Opinion
CV166062813S
11-24-2017
TOWN OF HAMDEN v. The HANOVER INSURANCE COMPANY et al.
UNPUBLISHED OPINION
OPINION
Wilson, J.
MOTION TO STRIKE (# 135) STATEMENT OF CASE AND PROCEDURAL HISTORY
The plaintiff, Town of Hamden, commenced this action on May 20, 2016, in a one-count complaint against The Hanover Insurance Company (Hanover) seeking enforcement of a surety bond (the surety bond) held by Hanover related to the development of Hamden Farms Condominiums located at 2906, 2932 and 2950 State Street, Hamden, Connecticut (Hamden Farms). The surety bond was issued by Hanover for the benefit of State Street Holdings, LLC (State Street), Andrew V. Forte, Deborah L. Forte, Richard J. Vizziello and Susan J. Vizziello in order to meet the requirements of the Town of Hamden for permitting the development of Hamden Farms.
Following a motion to implead (Docket No. 102.00) filed by Hanover on October 12, 2016, and granted by the Court (Wilson, J.) on November 18, 2016, State Street, Andrew V. Forte, Deborah L. Forte, Richard J. Vizziello and Susan J. Vizziello were named as third-party defendants to the action. Hanover filed a third-party complaint dated December 8, 2016 (Docket No. 104.00) against State Street as the developer of Hamden Farms and Andrew V. Forte, Deborah L. Forte, and the Vizziellos as indemnitors under the surety bond. The third-party defendants, Vizziellos filed a cross complaint dated March 3, 2017 (Docket No. 112.00) against the third-party defendants, State Street and Andrew V. Forte seeking indemnification and reimbursement should the court find liability against the Vizziellos under Hanover’s third-party complaint. Following a request to revise dated April 3, 2017 (Docket No. 114.00) and granted by the court (Wilson, J.) on July 10, 2017, the Vizziellos filed a four-count revised cross complaint dated September 6, 2017 (Docket No. 132.00). The revised cross complaint seeks indemnification and reimbursement on behalf of the Vizziellos against State Street and Andrew V. Forte for any liability ascribed to the Vizziellos as indemnitors under Hanover’s third-party complaint.
State Street, Andrew V. Forte, Deborah L. Forte, Richard J. Vizziello and Susan J. Vizziello will collectively be referred to in this memorandum as third-party defendants.
On October 5, 2017, the third-party defendants, State Street and Andrew V. Forte filed a motion to strike counts three and four of the third-party defendants’ Vizziellos’ cross complaint on grounds that the claims are legally insufficient. Attached to their motion is a memorandum in support. Count three of the cross complaint alleges a breach of fiduciary duty on behalf of Susan J. Vizziello against State Street and Andrew V. Forte, and count four alleges common-law indemnification on behalf of Susan J. Vizziello against Andrew V. Forte. On November 17, 2017, the Vizziellos filed an objection and memorandum in support, claiming that both counts are legally sufficient. The court heard oral argument on the motion on November 20, 2017.
DISCUSSION
Practice Book § 10-39(a) provides in relevant part: " Whenever any party wishes to contest ... the legal sufficiency of the allegations of any ... cross claim, or of any one or more counts thereof, to state a claim upon which relief can be granted, or ... the legal sufficiency of any prayer for relief in any such ... cross complaint ... that party may do so by filing a motion to strike the contested pleading or part thereof." " Practice Book § 10-39 allows a claim for relief to be stricken only if the relief sought could not be legally awarded." (Internal quotation marks omitted.) Thomas v. State, 130 Conn.App. 533, 542, 24 A.3d 12 (2011).
A motion to strike " admits all facts well pleaded; it does not admit legal conclusions or the truth or accuracy of opinions stated in the pleadings." (Internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 588, 693 A.2d 293 (1997). The court takes " the facts to be those alleged in the [complaint] ... and construe[s] the [complaint] in the manner most favorable to sustaining its legal sufficiency." (Internal quotation marks omitted.) New London County Mutual Ins. Co. v. Nantes, 303 Conn. 737, 747, 36 A.3d 224 (2012). " If any facts provable under the express and implied allegations in the ... complaint support a cause of action ... the complaint is not vulnerable to a motion to strike." Bouchard v. People ’s Bank, 219 Conn. 465, 471, 594 A.2d 1 (1991); see also Sturm v. Harb Development, LLC, 298 Conn. 124, 140, 2 A.3d 859 (2010) (motion must be denied where provable facts support cause of action). " In ruling on a motion to strike, the court is limited to the facts alleged in the complaint." (Internal quotation marks omitted.) Faulkner v. United Technologies Corp., supra, 240 Conn. 580.
