Opinion
No. CV 08 4008325
December 29, 2008
MEMORANDUM OF DECISION RE MOTION TO STRIKE
The plaintiff, Travelers Property Casualty Company of America (Travelers), brings this action against the defendant, Continental Casualty Company seeking a judgment declaring that the defendant has a duty to defend and indemnify the plaintiff's insured, Barr Barr, Inc. (Barr), in an underlying personal injury action. The defendant has filed a motion to strike the complaint on the grounds that the plaintiff lacks standing to maintain a declaratory judgment action.
See Rollo v. Barr Barr, Inc., Superior Court, judicial district of New London, Docket No. CV 07 5003791.
The following allegations contained in the plaintiff's complaint are relevant to the motion to strike. The plaintiff issued a general liability insurance policy to Barr, a general contractor, that was in effect from March 1, 2005, until March 1, 2006. On June 29, 2005, Barr entered into an agreement with William W. Backus Hospital (the hospital) in which Barr and the hospital agreed that Barr would serve as the construction manager for a certain construction project (the project). Subsequently, on August 10, 2005, Barr entered into an agreement with Tucker Mechanical, Inc. (Tucker), a subcontractor. Pursuant to the agreement between Barr and Tucker, Tucker obtained a liability insurance policy from the defendant in which Barr was a named insured. That policy was in effect from October 1, 2005, until October 1, 2006.
On November 8, 2005, Tucker entered into an agreement with Incor Group, Inc. (Incor), a subcontractor. Thereafter, on July 10, 2007, Donald Rollo filed a complaint against Barr in which Rollo claims that, on December 22, 2005, he slipped and fell on ice in a gravel parking lot used for the project. In his complaint, Rollo alleges that he was employed by Incor as a foreman and that he was injured while he was working on the project. All of the claims asserted against Barr and all the damages which Rollo seeks to recover arise out of Tucker's work or work and operations on Tucker's behalf for Barr on the project and are due to Tucker's negligence. The defendant's policy obligates it to provide a defense as to the claims asserted against Barr by Rollo and to indemnify Barr for any damages awarded against it. The defendant has wrongfully refused to defend and indemnify Barr. Due to the defendant's wrongful denial of coverage, Travelers has undertaken the defense of Barr in Rollo's underlying lawsuit.
"It is a basic principle of our law . . . that the [plaintiff] must have standing in order for a court to have jurisdiction to render a declaratory judgment." (Internal quotation marks omitted.) Pinchbeck v. Dept. of Public Health, 65 Conn.App. 201, 205, 782 A.2d 242, cert. denied, 258 Conn. 928, 783 A.2d 1029 (2001). "Standing is the legal 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 . . . [Our Supreme Court] has often stated that the question of subject matter jurisdiction, because it addresses the basic competency of the court, can be raised by any of the parties, or by the court sua sponte, at any time . . . [T]he court has a duty to dismiss, even on its own initiative, any [action] that it lacks jurisdiction to hear . . . Moreover, [t]he parties cannot confer subject matter jurisdiction on the court, either by waiver or by consent . . . Standing . . . is not a technical rule intended to keep aggrieved parties out of court; nor is it a test of substantive rights. Rather it is a practical concept designed to ensure that courts and parties are not vexed by suits brought to vindicate non-justiciable interests and that judicial decisions which may affect the rights of others are forged in hot controversy, with each view fairly and vigorously represented . . . Where a party is found to lack standing, the court is consequently without subject matter jurisdiction to determine the cause." (Citations omitted; internal quotation marks omitted.) Lewis v. Slack, 110 Conn.App. 641, 643-44, 955 A.2d 620 (2008).
In the present case, the defendant argues that the court should grant its motion to strike because the plaintiff lacks standing to bring this declaratory judgment action. Specifically, the defendant insists that the plaintiff lacks an interest in the declaratory judgment action because it is neither a party to, nor a third-party beneficiary of, the defendant's policy. Additionally, the defendant maintains that, because the plaintiff's obligation to defend Barr under the plaintiff's policy has not yet been determined, there is no actual dispute between the parties.
Since the question of standing as raised by the defendant implicates subject matter jurisdiction, it is unclear why this motion was brought as a motion to strike and not a motion to dismiss. Because the court finds that the plaintiff does have standing and has sufficiently set forth claim for a declaratory judgment action, the name of the motion is of no moment.
