Opinion
CV156030881
05-02-2016
Dora Sessa v. Amica Mutual Insurance Company et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE MOTION TO STRIKE, #114
Cynthia K. Swienton, J.
The issue presented is whether the court should grant Amica Mutual Insurance Company's motion to strike counts one and two of the complaint because New York law applies and renders the counts legally insufficient.
FACTS
The plaintiff, Dora Sessa, filed a four-count complaint on September 28, 2015, against the defendants Raffaella Coler and her auto insurance carrier, Amica Mutual Insurance Company (" Amica"), for injuries arising out of a motor vehicle accident. The complaint alleges the following facts. On July 5, 2014, the plaintiff was a passenger in a vehicle driven by Coler traveling in New York. Coler fell asleep at the wheel and lost control of her vehicle, causing injuries to the plaintiff. At the time of the accident Coler was insured by Amica. Sessa and Coler are residents of Connecticut, Amica is licensed insurance agency in Connecticut and Coler's auto insurance policy was issued in Connecticut. Count one of the complaint alleges " common law bad faith" against Amica for denied reimbursement of the plaintiff's medical bills. Count two alleges violation of the Connecticut Unfair Insurance Practices Act (" CUIPA"). Counts three and four sound in negligence and recklessness, respectively, against Coler for losing control of her vehicle and causing the accident.
For the purposes of this memorandum, Amica will be referred to by name and as " the defendant."
Amica filed a motion to strike counts one and two of the complaint. The plaintiff filed an objection. A reply was filed to the objection by the defendant and the plaintiff filed a supplemental brief. Parties presented oral argument at short calendar.
DISCUSSION
Motion to Strike
" [A] motion to strike challenges the legal sufficiency of a pleading and, consequently, requires no factual findings by the trial court . . . [The court] construe[s] the complaint in the manner most favorable to sustaining its legal sufficiency . . . Thus, [i]f facts provable in the complaint would support a cause of action, the motion to strike must be denied . . . Moreover, [the court notes] that [w]hat is necessarily implied [in an allegation] need not be expressly alleged . . . It is fundamental that in determining the sufficiency of a complaint challenged by a defendant's motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted . . . Indeed, pleadings must be construed broadly and realistically, rather than narrowly and technically." (Internal quotation marks omitted.) Coppola Construction Co. v. Hoffman Enterprises Ltd. Partnership, 309 Conn. 342, 350, 71 A.3d 480 (2013).
Furthermore, " [i]t is well established that a motion to strike must be considered within the confines of the pleadings and not external documents, such as the agreement between the parties. We are limited . . . to a consideration of the facts alleged in the complaint." (Internal quotation marks omitted.) Zirinsky v. Zirinsky, 87 Conn.App. 257, 268-69 n.9, 865 A.2d 488, cert. denied, 273 Conn. 916, 871 A.2d 372 (2005); see also Rowe v. Godou, 209 Conn. 273, 278, 550 A.2d 1073 (1988) (in ruling on motion to strike, court cannot resort to information outside of complaint). " Where the legal grounds for . . . a motion [to strike] are dependent upon underlying facts not alleged in the plaintiff's pleadings, the defendant must await the evidence which may be adduced at trial, and the motion should be denied." (Internal quotation marks omitted.) Comm'r of Labor v. C.J.M. Servs., 268 Conn. 283, 293, 842 A.2d 1124 (2004).
In its motion, Amica argues that counts one and two should be stricken because " New York law does not recognize . . . common-law bad faith in connection with the handling of no-fault claims, " nor does CUIPA apply in a New York no-fault claim; therefore, the counts fail to state legally sufficient causes of action. In her opposition, the plaintiff contends that under a choice of law analysis, Connecticut law should be applied because the parties are Connecticut residents and the insurance policy was issued in Connecticut.