I
COUNT THREE- BREACH OF FIDUCIARY DUTY
The third-party defendants, State Street and Andrew V. Forte argue that even when viewed in the light most favorable to the Vizziellos, the allegations contained in count three of the cross complaint are insufficient to establish the existence of a fiduciary relationship between the third-party defendants and Susan J. Vizziello. The third-party defendants argue that as no fiduciary relationship has been established, there can be no breach of a fiduciary duty and therefore the third count fails to state a claim and should be stricken.
It is axiomatic that in order for there to be a breach of fiduciary duty, a fiduciary relationship must exist in the first instance. Ahern v. Kappalumakkel, 97 Conn.App. 189, 194, 903 A.2d 266 (2006). Failure to allege or establish the existence of a fiduciary relationship implicates a plaintiff’s standing to assert a breach of fiduciary duty claim. Local 84 v. Francis, 138 Conn.App. 77, 87-88, 51 A.3d 401 (2012) (claim of breach of fiduciary duty was properly dismissed for lack of standing where court determined that the defendants were not in a fiduciary relationship to the plaintiffs and therefore owed no fiduciary duty to them at the time of the alleged misconduct); Peplau v. Roberto, 2010 WL 503132 (November 12, 2010, Sheldon, J.) (trial court dismissed claim for breach of fiduciary duty finding that plaintiff, as the settlor of a trust in which he retained no interest, was not in a fiduciary relationship with the trustee and therefore lacked standing to sue the trustee); Calpitano v. Rotundo, 2011 WL 3672092 *5-8 (August 3, 2011, Swienton, J.) (trial court dismissed claim for breach of fiduciary duty finding that the plaintiff, a member of an LLC, alleged only that the defendant breached his fiduciary duty to the LLC and therefore the plaintiff lacked standing to assert such a claim. The court left open the question of whether a member of an LLC might, under circumstances not presented therein, owe a fiduciary duty to another member as opposed to the LLC). Noteworthy, in the present case, it is undisputed that Susan J. Vizziello was not a member of State Street at the time of the alleged misconduct.
" A fiduciary duty springs not from a simple duty of care, but from a duty of loyalty to the party claiming the fiduciary relationship. See Beverly Hills Concepts, Inc. v. Schatz & Schatz, Ribicoff & Kotkin, 247 Conn. 48, 57, 717 A.2d 724 (1998). A party claiming a fiduciary relationship must plead and prove that the party it characterizes as a fiduciary had a duty to represent his or her interest. See Hi-Ho Tower, Inc. v. Com -Tronics, Inc., 255 Conn. 20, 38, 761 A.2d 1268 (2000); Murphy v. Wakelee, 247 Conn. 396, 400, 721 A.2d 1181 (1998). ‘It is axiomatic that a party cannot breach a fiduciary duty to another party unless a fiduciary relationship exists between them.’ Biller Associates v. Peterken, supra, 269 Conn. [716] [, 849 A.2d 847 (2004) ] at 723. ‘[A] fiduciary or confidential relationship is characterized by a unique degree of trust and confidence between the parties, one of whom has superior knowledge, skill or expertise and is under a duty to represent the interests of the other ... The superior position of the fiduciary or dominant party affords him great opportunity for abuse of the confidence reposed in him.’ (Internal quotation marks omitted.) Konover Development Corp. v. Zeller, 228 Conn. 206, 219, 635 A.2d 798 (1994)." Brignole, Bush & Lewis, LLC v. Freeman, Superior Court, judicial district of Hartford, Docket No. HHDCV156059731S (March 8, 2016, Huddleston, J.).
