Opinion
No. CV 05 4009532
March 16, 2007
MEMORANDUM OF DECISION RE MOTION TO DISMISS ACTION AGAINST SUBROGEE
This case arises from claims of negligence and breach of contract. By Amended Complaint, dated May 9, 2006, the plaintiffs James Barber and certain underwriters of Lloyd's, London, (hereafter Lloyd's London) allege that defendant Craig Berthiaume, d/b/a The Berthiaume Group and Berthiaume Contracting, negligently and in breach of a Home Improvement Contract, caused damage to James Barber's home while performing construction work on that structure. The scope of work under the contract called for Berthiaume to raise the plaintiff's house preparatory to installing new support footings and a support frame. After the house was raised, it fell from the frame, and was damaged. Plaintiff Lloyd's, London made payments to plaintiff James Barber for the damages, pursuant to its homeowner's insurance contract with him.
In this action plaintiff, Lloyd's London, as subrogee, seeks to recover damages for, inter alia, its payments to plaintiff James Barber. The Amended Complaint also names as a defendant Hanover Insurance Company ("Hanover"), and alleges that at all times relevant to this action, Hanover provided general liability insurance coverage to Craig Berthiaume and his business.
The Amended Complaint further states that on or about February 6, 2006, Craig Berthiaume received a discharge of indebtedness in the United States Bankruptcy Court for the District of Connecticut, and infers that the discharge in bankruptcy also discharged his indebtedness to James Barber for damages resultant from his alleged negligence in carrying out the construction contract.
Hanover has filed a motion to dismiss this case on the ground that this court lacks subject matter jurisdiction, arguing that since the plaintiffs have not secured judgment against Craig Berthiaume, they can not seek to recover from Craig Berthiaume's insurer. Connecticut General Statutes § 38a-321 provides that a defendant may not bring a direct action against an insurer until it has secured judgment against the insured party.
The Supreme Court has addressed the right of a subrogee to maintain an action against a contract violator, and its insured when the indebtedness of the contract violator has been discharged in bankruptcy.
In Lightowler v. Connecticut Ins. Co., 255 Conn. 639 (2001), plaintiff Maribeth Lightowler brought a legal malpractice action against attorney Steven Brayton and his malpractice carrier, Continental Insurance Company. Steven Brayton included the legal malpractice claim in his bankruptcy petition. Although he received a discharge of the claim, he asserted that since he would be obligated to pay a deductible on his malpractice insurance policy, a lawsuit against him would violate the fresh start provision of the Bankruptcy Code. Finding that the deductible also was discharged in bankruptcy the Supreme Court articulated the following language which resolves the issue in this case.
Because Brayton (the individual defendant in Lightowler) has no enforceable obligation to pay the deductible to Continental (Brayton's co-defendant insurer) under the policy, the plaintiff can maintain her action against Brayton-solely for the purpose of obtaining a judgment against Brayton as a necessary prerequisite to seeking a recovery against Continental . . .
Id. at 650-51
Conclusion
In this case, the defendant insured, like the defendant in Lightowler, has received a discharge of debt from the Bankruptcy Court and is not subject to personal liability for his alleged negligence and breach of contract. Consequently, as in Lightowler, this Court finds that it has jurisdiction in this lawsuit which names Craig Berthiaume, the bankrupt, and his insurer, Hanover, as defendants.
Accordingly, the defendant's Motion to Dismiss is denied.