Opinion
X06UWYCV156029923
01-30-2018
FOREST MANOR, LLC v. TRAVELERS C & S CO. et al.
UNPUBLISHED OPINION
ORDER RE PETRA’S MOTIONS FOR SUMMARY JUDGMENT, EN 214 & 216 AND FOREST MANOR’S OBJECTION EN 275
Court docket Entry Number.
TERENCE A. ZEMETIS, J.
The defendant Petra Construction Company, Inc.,Petra, moves for summary judgment on Count Two, Three, Four, and Five in the plaintiff’s January 19, 2016 Amended Complaint. The plaintiff objects.
EN 124.
BASIS FOR THE MOTION
In Counts Two, Three, Four, and Five of the Amended Complaint Forest Manor seeks to recover damages from Petra for negligence, breach of contract obligation to perform the work without damaging the existing building, breach of a contractual obligation to indemnify Forest Manor, and/or violation of the Connecticut Unfair Trade Practices Act (" CUTPA" ).
EN 124, Counts Two (Negligence), Three (Breach of Contract), Four (Breach of Contract) and/or Five (CUTPA violation).
Petra moves for summary judgment because the negligence and breach of contract claims are contractually " barred," and the CUTPA claim is legally and factually insufficient. Petra moves the court to limit the plaintiff’s claims for damages and/or find Forest Manor has failed to mitigate its damages.
" Any and all claims by Forest Manor for " property damage," (as defined in § § 11.3.1 and 11.3.1.1), including damage to the existing building and any other claim for damages that is covered or should have been covered under the builder’s risk insurance policy are barred against Petra. Builder’s risk coverage is primary for such damages and the waiver of subrogation provision bars any claim against Petra." EN 216, p. 15, section III.A.
Forest Manor objects to Petra’s motion because Petra has failed to prove no genuine issue of material fact exists and Petra is entitled to judgment as a matter of law because the contract does not bar the negligence or breach of contract claims, the CUTPA claim is legally and factually sufficient, and, regarding the measure of damages and failure to mitigate damages, the court should defer ruling until trial evidence is presented.
NECESSARY FACTS
Forest Manor, LLC’s, Forest, complaint alleges:
1. On November 24, 2014 Forest, in consideration of $6,843,488.00, contracted with Petra Construction Corporation, Petra, to partially demolish, repair, renovate, reconstruct, improve, and expand an 80-year-old brick building on 216-222 Orange Avenue, West Haven CT, formerly used as a furniture warehouse, for residential and retail usage. The project was named: " The Atwood." EN 124, ¶ 8.
Using AIA Document A101-2007, Standard Form of Agreement Between Owner and Contractor dated November 24, 2014, Forest engaged Petra Construction Corporation to act as the general contractor for the Atwood project. This Contract included AIA Document A201-2007, General Conditions of the Contract for Construction (" General Conditions" ) as well as specifications and drawings incorporated by reference. EN 211 & 212, Ex. A.
2. The parties purchased insurance and bond coverage and limited potential claims against each other in an apparent effort to address and compensate for risks of loss arising out of the construction projection and avoid litigation.
3. Petra purchased a Comprehensive General Liability Insurance policy, CGL, and bonds: Payment, not involved here, and Performance Bond from Travelers. EN 124, ¶ 9.
EN 124, Ex. B, The American Institutes of Architects, AIA Document A312-1984.
4. Forest purchased a Builder’s Risk insurance policy.
5. Petra subcontracted site work on the Atwood to Mizzy Construction, Inc., Mizzy. EN 124, ¶ 12.
6. On February 9, 2015 Mizzy’s employee, during the demolition phase of the project, accidentally caused a portion of Forest’s building to collapse and, Forest Manor claims, so compromised the remaining structure as to be economically unsalvageable. The nature and extent of the damage is contested by Seneca Insurance, Forest Manor’s builder’s risk insurer. EN 124, ¶ 19.
7. Forest’s design professionals detailed " make safe" work following the damage, Petra performed the " make safe" work in February 2015. EN 212, Guido Petra’s affidavit, ¶ 14.
8. Forest’s design professionals prepared preliminary repair plans, Petra prepared preliminary cost estimates. EN 212, Guido Petra’s affidavit, ¶ 15-17.
9. Petra prepared two preliminary repair plan cost estimates- the first, $438,542.00, submitted March 27, 2015 and the second, $1,065,042, submitted April 9, 2015. EN 212, Ex. C and D, and Guido Petra’s affidavit, ¶ 17.
