he hired another contractor, Ferrucci Construction, Inc., who secured the premises and obtained a permit on January 6, 1999 to rebuild the roof as part of a more extensive proposal, at a cost of $35,000.00, to remove the existing second-floor structure, construct new outside and inside walls, a roof and a deck, and install windows and doors (exhibit 18). Ultimately, Preston decided to raise the roof and turn Platt into a full three-story one-family house.
Other findings of fact will be made specifically in the context of the court's discussion of the legal claims made by the parties.
II. Agency
In order to hold Chartkoff liable for any of the causes of action asserted in the complaint, Preston was required to establish, by a fair preponderance of the evidence, that Chartkoff was acting as his agent with respect to obtaining either the commercial liability insurance or the performance bond or both.
There is no question that Chartkoff acted as a broker to procure insurance for Lee. Lee's former Nationwide agent, who no longer wrote commercial liability insurance, referred him to Chartkoff for the express purpose of obtaining commercial liability insurance and a performance bond. Chartkoff then took steps which are within the classic definition of an insurance broker as set forth in Ursini v. Goldman, 118 Conn. 554, 559, 173 A. 789 (1934): He "acts as a middleman between the insured and the insurer. Having secured an order, he places the insurance, in the absence of a selection by the insured, with the company selected by the broker. He is the agent of the insured in negotiating for the policy. As such he owes a duty to his principal to exercise reasonable skill, care, and diligence in effecting the insurance . . . (Citations omitted.)." Ordinarily, the broker's duty to use reasonable care to procure the requested insurance runs only to the applicant for the insurance. See 43 Am.Jur.2d Insurance § 113, p. 190. Indeed, as the plaintiff's expert testified, an insurance broker typically would not represent anyone other than the applicant and, under normal circumstances, would have no need to speak with the homeowner in order to procure liability insurance or a performance bond for a contractor.
In procuring insurance for a person, "the broker becomes the agent of that person for that purpose." Lewis v. Michigan Millers Mutual Insurance Co., 154 Conn. 660, 664, 228 A.2d 803 (1967). In order to resolve the question of the nature of Chartkoff's relationship with Preston, the court can be guided by the established rules of agency. See Hallas v. Boehmke Dobosz, Inc., 239 Conn. 658, 673, 686 A.2d 491 (1997). "Agency is the fiduciary relation which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act." 1 Restatement (Second), Agency § 1, p. 7 (1958). To establish that Chartkoff was his agent, Preston was required to demonstrate three elements: (1) a manifestation by Preston that Chartkoff was to act for him; (2) Chartkoff's acceptance of the undertaking; and (3) an understanding between Chartkoff and Preston that Preston was to be in control of the undertaking. Hallas v. Boehmke Dobosz, Inc., supra, 239 Conn. 673.
As to Preston's claims regarding the liability insurance, which are set forth in counts one, four, five, seven and eight, Preston has failed to establish any of these three elements by a fair preponderance of the evidence. It is undisputed that Lee, not Preston, was referred to Chartkoff and that Lee, not Preston, asked Chartkoff to act on Lee's behalf to obtain general commercial liability insurance for Lee's business. Although Preston testified that Lee told him about Chartkoff, gave him Chartkoff's business card and Preston called Chartkoff by that time Chartkoff had already begun the process of obtaining liability insurance on Lee's behalf without any direction from Preston. Further, there is no credible evidence that Chartkoff had an understanding with Preston that Preston was to be in control of the process of obtaining liability insurance with respect to any issues, including the nature or adequacy of the coverage. Even if Chartkoff received contracts I and II from Preston before the liability insurance was secured, which Chartkoff denies, any arguable duty Chartkoff may have had arising from a review of those contracts with respect to the nature of the coverage obtained would be to Lee, not Preston. Moreover, in the absence of a special relationship with a client such as an intimate long-term relationship, a broker does not have any duty to advise a client as to the sufficiency or adequacy of insurance coverage. See The DeHayes Group v Pretzels, Inc., 786 N.E.2d 779 (Ind.App. 2003); Sintros v. Hamon, 148 N.H. 478, 810 A.2d 553 (2002).
There is a considerable dispute regarding when Preston first spoke to Chartkoff about the liability insurance. Preston testified that he spoke with Chartkoff after Lee brought him Chartkoff's business card and that Chartkoff told him he was in the process of obtaining the general liability insurance and he believed there would be no problem in getting it. Chartkoff testified that he did not recall speaking with Preston until after the Platt property sustained damage.
