Opinion
No. CV 05 4002715
April 17, 2007
MEMORANDUM OF DECISION RE DEFENDANT NATIONWIDE INSURANCE'S MOTION TO STRIKE #125
FACTS
On June 1, 2006, the plaintiffs, Helen E. Hayden and Lewis B. Hayden, Jr., filed a seven-count amended complaint against two defendants, Benjamin Main and his insurer, Nationwide Mutual Insurance Company (Nationwide). Therein, the plaintiffs allege the following. On December 10, 2003, Helen Hayden and Main were involved in a motor vehicle accident in Shelton, Connecticut, when Main passed three vehicles in a no-passing zone and struck the side of Helen Hayden's vehicle. Helen Hayden suffered injuries and accrued over $116,760 in medical bills as a result of the accident. The plaintiffs further allege that Main caused Helen Hayden's injuries and that he has admitted that Helen Hayden did nothing to cause the accident.
Lewis Hayden, Jr. died on December 29, 2005. On June 21, 2006, the plaintiffs filed a motion to substitute Joyce Blake, the executrix of his estate, as a party plaintiff. The court, Stevens, J., granted the motion on July 10, 2006.
The plaintiffs originally filed a nine-count complaint against Main and Nationwide on March 18, 2005. On March 16, 2006, Nationwide filed a motion to strike all counts against it (#116). In response to that motion, the plaintiffs filed a motion to amend their complaint, which the court, Sylvester, J., granted on June 19, 2006. Therefore, no action was taken on Motion #116. Nationwide then filed the present motion to strike all counts against it on June 19, 2006 (#125). That motion was granted by this court on January 8, 2007. In granting that motion, this court noted that "No objection filed." The plaintiffs filed an objection on January 19, 2007. Therefore, the ruling on the motion, based on no objection being filed, is vacated and this court will consider this motion on its merits.
Counts two, three and four pertain to Nationwide. Specifically, count two alleges that approximately two months after the accident occurred, a Nationwide representative went to Helen Hayden's home and instructed her to sign a paper. Shortly thereafter, Helen Hayden received a check in the amount of $2,015 to compensate her for her injuries. At the time of the visit from Nationwide's representative, and resulting from her accident with Main, Helen Hayden allegedly was confused, dizzy and experiencing memory impairment, loss of willpower, loss of reasoning power, as well as other symptoms or conditions. In their request for relief on count two, therefore, the plaintiffs seek to enjoin Nationwide from using the paper its adjuster required Helen Hayden to sign and a declaration that such paper is null and void and of no effect. Counts three and four stem from the same purported conduct of Nationwide's representative. Count three alleges that Nationwide breached its duty of good faith and fair dealing. Count four alleges that Nationwide violated the Connecticut Unfair Insurance Practices Act (CUIPA) and, thus, also violated the Connecticut Unfair Trade Practices Act (CUTPA). The plaintiffs seek money damages, attorneys fees, costs and punitive damages in connection with counts three and four.
In count one, the plaintiffs allege that Main's negligence caused Helen Hayden's injuries. Additionally, Lewis Hayden, Jr. seeks to recover for loss of consortium in count five, as against Main, and in counts six and seven, as against Nationwide. The plaintiffs voluntarily withdrew counts six and seven, however, leaving only counts two, three and four at issue with regard to Nationwide's present motion to strike.
The nature of the plaintiffs' cause of action in count two remains unclear. Therefore, this memorandum does not consider it independently. The analyses set forth with respect to counts three and four also apply to count two.
On June 19, 2006, Nationwide filed a motion to strike all counts against it on the grounds that the plaintiffs failed to state a claim upon which relief can be granted. In particular, Nationwide claims that recent case law makes it clear that third-party claimants, such as the plaintiffs, cannot assert causes of action against an insurer. Nationwide has submitted a memorandum of law in support of its motion. On January 19, 2007, the plaintiff filed an objection, and the matter was heard on the short calendar on January 22, 2007.