10. Petra sought a " change order," a contractual modification authorizing Petra to repair the damage done by Mizzy and Forest agreeing to pay Petra for that repair.
11. Forest did not authorize Petra to proceed. Petra avers it was ready, willing, and able to proceed with either repair plan at the estimated cost if Forest Manor agreed to pay Petra for the work. EN 212, Guido Petra’s affidavit, ¶ 18-20.
12. On April 23, 2015 Forest emailed Petra to " HOLD" all future items including the elevator." EN 212, Ex. E, and Guido Petra’s affidavit, ¶ 20. Forest’s builder’s risk insurer, Seneca, would not pay Petra’s proposed repair costs.
13. By letter dated August 21, 2015, Forest notified Petra and Travelers that Mr. Gerald R. Kagan, Architect of the Atwood project, as required by section 14.2 of the General Conditions, certified sufficient cause existed to terminate Petra’s right to proceed under the Contract. Forest’s letter was the seven-day notice, required by the 14.2.2 of the General Conditions, indicating the Contractor’s right to proceed would be terminated seven days thereafter. The notice directed the Contractor to remove material and equipment from the project. EN 273, Gary Letendre’s affidavit, ¶ 8, Ex. A.
14. However, Forest did not terminate Petra’s right to proceed but instead mediated their dispute. The mediation efforts were unsuccessful: the dispute was not amicably resolved.
15. On September 11, 2015, the Building Official of the City of West Haven issued an order to raze Forest’s building. Travelers and Petra were provided notice of this order. Forest Manor advised Travelers and Petra it intended to comply with the Building Official’s order to raze the building. Forest provided Travelers the demolition schedule. EN 273, Gary Letendre’s affidavit, ¶ 11.
16. On October 8, 2015 Forest sent a second seven-day notice letter to Petra and Travelers terminating Petra’s right to complete the contract, effective October 15, 2015, EN 211, Ex. B.
17. Forest terminated Petra’s contractual rights effective October 15, 2015.
18. On December 7, 2015, the building was demolished. EN 273, Gary Letendre’s affidavit, ¶ 14.
19. Forest alleges Petra assumed contractual duties and negligently failed to provide the contractually mandated services and supervision of Petra’s site work contractor, Mizzy, harming Forest’s Atwood project, EN 124, Count Two, ¶ 50-53.
General Conditions, Article 10, EN 212, p. 30.
20. Forest alleges Petra materially breached contractual duties by failing to prevent Mizzy from damaging the Work and Forest’s property. EN 124, Count Three, ¶ 58-60.
21. Forest alleges Petra materially breached contractual duties by failing to indemnify Forest for the negligent acts of Petra’s subcontractor, Mizzy, damaging Forest. EN 124, Count Four, ¶ 62-64.
22. Petra asserts that whatever damage Mizzy caused Forest Manor’s property on February 9, 2015 must, contractually, be covered by Forest Manor’s " Builder’s Risk" policy.
23. Petra asserts Forest’s builder’s risk policy is the primary source of insurance coverage for the loss.
24. Petra asserts because Forest Manor’s claimed losses would be covered by the Builder’s Risk policy, had Forest purchased the required coverage, Petra claims it is not liable to Forest Manor for the damage caused by Mizzy.
25. Petra acknowledges Seneca, builder’s risk insurer, disputes Forest Manor’s loss claim.
26. In the Fifth Count of the Amended Complaint, Forest alleges Petra required Forest to purchase Builder’s Risk insurance coverage to benefit Forest and Petra.
27. Forest asserts Petra, prior to the start of construction, had to confirm Forest’s " Builder’s Risk" insurance coverage fulfilled Forest’s contractual obligations.
28. Forest asserts Petra failed to confirm Forest’s Builder’s Risk policy fulfilled Forest’s contractual obligation. But, after Petra’s subcontractor, Mizzy, harmed Forest’s property, Petra asserted Forest’s harm would be covered by the contractually required Builder’s Risk policy had Forest purchased the contractually required Builder’s Risk insurance.
29. Forest asserts Petra’s conduct, including that described in the preceding parargraphs, violated Connecticut Unfair Trade Practices Act.
30. Petra asserts it had no duty to review Forest Manor’s Builder’s Risk insurance coverage, was not provided a copy of the policy before the February 9, 2015 loss, and did not violate CUTPA.