The plaintiff responds that the defendant is obligated to the plaintiff pursuant to the defendant's policy. Additionally, the plaintiff argues that it retains an interest in this action because, as insurance companies, both parties "step into the shoes of their insureds and are subrogated to their rights, obligations and relations." Finally, the plaintiff argues that there exists a substantial question in dispute as to whether the defendant is obligated to defend and indemnify Barr pursuant to the defendant's policy.
"An action for declaratory judgment is a special proceeding under General Statutes § 52-29 . . . It provides a valuable tool by which litigants may resolve uncertainty of legal obligations . . . Our Supreme Court has frequently pointed out that the statutes and rules pertaining to declaratory judgments create an independent remedy and should be accorded a liberal construction . . . [T]he statute authorizing the Superior Court to render declaratory judgments is as broad as it well could be made . . . Indeed, [o]ur statute, which antedated the Uniform Declaratory Judgments Act, is broader in scope than that act and the statutes in most, if not all, other jurisdictions." (Citations omitted; emphasis added; internal quotation marks omitted.) ACMAT Corp. v. Greater New York Mutual Ins. Co., 88 Conn.App. 471, 475-76, 869 A.2d 1254, cert. denied, 274 Conn. 903, 876 A.2d 11 (2005).
General Statutes § 52-29(a) provides: "The Superior Court in any action or proceeding may declare rights and other legal relations on request for such a declaration, whether or not further relief is or could be claimed. The declaration shall have the force of a final judgment."
Practice Book § 17-55 provides: "A declaratory judgment action may be maintained if all of the following conditions have been met: (1) The party seeking the declaratory judgment has an interest, legal or equitable, by reason of danger of loss or of uncertainty as to the party's rights or other jural relations; (2) There is an actual bona fide and substantial question or issue in dispute or substantial uncertainty of legal relations which requires settlement between the parties; and (3) In the event that there is another form of proceeding that can provide the party seeking the declaratory judgment immediate redress, the court is of the opinion that such party should be allowed to proceed with the claim for declaratory judgment despite the existence of such alternate procedure."
In resolving whether a party has a sufficient legal or equitable interest in a declaratory judgment action, courts have examined Practice Book § 17-55(1) under a traditional aggrievement analysis. See E. Stephenson, Connecticut Civil Procedure (3d Ed. 1997) § 226 (e)(i), p. 587-88. Under such an analysis, "[s]tanding is established by showing that the party claiming it is authorized by statute to bring suit or is classically aggrieved . . . The fundamental test for determining aggrievement encompasses a well-settled twofold determination: first, 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]." (Citations omitted; internal quotation marks omitted.) Steeneck v. University of Bridgeport, 235 Conn. 572, 579, 668 A.2d 688 (1995).
Additionally, in determining whether there is "an actual bona fide and substantial question or issue in dispute," the court has noted that Practice Book § 17-55(2) prevents parties from using a declaratory judgment action "to secure advice on the law . . . or to establish abstract principles of law . . ." (Citation omitted; internal quotation marks omitted.) Pamela B. v. Ment, 244 Conn. 296, 323, 709 A.2d 1089 (1998). The court has also noted, however, that the requirement "means no more than that there must appear a sufficient practical need for the determination of the matter, and that need must be determined in the light of the particular circumstances involved in each case." Bania v. New Hartford, 138 Conn. 172, 175, 83 A.2d 165 (1951).
In examining whether the plaintiff retains standing to pursue the present declaratory judgment, the court is mindful of the fact that declaratory judgment rules are to be liberally construed. ACMAT Corp. v. Greater New York Mutual Ins. Co., supra, 88 Conn.App. 475-76. Operating under this framework, the court concludes that the plaintiff has standing to maintain this action. First, the plaintiff's interest in this matter can certainly be "distinguished from a general interest, such as is the concern of all members of the community as a whole." Moreover, because the defendant's denial of Barr's claim has obligated the plaintiff to defend and indemnify Barr, the defendant's denial has "injuriously affected" the plaintiff. As such, the plaintiff satisfies the requirements of Practice Book § 17-55(1). Further, the plaintiff is not merely seeking advice on the law. Instead, the interests of the plaintiff and the defendant are adverse and a declaration of the defendant's rights under the defendant's policy will provide the plaintiff with guidance regarding its duty to Barr. As the need for such guidance is sufficiently "practical," the plaintiff meets the requirements set forth in Practice Book § 17-55(2).