Analysis
At issue is whether Connecticut or New York law applies in determining the legal sufficiency of counts one and two of the plaintiff's complaint. Some superior courts have determined that motions to strike are premature in a choice of law analysis when facts are insufficiently pleaded or disputed. " [C]ourts have refused to address choice of law issues in a motion to strike because it is premature to conduct the requisite searching case-by-case contextual inquiry into the significance of the interests that the law of competing jurisdictions may assert in [the] particular controvers[y]." (Internal quotation marks omitted.) Financial Consulting, LLC v. Illinois Mutual Life Ins. Co., Superior Court, judicial district of New London, Docket No. CV-09-5013143-S, (October 28, 2010). " Where a choice of law issue is present on a motion to strike . . . it is unusual to determine the issue at this procedural stage." DiMauro v. Aiardo, Superior Court, judicial district of New Haven, Docket No. CV-97-0401576-S, (April 20, 1998). " In light of the 'searching case-by-case contextual inquiry' that is encouraged under the Restatement, it would be inappropriate to decide the choice of law issue at this stage in the proceedings in the absence of a more complete set of facts." Ffolkes v. Pasko, Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-96-0154395-S (May 13, 1997) (19 Conn. L. Rptr. 442, 443).
See also Reyes v. Bajwa, Superior Court, judicial district of Fairfield, Docket No. CV-11-6021388-S (March 13, 2012) (53 Conn. L. Rptr. 565) (motion to strike denied because " discovery is needed in order for the parties to develop a more complete set of facts beyond those alleged in the complaint as to whether Connecticut law or the law of another jurisdiction applies to the claims made by the plaintiffs in their complaint"); Bonelli v. Giguere, Superior Court, judicial district of Hartford, Docket No. CV-02-0819257-S, (October 15, 2003) (motion to strike denied " [b]ecause the domicile or citizenship of the parties is not alleged in the pleadings, there are insufficient facts before this court to decide the choice of law issue").
Contrastingly, other superior courts have conducted choice of law analyses to determine a motion to strike when there are sufficient underlying facts. Boston Property Exchange Transfer Co., Inc. v. Merrill Lynch, Superior Court, judicial district of Hartford, Complex Litigation Docket, Docket No. X04-CV-11-6026660-S (May 13, 2013) (56 Conn. L. Rptr. 125, 127) (" [T]he plaintiff has pointed to nothing beyond the complaint that the court needs or should consider in doing the choice of law analysis . . . [T]his is the unusual case where the court has all of the information it needs from the complaint to conduct the choice of law analysis." [Footnote omitted.]).
In the present matter, no dispositive facts in the complaint are disputed by the parties. Sessa and Coler are Connecticut residents, Amica is licensed to do business in Connecticut and the auto insurance policy was issued in Connecticut. The accident and injuries occurred in New York. Because there are sufficiently pleaded undisputed facts in the complaint, this court proceeds through a choice of law analysis to determine whether the counts are legally sufficient under the appropriate state's law.
Cf. Reyes v. Bajwa, supra, Superior Court, Docket No. CV-11-6021388-S (motion to strike denied because discovery was needed to determine " where the bulk of the contracting transaction between the defendant[s] . . . took place; thus it is impossible to determine whether the lease agreement is controlled by the laws of Canada"); Financial Consulting, LLC v. Illinois Mutual Life Ins. Co., supra, Superior Court, Docket No. CV09-5013143-S (motion to strike denied because " there appear to be additional facts outside the pleadings that would provide a more complete analysis of whether Connecticut law, or that of another jurisdiction, would apply to the plaintiffs' claims").
Choice of Law
" Under Connecticut choice of law rules, for the plaintiff's claims that sound in tort, namely, civil conspiracy, unjust enrichment and CUTPA, we apply the law of the state in which the plaintiff was injured, unless to do so would produce an arbitrary or irrational result. See O'Connor v. O'Connor, 201 Conn. 632, 649-50, 519 A.2d 13 (1986). For the plaintiff's contract claim, we adopt the 'significant relationship' test, and presume the application of the law of the state in which the bulk of the transaction took place. See Reichhold Chemicals, Inc. v. Hartford Accident & Indemnity Co., 243 Conn. 401, 406-07, 703 A.2d 1132 (1997), on appeal after remand, 252 Conn. 774, 750 A.2d 1051 (2000)." Macomber v. Travelers Property & Casualty Corp., 277 Conn. 617, 640, 894 A.2d 240 (2006).