STANDARD OF REVIEW OF SUMMARY JUDGMENT MOTIONS
" Practice Book [§ 17-49] provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law ... In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party ... The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law ... and [if the movant has met its burden] the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact ... A material fact [is] a fact which will make a difference in the result of the case ..." (Internal quotation marks omitted.) Dipietro v. Farmington Sports Arena, LLC, 306 Conn. 107, 116, 49 A.3d 951 (2012). Stuart v. Freiberg, 316 Conn. 809, 820-21 (2015). The court " resolv[es] all ambiguities and draw[s] all factual inferences in favor of the party against whom summary judgment is sought." O’Bert ex rel. Estate of O’Bert v. Vargo. 331 F.3d 29, 37 (2d Cir. 2003).
DISCUSSION
Forest Manor and Petra, sophisticated parties, assisted by experienced counsel, using standard AIA form construction contracts identified, allocated, limited, and purchased insurance coverages for risks of loss arising out of the project. " (P)arties are commercial entities and sophisticated corporations familiar with the type of services rendered, and the consequences for failure to perform a contract, such parties are free to negotiate agreements which allocate the risks, insure against potential losses, and adjust the contract price accordingly." Flagg Energy Development Corp. v. G.M.C., 244 Conn. 126, 154 (1998).
On February 9, 2015 Petra’s subcontractor, Mizzy, unintentionally damaged Forest’s existing building during demolition work. While the parties agree the building was damaged by Mizzy, the extent of the damage and responsibility to remedy the damage is disputed.
Counts Two and Three: Negligence and Breach of Contract
In Count Two Forest Manor pleads direct negligence against Petra, and vicarious liability for Mizzy’s, its subcontractor, negligence, during the demolition of a portion of the existing building at 216-222 Orange Avenue, West Haven on February 9, 2015.
In Count Three Forest Manor pleads Petra breached the contract by failing to perform its work under the contract and industry standards including failing to prevent damage to Forest Manor’s property.
Petra asserts the AIA contracts required Forest Manor to purchase property insurance coverage. Petra argues Forest Manor’s negligence and breach of contract claims, Counts Two and Three respectively, are contractually barred. Petra asserts Forest Manor had to purchase Builder’s Risk Insurance coverage, BRI, and that the BRI is Forest Manor’s primary remedy for property damage suffered on February 9, 2015. Petra asserts if Forest Manor had purchased the BRI contractually mandated coverage, its property damage claims, now asserted against Petra, would have been paid by Seneca.
Petra relies upon AIA A201-2007; General Conditions of the Contract for Construction, § 11.3-11.3.7.
EN 214, p. 22 and fn 4. The court is unable to find any contractual agreement that the BRI is " primary." The court does note that § 11.1.5 describes Contractor’s liability insurance as " primary insurance" vis a vis liability insurance claims. The court notes the Contract, § 11.1.1.5 requires Petra to purchase liability insurance for " Claims for damages, other than to the Work itself, because of injury to or destruction of tangible property ..."
Acknowledging the contractual obligation to purchase builder’s risk insurance coverage, Forest denies the builder’s risk coverage is a primary or exclusive remedy for the February 9, 2015 damage and/or Petra failed to satisfy the burden of proof associated with the motion.
First, Petra argues, under § § 11.3.1 and 11.3.1.1 of the Contract, General Conditions Forest Manor had to purchase builder’s risk insurance coverage covering the property damage claims in Forest Manor’s Complaint. Petra asserts, because Forest’s property damages would have been covered by the contractually required builder’s risk policy, Forest Manor is barred from asserting claims for those damages against Petra. Petra combines and supports this reasoning with ¶ 11.3.7, the " Waivers of Subrogation" contract provision.
AIA A201-2007, EN 212, Ex A.
Petra argues that Forest Manor’s remaining Counts Two and Three claims, other than " property damage," were contractually waived.
Forest Manor objects because: Petra failed to prove Forest Manor’s claimed damages would be covered by contractually required builder’s risk insurance. First, Forest Manor argues the contract does not require Forest Manor to insure the existing structure but only " the Work" and the contract does not require the BRI to be " primary" coverage. Forest Manor disputes the applicability of § 11.3.7 to its damage claims.
§ 11.3.1 of the Contract require Forest Manor to " purchase and maintain, ... property insurance written on a builder’s risk " all-risk" or equivalent policy form in the amount of the initial Contract Sum, ... on. a replacement cost basis without optional deductibles." § 11.3.1.1 of the Contract further describes the required property insurance coverage Forest Manor had to purchase.