As to Preston's claims regarding the performance bond, which are set forth in counts two, three, four and six, the evidence, although not overwhelming, supports the conclusion that Chartkoff had entered into an agency relationship with Preston. In reaching this conclusion, the court relies heavily on Lee's testimony that Preston spoke with Chartkoff about the performance bond and that Lee did not care if there was a performance bond but Preston was insistent about it. In addition, while Lee never gave any money to Chartkoff for the performance bond, Preston introduced evidence that he wrote a check in the amount of $900.00, close to the amount required to secure the bond, on November 5, 1998 (exhibit 29). Furthermore, although Chartkoff vehemently denies its authenticity, Preston introduced a letter from Chartkoff to him dated November 6, 1998 regarding the procurement of the bond which stated, among other things, "that the performance bond to cover Mr. Lee's work which you have requested is currently being placed." (Emphasis supplied; exhibit 5). This evidence supports the conclusion that while Lee may have initially approached Chartkoff regarding the performance bond, it was Preston who took control over the process of having Chartkoff procure the bond and Chartkoff understood that to be the case. Thus, unlike the situation involving the liability insurance, there is a preponderance of the evidence to satisfy the three elements of agency regarding the procurement of the performance bond.
Thus, the court concludes, based on the evidence presented in this case, that Chartkoff was not acting as Preston's agent in the procurement of the liability insurance but he was acting as Preston's agent in the procurement of the performance bond.
III. Standard for Liability
To the extent that Chartkoff was acting as Preston's agent he owed him a duty "to exercise reasonable skill, care, and diligence in effecting the insurance, and any negligence or other breach of duty on his part which defeats the insurance which he undertakes to secure will render him liable to his principal for the resulting loss. Where he undertakes to procure a policy affording protection against a designated risk, the law imposes upon him an obligation to perform with reasonable care the duty he has assumed, and he may be held liable for loss properly attributable to his default. The principal may sue either for breach of the contract or in tort for breach of duty imposed by it. (Citations omitted.)." Ursini v. Goldman, supra, 118 Conn. 559-60. See Rametta v. Stella, 214 Conn. 484, 489, 572 A.2d 978 (1990).
Whether the claim against an insurance broker is brought in contract or tort, the broker's general duty is the same: to act reasonably and without delay to procure the insurance coverage he has promised to obtain and to notify his client promptly if he is unable to procure the requested insurance coverage. Harnett, Responsibilities of Insurance Agents and Brokers, § 3.03 (Matthew Bender 2004). The agent breaches his contract to procure the insurance and also acts negligently if he fails to obtain the insurance and fails to notify the client. The agent's breach or negligence then must be established to be a proximate cause of the uninsured loss.
The purpose of timely notification is to permit the client to have an opportunity to procure insurance elsewhere. Baseball Office of the Commissioner v. Marsh McLennan, Inc., 295 App.Div. 73, 79-80, 742 N.Y.S.2d 40, 46 (App.Div. 2002).
IV. The Complaint A. Counts One, Five, Seven and Eight
As the court reads the complaint, counts one, five, seven and eight make claims solely in relation to the liability insurance. The court has concluded that Chartkoff was not acting as Preston's agent with respect to the liability insurance. Accordingly, Chartkoff did not owe Preston any duty to procure the liability insurance.
In counts one and five, Preston makes claims based on Chartkoff's failure to procure adequate liability insurance and, in count seven, Preston claims that Chartkoff negligently failed to inform him that the United National policy did not cover the roof. However, there is no question that through Chartkoff's efforts, on October 30, 1998, which was around the time that Lee commenced his work at Platt, United National issued a general commercial liability policy (exhibit 4) to Lee which provided $100,000.00 in coverage and did not contain a roofing exclusion. Indeed, according to the plaintiff's expert witness, the policy covered claims of damage arising from the work done on the roof. Consequently, the evidence is insufficient to support the allegations of counts one, five and seven.
Thus, even if the court's conclusion that Chartkoff was not Preston's agent is erroneous, Chartkoff would have met any duty he did owe to Preston by obtaining the liability insurance as it covered the loss in question. It is irrelevant to this conclusion that United National refused, initially, to pay Preston's claim against the policy because the law provides that an insurance broker or agent is absolved from liability if he has obtained the coverage requested, notwithstanding an insurer's refusal to pay. See Holmes' Appelman on Insurance 2d, § 83.9; Harnett, supra, § 3.03.
In count eight, Preston claims that Chartkoff was negligent in failing to promptly report his claim of damage to United National. The evidence establishes that Chartkoff submitted a notice of claim to United National on December 8, 1998 (exhibit 35), one day after Preston spoke to him about the claim. Accordingly, the evidence refutes the allegations contained in count eight. Moreover, any duty that Chartkoff could have owed Preston would have ended when Chartkoff procured the liability policy. Lewis v. Michigan Millers Mutual Insurance Co., supra, 154 Conn. 664.
Based on the foregoing, the court finds against the plaintiff and in favor of the defendant on the first, fifth, seventh and eighth counts.
