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Bruno v. Whipple

Appellate Court of Connecticut

December 29, 2015

LISA BRUNO
v.
REED WHIPPLE ET AL

         Argued September 16, 2015.

Page 900

[Copyrighted Material Omitted]

Page 901

          Action to recover damages for, inter alia, breach of contract, and for other relief, brought to the Superior Court in the judicial district of Danbury, where the court, Maronich, J., granted in part the defendants' motion for summary judgment and rendered judgment thereon, from which the plaintiff appealed to this court, which dismissed the appeal in part, reversed the judgment in part and remanded the case for further proceedings; thereafter, the matter was tried to the jury before Doherty, J.; subsequently, the court, Doherty, J., granted the defendants' motion for permission to file an amended answer and special defense; verdict for the defendants; thereafter, the court, Doherty, J., denied the plaintiff's motion to set aside the verdict and rendered judgment in accordance with the verdict, from which the plaintiff appealed to this court; subsequently, the court, Doherty, J., issued an articulation of its decision.

          SYLLABUS

         The plaintiff sought to recover damages from the defendants, H Co. and W, the president of H Co., for breach of contract, breach of the implied covenant of good faith and fair dealing, and violation of the Connecticut Unfair Trade Practices Act (CUTPA) (§ 42-110a et seq.), in connection with their construction of a home for the plaintiff and her then husband, B. The plaintiff claimed that W breached the contract and the implied covenant of good faith and fair dealing by conspiring with B to launder his money through the project by not performing all of the claimed construction work, and thus deprived the plaintiff of fair and reasonable alimony and division of assets in connection with the impending dissolution of her marriage to B. The plaintiff also claimed that W violated CUTPA by engaging in the collusive conduct with B, which caused the plaintiff ascertainable economic losses. The trial court granted the defendants' motion for summary judgment as to all three claims against W and as to two counts against H Co., but denied the motion as to the breach of contract count against H Co. The plaintiff appealed to this court, which dismissed the appeal in part as it pertained to the summary judgment rendered in favor of H Co. on two of the counts against it, reversed the judgment as to the CUTPA claim, and remanded the case to the trial court for further proceedings on that claim. Thereafter, the matter was tried to the jury, which returned a verdict in favor of H Co. on the breach of contract claim and in favor of W on the CUTPA claim. The trial court rendered judgment in accordance with the verdict, and the plaintiff appealed to this court. She claimed, inter alia, that the trial court improperly denied her motion to set aside the verdict. The plaintiff further claimed that the court improperly permitted H Co. to claim that she had waived her rights under the contract and to plead the special defense of waiver after the close of evidence. Held :

         1. The trial court abused its discretion by permitting H Co. to raise the special defense of waiver after the close of evidence, as that special defense had not been specially pleaded, the pleadings did not allege any facts supporting an inference of waiver, and the defendants' claim that the plaintiff had relinquished her contractual rights was not fully litigated at trial without objection by the plaintiff; moreover, although the defendants' counsel used the term waiver in his opening statement, that statement lacked a clear connection to the plaintiff's breach of contract claim, as the defendants' counsel referenced dealings of the parties that had occurred before B filed for divorce, and the plaintiff's breach of contract claim was based exclusively on conduct that had occurred through W's actions after B had initiated the divorce proceedings; furthermore, nothing in the defendants' pleadings or in their opening statement gave the plaintiff any forewarning that a special defense of waiver might be asserted, and the evidence the defendants presented as to the dealings with W before B filed for divorce did not put the plaintiff on notice that her breach of contract claim might later be met by an unpleaded special defense of waiver.

         2. The plaintiff could not prevail on her claim that the trial court abused its discretion in denying her motion to set aside the verdict in favor of W on the CUTPA claim; although W admitted at trial that he had filtered project information through B, the jury was free to reject the plaintiff's claim that W did so in collusion with B with the intent to deprive the plaintiff of her fair share of the marital assets, and the jury was within its province to determine whether W's decision to deal only with B violated CUTPA.