Petra does not cite contractual language designating the BRI coverage as " primary" or Owner’s " exclusive remedy" for property damage. The court cannot find such language in the contract.
Forest Manor purchased BRI. Petra asserts the purchased coverage violated the contractual mandate. Forest Manor purchased ACV instead of " Replacement cost basis" coverage, but Petra offered insufficient evidence of how or why the identified difference entitles Petra to summary judgment.
ACV is actual cash value. Forest procured a builder’s risk policy with " actual cash value" damage coverage, rather than " replacement cost" damage coverage. The latter was required by Article 11.3.1. Actual cash value is equal to the replacement cost minus any depreciation (ACV = replacement cost less depreciation), C.G.S. 38a-307.
Petra failed to establish the contractually required BRI coverage is Forest Manor’s " primary" source of recovery, that the BRI is an exclusive source of remedy, or why Forest Manor’s purchase of ACV coverage rather than Replacement cost basis coverage entitles Petra to summary judgment.
§ 11.3.7 of the Contract, entitled " WAIVERS OF SUBROGATION," " (T)he Owner and Contractor waive all rights against (1) each other and any of their subcontractors ... for damages caused by fire or other causes of loss to the extent of property insurance specified to be provided by the Owner per this Section 11.3 or other property insurance applicable to the Work, ..."
The waiver is self-limiting. The parties waive all subrogation rights against each other.
" The right to stand in the shoes of another and to claim whatever rights the original person or entity had." A201-2007 Commentary, p.46, and available at: http://aiad8.prod.acquia-sites.com/sites/default/files/2017-02/a201-2007% 20commentary.pdf, see EN 275, p. 5, fn 8.
Both the Contract heading: " WAIVERS OF SUBROGATION," and the text " (T)he Owner and Contractor waive all rights to the extent of property insurance specified (emphasis added) to be provided by the Owner per this Section 11.3 or (emphasis added) other property insurance applicable to the Work ..." limit the waiver.
The parties mutually waived subrogation rights to the extent of property insurance. The limited waiver coupled with the mandatory property insurance obligation on the Owner, BRI, and the possibility of additional property insurance by either Owner or Contractor on " the Work," limits the potential for litigation while insuring the parties’ property rights against loss- within the scope of purchased property insurance.
Forest Manor is asserting direct claims against Petra- not a subrogation claim. Forest Manor did not waive direct claims against Petra, but waived, on behalf of its insurer, subrogation rights " to the extent of property insurance specified ..." in § 11.3.7. Forest Manor’s BRI insurer, Seneca, admitted not having subrogation rights against Petra for property damage paid or payable to Forest Manor caused by the February 9, 2015 loss.
EN 214, p.22, fn 4 citing Michael Davis, Seneca deponent, testimony.
This mutual waiver of subrogation rights minimizes litigation and avoids duplicate insurance expense for the Owner and Contractor. The Owner/Forest Manor had to purchase, § 11.3.1 and 11.3.1.1, and Forest Manor purchased, BRI insuring against property damage. Contractor had to purchase, § 10.2.5, and Petra purchased, liability insurance covering damage to Owner’s tangible property. The combination of the insurance coverages was apparently designed to mitigate the insured’s loss and minimize litigation.
Petra’s reliance on the trial court’s holding in Best Friends Pet Care v. Design Learned, Inc., 77 Conn.App. 167 (2003), to bar Forest Manor’s claim against Petra is misplaced. The Hartford Insurance Company, property insurer of Best Friends Pet Care, paid its insured for fire loss caused by Trane, then acting as subrogee of Best Friends Pet Care, sued Trane. The trial court upheld the contractual waiver in Section 11.3.7 because that was a subrogation action. This case is not a subrogation action.
Petra has not established Forest Manor’s direct claims for property damage against Petra are waived by § 11.3.7.
Second, Petra argues the parties mutually waived claims for loss of use and consequential damages arising out of or relating to the contract, see § 11.3.3 and § 15.1.6 of the General Conditions.
§ 11.3.3 LOSS OF USE INSURANCE The Owner, at the Owner’s option may purchase and maintain such insurance as will insure the Owner against loss of use ... The Owner waives all rights of action against the contractor for loss of use of the Owner’s property, including consequential losses due to fire or other hazards however caused.
