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Clasby v. Zimmerman

Court of Appeals of Connecticut

July 9, 2019


          Argued February 4, 2019

         Procedural History

         Action to recover damages for, inter alia, breach of contract, and for other relief, brought to the Superior Court in the judicial district of Stamford-Norwalk, where the defendants filed a counterclaim; thereafter, the plaintiffs withdrew the action in accordance with the parties' stipulation to enter into binding arbitration and the defendants withdrew their counterclaim; subsequently, the arbitrators issued certain awards and entered certain orders; thereafter, the court, Genuario, J., denied the application to confirm the arbitration award filed by the defendant Bradford Estates, LLC, and rendered judgment thereon, from which the defendant Bradford Estates, LLC, appealed to this court; subsequently, the court denied the motion for reconsideration filed by the defendant Bradford Estates, LLC, and the defendant Bradford Estates, LLC, filed an amended appeal with this court. Reversed in part; judgment directed.

          Lawrence F. Reilly, with whom was James A. Alissi, for the appellant (defendant Bradford Estates, LLC).

          Thomas B. Noonan, for the appellees (plaintiffs).

          Lavine, Prescott and Elgo, Js.


          PRESCOTT, J.

         The defendant, Bradford Estates, LLC, [1] is a general contracting business hired by the plaintiffs, Robert Clasby and Krista Clasby, to raise and remodel their shoreline home, which was extensively damaged by Hurricane Sandy. The parties agreed to arbitrate disputes that arose during the construction project, and the defendant now appeals from the judgment of the trial court denying its application to confirm a February 4, 2017 arbitration award.[2] The defendant contends that the February 4, 2017 award conclusively established that the defendant was entitled to collect from the plaintiffs a balance of $51, 856.65 in materials and labor for certain cabinetry work.

         The defendant's claim on appeal is essentially twofold. First, he claims that, because no timely application to vacate, modify or correct the February 4, 2017 award was ever filed, the court was obligated to grant the defendant's application to confirm the award. Second, the defendant claims that, by denying its application to confirm the February 4, 2017 award, the court effectively and improperly gave legal effect to a subsequent award issued by the arbitration panel on August 23, 2017, in which the arbitration panel clarified that the February 4, 2017 award was not a final determination with respect to the cost of the cabinetry work and reduced the amount that the defendant was entitled to collect for the cabinetry work by more than $20, 000.

         We agree with the defendant that the trial court ‘‘had no choice'' but to grant the defendant's timely application to confirm the award because neither party filed a timely application to vacate, modify or correct the February 4, 2017 arbitration award. See Rosenthal Law Firm, LLC v. Cohen, 165 Conn.App. 467, 472, 139 A.3d 774, cert. denied, 322 Conn. 904, 138 A.3d 933 (2016). Nevertheless, we do not agree with the remaining aspect of the defendant's claim that confirmation of the February 4, 2017 award necessarily invalidates or renders legally inoperative the arbitration panel's August 23, 2007 award, particularly with respect to its modification of the balance owed to the defendant for the cabinetry work. In other words, we conclude that the trial court properly denied the defendant's request for an order directing the plaintiffs to pay the defendant an additional $21, 463 for cabinetry work.[3] For the reasons that follow, we affirm in part and reverse in part the judgment of the trial court, and remand the matter with direction to grant the application to confirm the February 4, 2017 award, but to deny the remainder of the relief requested in the application.

         The record reveals the following facts, as found by the arbitration panel or as undisputed in the record.[4]The plaintiffs hired the defendant to renovate and remodel their shoreline home in Darien, which had suffered significant damage from Hurricane Sandy. The project included raising the home above the existing foundation and redesigning and strengthening the foundation to comply with new regulations. The relationship between the parties, however, soon deteriorated.[5] The plaintiffs became dissatisfied with many aspects of the project, including the cost, quality, and progress of the renovations. The defendant eventually withdrew from the project after it was halfway completed.