In O'Connor v. O'Connor, 201 Conn. 632, 650, 519 A.2d 13 (1986), our Supreme Court adopted the guidelines of the Restatements (Second) of Conflicts of Laws § § 145 and 6 as the governing principles in choice of law cases in which application of the doctrine of lex loci would produce an arbitrary or irrational result. " This doctrine was slightly modified in O'Connor, which holds that when the application of the doctrine of lex loci delicti would produce an arbitrary, irrational result we should turn to and incorporate the guidelines of the Restatement [(Second) of Conflict of Laws] as the governing principles . . ." Western Dermatology Consultants, P.C. v. Vital Works, Inc., 146 Conn.App. 169, 203, 78 A.3d 167 (2013).
Count One--Bad Faith
In count one of the complaint, titled " common law bad faith, " the plaintiff asserts that " [w]ithout investigation, [Amica] willfully and maliciously claimed plaintiff had a pre-existing condition as reason not to pay the above captioned bills . . . As a result of [Amica's] bad faith handing of plaintiff's medical bills, plaintiff has been further harmed . . ." Generally, Connecticut courts recognize bad faith as a claim sounding in tort law. Buckman v. People Express, Inc., 205 Conn. 166, 170, 530 A.2d 596 (1987) (" this court recognizes an independent cause of action in tort arising from an insurer's common law duty of good faith"). Under Connecticut choice of law rules, for a claim sounding in tort, the court applies the law of the state in which the plaintiff was injured, unless to do so would produce an arbitrary or irrational result. See Macomber v. Travelers Property & Casualty Corp., supra, 277 Conn. 640.
For a thorough analysis on the proper characterization of actions for good faith and fair dealing and bad faith claims arising out of contracts under a choice of law analysis, see DelMonaco v. Albert Kemperle, Inc., Superior Court, judicial district of New Haven, Docket No. CV-14-6045251-S (November 26, 2014) (59 Conn. L. Rptr. 424, 429) (" A few cases have suggested that a cause of action for a violation of good faith and fair dealing sound in contract . . . In other contexts, however, the Supreme Court has explicitly recognized that claims for this same cause of action sound in tort . . . Subsequently, many opinions have held that claims for a violation of this covenant sound in tort, not contract." [Citations omitted.])
Here, the accident and the plaintiff's injuries occurred in New York. Thus, applying New York law, " [a] claim for breach of the implied covenant of good faith and fair dealing is generally actionable only where wrongs independent of the express terms of the contract are asserted and demands for the recovery of separate damages not intertwined the damages resulting from a breach of a contractual are advanced . . . Where a contractual party is merely seeking to reap the benefits of its contractual bargain, the implied covenant breach claim will not lie . . . as it is considered duplicative of the . . . breach of contract claim . . ." J. Kokolakis Contracting Corp. v. Evolution Piping Corp., 46 Misc.3d 544, 547-48, 998 N.Y.S.2d 788 (2014). " New York law . . . does not recognize a separate cause of action for breach of the implied covenant of good faith and fair dealing when a breach of contract claim, based upon the same facts, is also pled." Harris v. Provident Life & Acc. Ins. Co., 310 F.3d 73, 81 (2d Cir. 2002). See also Alexander v. Geico Ins. Co., 35 A.D.3d 989, 990, 826 N.Y.S.2d 777 (2006) (" no separate cause of action exists in tort for an insured's alleged bad faith in failing to perform its contractual obligations"). " Therefore, when a complaint alleges both a breach of contract and a breach of the implied covenant of good faith and fair dealing based on the same facts, the latter claim should be dismissed as redundant." Cruz v. FXDirectDealer, LLC, 720 F.3d 115, 125 (2d Cir. 2013) (applying New York law).
In the present circumstances, the plaintiff has alleged that because of the defendant's " bad faith handling of [her] medical bills, " she has " received numerous collection letters and phone calls threatening her credit rating . . . causing [her] emotional distress." The plaintiff's complaint does not contain a breach of contract claim. Nor is the plaintiff's bad faith claim duplicative. Applying New York law, the court finds that the plaintiff's bad faith claim is legally sufficient.
