2003 WL 1908252 (Conn.Super.), 34 Conn. L. Rptr. 562
UNPUBLISHED OPINION. CHECK COURT RULES BEFORE CITING.
Superior Court of Connecticut, Judicial District of Ansonia-Milford. James TOTH dba Shelton Pawn and Jewelry,
v.
Walter K. CLARK dba Dictograph Security Systems.
No. CV02077296S.
April 1, 2003.
Lyons, Tuccio & Gallant, Ansonia, for James Toth. Howd & Ludorf, Hartford, and Pete Rotatori, III, Naugatuck, for Walter K. Clark.
Trotta, Trotta & Trotta, New Haven, for Monital Signal Corp.
HOLDEN, J.
Presently before the court is the defendant Clark's motion for summary judgment filed on October 24, 2002, and the plaintiff's objection thereto filed on November 27, 2002. The plaintiff is James Toth, doing business as Shelton Pawn and Jewelry (Shelton Pawn), while the defendants are Walter Clark, doing business as both Dictograph Security Systems (Dictograph) and as Western Connecticut Security Systems (Western) and Monitol Signal Corp. (Monitol). The plaintiff's fourteen-count, second amended complaint was filed on November 8, 2002. [FN1] The complaint alleges the following: On August 22, 2000, the plaintiff and Dictograph and/or Western entered into an alarm monitoring service agreement whereby Dictograph and/or Western agreed to monitor signals received from the plaintiff's alarm system located at 549 Howe Avenue, Shelton, Connecticut (premises). In turn, Diotograph and/or Western entered into an agreement with Monitol whereby Monitol would provide the monitoring service for the plaintiff's premises and would, upon receiving a signal from the plaintiff's alarm, direct calls to the proper authorities. On December 10, 2000, the plaintiff's premises was burglarized and, despite receiving two separate signals from the plaintiff's alarm system, the defendants failed to notify the police department, the fire department, and/or the representatives of the plaintiff.
FN1. The court recognizes that the plaintiff filed the operative complaint after Clark filed his motion for summary judgment. Nevertheless, because Clark has chosen not to amend his motion for summary judgment, the court will apply the motion so far as possible to the plaintiff's second amended complaint. Practice Book § 10-61.
Based on these allegations, the plaintiff has brought the operative, fourteen-count, second amended complaint. Counts one through six are brought against Clark d/b/a Dictograph, counts seven through twelve against Clark d/b/a Western, and counts thirteen and fourteen against Monitol. The plaintiff's claims are breach of contract (counts one and seven), negligence (counts two, eight, and thirteen), gross negligence (counts three, nine, and fourteen), fraudulent misrepresentation (counts four and ten), negligent misrepresentation (counts five and eleven), and violations of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. (counts six and twelve).
On October 24, 2002, Clark filed a motion for summary judgment on counts one through six, the claims against him doing business as Dictograph. [FN2] Clark moves on the ground that: 1) the plaintiff's claims are expressly barred by the parties' contract; and 2) if Clark is found to be liable, the
contract limits the defendant's liability to $250.00. Clark has filed a corresponding memorandum in support of its motion and has attached copies of the parties' contracts.
FN2. The court notes that Clark has not moved for summary judgment on counts seven through twelve, which are against him doing business as Western.
On November 27, 2002, the plaintiff filed an objection and a corresponding memorandum of law in opposition to Clark's motion for summary judgment. The plaintiff has also attached copies of the parties' contracts.