On this basis, Nationwide indicated that it also intends to file a motion to dismiss for lack of subject matter jurisdiction.
Practice Book § 10-42(b) requires that a party objecting to the motion to strike must file a memorandum of law "at least five days before the date the motion is to be considered on the short calendar . . ." The Superior Court, however, recently explained: "The case law seems to allow a court some discretion to waive [the § 10-42(b)] requirement although the failure to file a memorandum may still be a basis for granting a motion to strike." Sullivan v. Guzman, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV 04 4002010 (October 26, 2006, Adams, J.) [ 42 Conn. L. Rptr. 233]. The court in Sullivan then expressly refused to grant the motion to strike on that basis, although it did note that "the lack of opposition adds some force to the moving party's] arguments." Id. See also Papas Group, Inc., v. Turner, Superior Court, judicial district of New London, Docket No. CV 01 0559336 (February 26, 2002, Martin, J.) ("[t]he failure to timely file an opposing memorandum will not necessarily be fatal and the court may therefore address the merits of the motion" (citations omitted; internal quotation marks omitted)). Thus, although the plaintiffs in the present case did not comply with § 10-42, this court will consider Nationwide's motion to strike on its merits, particularly in light of the fact that Nationwide did not raise § 10-42(b) in its reply to the plaintiffs' objection.
DISCUSSION
"The purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any complaint . . . to state a claim upon which relief can be granted." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 498, 815 A.2d 1188 (2003). "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." (Internal quotation marks omitted.) Asylum Hill Problem Solving Revitalization Assn. v. King, 277 Conn. 238, 246, 890 A.2d 522 (2006). "[I]f facts provable in the complaint would support a cause of action, the motion to strike must be denied." (Internal quotation marks omitted.) Greco v. United Technologies Corp., 277 Conn. 337, 347, 890 A.2d 1269 (2006).
Nationwide argues that recent case law requires that all counts against it be stricken. Specifically, it relies upon Carford v. Empire Fire Marine Ins. Co., 94 Conn.App. 41, 891 A.2d 55 (2006), in which, according to Nationwide, the Appellate Court clarified that only insureds, and not third-party claimants, may bring actions based on allegedly unfair claims settlement practices. Nationwide argues that the plaintiffs cannot enforce the insurer's duty of good faith and fair dealing, which runs only to its insured. Nationwide further argues that a private cause of action under CUTPA is unavailable to third-party claimants seeking to recover for purported CUIPA violations, and that even if it were available, the plaintiffs have not alleged sufficient facts to state a viable CUIPA claim.
The plaintiffs counter that Carford does not preclude them from bringing an action against Nationwide. As to count three, the plaintiffs argue that Main's liability has been determined, given his admissions at deposition and through the pleadings, and that Nationwide's representative visited the plaintiffs' residence with the specific purpose of taking advantage of Helen Hayden. As to count four, the plaintiffs seek to distinguish Carford on the basis that in that case, the insured's liability had not been determined. The plaintiffs argue that in the present case, on the other hand, the question of Main's liability has been judicially determined, and therefore, they have stated a viable CUTPA claim based on Nationwide's alleged CUIPA violations.
Specifically, the plaintiffs allege that at his deposition of October 12, 2005, Main admitted that Helen Hayden did nothing to cause the accident. The plaintiffs further allege that they filed against Main requests for admissions, reciting the admissions made at Main's deposition, and that Main failed to deny them within thirty days. Also in their objection, the plaintiffs point to Main's amended answer to the plaintiffs' amended complaint, in which Main conceded that the accident was due to his own fault. They have attached Main's deposition transcript to their objection to the motion to strike. Nationwide, however, urges the court to disregard the attached deposition transcript, arguing that it goes beyond the allegations of the plaintiffs' complaint. In deciding the motion to strike, this court, in fact, is limited to the plaintiffs' allegations; Doe v. Marselle, 38 Conn.App. 360, 364, 660 A.2d 871 (1995), rev'd on other grounds, 236 Conn. 845, 675 A.2d 835 (1996); see also Rowe v. Godou, 209 Conn. 273, 278, 550 A.2d 1073 (1988); and therefore, this court will heed Nationwide's request.
