Opinion
No. CV01 0278215-S
February 4, 2004
MEMORANDUM OF DECISION RE MOTION TO DISMISS #120
I PROCEDURAL HISTORY
The plaintiff, Travelers Property Casualty Company, alleges the following facts in its amended complaint filed on July 9, 2002. The plaintiff is an insurance company that insured Windshire Terrace Condominium Association (the Association). The defendant, Crescendo of New England Building and Development Corporation, was the general contractor responsible for the construction of the buildings that collectively became the Windshire Terrace Condominiums. Construction concluded in the fall of 1999. In January 2000, as a result of the defendant's negligence, pipes and valves froze and subsequently burst causing water damage to the condominiums. The plaintiff paid $53,980.06 to its insured, the Association, to cover costs associated with the water damage, which is the amount prayed for in this subrogation action.
The plaintiff withdrew the action against the originally named defendant, Cormier Construction, on April 23, 2002. On November 30, 2001, the plaintiff filed a motion to cite in Crescendo of New England Building and Development Corporation as a party defendant. That motion was granted on December 17, 2001, and Crescendo of New England Building and Development Corporation was made a party by service of process on December 29, 2001.
On January 10, 2003, the defendant filed a motion to dismiss the plaintiff's complaint on the ground that the court lacks subject matter jurisdiction. Pursuant to Practice Book § 10-31(a), the defendant submitted a memorandum of law in support of its motion, attached to which is a document, entitled, "Standard Form of Agreement Between Owner and Construction Manager" (the agreement). In opposition, the plaintiff has submitted a timely memorandum of law as required by Practice Book § 10-31(b).
II DISCUSSION CT Page 1497
"A motion to dismiss shall be used to assert lack of jurisdiction over the subject matter, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court." (Internal quotation marks omitted.) Kizis v. Morse Diesel International, Inc., 260 Conn. 46, 51, 794 A.2d 498 (2002). "In ruling upon whether a complaint survives a motion to dismiss, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Dyous v. Psychiatric Security Review Board, 264 Conn. 766, 773, 826 A.2d 138 (2003).
"The plaintiff bears the burden of proving subject matter jurisdiction, whenever and however raised." Fink v. Golenbock, 238 Conn. 183, 199 n. 13, 680 A.2d 1243 (1996). "Subject matter jurisdiction involves the authority of the court to adjudicate the type of controversy presented by the action before it . . . [A] court lacks discretion to consider the merits of a case over which it is without jurisdiction . . . The requirement of subject matter jurisdiction cannot be waived by any party and can be raised at any stage in the proceedings." (Internal quotation marks omitted.) Frillici v. Westport, 264 Conn. 266, 280, 823 A.2d 1172 (2003).
In the present action, the defendant moves to dismiss the plaintiff's action on the ground that "pursuant to the underlying agreement between the parties, any claim, dispute or other matter . . . must be resolved through mediation and/or arbitration and, therefore, this Court lacks subject matter jurisdiction to hear this matter." (January 8, 2003, Motion to Dismiss.) The plaintiff argues in opposition that according to the agreement, arbitration is not an express condition precedent to initiating a court action. The defendant's legal argument relies exclusively on the agreement. The agreement is between the owner, Forest Glen Associates of Middletown, Inc., and the construction manager, Crescendo of New England Building and Development Corporation. The defendant notes in its memorandum of law that the plaintiff's insured, the Association, is also known as Forest Glen Associates of Middletown, Inc.
It should be noted that the plaintiff advances three additional arguments in its memorandum of law in opposition to the defendant's motion to strike: (1) that the defendant waived the right to arbitrate by engaging in an unreasonable delay and improper conduct; (2) that the defendant waived the right to arbitrate by failing to follow the agreement's procedures; and (3) that the arbitration clause does not pertain to damages sustained after construction concluded. Because the plaintiff's first argument, stating arbitration is not an express condition precedent to court action, is dispositive of the defendant's motion, the court will not address the plaintiff's remaining three arguments in opposition.