B. Counts Two, Three, Four and Six
Counts two, three and six make claims solely in relation to the procurement of the performance bond. In count two, Preston claims negligence in failing to procure a performance bond and, in count six, he claims professional negligence based on the same facts; in count three, he claims negligence in failing to inform him that the performance bond was not procured. In count four, Preston claims that Chartkoff breached his contract with him to procure both the liability insurance and the performance bond but for reasons stated above, the only viable contractual claim in that count concerns the performance bond.
Generally speaking, the duty imposed on an insurance broker to procure insurance, under either tort or contract law, simply requires the broker to act reasonably and without delay to try to obtain the requested coverage, but the broker cannot be held liable for the failure to obtain coverage as long as the client is informed of that fact. "In most cases where courts find that an agent has a duty to procure insurance, the agent has engaged in some type of affirmative conduct sufficient to warrant the client to assume that the desired insurance coverage has been or would be obtained. For example, a statement by an agent to the client that an insurance policy had been or would be procured has often been singled out by the courts as an important liability-imposing factor." Holmes' Appelman on Insurance 2d, supra, § 83.1. See Annot. 64 ALR3d 398, § 2[a], 6[a].
In this case, there is no question that Chartkoff acted reasonably and without delay by seeking a performance bond from Western Surety on October 24, 1998, almost immediately after he first met with Lee. When Chartkoff was unable to obtain a performance bond from Western Surety, he then went to other companies and finally obtained a quotation from Atlantic Surety which was willing to place the bond for a premium of $980.00. At this point, he communicated the information to Lee who indicated he was unwilling to pay that amount of money for the bond and would do without it. As to Lee, Chartkoff was not negligent nor did he breach any contract.
However, in this case Chartkoff assumed an independent duty, both in tort and contract, to Preston based on his conversations with him regarding the performance bond and the representations he made in the letter to Preston dated November 6, 1998. As a result, Chartkoff had a duty to Preston (1) to use reasonable diligence to obtain the performance bond and (2) to notify Preston promptly if he was unable to obtain it. Annot., supra, 64 ALR3d 398, §§ 3, 4; Harnett, supra, § 3.03. As to (1), the evidence establishes that Chartkoff acted diligently in attempting to obtain a performance bond. As to (2), there is no direct evidence that Chartkoff failed to notify Preston that a bond was not obtainable, rather the only evidence is the letter dated November 6, 1998 which indicates that "another company has agreed to bond Mr. Lee" and the requested bond was "being placed." Consequently, in order to recover for any loss arising out of either Chartkoff's failure to secure a performance bond or failure to advise him that he was unable to procure one, Preston must establish that Chartkoff acted in a manner that "warranted an assumption by the client that he was properly insured." Breck Construction Co., LLC v. Thomas, Farr Reeves Agency, Inc., 852 So.2d 1151 (La.App. 2d Cir. 2003); Batiste v. Security Insurance Group, 416 So.2d 279 (La.App.), cert. denied, 421 So.2d 909 (1982).
Although it might have been reasonable for Preston to rely on the November 6, 1998 letter and assume that a performance bond was to be in place within a few days after its receipt, the court concludes that it was not reasonable for Preston to assume that Lee's work was protected by a performance bond at the time Lee began work at Platt. As the court concluded above, see text at footnote 5, Lee began working at Platt shortly after the liability insurance was secured and before the permit to remove the roof was issued on November 3, 1998. Preston's conduct in permitting Lee to commence work unbonded is inconsistent with his claimed intent to protect himself through Chartkoff's procurement of a performance bond and can be deemed to constitute not only a waiver of the requirements of contracts, I and II concerning the procurement of a performance bond, but also of any duty Chartkoff may have had to secure the bond. Appelman, supra, § 87.2. Cf. T.G.I. East Coast Construction Corp. v. Fireman's Fund Insurance Co., 600 F. Sup. 178, 181 (S.D.N.Y. 1985). Indeed, even if Chartkoff had fulfilled his duty to inform Preston, within a reasonable period of time after the November 6, 1998 letter, that he had failed to place the performance bond, it would have been futile for Preston to attempt to secure a bond elsewhere because he had already permitted Lee to begin working at Platt.
Furthermore, it is impossible to conclude on the evidence presented that Chartkoff's failure to either secure a performance bond in the amount of $9,800.00 or inform Preston of his inability to do so was a proximate cause of any damages Preston sustained. It was Lee's direct negligence in performing the work on the roof and second story of Platt that resulted, in part, in to subsequent water damage to the Platt property and to Preston's personal belongings. The evidence presented does not permit the court to determine when Lee performed the shoddy work nor to conclude that it was any breach on Chartkoff's part, a finding the court does not make, rather than Preston's implied waiver of the performance bond by permitting Lee to commence work before the bond was obtained, that caused Preston to suffer a loss. Accordingly, even if Chartkoff could be found to have breached a duty in tort or contract to Preston by misleading Preston into believing that a performance bond was in place as early as November 6, 1998 or failing to tell him it was not in place, that breach cannot be found to be a proximate cause of any damages Preston may have sustained.