Under Connecticut law, count one is also legally sufficient because it includes an allegation of bad faith. In Connecticut, " [t]o constitute a breach of [the implied covenant of good faith and fair dealing], the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith . . . Bad faith in general implies both actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake as to one's rights or duties, but by some interested or sinister motive . . . Bad faith means more than mere negligence; it involves a dishonest purpose." (Emphasis omitted; internal quotation marks omitted.) TD Bank, N.A. v. J& M Holdings, LLC, 143 Conn.App. 340, 348, 70 A.3d 156 (2013).
Count Two--CUIPA
In count two, titled " CUIPA, " the plaintiff asserts that " [t]he manner in which . . . Amica handled the plaintiff's claims as described . . . violated one or more of these prohibitions of the Connecticut Unfair Insurance Practices Act . . . in [General Statutes] § § 38a-815, 38a-816 et seq." The defendant argues that CUIPA is not applicable because " the plaintiff's New York no-fault claim is governed by New York substantive law."
CUIPA claims are causes of action created by statute. See Lees v. Middlesex Ins. Co., 219 Conn. 644, 653, 594 A.2d 952 (1991) (" [i]n a CUIPA and CUTPA claim, the insurer's duty stems not from the private insurance agreement but from a duty imposed by statute"). " CUIPA was enacted in 1955 and was based on a model insurance trade practices act promulgated by the National Association of Insurance Commissioners in 1947 . . . The impetus behind both the promulgation of the model act and the subsequent enactment of CUIPA was to preempt federal regulation." (Citation omitted; internal quotation marks omitted.) State v. Acordia, Inc., 310 Conn. 1, 24, 73 A.3d 711 (2013).
As discussed in the preceding section, Connecticut utilizes the 'significant relationship' test in a choice of law analysis when the cause of action involves a contract claim., Section 145(2) contacts to be taken into account to determine the law applicable include: (a) the place of injury; (b) the place where the conduct causing the injury occurred; (c) the domiciles of the parties; and (d) the place where the relationship, if any, between the parties is centered. Because the accident and injuries occurred in New York, factors (a) and (b) point toward the application of New York law. " According to the Restatement, those two factors are the most significant in determining which state's tort law to apply. As comment (e) to § 145 provides: When the injury occurred in a single, clearly ascertainable state and when the conduct which caused the injury also occurred there, that state will usually be the state of the applicable law . . ." (Internal quotation marks omitted.) Williams v. State Farm Mutual Automobile Ins. Co., 229 Conn. 359, 372, 641 A.2d 783 (1994). Factor (c) favors Connecticut law because the plaintiff and defendant Coler are Connecticut residents, and defendant Amica is a licensed insurance agency in Connecticut. Factor (d) also favors Connecticut because the auto insurance policy, which the plaintiff is claiming coverage from, was issued in Connecticut.
O'Connor v. O'Connor, supra, 201 Conn. at 650. The " significant relationship" test utilizes the governing principles of § § 145 and 6 of the Restatement (Second) of Conflict of Laws.
As stated above, CUIPA is a cause of action created solely by statute. As it arises under the insurer's duty based upon the contract between it and the insured, the court is applying the significant relationship test in this choice of law analysis.
" To resolve this potential standoff, we need to recall that it is the significance, and not the number, of § 145(2) contacts that determines the outcome of the choice of law inquiry under the Restatement approach. As the concluding sentence of § 145(2) states, [t]hese contacts are to be evaluated according to their relative importance with respect to the particular issue." (Internal quotation marks omitted.) O'Connor v. O'Connor, supra, 201 Conn. 652-53. Other than New York's status as the place of injury, it does not have significant contact for purposes of this choice of law inquiry. Conversely, Connecticut has a significant interest in this litigation because " the legislative intent in passing CUIPA was to occupy the field with regard to unfair trade practices in the insurance industry." State v. Acordia, Inc., supra, 310 Conn. 25.