         3. The trial court properly rendered summary judgment in favor of H Co. on the plaintiff's claims of breach of the implied covenant of good faith and fair dealing, and violation CUTPA; the plaintiff provided no evidence that H Co. ever returned to B any money paid by B, and the fact that H Co. may have breached the construction contract by choosing to deal only with B did not, in itself, show that H Co. acted in bad faith or that it colluded with B to launder his cash through the construction project.

         Lisa Bruno, self-represented, the appellant (plaintiff).

         Laura Pascale Zaino, with whom, on the brief, was Stephen P. Fogerty, for the appellees (defendants).

         Sheldon, Keller and Harper, Js. SHELDON, J. In this opinion the other judges concurred.

          OPINION

Page 902

         [162 Conn.App. 188] SHELDON, J.

         This case arises from dealings between the parties concerning the construction by the defendant Heritage Homes Construction Company, LLC (Heritage Homes), of a new home in Ridgefield for the [162 Conn.App. 189] plaintiff, Lisa Bruno, and her former husband, Stephen Bruno (Bruno). The plaintiff appeals from the judgment of the trial court in favor of the defendants, Heritage Homes and its president, Reed Whipple, claiming that the trial court erred: (1) in denying her posttrial motion to set aside the jury's verdict (a) for Heritage Homes on her claim of breach of contract, and (b) for Whipple on her claim of violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq.; and (2) in granting the pretrial motion of Heritage Homes for summary judgment on her claims of breach of the implied covenant of good faith and fair dealing and violation of CUTPA. We reverse the judgment in favor of Heritage Homes on the plaintiff's claim of breach of contract and remand the case for a hearing in damages on that claim pursuant to the unchallenged portion of the jury's verdict and accompanying answers to interrogatories concerning that claim. We affirm the judgment in all other respects.

         In a previous appeal in this matter, Bruno v. Whipple, 138 Conn.App. 496, 498-503, 54 A.3d 184 (2012), this court set forth the following relevant factual and procedural history. " On January 27, 2010, the plaintiff filed a six count amended second revised complaint against the defendants. In the complaint, the plaintiff alleged that the defendants, as parties to a contract with herself and Bruno to build the new home, had breached the contract and the implied covenant of good faith and fair dealing arising thereunder by conspiring with Bruno to launder his money through the project, and thus to deprive her of fair, just and reasonable alimony and division of assets in connection with the impending dissolution of her marriage. On that score, the plaintiff alleged, more particularly, that by December, 2005, when Bruno initiated marital dissolution proceedings against her, construction of the new home was nearly [162 Conn.App. 190] complete for what by then was the total sum of approximately $1,800,000. Thereafter, however, from December, 2005, to January, 2006, and from May, 2006, to July, 2006, Bruno paid the defendants additional sums totaling approximately $2,600,000, all purportedly for expenditures on the project that she did not authorize. On that basis, the plaintiff alleged that the defendants had colluded with Bruno to launder his money through the project, either by not performing all of the construction work they claimed to have performed on the project or by submitting multiple billings for the work they did perform. The plaintiff claimed . . . that by engaging in such collusive conduct with Bruno, [the defendants] not only breached the contract, as alleged in count[s] one [and two] of the complaint,[1] and the implied

Page 903

covenant of good faith and fair dealing arising under the contract, as alleged in count[s] three [and four], but [they] also committed unfair or deceptive acts or practices in the conduct of a trade or commerce that caused her to suffer ascertainable economic losses in violation of CUTPA, as alleged in count[s] five [and six].

         " On March 25, 2011, the plaintiff and, on March 28, 2011, the defendants filed motions for summary judgment. In support of their motion, the defendants argued, inter alia, that Whipple was entitled to judgment as a matter of law on each of the plaintiff's claims against him because all such claims were based materially upon alleged breaches of duties arising under a contract to which he was not a party. On that score, they argued that Whipple was not identified in the contract as a party and that, although he signed the contract in his representative capacity as a member of Heritage Homes, he did not sign it in his individual capacity. In support of that argument, the defendants submitted [162 Conn.App. 191] Whipple's personal affidavit in which he averred that he had never individually entered into any contract with the plaintiff or Bruno, nor had he ever individually performed any work or provided any labor, services or material for either of them on his own behalf. In addition, with respect to the plaintiff's core allegation of wrongdoing against him in each of her claims--that he had engaged in money laundering on behalf of Bruno by returning money to him for work billed on the home construction project--Whipple averred that all work billed by Heritage Homes on the project was performed and fully paid for by Bruno pursuant to the contract, and that neither he nor Heritage Homes ever had returned any money to Bruno or laundered money for him through the project, as the plaintiff had alleged. The defendants supported their summary judgment motion with a memorandum of law and several exhibits, including Whipple's affidavit and an unauthenticated copy of the subject contract.

