Opinion
KNLCV156023771S
06-09-2016
Raymond Lafever et al. v. Cambridge Mutual Fire Insurance Company et al
UNPUBLISHED OPINION
RULING RE DEFENDANT'S MOTION TO STRIKE
Robert F. Vacchelli, Judge
This case is an action for money damages by the plaintiffs, Raymond and Barbara LaFever, against the defendants, Cambridge Mutual Fire Insurance Company (" Cambridge Mutual") and Frontier Adjusters, Inc. (" Frontier"), alleging that they did not receive adequate payment for a covered loss. The complaint is in six counts. The first five counts are against Cambridge Mutual for breach of contract, breach of implied covenant of good faith and fair dealing, violation of the Connecticut Unfair Insurance Practice Act (CUIPA), General Statutes § § 38a-815 et seq., and violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § § 42-110a et seq. Count Six, which is the subject of the instant decision, is against Frontier. That count alleges common-law negligence. Frontier has moved to strike that count on the grounds of legal insufficiency. (Doc. No. 110.00.) For the following reasons, the motion is granted.
I
A motion to strike is used " [w]henever any party wishes to contest ... the legal sufficiency of the allegations of any complaint, counterclaim or cross claim, or any one or more counts thereof, to state a claim upon which relief can be granted ..." Practice Book § 10-39(a)(1); Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 498, 815 A.2d 1188 (2003). " In ruling on a motion to strike, the court is limited to the facts alleged in the complaint." (Citation omitted; internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997). " The role of the trial court [is] to examine the [complaint], construed in favor of the [plaintiff], to determine whether the [plaintiff has] stated a legally sufficient cause of action." (Citations omitted; internal quotation marks omitted.) Dodd v. Middlesex Mutual Assurance Co., 242 Conn. 375, 378, 698 A.2d 859 (1997). " 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." (Citations omitted; internal quotation marks omitted.) Connecticut Coalition for Justice in Education Funding, Inc. v. Rell, 295 Conn. 240, 252-53, 990 A.2d 206 (2010).
" [I]f facts provable in the complaint would support a cause of action, the motion to strike must be denied." (Citation omitted; internal quotation marks omitted.) Id., 252. Nevertheless, " [a] motion to strike is properly granted if the complaint alleges mere conclusions of law that are unsupported by the facts alleged." (Citation omitted; internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alves, supra, 262 Conn. 498.
II
The essential, pertinent facts, drawn from the factual allegations in the complaint, are as follows: The plaintiffs own real property with improvements thereon situated in the Town of Waterford, commonly known as 125 Shore Road, Waterford, CT. The defendant, Frontier, is a corporation organized under the laws of the State of Connecticut and it is in the business of acting as a property and casualty adjusting service. The plaintiffs maintained a certain homeowner's insurance policy with the defendant, Cambridge Mutual, which provided for general liability coverage for the property. On or about February 24, 2014, the plaintiffs' property sustained substantial water damage. Plaintiffs' policy covered the loss. The plaintiffs filed a claim with Cambridge Mutual and, on or about March 24, 2014, Cambridge Mutual hired Frontier as an independent claims adjuster to handle the plaintiffs' claim. During the months of March and subsequent months, Frontier conducted an investigation to examine the facts and surrounding property loss. Plaintiffs allege that Frontier acted negligently in one or more of the following ways:
a. By failing to explain what inspection, appraisal and investigation the adjuster will be doing;
b. By failing to tell the plaintiffs what is required to protect the property and present the claim;
c. By failing to notify plaintiffs with potential coverage questions or policy limitation or exclusions;
d. By failing to explain the time involved to process and conclude the claim;
e. By failing to engage in an unbiased investigation of plaintiffs' claim;
f. By failing to conduct a reasonable investigation of plaintiffs' claim;
g. By failing to properly adjust plaintiffs' claim;
h. By failing to properly estimate the value and amount of plaintiffs' claim; and
i. By failing to evaluate plaintiffs' claim in a good faith manner.
Plaintiffs' Complaint, Count Six, para. 12.
As a result, Cambridge Mutual failed to adequately pay for the covered loss, and the plaintiffs sustained substantial financial damages and losses.
III
Defendant, Frontier, argues that Count Six, alleging negligence, should be stricken because it was hired by Cambridge Mutual, not the plaintiffs, that it owed no duty to the plaintiffs, and, therefore, it cannot be held liable in negligence. The court agrees with the defendant.