         The plaintiffs commenced a civil action against the defendant in January, 2014. In their operative complaint, the plaintiffs alleged causes of action sounding in breach of contract, a violation of the Connecticut Unfair Trade Practices Act, General Statutes § 42-110a et seq., fraud, conversion, breach of the covenant of good faith and fair dealing, and negligence. The plaintiffs also sought to pierce the corporate veil between the defendant and the Zimmermans. The defendants filed an answer, special defenses, and a counterclaim alleging defamation per se.

         After several years of litigation, on April 29, 2016, the parties signed a stipulation that included an agreement to resolve their disputes through private arbitration in lieu of a trial. The plaintiffs withdrew their complaint, and the defendant withdrew its counterclaim. The parties agreed to submit their issues to a three member arbitration panel with the intent that the defendant would return to the project and finish the renovations to the plaintiffs' home under the direction and supervision of an engineer and a building professional, both of whom also would serve as members of the arbitration panel.[6] The stipulation refers to a ‘‘Schedule A, '' which was a chart that listed a variety of existing construction issues, the parties' positions relative to those issues, and any agreed upon resolution already reached by the parties. Pursuant to the stipulation, the plaintiffs agreed to pay ‘‘any remaining amounts determined by the [a]rbitrators to be due for the completion of the [p]roject'' and to ‘‘place in escrow with their counsel an evergreen $100, 000 to secure payments to [the defendant] under [the] [s]tipulation . . . .''[7] The parties granted broad oversight authority to the arbitration panel, including the right to determine when the project was completed, at which time the parties agreed to exchange releases from liability.

         The parties submitted evidence to the arbitration panel, and the panel conducted several days of hearings. The parties submitted simultaneous posthearing briefs on January 6, 2017. On February 4, 2017, the arbitration panel issued an award with the seemingly contradictory title ‘‘Interim Award/Final Award.'' By way of explanation, the arbitrators expressly provided that the award should be viewed as final ‘‘as to allocations of costs of items proven to date, '' but interim ‘‘as to costs to complete.'' Later in the award, in a section addressing the costs to complete the project, the arbitrators again discussed, albeit in somewhat different terms, the interim aspects of the award. In particular, they stated that the award was interim ‘‘as to the attribution to the parties of costs to complete the project, but is a final award as to each credit and/or cost accounted for'' in a spreadsheet appended to the award.[8]

         The spreadsheet attached to the award listed a variety of specific items that remained to be completed. Associated with each enumerated item was (1) a ‘‘cost, '' representing a total cost that the arbitrators assigned to complete the item, (2) a ‘‘paid to date'' amount, reflecting the amount the plaintiffs already had paid toward completion of that item; and (3) a ‘‘balance, '' or the difference between the ‘‘cost'' and the ‘‘paid to date'' amount. Item 21 of the spreadsheet pertained to ‘‘Cabinetry-labor/material'' and listed a cost of $76, 500, a paid to date amount of $24, 643.50, and a balance of $51, 856.65.[9]

         Neither party timely filed an application to vacate, modify or correct the February 4, 2017 award.[10] The defendant resumed its work completing the remaining renovations under the terms of the stipulation, including the cabinetry work.

         On August 23, 2017, the arbitration panel issued another arbitration award titled ‘‘Interim Award (revised).'' That award attempted to resolve the parties' ongoing dispute regarding payment for the cabinetry work referenced in item 21of the spreadsheet appended to the February 4, 2017 award.[11] The August 23, 2017 award provided in relevant part: ‘‘Despite numerous discussions between the [supervising members of the arbitration panel] and the [defendant], [the defendant] continues to insist to the [arbitration panel] that its [February 4, 2017 award] requires that it be paid $76, 500 for cabinetry work, whether or not this amount is ever proven as the actual cost of the cabinetry. The [defendant's] position is groundless and untenable. While the [arbitration panel] found there was a contract between the parties, which included a ‘total price,' because the actual costs were unknown, this price was only a placeholder for whatever the actual construction costs turned out to be.'' The arbitration panel explained that the spreadsheet containing the $76, 500 figure representing the ‘‘cost'' of cabinetry work was prepared ‘‘to show what the [plaintiffs] had already paid, as of the hearing, toward the construction's actual cost. This was the sole purpose of the [spreadsheet]. As to costs yet unknown, the [February 4, 2017 award] was interim, because it was subject to change, as any construction cost might be, ...

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