§ 15.1.6 CLAIMS FOR CONSEQUENTIAL DAMAGES
The term " loss of use" appears in § 11.1.1.5 and § 11.3.3 (see footnote 15). In the former provision Contractor must purchase liability insurance to protect the Contractor from enumerated claims, including " loss of use," as may arise. In the latter provision Owner " waives all rights of action against the contractor for the loss of use of the Owner’s property, including consequential losses due to fire or other hazards however caused." The provisions are consistent; the latter narrows the former. Though the Contractor must purchase liability insurance to cover " loss of use" claims, the Owner waived claims against the Contractor for " loss of use of the Owner’s property, including consequential losses ..." but parties- other than the owner - may press loss of use claims against the Contractor.
§ 11.1.1 The Contractor shall purchase from and maintain in a company or companies lawfully authorized to do business in the jurisdiction in which the Project is located such insurance as will protect the Contractor from claims set forth below which may arise out of or result from the Contractor’s operations under the Contract and for which the Contractor may be legally liable, whether such operations be by the Contractor or by a Subcontractor or by anyone directly or indirectly employed by any of them, or by anyone for whose acts any of them may be liable:
In § 15.1.6.1, " CLAIMS FOR CONSEQUENTIAL DAMAGES," (see footnote 16), the parties waived claims against each other for consequential damages arising out of or relating to the contract including Forest Manor’s damage claims for losses of use, income, profit, and financing.
If § 11.3.3 and § 15.1.6.1 are operative when Forest Manor’s claims for those consequential damages occurred, then Forest Manor waived claims against Petra for consequential damages including losses of income. Forest Manor’s damage claims for lost rental income, $751,852.00, and. lost investment income, $360,000.00 are contractually defined as consequential damages.
EN 274, p. 14 and EN 216, p. 76/211 (FM’s disclosure answers to Mizzy re damage claims).
Whether and when Petra materially breached the contract, as Forest Manor alleged, by violating Article 10, including § 10.2.5, is a question of fact for the trier of fact and cannot be determined on a motion for summary judgment, Shah v. Cover-It, Inc., 86 Conn.App. 71, 74-75 (2004).
" It is a general rule of contract law that a total breach of the contract by one party relieves the injured party of any further duty to perform further obligations under the contract." (Emphasis added.) Rokalor, Inc. v. Connecticut Eating Enterprises, Inc., 18 Conn.App. 384, 391, 558 A.2d 265 (1989); see also State v. Lex Associates, 248 Conn. 612, 624, 730 A.2d 38 (1999); 669 Atlantic Street Associates v. Atlantic-Rockland Stamford Associates, 43 Conn.App. 113, 125-26, 682 A.2d 572, cert. denied, 239 Conn. 949, 950, 686 A.2d 126 (1996); 2 Restatement (Second) Contracts § 237 (1981).
EN 124, Count Three, ¶ 58-60.
" The Contractor shall promptly remedy damage and loss (other than damage or loss insured under property insurance required by the Contract Documents) to property referred to in Sections 10.2.1.2 and 10.2.1.3 caused in whole or in part by the Contractor and Subcontractor ..."
If Petra materially breached the contract, Forest Manor is relieved of its contractual obligations and Petra no longer has the benefit of the contractual waiver of damages provisions. Id., 74.
Summary judgment is denied on Counts Two and Three.
Count Four: Breach of Contract
Forest Manor alleges Petra breached its contractual duty to defend, protect, and hold harmless Forest Manor from and against all claims, damages, losses and expenses arising out of or resulting from injury to tangible property caused by the negligent acts of its subcontractors occurring during performance of the Work on the Project.
Count Four, ¶ 62, General Conditions § 3.18.1
§ 3.18, INDEMNIFICATION, required Petra to defend, hold harmless, and indemnify Forest Manor against third -party claims under defined circumstances. There are no third-party claims asserted against Forest Manor and the duty to indemnify and hold harmless is not involved in the first-party claim by Forest Manor against Petra.
Forest Manor provided access to AIA contract general conditions commentary about applying § 3.18:
EN 275, p. 5, fn 8, http://aiad8.prod.acquia-sites.com/sites/default/files/2017-02/a2012007% 20commentary.pdf.
This provision does not cover injury or damage to the Work itself nor does it cover a claim by the Owner that the Contractor has failed to construct the building according to the Contract documents.
