Opinion
FSTCV175016639S
06-28-2018
PORSCHE LEASING LTD. v. Jayaraman KRISHNA
UNPUBLISHED OPINION
GENUARIO, J.
I. Introduction
The plaintiff brings this action claiming amounts due pursuant to a motor vehicle lease which had a term of forty-eight months and required monthly payments of $2,860.36. The lease began on October 30, 2014 and the defendant failed to make the monthly lease payment on January 2016 as well as all subsequent lease payments. The plaintiff alleges that it repossessed the vehicle on October 17, 2016 sold it in a commercially reasonable manner for $101,000. The plaintiff now claims amounts due under the lease in the amount of $60,162,67 resulting from the defendant’s default.
The defendant has alleged two special defenses. The first special defense which is not the subject of this motion asserts that the plaintiff failed to use reasonable means to mitigate its damages. The second special defense in its entirety reads as follows:
Plaintiff breached its obligation of good faith and fair dealings. The plaintiff, despite being aware the defendant had significant and severe medical conditions, and had requested early termination, nevertheless failed to act in good faith and, to the contrary, liquidated the asset for its sole and absolute benefit. More specifically, the total of the alleged damages claimed by the plaintiff are approximately equal to the balance of the lease term had defendant paid the monthly payments in full in accordance with the terms and conditions of the lease. Accordingly, to otherwise dispossess the defendant of the automobile but still charge him the same dollar amount as if he would have kept the automobile is a breach of the plaintiff’s obligation of good faith and fair dealings.
The plaintiff moves to strike the special defense arguing that it is insufficient as a matter of law because the defendant has failed to (1) identify any provision the subject contract that the plaintiff allegedly breached or (2) state facts that explain how the plaintiff allegedly impaired any of the defendant’s contractual rights.
II. Motion to Strike
"A motion to strike challenges the legal sufficiency of a pleading, and, consequently requires no factual findings by the trial court." Fidelity Bank v. Kreniski, 72 Conn.App. 700, 720 (2002) (Internal quotation marks omitted.) "For the purpose of ruling upon a motion to strike, the facts alleged in the [pleading], though not the legal conclusions it may contain, are deemed to be admitted." Bridgeport Harbor Place I, LLC v. Ganim, 111 Conn.App. 197, 2003 (2008) aff’d 303 Conn. 705 (2011). Pleadings must be construed broadly and realistically rather than narrowly and technically. Asylum Hill Problem Solving Revitalization Association v. King, 227 Conn. 238, 246 (2006). "A motion to strike is properly granted if the [pleading] alleges mere conclusions of law that are unsupported by the facts alleged." Bridgeport Harbor Place I, LLC v. Ganim, 303 Conn. 205, 213 (2011).
III. Discussion
Every contract carries an implied covenant of good faith and fair dealing requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement. To constitute a breach of that covenant, the acts by which a [party] allegedly impedes the [other parties’] right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith.
Alexandru v. Strong, 81 Conn.App. 68 (2004). The covenant of good faith and fair dealing is not implicated by conduct that does not impair contractual rights. Capstone Building Corp. v. American Motorist Insurance Company, 308 Conn. 760, 794-95 (2013). In moving to strike the special defense the plaintiffs rely heavily on the case of Financial Freedom Acquisition, LLC v. Griffin, 176 Conn.App. 314 (2017).
In Griffin the plaintiff sought to foreclose a reverse mortgage which contained a clause defining the death of the borrower as a maturity event rendering the balance of the loan due and payable "unless there was an agreement in writing between the plaintiff and certain legal representatives of the decedent within thirty days to cooperate fully in selling the property." The defendant executrix after her appointment entered into a listing agreement for the sale of the property and forwarded the same to the plaintiff. The executrix and the plaintiff never entered into a written agreement regarding cooperation in the sale of the property and the plaintiff began the foreclosure action. The defendant executrix pleaded as a special defense that the plaintiff had breached the implied covenant of good faith and fair dealing. After trial, the trial court concluded that the defendant had failed to meet their burden of proof with regard to the special defense and counterclaim noting that the defendant executrix sought to enforce nonexistent obligations under the note and that there had never been a meeting of the minds between the parties regarding a repayment extension so that the property could be sold. The Appellate Court affirmed the decision of the trial court, stating "every contract carries an implied duty requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement ... The covenant of good faith and fair dealing presupposes that the terms and purpose of the contract are agreed upon by the parties and that what is in dispute is the parties’ discretionary application or interpretation of a contract ..." Griffin at 339 (Emphasis added.). "[T]he covenant of good faith and fair dealing ‘is not implicated by conduct that does not impair contractual rights.’ " Griffin at 340 quoting Capstone at 795.
By the time of trial the mortgage had been transferred, but the claim of the breach of good faith and fair dealing was alleged against the original lender and original foreclosing party.
A breach of the implied covenant of good faith and fair dealing must be tied to conduct which impairs some contractual right or reasonably expected benefit of the party claiming breach of the covenant which benefit was tied to some contractual right. However, it is noteworthy that the Griffin case was decided after trial and after the trial court had made findings based upon the evidence that there was no breach of a covenant in that there was no impairment of the defendant’s contractual rights or benefits.
In the current procedural context, the issue before the court is whether or not the special defense, when read broadly as the court is required to read it, states a claim consistent with this principle. The first sentence of the special defense is but a legal conclusion and cannot survive a motion to strike. The second sentence of the special defense concerning the defendant’s medical condition and his request for early termination does not indicate any connection to a contractual right that the defendant reasonably could have expected binding the plaintiff to agree to an early termination. The allegation that the plaintiff liquidated the asset for its sole and absolute benefit also does not indicate a breach of any term of the lease. Indeed the lease specifically provides for the disposal of the car in a commercially reasonable manner. The last two sentences of the special defense which indicate that the damages claimed in this lawsuit approximately equal the balance that the defendant would have had to pay if the car had not been repossessed do not allege any contractual obligation of the plaintiff to do other than what it had done. Nor does it allege a specific contractual right or contractual benefit of the defendant that has been impaired.
In short the defendant alleges that the plaintiff wasn’t fair to him and that a reasonable person or company might have acted differently and in a manner that was more generous of spirit to the defendant. The defendant has pointed to nothing in the contract which gives rise to an obligation on the part of the plaintiff to do other than what it had done. Since there is nothing in the lease/contract which the defendant can reference to support its claim that the defendant’s conduct violated a reasonable expectation which the defendant had based on some contractual provision, the second special defense cannot stand.
Of course, as in any contract or lease there is an obligation on the part of the plaintiff to mitigate its damages and if the plaintiff did not act in the manner consistent with that obligation the defendant will have the benefit of its first special defense. The defendant however will not have the benefit of its second special defense as the court is duty bound to strike the same.
IV. Conclusion
For all these reasons the plaintiff’s motion to strike the second special defense is granted.