DISCUSSION
The court begins its analysis with a determination of the applicable law. In this case, both contracts contain a choice-of-law provision which provides:
"This agreement is to be governed by the laws of New York." With respect to choice-of-law provisions, Connecticut has adopted the analysis set forth in 1 Restatement (Second), Conflict of Laws § 187, p. 561 (1971). See Elgar v. Elgar, 238 Conn. 839, 850, 679 A.2d 937 (1996). The Restatement provides in pertinent part:
The law of the state chosen by the parties to govern their contractual rights and duties will be applied, even if the particular issue is one which the parties could not have resolved by an explicit provision in their agreement directed to that issue, unless either (a) the chosen state has no substantial relationship to the parties or the transaction and there is no other reasonable basis for the parties' choice, or (b) application of the law of the chosen state would be contrary to a fundamental policy of a state which has a materially greater interest than the chosen state in the determination of the particular issue and which, under the rule of § 188 would be the state of the applicable law in the absence of an effective choice of law by the parties. 1 Restatement (Second), Conflict of Laws § 187(2), p. 561 (1971). Because neither party contests the validity of these provisions, the laws of New
York will govern the contracts at issue in this case. Although New York contract law will govern the contracts, our Appellate Court has explained that "in a choice of law situation the forum state will apply its own procedure." Paine Webber Jackson & Curtis, Inc. v. Winters, 22 Conn.App. 640, 650, 579 A.2d 545, cert. denied, 216 Conn. 820, 581 A.2d 1057 (1990). Thus, the court now turns to the standard for summary judgment under Connecticut law. "The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law ... and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." (Internal quotation marks omitted.) Buell Industries, Inc. v. Greater New York Mutual Ins. Co., 259 Conn. 527, 550, 791 A.2d 489 (2002). "[A]lthough the party seeking summary judgment has the burden of showing the nonexistence of any material fact ... a party opposing summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue ... It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue. Mere assertions of fact ... are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court [in support of a motion for summary judgment]." (Internal quotation marks omitted.) Id. Clark asserts that the court should grant summary judgment as to counts one through six because the parties' contract expressly bars the plaintiff's actions against Clark. Specifically, Clark contends that the contract did not guarantee that the monitoring services would prevent burglary. Furthermore, Clark argues, the contract expressly provides that Clark would not be liable for the negligence of his employees. Finally, Clark argues in the alternative, that the parties' contract limits Dictograph's liability to $250.00. The plaintiff counters that although New York law provides that limitation of liability clauses are enforceable in claims based on negligence, they are not enforceable in tort or breach of contract claims that are the result of gross negligence.
I The court will first determine whether to grant summary judgment as to counts one through three, which claim breach of contract, negligence, and gross negligence respectively. The court begins its analysis with the parties' contract. "When interpreting a written contract, the court should give effect to the intent of the parties as revealed by the language and structure of the contract ... and should ascertain such intent by examining the document as a whole ... Effect and meaning must be given to every term of the contract ... and reasonable effort must be made to harmonize all of its terms ... Moreover, the contract must be interpreted so as to give effect to, not nullify, its general or primary purpose ..." (Citations omitted; internal quotation marks omitted.) Hamburg v. American Ref-fuel Co., 284 App.Div.2d 85, 89, 727 N.Y . S.2d 843, appeal denied, 97 N.Y.2d 603, 760 N.E.2d 1288, 735 N.Y.S.2d 492 (2001). In this case, the contract provides: "The parties agree that the Company's sole obligation under this agreement shall be to monitor signals received from the protective system located on Customer's premises. The Company upon receipt of a signal shall make every reasonable effort to transmit notification of the alarm promptly to the police, fire or other authorities and to the person or persons whose names and telephone numbers are provided to the Company by Customer, unless there is reason to assume that an emergency condition does not exist." Despite these provisions, Clark's liability is limited. The contract provides: "The Subscriber agrees that the Company will have no liability for loss or damage to property or for personal injury or death due to any failure of service including, but not limited to the failure in transmission of an alarm to the Company or by the Company to others or for interruptions of service because of ... the negligent act or negligent failure to act of the Company, its employees or agents." The contract further provides: "If the Company should nevertheless be found liable for loss or damage to persons or property irrespective of the cause, whether because of the negligent act or negligent failure to act of the Company, its employees or agents, or on some other basis, the Subscriber agrees that such liability is limited to $250." "A limitation on liability provision in a contract represents the parties' Agreement on the allocation of the risk of economic loss in the event that the contemplated transaction is not fully executed, which the courts should honor." Metropolitan Life Insurance Co. v. Noble Lowndes International, Inc., 84 N.Y.2d 430, 436, 618 N.Y.S.2d 882 (1994). "Although such clauses in commercial contracts are enforceable to limit recovery for claims on ordinary negligence, they will not preclude recovery in tort or breach of
contract where the losses are the result of gross negligence." (Citations omitted.) Gold Connection Discount Jewelers v. American District Telephone Company, Inc., 212 App.Div.2d 577, 578, 622 N.Y.S.2d 740 (1995). Because the contract limits Clark's liability for the negligence of its employees and because New York law allows such limitation on liability, the court grants Clark's motion for summary judgment as to count two. Nevertheless, the court denies Clark's motion for summary judgment as to counts one and three as such clauses will not preclude recovery in tort or breach of contract where the losses are the result of gross negligence.