In Kaplan v. Merberg Wrecking Corp., 152 Conn. 405, 410 (1965), our Supreme Court, relying on the Restatement (First) of Restitution § 96 (1937), recognized common-law indemnification to mean: " A person who, without personal fault, has become subject to tort liability for the unauthorized and wrongful conduct of another, is entitled to indemnity from the other for expenditures properly made in the discharge of such liability." Whether Petra performed its contractual obligations within industry standards, including timely repair of damage done to Owner’s property by its subcontractor Mizzy during construction and to purchase liability insurance covering such losses are not indemnification issues addressed by § 3.18.
§ 10.2.5 The Contractor shall promptly remedy damage and loss (other than damage or loss insured under property insurance required by the Contract Documents) to property referred to in § s 10.2.1.2 and 10.2.1.3 caused in whole or in part by the Contractor, a Subcontractor, a Sub-subcontractor, or anyone directly or indirectly employed by any of them, or by anyone for whose acts they may be liable and for which the Contractor is responsible under § § 10.2.1.2 and 10.2.1.3, except damage or loss attributable to acts or omissions of the Owner or Architect or anyone directly or indirectly employed by either of them, or by anyone for whose acts either of them may be liable, and not attributable to the fault or negligence of the Contractor. The foregoing obligations of the Contractor are in addition to the Contractor’s obligations under § 3.18.
§ 11.1.1 The Contractor shall purchase from and maintain in a company or companies lawfully authorized to do business in the jurisdiction in which the Project is located such insurance as will protect the Contractor from claims set forth below which may arise out of or result from the Contractor’s operations under the Contract and for which the Contractor may be legally liable, whether such operations be by the Contractor or by a Subcontractor or by anyone directly or indirectly employed by any of them, or by anyone for whose acts any of them may be liable:
Petra has established there is no genuine issue of material fact about the non-application of the Indemnification provision found in § 3.18 to Forest Manor’s claims against Petra and that Petra is entitled to judgment on Count Four as a matter of law.
Summary judgment for Petra is granted as to Count Four.
Count Five: CUTPA
Forest Manor asserts a CUTPA claim against Petra in Count Five. The basis for the claim is twofold: (1) Petra’s failure to alert Forest Manor before February 9, 2015 the Builder’s Risk policy Certificate of Insurance Forest Manor provided to Petra failed to meet the contractual obligations; and (2) Petra’s failure to fulfill its contractual obligation to promptly remediate the damage to Forest Manor’s property caused by Mizzy on February 9, 2015.
Count Five, ¶¶ 68-72 & 77-80.
Count Five, ¶¶ 73-80.
Petra moves for summary judgment asserting Forest Manor has no ascertainable loss, Petra was not in breach of contract, and Petra’s conduct is not within the scope of the CUTPA.
Petra’s first claim, Forest Manor’s lack of ascertainable loss, harkens to the basis for summary judgment on Counts Two and. Three- i.e. Forest Manor’s damage claims against Petra are " barred" or waived under § § 11.1, 11.1.1., 11.3.1, and 11.3.7. I found that genuine issues of material fact exist on those issues and hence this aspect of the summary judgment fails.
Petra’s second claim is that Petra did not materially breach the contract with Forest Manor. Forest Manor asserts that Petra did materially breach the contract by failing to promptly remediate and repair the damage done to Forest Manor’s property by Petra’s subcontractor Mizzy. Forest Manor notes Mr. Gerald R. Kagan, Architect of the Atwood project, as required by section 14.2 of the General Conditions, in August 2015 certified sufficient cause existed to terminate Petra’s right to proceed under the Contract. Whether Petra materially breached the contract is a question of fact for the trier of fact.
Last, Petra asserts its alleged misconduct does not fall within the scope of CUTPA despite Forest Manor’s allegations to the contrary. " It is well settled that whether a defendant’s acts constitute ... deceptive or unfair trade practices under CUTPA, is a question of fact for the trier, ..." (Internal quotation marks and citations omitted.) Naples v. Keystone Bldg. & Dev. Corp., 295 Conn. 214, 226-28 (2010).
Summary judgment is denied on Count Five as there exists a genuine issue of material fact and the movant is not entitled to judgment as a matter of law.