" The essential elements of a cause of action in negligence are well established: duty, breach of that duty; causation; and actual damages." (Citation omitted; internal quotation marks omitted.) Archambault v. Soneco/Northeastern, Inc., 287 Conn. 20, 32, 946 A.2d 839 (2008). The existence of a duty is an essential element in a negligence action. Silano v. Cumberland Farms, Inc., 85 Conn.App. 450, 453, 857 A.2d 439 (2004). " If the court determines, as a matter of law, that a defendant owes no duty to a plaintiff, the plaintiff cannot recover in negligence from the defendant." RK Constructors, Inc. v . Fusco Corp., 231 Conn. 381, 384-85, 650 A.2d 153 (1994).
" A duty to use care may arise from a contract, from a statute, or from circumstances under which a reasonable person, knowing what he knew or should have known, would anticipate that harm of the general nature of that suffered was likely to result from his act or failure to act." (Citation omitted; internal quotation marks omitted.) Pelletier v. Sordoni/Skanska Construction Co., 286 Conn. 563, 578, 945 A.2d 388 (2008); Twin Oaks Condo. Ass'n v. Jones, 132 Conn.App. 8, 12 n.3, 30 A.3d 7 (2011), cert. denied, 305 Conn. 901, 43 A.3d 663 (2012).
" Duty is a legal conclusion about relationships between individuals, made after the fact, and imperative to a negligence cause of action. The nature of the duty, and the specific persons to whom it is owed, are determined by the circumstances surrounding the conduct of the individual ... Although it has been said that no universal test for [duty] ever has been formulated ... our threshold inquiry has always been whether the specific harm alleged by the plaintiff was foreseeable to the defendant. The ultimate test of the existence of the duty to use care is found in the foreseeability that harm may result if it is not exercised ... By that is not meant that one charged with negligence must be found actually to have foreseen the probability of harm or that the particular injury [that] resulted was foreseeable ... [T]he test for the existence of a legal duty entails (1) a determination of whether an ordinary person in the defendant's position, knowing what the defendant knew or should have known, would anticipate that harm of the general nature of that suffered was likely to result, and (2) a determination, on the basis of a public policy analysis, of whether the defendant's responsibility for its negligent conduct should extend to the particular consequences or particular plaintiff in the case." (Citations omitted; internal quotation marks omitted.) Lawrence v. O and G Industries, Inc., 319 Conn. 641, 649-50, 126 A.3d 569 (2015). " [I]n considering whether public policy suggests the imposition of a duty, we ... consider the following four factors: (1) the normal expectations of the participants in the activity under review; (2) the public policy of encouraging participation in the activity, while weighing the safety of the participants; (3) the avoidance of increased litigation; and (4) the decisions of other jurisdictions." (Citation omitted; internal quotation marks omitted.) Ruiz v. Victory Properties, LLC, 315 Conn. 320, 337, 107 A.3d 381 (2015). If the court determines that, based on the public policy prong, that no duty of care exists, then it is not required to address the first prong as to foreseeability. Neuhaus v. DeCholnoky, 280 Conn. 190, 218, 905 A.2d 1135 (2006).
Although no Connecticut appellate court has yet addressed the issue, the question of whether an independent insurance adjuster hired by an insurer owes a duty of care to the insured has been addressed by several Superior Court judges and, applying the above tests, all have found in the negative. See Shlank v. Middlesex Assurance Co., Superior Court, judicial district of New Haven, Doc. No. CV 14-605452, (December 1, 2015, Wilson, J.) ; Beck v. Utica Mutual Insurance Co., Superior Court, judicial district of New Haven, Doc. No. CV 11-6022761, June 18, 2013, Berdon, J.T.R.); Savanella v. Kemper Independent Insurance Co., Superior Court, judicial district of Litchfield, Doc. No. CV 11-6003947, (December 28, 2011, Pickard, J.) ; Weimer v. Allstate Ins. Co., Superior Court, judicial district of New Haven, Doc. No. CV 10-6010177, Zoarski, J.T.R.); Grossman v. Homesite Ins. Co., Superior Court, judicial district of Stamford-Norwalk, Doc. No. CV 07-5004413, (July 6, 2009, Adams, J.) ; see also Danielson v. USAA Casualty Insurance Co., Case No. 3:15-CV-000878 (VAB), (D.Conn., November 24, 2015, Bolden, U.S.D.J.). The repeated conclusion was that public policy augured against extending the adjuster's responsibility for negligent conduct to the insured. As the court in Grossman v. Homesite Ins. Co., supra, explained, " [T]he relationship between adjuster and insured is sufficiently attenuated by the insurer's control over the adjuster to be an important factor that militates against imposing a further duty on the adjuster to the insured ... More important ... imposing a duty on the adjuster in these circumstances would work a fundamental change in the law. The law of agency requires a duty of absolute loyalty of the adjuster to its employer, the insurer ... The independent adjuster's obligation is measured by the contract between the adjuster and the insurer ... Creating a separate duty from the adjuster to the insured would thrust the adjuster into what could be an irreconcilable conflict between such duty and the adjuster's contractual duty to follow the instructions of its client, the insurer." Id., quoting Meineke v. GAB Business Services, Inc., 195 Ariz. 564, 567-68, 991 P.2d 267 (Ariz.Ct.App. 1999). That conclusion reflects the general rule. " Although there are exceptions, investigators and adjusters working under contract for the insurer are, for the most part, not considered to have sufficient privity with or duty to the insured to be directly and personally liable to the insured." 14 Couch on Insurance 3d (2005) § 208.10, p. 208-17. This court concurs with the above Superior Court decisions, and rules likewise for the same reasons.
