Opinion
No. HHBCV 05500025 S
March 6, 2006
MEMORANDUM OF DECISION RE MOTION TO DISMISS # 104
The Defendant Tiger Group, Inc. has filed a Motion to Dismiss (# 104), arguing that the Court has no subject matter jurisdiction over the plaintiffs' complaint in that any dispute between the plaintiff James Lynes and the defendant corporation must be submitted to arbitration pursuant to the written contract executed between the parties. The plaintiffs have filed a timely objection to the motion (#106), arguing that the contract containing the arbitration clause is a contract by adhesion and therefore unenforceable. Oral argument was held before the court on February 27, 2006. For the reasons stated below, the court grants the Motion to Dismiss.
I. OVERVIEW
In their seven-count Amended Complaint dated December 19, 2005, the plaintiffs, James and Joy Lynes, allege that on or about March 10, 2004, they entered into a contract to purchase a home at 148 Tanglewood Dr., Southington, Connecticut, from the defendant seller, Richard M. O'Neil, based in part on the seller's representation that the property was connected to the town's sewer system. On March 12, 2004, the plaintiff James Lynes entered into a contract with the defendant Tiger Group, Inc., to perform a home and building inspection of the premises. The inspection was done but the plaintiffs claim it did not report the fact that the home was connected to a septic system rather than the town sewer system. They allege that following the completion of the purchase they independently discovered the home was not connected to the town sewer system and commenced the present action against the listing agency Calcagni Associates Real Estate, the seller Richard M. O'Neil, and the home inspector Tiger Group, Inc. As to the defendant home inspector, the plaintiffs filed claims of negligence in Count Four, violation of the Connecticut Unfair Trade Practices Act in Count Five, fraud in Count Six, and "contract by adhesion" in Count Seven.
The plaintiff Joy Lynes was not a signatory to the contract and therefore the Motion to Dismiss is not applicable to her.
II. DISCUSSION
"A motion to dismiss . . . properly attacks the jurisdiction of the court, 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 . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Filippi v. Sullivan, 273 Conn. 1, 8, 866 A.2d 599 (2005); see also Blumenthal v. Barnes, 261 Conn. 434, 442, 804 A.2d 152 (2003); Dyous v. Psychiatric Security Review Board, 264 Conn. 766, 773, 826 A.2d 138 (2003).
"It is well established that, in determining whether a court has subject matter jurisdiction, every presumption favoring jurisdiction should be indulged." (Citations omitted; internal quotations marks omitted.) Amodio v. Amodio, 247 Conn. 724, 727-28, 724 A.2d 1084 (1999). A claim that the court lacks subject matter jurisdiction may be raised at any time. Practice Book § 10-33, Dowling v. Slotnick, 244 Conn. 781, 787, 712 A.2d 396, cert. denied, 525 U.S. 1017, 119 S.Ct. 542, 142 L.Ed.2d 451 (1998). In considering the motion, the court must review the allegations in the complaint and construe them in a manner most favorable to the pleader. Pamela B. v. Ment, 244 Conn. 296, 308 (1998).
Defendant Tiger Group, Inc. argues that the court lacks subject matter jurisdiction because any dispute arising from the March 12, 2004 home inspection is governed by the arbitration provision of the parties' written contract, which specifically provides that "arbitration is a condition precedent to the filing of an action in court." The plaintiffs have objected, arguing that the arbitration clause is a contract by adhesion resulting from the unequal bargaining power of the parties and as such is void and unenforceable. Specifically, the plaintiffs argue that the clause violates public policy because it (1) only provides attorneys fees for Tiger Group if they should prevail, without any reciprocal provision for the plaintiffs, (2) designates arbitrators (architects, home inspectors, ASHI members, engineers or professional contractors) who would be inherently biased toward the home inspector, and (3) is a preprinted contract which was presented on a "take it or leave it" basis, giving the plaintiffs no choice but to agree to its terms.
The wording of that provision is as follows: "If any dispute arises out of or in connection with this Agreement, the visual inspection of the property or the written inspection report, such dispute shall be submitted to arbitration within a reasonable time after discovery of the matter(s) in dispute and in no event later than two (2) years from the date of the inspection. Only licensed architects, home inspectors, ASHI members, engineers or professional contractors will be eligible to serve as an arbitrator. In any arbitration in which we are found to be without fault, you agree to reimburse us for any attorneys fees and costs incurred in our defense of the proceeding. It is hereby expressly acknowledged and agreed that arbitration is a condition precedent to the filing of an action in court."
"Connecticut has adopted a clear public policy in favor of arbitrating disputes." Nussbaum v. Kimberly Timbers, Ltd., 271 Conn. 65, 856 A.2d 354 (2004); see also, Alexson v. Foss, 276 Conn. 599, 607, 887 A.2d 872 (2006). "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." (Citations omitted.) Kantrowitz v. Perlman, 156 Conn. 224, 227, 240 A.2d 891 (1968). However, an arbitration agreement can be rendered void if the formation of that agreement involved duress, misrepresentation, fraud or undue influence. See Dewart v. Northeastern Gas Transmission Co., 140 Conn. 446, 449, 101 A.2d 299 (1953).
There is no question that the express provisions of the contract clearly mandate that the matter be submitted to arbitration for decision prior to instituting any action in this court. Furthermore, the plaintiffs' argument that the arbitration clause violates public policy is wholly unavailing as to this motion. A close reading of the plaintiffs' complaint reveals that they attack the entire contract as unconscionable. The plaintiffs are essentially asking this court to render judgment on the Seventh Count of their complaint in order to overrule the defendant's motion to dismiss. "[T]he question of whether the entire agreement containing an arbitration provision is a contract of adhesion is one for an arbitrator's determination and not, at this juncture, one for judicial review." Salomon Smith Barney, Inc. v. Cotrone, 81 Conn.App. 755, 760, 841 A.2d 1199 (2004). The plaintiffs have cited no authority, nor have they presented any evidence whatsoever to support the claim that they were induced to sign the contract of March 12, 2004 as a result of fraud, duress, misrepresentation, or undue influence. As such, all of the claims against the defendant Tiger Group, Inc., including the allegation that the contract is one of adhesion, are properly referable to arbitration.
III. CONCLUSION
The court finds that in reviewing the pleadings in the light most favorable to the plaintiffs, the arbitration provision of the contract clearly mandates arbitration as a condition precedent to court action. It further finds that the reasons cited by the plaintiffs are insufficient to not have the matter referred to arbitration. Therefore, as to the claims of the plaintiff James Lynes, the court finds it lacks subject matter jurisdiction. The objection of the plaintiff is overruled and the Motion to Dismiss Counts Four, Five, Six and Seven against the Defendant Tiger Group, Inc. is granted.