II The court now turns to counts four, five, and six, which claim misrepresentation, negligent misrepresentation and a violation of CUTPA, respectively. Before proceeding, however, the court finds it necessary to determine whether these counts also fall within the scope of the contract's choice-of-law clause. In addressing this issue, the court finds guidance in George S. May International Co. v. Cabinet Crafters, Inc., United States District Court, Docket No. H-88-28 (D.Conn. August 10, 1988) (14 Conn. L. Trib. No. 45, p. 33-34). In that case, the parties entered into a lease agreement whereby the plaintiff agreed to provide the defendant with a business-management computer system. Id. According to the agreement, the lease would be governed by Illinois law. Id. After the plaintiff had initiated an action against the defendant for breach of contract, the defendant counterclaimed for, inter alia, fraud, negligent misrepresentation, and unfair trade practices in violation of CUTPA. Id. The court concluded that although the choice-of-law clause would govern the lease agreement, the defendant's counterclaims would, nevertheless, be governed by Connecticut law as they did not arise
from the lease agreement itself. Id. In the present case, the contract contained a choice-of-law clause, which provided that the contract would be governed by New York law. Despite this clause, however, the court finds the reasoning in George S. May International Co. v. Cabinet Crafters, Inc. persuasive, and thus, applies Connecticut law to counts four through six.
A Having determined that Connecticut law applies, the court now proceeds to determine whether the defendant's motion for summary judgment should be granted as to these counts. Count four is a claim for fraudulent misrepresentation. Specifically, the plaintiff claims that during contract negotiations, Clark induced him to sign the contract by representing that the plaintiff's alarm would be monitored by experienced operators. "The essential elements of a cause of action in [fraudulent misrepresentation] are: (1) a false representation was made as a statement of fact; (2) it was untrue and known to be untrue by the party making it; (3) it was made to induce the other party to act upon it; and (4) the other party did so act upon the false representation to his injury." (Internal quotation marks omitted.) Cadle Co. v. Ginsberg, 70 Conn.App. 748, 769, 802 A.2d 137 (2002). With respect to count four, the court finds that Clark has not presented sufficient evidence to support his motion for summary judgment. Clark argues that he is entitled to summary judgment on this claim because the plaintiff cannot show that Clark knowingly made an untrue statement, which induced the plaintiff to sign the contract. The only evidence Clark provides, however, is the contract itself. The contract alone is insufficient because the plaintiff's claim does not arise out of the contract, but rather out of the communications between the parties during the contract negotiations.
B In count five, the plaintiff's claim for negligent misrepresentation, the plaintiff maintains that Clark, in the course of the contract negotiations, failed to exercise reasonable care in stating that the plaintiff's alarm would be monitored by experienced operators. With respect to negligent misrepresentation, our Supreme Court has adopted § 552 of the Restatement (Second) of Torts (1977) "One who, in the course of his business, profession or employment ... supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information." (Internal quotation marks omitted.) Craine v. Trinity College, 259 Conn. 625, 661, 791 A.2d 518 (2002). Clark moves for summary judgment on the ground that the plaintiff cannot show that Clark made untrue statements to him during the course of the parties' contract negotiations. The only evidence Clark provides, however, is the parties' contract. The contract is not enough because it does not shed any light on the information that Clark may have offered the plaintiff during the contract negotiations.
C In count six, the plaintiff claims that Clark, in the course of the contract negotiations, violated CUTPA by stating that the plaintiff's alarms would be monitored by experienced operators. "[I]n determining whether a practice violates CUTPA we have adopted the criteria set out in the cigarette rule by the federal trade commission for determining when a practice is unfair: (1) [W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise--in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness; (2) whether it is immoral, unethical, oppressive, or unscrupulous; (3) whether it causes substantial injury to consumers, [competitors or other business persons] ... All three criteria do not need to be satisfied to support a finding of [a violation of CUTPA]." (Internal quotation marks omitted.) Macomber v. Travelers Property & Casualty Corp., 261 Conn. 620, 644, 803 A.2d 311 (2002). Again, this court determines that Clark has not presented sufficient evidence to support summary judgment. Clark contends that he is entitled to summary judgment on this claim because the plaintiff cannot show that Clark violated CUTPA by making untrue statements during the parties' contract negotiations. Clark does not, however, present the court with any documentation regarding the parties' negotiations. Instead, he relies solely on the parties' contract. The contract alone does not shed light on whether Clark violated CUTPA in the course of the parties' negotiations.
CONCLUSION
For the foregoing reasons, the court grants Clark's motion for summary judgment as to count two, and thus, overrules the plaintiff's objection to Clark's motion for summary judgment as to count two. The court denies Clark's motion for summary judgment as to counts one, three, four, five, and six, and accordingly, sustains the plaintiff's objection to Clark's motion for summary judgment as to counts one, three, four, five, and six. Conn.Super.,2003. Toth v. Clark 2003 WL 1908252 (Conn.Super.), 34 Conn. L. Rptr. 562 END OF DOCUMENT