Plaintiffs, nevertheless, argue that this court should depart from this trend because " none of those courts have considered the ramifications their refusal has or may have on the duties imposed on adjusters under CUIPA." Plaintiffs' Brief, p. 5. A review of CUIPA is necessary.
CUIPA identifies a broad array of practices that are defined as unfair methods of competition and unfair and deceptive acts or practices in the business of insurance. General Statutes § 38a-816; State of Connecticut v. Acordia, Inc., 310 Conn. 1, 19, 73 A.3d 711 (2013). CUIPA applies to a variety of insurance industry members, including adjusters. General Statutes § 38a-815. CUIPA does not authorize a private right of action. Artie's Auto Body, Inc. v. Hartford Fire Ins. Co., 317 Conn. 602, 623, 119 A.3d 1139 (2015). But, it is a source of public policy with respect to general insurance practices. State of Connecticut v. Acordia, Inc., supra, 301 Conn. at 37. Thus, it has been held that a specific CUIPA violation can give rise to an action for damages under CUTPA, inasmuch as CUTPA authorizes actions for money damages for practices that offend public policy; but, " unless an insurance related practice violates CUIPA or, arguably, some other statute regulating a specific type of insurance related conduct, it cannot be found to violate public policy and, therefore, it cannot be found to violate CUTPA." Id., 37. The CUIPA list is exclusive and comprehensive. Id., 37. A practice that does not actually contravene CUIPA, or some other statute or regulation that regulates the insurance industry, is not actionable under CUTPA. See Artie's Auto Body, Inc. v. Hartford Fire Ins. Co., supra, 317 Conn. 627.
In an effort to paint the defendant's conduct as violating CUIPA, the plaintiffs list the unfair settlement claim practices proscribed by General Statutes § 38a-816(6) and juxtapose that list with the allegations of their complaint and conclude that the acts of negligence of the defendant are the very types of claim settlement practices that CUIPA deems to be unfair and deceptive acts and practices in the business of insurance. They argue that since adjusters already owe a statutory duty of care to insureds not to engage in unfair claim settlement practices, disallowance of a negligence action would result in a determination that an adjuster has no duty to comply with CUIPA.
The court is not persuaded. CUIPA lists numerous proscribed practices, most of which do not involve activities ordinarily performed by adjusters. The court finds that most of the CUIPA proscriptions listed by plaintiffs are irrelevant under the facts alleged in the instant case. And, the connections between any potentially relevant provisions to the events in the instant case are vague and uncertain, particularly in light of the fact that § 38a-816(6) only applies to acts committed or performed " with such frequency as to indicate a general business practice." Mead v. Burns, 199 Conn. 651, 659, 509 A.2d 11 (1986); Beck v. Utica Mutual Insurance Co., supra . No facts demonstrating frequency indicating the general business practices of Frontier are alleged thus far in the instant case. See Plaintiffs' Complaint, Count Six. Simply put, the plaintiffs fail to demonstrate the applicability of CUIPA in this case. Applicability is a prerequisite. See Artie's Auto Body, Inc. v. Hartford Fire Ins. Co., supra, 317 Conn. 627. " It is a well-settled rule that a person cannot recover from another for negligence based upon the violation of a statute ... that is not intended for his protection." (Citation omitted.) Longstean v. Owen McCaffrey's Sons, 95 Conn. 486, 494, 111 A. 788 (1920). Likewise, the plaintiff cannot rely on an inapplicable list of unfair and deceptive acts and or practices as proof of public policy in favor of extending liability in negligence to parties who otherwise owe no duty to that plaintiff.
Tellingly, the plaintiffs purported to bring a claim against Cambridge Mutual based on several violations of CUIPA. See Complaint, Count Three. They did not do so with respect to Frontier. The omission weakens their invocation of CUIPA as evidencing Connecticut public policy that favors imposing a duty of care on Frontier to the plaintiffs in the instant case. The finding that the plaintiffs have not demonstrated the applicability of CUIPA is not equivalent to an abrogation of CUIPA, but it is dispositive of plaintiffs' objections to the motion to strike.
IV
For all of the foregoing reasons, the defendant's motion to strike is granted as to Count Six of the plaintiffs' complaint.