Limitation of Damages
Petra moves for summary judgment under P.B. 17-51 and under Willow Springs Condo. Assn., Inc. v. Seventh BRT Dev. Corp., 245 Conn. 1, 59 (1998), holding regarding the appropriate measure of damages:
Sec. 17-51.- Judgment for Part of Claim: If it appears that the defense applies to only part of the claim, or that any part is admitted, the moving party may have final judgment forthwith for so much of the claim as the defense does not apply to, or as is admitted, on such terms as may be just; and the action may be severed and proceeded with as respects the remainder of the claim. (P.B. 1978-1997, Sec. 386.)
[I]n determining the proper measure of damages for injury to land, the legal effort is to compensate the landowner for the damage done. This is essentially true whether the injury is redressed under a theory of tort or breach of contract. The basic measure of damages for injury to real property is the resultant diminution in its value. There is, however, a well-established exception to this formula; such diminution in value may be determined by the cost of repairing the damage, provided, of course, that that cost does not exceed the former value of the property and provided also that the repairs do not enhance the value of the property over what it was before it was damaged.
Another measure of damages may apply, if Forest Manor proves the February 9, 2015 damage was not remediable, " [I]f the defect is not thus remediable, damages are based on the difference between the value of the defective structure and that of the structure if properly completed." Ambrogio v. Beaver Road Associates, 267 Conn. 148, 159 fn. 7 (2003). The measure of damages will depend on the evidence produced. A genuine issue of material fact exists on the nature and extent of the damage caused on February 9, 2015 and this issue is not appropriate for summary judgment.
Movant offers the court no case law interpreting P.B. 17-51 as authorizing a summary judgment on the measure of damages.
Counsel are well aware the Superior Court is bound to follow existing appellate court precedent, but will address the issue at the conclusion of the evidence to determine the appropriate measure of damages.
Summary judgment on the measure of damages is denied.
Mitigation of Damages
Petra moves for summary judgment on all counts asserting Forest Manor failed to act reasonably to mitigate its damages. Questions of reasonableness of litigant’s behavior are uniquely within the province of the factfinder. The movant has failed to establish no genuine issue of material fact exists on the reasonableness of Forest Manor’s efforts to mitigate the loss.
Summary judgment based on Forest Manor’s alleged failure to mitigate damages is denied.
HOLDING
Petra’s motion for summary judgment is DENIED on Counts Two, Three and Five and GRANTED on Count Four.
The Contractor and Owner waive Claims against each other for consequential damages arising out of or relating to this Contract. This mutual waiver includes
1. Damages incurred by Owner for rental expenses, for losses of use, income, profit, financing, business and reputation; and for loss of management or employee productivity or of the services of such persons; and
2. Damages incurred by the Contractor ...This mutual waiver is applicable, without limitation, to all consequential damages due to either party’s termination in accordance with Article 14. Nothing contained in this Section 15.1.6 shall be deemed to preclude an award of liquidated direct damages, when applicable, in accordance with the requirements of the Contract Documents.
11.1.1.5 Claims for damages, other than to the Work itself, because of injury to or destruction of tangible property, including loss of use resulting therefrom;
In Bernstein v. Nemeyer, 213 Conn. 665, 672, 570 A.2d 164 (1990), our Supreme Court endorsed the use of the multifactor test set forth in the Restatement (Second) of Contracts, supra, § 241, when determining whether a breach is material. " Section 241 of the Restatement (Second) of Contracts provides: ‘In determining whether a failure to render or to offer performance is material, the following circumstances are significant: (a) the extent to which the injured party will be deprived of the benefit which he reasonably expected; (b) the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived; (c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture; (d) the likelihood that the party failing to perform or to offer to perform will cure his failure, taking account of all the circumstances including any reasonable assurances; [and] (e) the extent to which the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing.’ " Bernstein v. Nemeyer, supra, at 672n.8, 570 A.2d 164; Strouth v. Pools by Murphy & Sons, Inc., 79 Conn.App. 55, 60, 829 A.2d 102 (2003). " The standards of materiality [are] to be applied in the light of the facts of each case in such a way as to further the purpose of securing for each party his expectation of an exchange of performances. [Section 241] therefore states circumstances, not rules, which are to be considered in determining whether a particular failure is material. 2 Restatement (Second), supra, § 241, comment (a)." (Internal quotation marks omitted.) Strouth v. Pools by Murphy & Sons, Inc., supra, at 60, 829 A.2d 102. Shah v. Cover-It, Inc., 86 Conn.App. 71, 75-76 (2004).
... 11.1.1.5 Claims for damages, other than to the Work itself, because of injury to or destruction of tangible property, including, loss of use resulting therefrom.