In particular, the defendant's memorandum in support of its motion to dismiss cites to article 9, §§ 9.1.1, 9.1.3 and 9.2.1 of the agreement. Article 9, § 9.1.1 states: "Claims, disputes or other matters in question between the parties to this Agreement which arise prior to the commencement of the Construction Phase or which relate solely to the Preconstruction Phase services of the Construction Manager or to the Owner's obligations to the Construction Manager during the Preconstruction Phase, shall be resolved by mediation or by arbitration." Article 9, § 9.1.3 of the agreement states: "Any claim, dispute or other matter in question not resolved by mediation shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association currently in effect unless the parties mutually agree otherwise." Article 9, § 9.2.1 states in relevant part: "Any other claim, dispute or other matter in question arising out of or related to this Agreement or breach thereof shall be settled in accordance with Article 4 of AIA Document A201, except that in addition to and prior to arbitration, the parties shall endeavor to settle disputes by mediation . . ." The parties did not explain what "Article 4 of AIA Document A201" expressed.
In Connecticut, "arbitration is the favored means of settling differences . . ." (Internal quotation marks omitted.) State v. AFSCME, Council 4, Local 387, AFL-CIO, 252 Conn. 467, 473, 747 A.2d 480 (2000). "[A] person can be compelled to arbitrate a dispute only if, to the extent that, and in the manner in which, he has agreed so to do." (Internal quotation marks omitted.) White v. Kampner, 229 Conn. 465, 471, 641 A.2d 1381 (1994). "Where a contract contains a stipulation that the decision of arbitrators on certain questions shall be a condition precedent to the right of action on the contract itself, such a stipulation will be enforced and, until arbitration has been pursued or some sufficient reason given for not pursuing it, no action can be brought on the contract . . . Whether an agreement makes arbitration a condition precedent to an action in court depends on the language of the arbitration clause." (Citation omitted.) Multi-Service Contractors, Inc. v. Vernon, 181 Conn. 445, 447, 435 A.2d 983 (1980).
"For arbitration to be a condition precedent, the agreement to arbitrate must expressly so stipulate, or it must necessarily be implied from the language used." Id., 448. "The mere agreement to arbitrate, standing alone, does not give rise to the necessary implication that arbitration is a condition precedent to an action in court." Id. In addition, mediation clauses are interpreted by using the same legal analysis used in construing arbitration clauses. See Ventre v. Ventre, Superior Court, judicial district of Fairfield at Bridgeport, Docket No. CV 00 377148 (January 9, 2001, Rush, J.).
In Multi-Service Contractors, Inc. v. Vernon, supra, 181 Conn. 449, the Supreme Court held that the trial court did not lack subject matter jurisdiction, because the arbitration clause at issue did not imply or expressly require arbitration as a condition precedent to court action. In that case the arbitration clause read as follows, "all claims, disputes and other matters in question between the contractor and owner arising out of, or relating to, the Contract Documents or the breach thereof . . . shall be decided by arbitration . . ." (Internal quotation marks omitted.) Id., 446. The trial court in McIntosh v. Oxford Health Plans, Inc., Superior Court, complex litigation docket at Waterbury, Docket No. X01 CV 01 0165663 (November 30, 2001, Hodgson, J.), however, found arbitration a condition precedent where the arbitration clause read, in relevant part, "[p]roceeding to arbitration and obtaining an award thereunder shall be a condition precedent to the bringing or maintaining of any action in any court with respect to any dispute arising under this Agreement . . ." (Emphasis added.)
In the present action, the sections of the agreement discussed above, which are similar to the contract provision in Multi-Service Contractors, Inc. v. Vernon, supra, 181 Conn. 446, do not contain express condition precedent language. "While it is true that in the absence of express language a provision for arbitration may be construed, by implication, to be a condition precedent to suit that implication must be so plain that a contrary intention cannot be supposed." Id., 447-48. The defendant solely relies on the agreement, which "does not give rise to the necessary implication that arbitration is a condition precedent to an action in court." Id., 448.
III CONCLUSION
This court has subject matter jurisdiction because the language of the agreement does not expressly stipulate or imply that arbitration, and/or mediation are mandated conditions precedent to court action. Accordingly, the defendant's motion to dismiss is denied.
So ordered.
BY THE COURT
Peter Emmett Weise, Judge