" In the seminal cases in which this court has recognized the existence of a fiduciary relationship, the fiduciary was either in a dominant position, thereby creating a relationship of dependency, or was under a specific duty to act for the benefit of another ... In the cases in which this court has, as a matter of law, refused to recognize a fiduciary relationship, the parties were either dealing at arm’s length, thereby lacking a relationship of dominance and dependence, or the parties were not engaged in a relationship of special trust and confidence." (Internal quotations marks omitted.) Biller Associates v. Peterken, supra, 269 Conn. 723-24. For example, the relationship between an attorney and a client is " highly fiduciary in its nature." Andrews v. Gorby, 237 Conn. 12, 20, 675 A.2d 449 (1996) [quoting Matza v. Matza, 226 Conn. 166, 184, 627 A.2d 414 (1993). " The law will imply [fiduciary responsibilities] only where one party to a relationship is unable to fully protect its interests [or where one party has a high degree of control over the property or subject matter of another] and the unprotected party has placed its trust and confidence in the other." (Internal quotation marks omitted.) Hi-Ho Tower, Inc. v. Com -Tronics, Inc., 255 Conn. 20, 41, 761 A.2d 1268 (2000).
Moreover, as our Supreme Court recently held, " ‘[f]iduciaries appear in a variety of forms, including agents, partners, lawyers, directors, trustees, executors, receivers, bailees and guardians ... The fact that one business person trusts another and relies on [the person] to perform [his obligations] does not rise to the level of a confidential relationship for purposes of establishing a fiduciary duty .’ ... ‘[N]ot all business relationships implicate the duty of a fiduciary ... Accordingly, a mere contractual relationship does not create a fiduciary or confidential relationship ...’ " (Citations omitted; emphasis added.) Saint Bernard School of Montville, Inc. v. Bank of America, 312 Conn. 811, 836, 95 A.3d 1063 (2014).
" ‘The existence of a fiduciary duty is largely a factual determination and the extent of the duty and the resulting obligations may vary according to the nature of the relationship: the obligations do not arise as a result of labeling, but rather by analysis of each case.’ Hoffnagle v. Henderson, Superior Court, Judicial District of Hartford, Docket No. CV02 0813972 (April 17, 2003, Beach, J.). Furthermore, ‘[i]t is inappropriate to decide a question of fact on a motion to strike ... It is appropriate, however, for this court to decide whether the plaintiff ... has [pleaded] sufficient facts to allege a fiduciary relationship.’ (Internal quotation marks omitted.) Golek v. St. Mary’s Hospital, Superior Court, Judicial District of Waterbury, Docket No. CV 08 5007118 (August 22, 2008, Roche, J.)." Doe v. Terwilliger, Superior Court, judicial district of New Haven, Docket No. CV095024692S (June 8, 2010, Zoarski, J.) .
In the present case, when viewing the allegations in count three broadly, and in a light most favorable to the third-party defendants, Richard J. Vizziello and Susan J. Vizziello, the third-party defendants in their cross complaint have failed to sufficiently allege facts to demonstrate that a fiduciary relationship existed between Susan J. Vizziello and State Street Holdings, LLC, and/or Andrew Forte. The most this court can glean from the allegations is that Susan J. Vizziello executed the agreement of indemnity in favor of Hanover in order to secure the security bond for Hamden Farms. Further, count three is devoid of any factual allegations describing the nature of the relationship between Susan J. Vizziello, and State Street and Andrew V. Forte. This court’s research did not reveal any cases which hold that the signing of a surety bond as an indemnitor creates a fiduciary relationship as between the other indemnitors on the bond. As this court just previously discussed, our Supreme Court has held that not all business relationships implicate the duty of a fiduciary, nor does a mere contractual relationship create a fiduciary or confidential relationship. Indeed, without further allegations describing the nature of the business relationship between Susan J. Vizziello and State Street and Andrew V. Forte, and demonstrating that " the [defendants State Street Holdings, LLC and/or Andrew V. Forte] were either in a dominant position, thereby creating a relationship of dependency, or was under a specific duty to act for the benefit of [Susan Vizziello], " this court cannot conclude that such a fiduciary relationship existed. Nor can such be inferred from the existing allegations contained in count three. Accordingly, the motion to strike count three is granted.
II
COUNT FOUR- COMMON-LAW INDEMNIFICATION
Count four of the revised cross complaint alleges common-law indemnification against the defendant Andrew Forte. The third-party defendant Andrew Forte has moved to strike the fourth count on grounds that the Vizziellos have failed to sufficiently allege facts to establish a claim for common-law indemnification.