The auto insurance policy was issued by Amica in Connecticut to a Connecticut resident. Utilizing a case-by-case contextual inquiry into the significance of the interests that the law of competing jurisdictions may assert in particular controversies, the court finds that count two's cause of action alleging a violation of the Connecticut Unfair Insurance Practices Act is legally sufficient.
CUIPA--General Business Practice
In a footnote, the defendant alternatively argues that the plaintiff has not sufficiently pleaded that " Amica engaged in unfair practices with such frequency as to indicate a general business practice." " [A] claim under CUIPA predicated upon alleged unfair claim settlement practices in violation of § 38a-816(6) requires proof that the unfair settlement practices were committed or performed with such frequency as to indicate a general business practice." (Footnote omitted; internal quotation marks omitted.) Lees v. Middlesex Ins. Co., supra, 229 Conn. 847-48. Hence a " defendant's alleged improper conduct in the handling of a single insurance claim, without any evidence of misconduct by the defendant in the processing of any other claim, does not rise to the level of a 'general business practice' as required by § 38a-816(6)." Id., 849. Here, paragraph 19 in count two of the plaintiff's complaint alleges that the defendant Amica " has engaged in similar unfair practices as outlined above against Betty Turner . . . a passenger in the above described accident." Paragraph 20 further alleges that " Amica has engaged in similar unfair practices as outlined above against the defendant Raffaella Coler." These factual allegations, if provable, would demonstrate that the defendant has performed acts that violate CUIPA in more than one instance, and would, therefore, demonstrate a general business practice incurring liability under CUIPA. See e.g., Jendrick v. Middlesex Mutual Assurance Co., Superior Court, judicial district of Stamford-Norwalk, Docket No. CV-13-6020416-S (July 8, 2014) (58 Conn. L. Rptr. 494, 498).
CONCLUSION
For the foregoing reasons, the court denies the defendant's motion to strike counts one and two of the complaint.
The court notes that this situation can be characterized as a false conflict, where " application of the laws of two or more jurisdictions with contacts to the litigation reach identical results, thus eliminating any potential conflict of laws. See R. LeFlar, American Conflicts Law (1968) pp. 237-38; see generally A. Ehrenzweig, 'A Counter-Revolution in Conflicts Law? From Beale to Cavers, ' 80 Harv.L.Rev. 377 (1966)." O'Connor v. O'Connor, supra, 201 Conn. 656 n.18. See also Haymond v. Statewide Grievance Committee, 45 Conn.Supp. 481, 488-89, 723 A.2d 821 (1997), aff'd, 247 Conn. 436, 723 A.2d 808 (1998) (" Under modern conflicts-of-law theory, where there is a false conflict such that the laws of both states relevant to the set of facts are the same, or would produce the same decision in the lawsuit, there is no real conflict between them . . . In such a case, the case ought to be decided under the law that is common to both states . . . It is only after a determination is made that there is indeed an actual conflict between the laws of the particular jurisdictions that the interests of the respective jurisdictions are analyzed." [Citations omitted; internal quotation marks omitted.]).
Section 145 of the Restatement (Second) of Conflict of Laws provides: " (1) The rights and liabilities of the parties with respect to an issue are determined by the local law of the state which, with respect to that issue, has the most significant relationship to the occurrence and the parties under the principles stated in § 6. (2) Contacts to be taken into account in applying the principles of § 6 to determine the law applicable to an issue include: (a) the place where the injury occurred, (b) the place where the conduct causing the injury occurred, (c) the domicile, residence, nationality, place of incorporation and place of business of the parties, and (d) the place where the relationship, if any, between the parties is centered. These contacts are to be evaluated according to their relative importance with respect to the particular issue." Section 6 of the Restatement provides: " (1) A court, subject to constitutional restrictions, will follow a statutory directive of its own state on choice of law. (2) When there is no such directive, the factors relevant to the choice of the applicable rule of law include (a) the needs of the interstate and international systems, (b) the relevant policies of the forum, (c) the relevant policies of other interested states and the relative interests of those states in the determination of the particular issue, (d) the protections of justified expectations, (e) the basic policies underlying the particular field of law, (f) certainty, predictability and uniformity of result, and (g) ease in the determination and application of the law to be applied."