The court's finding is bolstered by the manner in which declaratory judgments have been addressed in an insurance context. To begin, "[t]here is no question that a declaratory judgment action is a suitable vehicle to test the rights and liabilities under an insurance policy." St. Paul Fire Marine Ins. Co. v. Shernow, 22 Conn.App. 377, 380, 577 A.2d 1093 (1990). Further, a number of Superior Courts, in circumstances involving an uninsured motorist carrier, have determined that declaratory judgment actions are an appropriate method for resolving insurance coverage disputes, regardless of whether the party seeking judgment is also a party to the subject insurance policy. See Amica Ins. Co. v. Nationwide Mutual Ins. Co., Superior Court, judicial district of Hartford, Docket No. CV 94 0542179 (April 21, 1995, Hennessey, J.) (14 Conn. L. Rptr. 225) (determining that victim's uninsured motorist carrier had standing to seek declaratory judgment against tortfeasor's automobile insurance company); Colonial Penn Ins. Co. v. Patriot General Ins. Co., Superior Court, judicial district of New Haven, Docket No. CV 95 0377876 (Licari, J., January 19, 1996) (16 Conn. L. Rptr. 73) (same); Wynn v. Commercial Union Ins. Co., Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. 93 0135153 (June 13, 1994, Lewis, J.) [12 Conn. L. Rptr. 51] (permitting victim in automobile accident to seek declaratory judgment against tortfeasor's automobile insurance company).
The defendant's primary objection appears to be based upon the contingent nature of the plaintiff's obligation to Barr under the plaintiff's own policy. Specifically, the defendant asserts that the plaintiff's "obligation to defend Barr has not been determined, and that is the pivotal issue with regard to whether or not [the plaintiff] has standing to bring the . . . declaratory judgment action." In the same vein, the defendant attempts to distinguish those Superior Court cases involving uninsured motorist carriers by noting that, in those cases, "by operation of [the] Connecticut uninsured motorist statute, one insurance carrier's denial of coverage automatically makes the plaintiff's carrier responsible for the loss."
The defendant's argument, however, ignores the fact that the complaint alleges that the plaintiff is currently actively defending Barr and that it has no duty to do so. Complaint ¶ 34. Further, at least two Superior Courts have found standing outside of an uninsured motorist context. See Steadfast Ins. Co. v. The Purdue Frederick Co., Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. X08 CV 02 0191697 (June 17, 2003, Adams, J.) (35 Conn. L. Rptr. 87) (finding that primary insurance company had standing to pursue declaratory judgment action against excess carriers even though there was "arguably no direct relationship between" the carriers); Vermont Mutual Ins. Co. v. Westwood Condominium Ass'n., Superior Court, judicial district of Hartford, Docket No. CV 03 0825593 (March 30, 2005, Wagner, J.T.R.) ("declaratory judgment statute is sufficiently broad to permit the joining in of the two insurance companies for a judicial determination of which coverage applies and the consequent duty to defend or indemnify the insured").
The defendant emphatically points out that the plaintiff alleges that it "has no duty to defend Barr." However, the defendant takes this statement out of context. "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.) Bernhard-Thomas Building Systems, LLC v. Dunican, 100 Conn.App. 63, 67-68, 918 A.2d 889 (2007), aff'd, 286 Conn. 548, 944 A.2d 329 (2008). Here, the court construes such an allegation to imply that, but for the defendant's obligation to defend Barr, the plaintiff may be liable to do so under its own policy.
Finally, the holding in AIU Ins. Co. v. Brown, 42 Conn.App. 363, 679 A.2d 983 (1996), indicates that the contingent nature of the plaintiff's liability under its own policy with Barr does not preclude it from seeking a declaratory judgment. In Brown, the court held that "[s]tatutes and rules relating to the remedy of declaratory judgments are given a liberal construction to effectuate their purposes . . . One great purpose is to enable parties to have their differences authoritatively settled in advance of any claimed invasion of rights, that they may guide their actions accordingly and often may be able to keep them within lawful bounds, and so avoid the expense, bitterness of feeling and disturbance of the orderly pursuits of life which are so often the incidents of law suits. Fully to carry out the purposes intended to be served by such judgments, it is sometimes necessary to determine rights which will arise or become complete only in the contingency of some future happening. Even if the right claimed is a contingent one, its present determination may well serve a very real practical need of the parties for guidance in their future conduct. A construction of our statute and rules which would exclude from the field of their operation the determination of rights, powers, privileges and immunities which are contingent upon the happening or not happening of some future event would hamper their useful operation." (Citation omitted; emphasis added; internal quotation marks omitted.) AIU Ins. Co. v. Brown, supra, 42 Conn.App. 368-69.
CONCLUSION
For all the foregoing reasons, the plaintiff meets the requirements for standing set forth under Practice Book § 17-55. Accordingly, the defendant's motion to strike is hereby denied.