In their memorandum in opposition, the plaintiffs also argue that the court should not strike count three, because the motion to strike does not comply with Practice Book § 10-41, in that it fails to separate its arguments as to this count from those pertaining to other counts. The plaintiffs also point out that the motion is altogether silent as to count three. Section 10-41 provides: "Each motion to strike raising . . . claims of legal insufficiency . . . shall separately set forth each such claim of insufficiency and shall distinctly specify the reason or reasons for each such claimed insufficiency." Contrary to the plaintiffs' contention, however, this section does not require the moving party to relate each claim of legal insufficiency to each contested count or claim. Rather, courts have understood § 10-41 to require the reasons for a claimed insufficiency to appear on the face of the motion itself, as opposed to appearing only in the supporting memorandum. See Barasso v. Rear Still Hill Road, LLC, 64 Conn.App. 9, 13-14, 779 A.2d 198 (2001), on appeal after remand, 81 Conn.App. 798, 842 A.2d 1134 (2004); Guarco Construction, Inc. v. C R Development Co., Inc., Superior Court, judicial district of Hartford, Docket No. CV 06 4021195 (October 16, 2006, Tanzer, J.) ( 42 Conn. L. Rptr. 187); Segarra v. Electrical Wholesalers, Superior Court, judicial district of New Haven, Docket No. CV 05 5001341 (October 3, 2006, Skolnick, J.T.R.) ( 42 Conn. L. Rptr. 143); Thomas v. Biller Associates Tri State, Superior Court, judicial district of New Haven, Docket No. CV 05 4010695 (Thompson, J.). In the present case, Nationwide stated on the face of its motion to strike that "[r]ecent controlling . . . caselaw requires that all counts against Nationwide be stricken." Nationwide continued: "All counts against Nationwide fail to allege a cause of action because the allegations are based on Nationwide's conduct in connection with the plaintiff, a third-party claimant, against Nationwide's insured, Benjamin Main. As a matter of law, unfair claims settlement practices can only be brought by the insured, not third-party claimants." Finally, Nationwide specified that the fourth count fails to allege a cause of action under CUTPA "because the lawsuit is based upon a single occurrence and the plaintiff has failed to allege facts which would support a general business practice under CUIPA." Accordingly, Nationwide has complied with § 10-41.
I DUTY OF GOOD FAITH AND FAIR DEALING
Connecticut appellate authority clearly requires the existence of a contractual relationship as a "necessary antecedent to any claim of breach of the duty of good faith and fair dealing." Macomber v. Travelers Property Casualty Corp., 261 Conn. 620, 638, 804 A.2d 180 (2002), on appeal after remand, 277 Conn. 617, 894 A.2d 240 (2006). The Supreme Court has explained, therefore, that even assuming that an insurer owes a fiduciary duty to its insured, such duty does not extend to a third-party claimant. Id., 641-42. In fact, the existence of a duty running to the insured "precludes an inference of a fiduciary duty existing between the insurer and a third-party claimant because such a duty would interfere with the insurer's ability to act primarily for the benefit of its insured." Id. In Hipsky v. Allstate Ins. Co., 304 F.Sup.2d 284 (D.Conn. 2004), one federal court relied on this reasoning, concluding that "an implied covenant of good faith and fair dealing in the third party settlement context could interfere with the insurer's duty to its own insured." Id., 288. Finding no contract between the insurer and the claimant, the Hipsky court thus granted the insurer's motion for summary judgment as against the third-party claimant. Id.
In Carford v. Empire Fire Marine Ins. Co., supra, 94 Conn.App. 41, the Appellate Court more recently examined whether a third-party claimant could bring an action to enforce an insurer's duty of good faith and fair dealing. There, as in the present case, the plaintiffs brought suit directly against the insurer, seeking to recover damages arising out of a motor vehicle accident involving the insured. Also as in the present case, the plaintiffs in Carford alleged a breach of the duty of good faith and fair dealing, as well as CUTPA violations stemming from alleged CUIPA violations. The court upheld the granting of the insurer's motion to strike.