         " In opposition to the defendants' motion, the plaintiff filed, inter alia, a memorandum of law and several exhibits, including a copy of the contract that was textually identical to that submitted by the defendants and two personal affidavits. . . . As grounds for opposing the defendants' motion, the plaintiff argued, inter alia, that (1) the defendants had failed to support their motion by properly authenticated documents and materials; (2) Whipple was indeed a party to the contract in his individual capacity; (3) even if Whipple signed the contract only in his representative capacity, he nonetheless should be held liable for Heritage Homes' tortious conduct, either as a direct participant in such conduct or as a person who so completely and pervasively controlled the company as to warrant piercing the corporate veil; and (4) the defendants' documented interference with her ability to keep informed of and participate in the construction project's planning and [162 Conn.App. 192] oversight after Bruno commenced marital dissolution proceedings against her, by dealing solely and exclusively with Bruno as to costly project modifications without her knowledge or consent, supports the inference that the defendants conspired with Bruno to launder his marital assets through Heritage Homes' accounts, for Bruno's benefit and to her own great financial loss.

         " After hearing oral argument on the parties' motions for summary judgment,

Page 904

the court issued a memorandum of decision in which it granted the defendants' motion as to all three of the plaintiff's claims against Whipple. As to the plaintiff's threshold claim of breach of contract, under count one of her complaint, the court relied upon the language of the contract, as submitted to it by both parties, to conclude that Whipple could not be found liable because 'there is no genuine issue of [material] fact that Whipple was not a party to the contract as pleaded by the plaintiff.' As to the plaintiff's claims of breach of the implied covenant of good faith and fair dealing and . . . violation of CUTPA, under counts three and five of her complaint, the court determined that both of those claims were also 'directly dependent upon the existence of the contractual relationship' between the plaintiff and Whipple, and thus that Whipple could not be held liable on either such claim due to his status as a nonparty to the contract. The court's determination to this effect on the plaintiff's claim of breach of the implied covenant of good faith and fair dealing was based upon both settled case law, holding that such a claim can only be asserted against a contracting party, and its conclusion that the allegations of the third count failed to state any independent basis for establishing his liability in tort. By contrast, the court's determination that the plaintiff's CUTPA claim against Whipple was directly dependent upon the existence of a contractual relationship was based [162 Conn.App. 193] simply upon its observation that all of the allegations of her breach of contract claim against him were realleged in support of the CUTPA claim.

         " Following the issuance of the court's decision, the defendants asked that the decision be clarified as to whether it also was intended to apply to the plaintiff's claims against Heritage Homes, which had joined with [Whipple] in moving for summary judgment. In response to that request, the court promptly issued a corrected memorandum of decision in which it (1) restated nearly verbatim, in the first section of the corrected decision bearing only Whipple's name and a specific reference to the three numbered counts against him (one, three and five), its prior decision granting the defendants' motion as to each such count; and then (2) proceeded, in the second section bearing only the name of Heritage Homes and a specific reference to the three numbered counts against it (two, four and six), to deny the defendants' motion with respect to count two, alleging breach of contract, but to grant the motion as to counts four and six, alleging breach of the implied covenant of good faith and fair dealing and . . . violation of CUTPA. With respect to counts four and six, in particular, the court concluded its analysis as follows: 'While the plaintiff has alleged conduct that would support a finding of aggravating circumstances sufficient for a CUTPA claim or a claim for breach of covenants of good faith and fair dealing, that the defendants have engaged in a scheme to launder money through . . . Bruno through the construction contract, those allegations are conclusory and supported by no facts. The defendants have challenged those assertions in their motion for summary judgment together with supporting affidavits and documents. If the plaintiff has no evidence and her supporting documents are inadequate, the court is justified in granting summary judgment provided the defendants have met their burden [162 Conn.App. 194] of proof. . . . The plaintiff must demonstrate that a genuine issue of material fact exists through 'counter affidavits and concrete evidence.' . . . The court finds that the plaintiff has failed to meet that burden. . . . Following the court's later denials of the plaintiff's separate motions for reargument with respect to the court's summary judgment as to Whipple