" [T]ortious [or common-law] indemnification is an action that arises between two tortfeasors, one, whose passive negligence resulted in a monetary recovery [against] the plaintiff, and a second, whose active negligence renders him liable to the first by way of reimbursement." (Internal quotation marks omitted.) ATC Partnership v. Coats North America Consolidated, Inc., 284 Conn. 537, 551, 935 A.2d 115 (2007) [A]n action for indemnification is one in which one party seeks reimbursement from another party for losses incurred in connection with the first party’s liability to a third party ... [A] loss in the context of indemnity is the payment that discharges a liability ... In the absence of an express contract for indemnification or statutory provisions authorizing actions for indemnification ... a party may nonetheless assert an implied right to indemnification as a measure of restitution.’ Chicago Title Ins. Co. v. Accurate Title Searches, Inc., 173 Conn.App. 463, 480 (2017). ‘[A] cause of action for implied indemnification requires a showing that the plaintiff and the defendant owed a duty to a third party, and that the plaintiff discharged the duty which, as between the plaintiff and the defendant, should have been discharged by the defendant ... A claim to indemnify or contribution arises when the claimant has discharged all or part of a joint obligation.’ (Citations omitted; internal quotation marks omitted.) Id., 481.
" ‘The theory of common-law indemnification was first announced by our Supreme Court in the seminal case of Kaplan v. Merberg Wrecking Corp., 152 Conn. 405, 207 A.2d 732 (1965), as an exception to the rule that [o]rdinarily there is no right of indemnity or contribution between joint [tortfeasors] ... The rationale for this exception is that [w]here one of the defendants is in control of the situation and his negligence alone is the direct immediate cause of the injury and the other defendant does not know of the fault, has no reason to anticipate it and may reasonably rely upon the former not to commit a wrong, it is only justice that the former should bear the burden of damages due to the injury ... As a result of the decision in Kaplan, a third-party plaintiff who previously has been found liable in tort may assert an implied right to indemnity against another negligent party, provided that the plaintiff satisfies the four elements of Kaplan .’ (Citations omitted; footnote omitted; internal quotation marks omitted.) Id., 481-82. The four elements found in Kaplan are as follows: ‘(1) the party against whom the indemnification is sought was negligent; (2) that party’s active negligence, rather than the defendant’s own passive negligence, was the direct, immediate cause of the ... resulting injuries ... (3) the other party was in control of the situation to the exclusion of the defendant seeking reimbursement; and (4) the defendant did not know of the other party’s negligence, had no reason to anticipate it, and reasonably could rely on the other party not to be negligent.’ (Emphasis in original; internal quotation marks omitted.) McCann Real Equities Series XXII, LLC v. David McDermott Chevrolet, Inc., 93 Conn.App. 486, 523-24, 890 A.2d 140, cert. denied, 277 Conn. 928, 895 A.2d 798 (2006).
" Common-law indemnity exists when two parties owe identical duties to a third party for which they are jointly and severally liable, and one party, the indemnitee, seeks restitution from the other, the indemnitor, for the former’s payment satisfying the joint obligation.
" The theory of common-law indemnification is an implied right to indemnification and is considered a means of achieving restitution between the parties. Where a party seeks restitution in the form of common-law indemnification, several authorities agree that the party seeking indemnity and the party from whom indemnification is sought must be considered jointly and severally liable for the loss incurred by the putative indemnitee. See 42 C.J.S., [98, Indemnity, § 2 (2007) ] (‘[i]ndemnity applies only where there is an identical duty owed by one and discharged by another’); see also 42 C.J.S., supra, § 33, p. 149 (‘[a] cause of action for implied indemnification requires a showing that the plaintiff and the defendant owed a duty to a third party, and that the plaintiff discharged the duty which, as between the plaintiff and the defendant, should have been discharged by the defendant’); 41 Am.Jur.2d., [383, Indemnity, § 1 (2015) (‘[i]ndemnity requires that a common duty be mutually owed to ‘a third party’); 1 Restatement (Third), Restitution and Unjust Enrichment, § 23, comment (d) (2011) (A claim to indemnity or contribution arises when the claimant has discharged all or part of a joint obligation. A claim under this section is readily distinguished, therefore, from the similar claim that arises when A and B owe independent duties to a third party C; or when A, acting with adequate justification, renders a performance to C for which B would have been liable to C directly ... The restitution claim that arises from such transactions is ... more often referred to as a claim to ‘equitable subrogation’). Chicago Title Ins. Co. v. Accurate Title Searches, Inc., supra, 173 Conn.App. 480-81." Maxwell v. Bozelko, Superior Court, judicial district of Ansonia-Milford, Docket No. AANCV116006411S (June 30, 2017, Stevens, J.).