According to Lee, after the stop work order issued on November 10, 1998, he covered the roof of the Platt house with a tarpaulin and it was secure. According to Preston, all the damage the Platt property sustained occurred between November 10, 1998 and November 26, 1998 as a result of water coming through an inadequately secured roof. Although Preston had Lee return several times in this period to adjust the tarpaulin, he made no efforts to obtain another professional to cover the roof and did not contact his subsequent contractor, Ferrucci, until after the damage was sustained.
Based on the foregoing, the court finds against the plaintiff and in favor of the defendant on the second, third, fourth and sixth counts.
C. CUTPA
In the ninth count, Preston claims that Chartkoff violated the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a, et seq., by, among other things, submitting inaccurate answers in Lee's application for liability insurance coverage, failing to procure the performance bond and failing to inform him that the performance bond was not procured (ninth count, ¶ 20). These allegations are also contained in the counts alleging negligence and professional negligence (Counts 1-3, 5-8).
Preston's allegation in ¶ 20(h) that the liability insurance did not cover the damage caused by the roofing work was refuted by the evidence.
The court is required to focus on the activities alleged to be violative of CUTPA. Larsen Chelsey Realty Co. v. Larsen, 232 Conn. 480, 492, 642 A.2d 1009 (1995). Because the claims made in this case involve Chartkoff's provision of professional services as an insurance broker, Preston had to establish, by a fair preponderance of the evidence, that Chartkoff's alleged unfair or deceptive acts or practices involved the conduct of the entrepreneurial aspects of Chartkoff's insurance brokerage business. See Suffield Development Associates Ltd. Partnership v. National Loan Investors, L.P., 260 Conn. 766, 780-84, 802 A.2d 44 (2002); Haynes v. Yale-New Haven Hospital, 243 Conn. 17, 34, 669 A.2d 964 (1997). Like other professionals, Chartkoff is entitled to immunity for "violations predicated on negligence or malpractice . . . because those claims address only competence." Id., 243 Conn. 35. The entrepreneurial exception is a "specific exception from CUTPA immunity for a well-defined set activities — advertising and bill collection, for example," Suffield Development, supra, 260 Conn. 782, or the solicitation of business. The activities involved here — submitting an application for liability insurance and procuring a performance bond — are not entrepreneurial.
Furthermore, the conduct claimed to be violative of CUTPA does not satisfy any of the three criteria of the "cigarette rule" to qualify as unfair under the statute. Those criteria are: "(1) whether the practice, without necessarily having been considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise — whether, in other words, it is within at least the penumbra of some common law, statutory or other established conduct of unfairness; (2) whether it is immoral, unethical, oppressive or unscrupulous; (3) whether it causes substantial injury to consumers (or competitors, or other businessmen)." Federal Trade Commission v. Sperry Hutchinson Co., 405 U.S. 244-45, n. 5, 92 S.Ct. 898, 31 L.Ed.2d 170 (1972). With respect to the claim that Chartkoff submitted inaccurate answers in Lee's application for liability insurance, even assuming those answers constituted a misrepresentation, Preston's expert stated that an agent had no obligation to go beyond submitting the answers given to him by the applicant in response to the form questions supplied by the insurance company. Any verification of that information is the responsibility of the insurance company. Even if Chartkoff had suspicions about the information submitted, according to Preston's expert, his only obligation would have been to tell the applicant that the insurance company would verify the information and, perhaps, to raise his suspicions with the insurance company. As to Chartkoff's conduct regarding the procurement of the performance bond, any arguable breach of duty in failing to procure the bond or to tell Preston of his failure does not rise to the level of either the second or third criterion, and the first criterion is clearly inapplicable. Moreover, as discussed above in Section IV.B, the court is unable to conclude that Chartkoff's conduct with respect to the performance bond is a proximate cause of the damages that Preston sustained. See Abrahams v. Young Rubicam, Inc., 240 Conn. 300, 306, 692 A.2d 709 (1997).
It is not necessary to prove all three criteria; 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." Cheshire Mortgage Service, Inc. v. Montes, 223 Conn. 80, 106, 612 A.2d 1130 (1992).
Based on the foregoing, the court finds against the plaintiff and in favor of the defendant on the ninth count.
V. Conclusion
The court concludes that the plaintiff has failed to establish the claims alleged in his complaint by a fair preponderance of the evidence. Accordingly, judgment shall enter in favor of the defendant on the complaint.
LINDA K. LAGER, JUDGE.