With respect to the plaintiffs' claim based on the duty of good faith and fair dealing, the court reiterated that "[a]s [the] case law makes clear, no claim of breach of the duty of good faith and fair dealing will lie for conduct that is outside of a contractual relationship." Id., 46. The Carford court then specifically addressed the viability of the claim in the insurance context and expressly held that the "common-law duty of good faith and fair dealing between an insurer and its insured . . . does not extend to a third party." Id. Although the court recognized that a third-party claimant may bring an action directly against an insurer in cases in which the claimant has been subrogated to the rights of the insured, the court made clear that this occurs "only after judgment." (Emphasis in original.) Id., 46. It reasoned, therefore, that "[b]ecause there was no contractual relationship between the parties, nor any judgment leading to subrogation, the [insurer] owed no duty of good faith and fair dealing to the plaintiffs." Id., 46-47. See also DaCruz v. State Farm Fire Casualty Co., 69 Conn.App. 507, 513, 794 A.2d 1117 (2002), rev'd on other grounds, 268 Conn. 675, 846 A.2d 849 (2004) (discussing General Statutes § 38a-321, which "allows the victim to bring a direct action for indemnification against the insurance company. The plaintiff, however, must first obtain a final judgment in the underlying tort action." (Emphasis added.)).
General Statutes § 38a-321 states in relevant part: "Upon the recovery of a final judgment against any person, firm or corporation by any person, including administrators or executors, for loss or damage on account of bodily injury or death or damage to property, if the defendant in such action was insured against such loss or damage at the time when the right of action arose and if such judgment is not satisfied within thirty days after the date when it was rendered, such judgment creditor shall be subrogated to all the rights of the defendant and shall have a right of action against the insurer to the same extent that the defendant in such action could have enforced his claim against such insurer had such defendant paid such judgment." (Emphasis added.)
The present case is closely analogous to Carford. The plaintiffs are third-party claimants seeking to recover directly from the insurer, with which they were not in any contractual relationship. Nor are they subrogated to the rights of the insured, Main, as there has been no final judgment regarding his liability. In an attempt to circumvent this requirement, the plaintiffs rely upon Main's admissions at deposition and in his pleadings. Admissions, however, are not functionally equivalent to a final judgment. "Judgment" is defined as "[t]he law's last word in a judicial controversy, it being the final determination by a court of the rights of the parties upon matters submitted to it in an action or proceeding." (Emphasis added.) Citicorp Vendor Finance, Inc. v. Premier Support Services, Inc., Superior Court, judicial district of New Haven at Meriden, Docket No. CV 04 0286362 (April 26, 2006, Shluger, J.) (citing Black's Law Dictionary (6th Ed. 1990)). By contrast, an admission is defined as "[a]ny statement or assertion made by a party to a case and offered against that party" or "an acknowledgment that facts are true." (Emphasis added.) Black's Law Dictionary (8th Ed. 2004). Admissions, therefore, involve discrete factual determinations, not determinations regarding the rights of the parties.
The plaintiffs attempt to argue, however, that Main's admissions of fault in causing the accident put to rest the issue of his liability. Specifically, the plaintiffs allege, and Nationwide does not dispute, that Main admitted at deposition that he was at fault for the motor vehicle accident, and that Main failed to deny such fault in response to the plaintiffs' requests for admission. The plaintiffs correctly note, therefore, that Main's fault properly is the subject of a judicial admission, which is "conclusive on the trier of fact . . ." Nationwide Mutual Ins. Co. v. Allen, 83 Conn.App. 526, 541, 850 A.2d 1047, cert. denied, 271 Conn. 907, 859 A.2d 562 (2004). See Practice Book §§ 13-23(a) and 13-24(a). See also East Haven Builders Supply, Inc. v. Fanton, 80 Conn.App. 734, 744, 837 A.2d 866 (2004) ("[a] party's response to a request for admissions is binding as a judicial admission unless the judicial authority permits withdrawal or amendment . . . Similarly, a failure to respond timely to a request for admissions means that the matters sought to be answered were conclusively admitted." (Citations omitted; internal quotation marks omitted.)).