In count four of the cross complaint the Vizziellos incorporate paragraphs one through seven of the third count, which count incorporates paragraphs one through six of the first count, and alleges the following in relevant part: " The third party plaintiff, The Hanover Insurance Company has commenced an action against the defendants, [State Street, and Andrew V. Forte, Deborah L. Forte], Richard J. Vizziello and Susan J. Vizziello, alleging that said defendants are liable and responsible to it for claims, demands, liabilities, costs, charges, expenses, losses, interest, court costs, consultant fees and attorneys fees arising out of an issuance of a ‘Surety Bond for Completion of Required Improvements’ to Town of Hamden Planning and Zoning Commission." Rev. Cross Compl., 9/6/2017, count one ¶ 1.
In addition, consistent with the allegations contained in count four, the third-party complaint filed by Hanover against all of the third-party defendants, State Street, the Fortes, and the Vizziellos allege contractual indemnification based upon their execution of " an Agreement of Indemnity running in favor of the Surety under which they each agreed to indemnify the Surety for all losses incurred by the Surety as a result of issuing surety bonds to the Contractor, including but not limited to indemnity for claims payments, costs, expenses, investigation fees, and costs, attorney’s and consulting fees, and interests." Third Pty Compl, 12/8/2016, ¶ 2. Indeed, the Agreement of Indemnity which is an exhibit to the third-party complaint, states in relevant part that, " [i]n consideration of the premises, and of the execution or continuance of such bonds, the indemnitors, jointly and severally, hereby covenant and agree in favor of the Surety [that] ... [t]he indemnitors shall exonerate, indemnify, and save harmless the Surety from and against every claim, demand, liability, cost, charge, suit, judgment and expenses which the Surety may pay or incur, including but not limited to, loss, interest, court costs and consultant and attorney fees ..." (Emphasis added.) Id. Thus, the third-party defendant, Andrew V. Forte, along with the third-party defendants, Vizziellos are " considered jointly and severally liable for the loss incurred by the putative indemnitee, [Susan J. Vizziello]" by virtue of their executing the Agreement of Indemnity on the surety bond. Maxwell v. Bozelko, supra, Superior Court, Docket No. AANCV116006411S. " The party seeking indemnity [Susan J. Vizziello] and the party from whom indemnification is sought [Andrew V. Forte] must be considered jointly and severally liable for the loss incurred by the putative indemnitee." Id.
Count four of the revised cross complaint further alleges that, " 8. In the event that the Third Party [plaintiff] [Hanover] receives or is awarded any sums in this litigation by way of judgment or settlement, and Susan J. Vizziello is determined to be liable or responsible for payment of same, in whole or in part, by reason of her alleged indemnification of the Third Party plaintiff, then the defendant, Andrew V. Forte, is liable and responsible to the defendant, Susan J. Vizziello under an implied obligation of indemnity, by virtue of the following: (A) The defendant, Andrew V. Forte, misappropriated funds of State Street Holding, LLC such that State Street Holding, LLC was unable to complete construction of the project, as alleged by the Third Party Complaint; (B) The acts or activities of the defendant, Andrew V. Forte were the direct, immediate cause of the claimed damages to the Third Party plaintiff on account of Andrew V. Forte’s negligence, mismanagement or fraud in the operation of the business and financial transactions of State Street Holding, LLC; (C) The defendant, Andrew V. Forte, was at all times in control of the defendant, State Street Holding, LLC, to the exclusion of the defendant, Susan J. Vizziello; and (D) The defendant, Susan J. Vizziello, did not know of the negligence, mismanagement or fraud perpetuated by the defendant, Andrew V. Forte, and had no reason to anticipate it, and could reasonably rely upon the defendant, Andrew V. Forte, not to engage in such acts or activities." Rev. Cross Compl., ¶ 8, p. 8-9.
Based on the foregoing, the court concludes that the third-party defendant Susan J. Vizziello has sufficiently alleged facts to establish a claim for common-law indemnification as set forth in count four. Accordingly, the motion to strike count four is denied.
CONCLUSION
For the foregoing reasons, the motion to strike is granted as to count three and denied as to count four.