Page 905

and Heritage Homes, the plaintiff filed this appeal." (Footnotes altered.) Id.

         This court dismissed the plaintiff's appeal from the summary judgment rendered for Heritage Homes for lack of a final judgment due to the continuing pendency in the trial court of the plaintiff's claim of breach of contract against it. Id., 498 n.1. Thereafter, this court affirmed the summary judgment rendered for Whipple on the plaintiff's claims of breach of contract and breach of the implied covenant of good faith and fair dealing against him, but found error in the trial court's rendering of summary judgment for Whipple on the plaintiff's CUTPA claim against him. Id., 503. Accordingly, on remand, the remaining two counts of the plaintiff's complaint--her breach of contract claim against Heritage Homes and her CUTPA claim against Whipple--were tried to a jury.

         The presentation of evidence to the jury commenced on February 27, 2013. Five days later, after both sides had rested, the defendants filed written requests to charge dated March 4, 2013, that included a proposed instruction on the special defense of waiver to the plaintiff's claim of breach of contract. The theory of waiver set forth in the proposed instruction was that both the plaintiff and Bruno had made oral requests for changes to the construction contract without signed work orders and that neither had requested billings every two weeks, as required by the parties' contract. The plaintiff objected to the defendants' proposed charge on waiver, arguing that waiver had not been pleaded as a special defense, and thus that she had had no notice of that [162 Conn.App. 195] claim. In response, the defendants argued that they had mentioned waiver in their opening statement to the jury and had introduced evidence of waiver throughout the trial.[2] The defendants further argued that because the plaintiff had not objected to their evidence of waiver, she had waived her right to object to an instruction on waiver as a special defense.

         The court determined that sufficient evidence of waiver had been presented at trial to apprise the plaintiff of that claim. It therefore granted the defendants permission

Page 906

to amend their answer by pleading waiver as a special defense[3] and agreed to instruct the jury on that special defense. Consistent with those rulings, the court instructed the jury on waiver with directions to [162 Conn.App. 196] have the jury separately answer jury interrogatories asking whether it " f[ou]nd in favor of Lisa Bruno" on her claim of breach of contract against Heritage Homes" and, if so, whether " the plaintiff, Lisa Bruno, waived the breach of contract by the defendant Heritage Homes . . . ."

         On March 8, 2013, the jury returned a verdict in favor of Whipple on the plaintiff's CUTPA claim against him. It also returned a verdict in favor of Heritage Homes on the plaintiff's breach of contract claim against it, expressly basing the latter verdict on its answers to jury interrogatories that (1) Heritage Homes had breached its contract with the plaintiff, but (2) the plaintiff had waived that breach.

         On March 18, 2013, the plaintiff filed a motion to set aside the verdict, claiming that the trial court erred by instructing the jury on Heritage Homes' special defense of waiver because the defendants had neither pleaded waiver as a special defense nor alleged facts supportive of that special defense in any of its other pleadings. She argued that the trial court's ruling permitting Heritage Homes to assert that special defense, without any notice to her before the close of evidence, violated her right not to be deprived of her property without due process of law. She also argued that the jury's verdict in favor of Whipple on her CUTPA claim against him should be set aside because it was contrary to law and to the evidence presented at trial, particularly Whipple's admission in his testimony that, at Bruno's request, he had refused to give the plaintiff any information concerning the construction project after Bruno's initiation of divorce proceedings against her. The trial court summarily denied the plaintiff's motion. On July 7, 2014, after this appeal was filed, ...


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