Main's admissions at deposition likely constitute mere evidential admissions and thus carry less evidentiary weight than those that arise from his pleadings. "In contrast with a judicial admission . . . [a]n evidential admission is subject to explanation by the party making it so that the trier may properly evaluate it . . . Thus, an evidential admission, while relevant as proof of the matter stated . . . [is] not conclusive." (Citations omitted; internal quotation marks omitted.) Nationwide Mutual Ins. Co. v. Allen, supra, 83 Conn.App. 542. See also Deschaine v. Deschaine, Superior Court, judicial district of New Britain, Docket No. FA 04 0525813 (August 11, 2006, Graham, J.) ("evidentiary admissions are not conclusive and their probative weight is to be determined by the fact finder, weighing the surrounding circumstances"). Nevertheless, his judicial admissions confirmed his admissions at deposition and preclude him from disputing that he was at fault in the motor vehicle accident involving Helen Hayden.
Nevertheless, as Nationwide points out, there has not yet been a final judicial determination as to Main's liability, and Nationwide continues to represent Main on precisely that issue. Nationwide maintains that the plaintiffs have not established the requisite causal link between Main's admittedly careless driving and the injuries that the plaintiffs delineate in their amended complaint. Thus, although Main likely will not be able to refute his admissions of fault, such admissions do not automatically render him legally liable. In fact, the court, Ripley, J., previously denied the plaintiffs' motion for summary judgment, which was limited to the issue of Main's liability. Absent final judgment on this issue, the plaintiffs have not been subrogated to the rights of Main under his insurance contract with Nationwide. Accordingly, in light of Carford v. Empire Fire and Marine Ins. Co., supra, 94 Conn.App. 46-47, at present, the plaintiffs cannot bring an action directly against Nationwide alleging breach of the duty of good faith and fair dealing. Therefore, this court grants Nationwide's motion to strike counts two and three of the plaintiffs' amended complaint.
II CUTPA/CUIPA
Neither the Supreme Court nor the Appellate Court has definitively determined whether a private cause of action is available under CUIPA. See Macomber v. Travelers Property Casualty Corp., supra, 261 Conn. 645 n. 14 (court specifically declined to decide whether CUIPA affords private cause of action); Napoletano v. CIGNA Healthcare of Connecticut, Inc., 238 Conn. 216, 221 n. 5, 680 A.2d 127 (1996), cert. denied, 520 U.S. 1103, 117 S.Ct. 1106, 137 L.Ed.2d 308 (1997) (same); Lees v. Middlesex Ins. Co., 229 Conn. 842, 847 n. 4, 643 A.2d 1282 (1994) (same); Carford v. Empire Fire and Marine Ins. Co., supra, 94 Conn.App. 52-53. ("[b]ecause the plaintiffs here did not assert a separate cause of action solely under CUIPA, we do not decide whether CUIPA allows a private cause of action"). Nevertheless, as the Appellate Court pointed out in Carford, "[i]t is well established that CUTPA affords a private cause of action . . . The Supreme Court applied that provision to CUIPA . . . affirming the existence of a private cause of action under CUTPA to enforce alleged CUIPA violations . . . Thus, if the plaintiffs properly allege CUIPA violations, they may have a cause of action under CUTPA." (Citations omitted; internal quotation marks omitted.) Id., 47. See also Nazami v. Patrons Mutual Ins. Co., 280 Conn. 619, 625, 910 A.2d 209 (2006); Mead v. Burns, 199 Conn. 651, 663, 509 A.2d 11 (1986).
The plaintiffs have taken this approach in count four of their amended complaint, in which they invoke CUTPA; General Statutes § 42-110 et seq.; in order to recover for Nationwide's alleged violations of §§ 38a-815 and 38a-816(6) of CUIPA. Nationwide argues, however, that pursuant to Carford, actions based on unfair claims settlement practices can properly be brought only by an insured or by a party subrogated to the rights of the insured, and not by third-party claimants. In response, the plaintiffs again attempt to rely on Main's admissions, arguing that because the question of Main's liability has been judicially determined, they are entitled to bring an action under CUTPA.
General Statutes § 42-110b(a) provides: "No person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce."
General Statutes § 38a-815 provides in pertinent part: "No person shall engage in this state in any trade practice which is defined in section 38a-816 as . . . an unfair method of competition or an unfair deceptive act or practice in the business of insurance . . ." Section 38a-816(6) defines unfair claim settlement practices for purposes of § 38a-815 as "[c]ommitting or performing with such frequency as to indicate a general business practice any of the following: (a) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue; (b) failing to acknowledge and act with reasonable promptness upon communications with respect to claims arising under insurance policies; (c) failing to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies; (d) refusing to pay claims without conducting a reasonable investigation based upon all available information; (e) failing to affirm or deny coverage of claims within a reasonable time after proof of loss statements have been completed; (f) not attempting in good faith to effectuate prompt, fair and equitable settlements of claims in which liability has become reasonably clear; (g) compelling insureds to institute litigation to recover amounts due under an insurance policy by offering substantially less than the amounts ultimately recovered in actions brought by such insureds; (h) attempting to settle a claim for less than the amount to which a reasonable man would have believed he was entitled by reference to written or printed advertising material accompanying or made part of an application; (i) attempting to settle claims on the basis of an application which was altered without notice to, or knowledge or consent of the insured; (j) making claims payments to insureds or beneficiaries not accompanied by statements setting forth the coverage under which the payments are being made; (k) making known to insureds or claimants a policy of appealing from arbitration awards in favor of insureds or claimants for the purpose of compelling them to accept settlements or compromises less than the amount awarded in arbitration; (l) delaying the investigation or payment of claims by requiring an insured, claimant, or the physician of either to submit a preliminary claim report and then requiring the subsequent submission of formal proof of loss forms, both of which submissions contain substantially the same information; (m) failing to promptly settle claims, where liability has become reasonably clear, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage; (n) failing to promptly provide a reasonable explanation of the basis in the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement; (o) using as a basis for cash settlement with a first party automobile insurance claimant an amount which is less than the amount which the insurer would pay if repairs were made unless such amount is agreed to by the insured or provided for by the insurance policy."
As it did with respect to the plaintiffs' claims of breach of the duty of good faith and fair dealing, the Carford court further concluded that "the right to assert a private cause of action for CUIPA violations through CUTPA does not extend to third parties absent subrogation or a judicial determination of the insured's liability." Carford v. Empire Fire Marine Ins. Co., supra, 94 Conn.App. 53. It explained the rationale behind this limitation as follows: "To hold otherwise [and allow such actions] would create confusion, increased and multiple litigation both generally and within specific cases, the potential coercion of settlements when the insured's liability has not been and may never be established, and an inherent conflict of interest . . . The judicial creation of such a right would not further the policy underlying CUIPA and CUTPA. Rather it is in the province of the legislature to create new rights and remedies contained within the highly regulated industry of insurance." Id. Because, as discussed above, there has not yet been a final judgment in the present case on the issue of Main's liability, Carford closes the door to the plaintiffs' CUTPA claim at the present time. Therefore, this court grants Nationwide's motion to strike counts two and four of the plaintiffs' amended complaint.
CONCLUSION
In light of the foregoing, this court grants the defendant's motion to strike all counts against it, on the grounds that the plaintiffs, as third-party claimants, cannot bring an action directly against the defendant insurer for breach of the duty of good faith and fair dealing or to recover for alleged CUTPA and CUIPA violations.