Opinion
No. WWM CV08-5003904-S
September 22, 2010
MEMORANDUM OF DECISION
The plaintiff, Galfin, Inc., brings this action in six counts alleging violation of the Connecticut Unfair Trade Practices Act, breach of warranty, intentional misrepresentation, negligent misrepresentation, revocation of acceptance and recission due to mutual mistake. The defendant, Beauregard Equipment, Inc., denies the material allegations of the complaint, asserts special defenses of estoppel, waiver and failure to mitigate damages and counterclaims for attorneys fees.
The matter came before the court on July 12-13, 2010 for a trial on the merits. In addition to the testimony of the plaintiff's managing member, Real Gallant, and the defendant's president, Carl Beauregard, the deposition of Edward E. Cote, Jr. was introduced as evidence. The court finds the testimony of Gallant to be generally not credible, the testimony of Beauregard to be credible in part and not credible in part and the testimony of Cote to be generally credible. The court has reviewed and considered the testimony, the exhibits, the parties' memorandum of law and their closing arguments. After applying the law to the facts, judgment enters for the defendant on the complaint and for the plaintiff on the counterclaim.
FINDINGS OF FACT
In the spring of 2008, Edward Cote, a general contractor in Ashland, New Hampshire, decided to restrict his business to home remodeling. Accordingly he decided to replace his 1995 Komatsu excavator with a mini excavator. Cote contacted the defendant, Beauregard Equipment, Inc. a retail concern which sells and services new and used heavy construction equipment in three locations in northern New England.
Carl Beauregard, the defendant's president, gave Cote a price for a mini excavator and expressed an interest in taking the Komatsu as a trade-in. After not hearing from Cote for a couple of weeks, Beauregard called Cote who indicated that he had bought a mini excavator from another dealer. Undeterred Beauregard told Cote that he was interested in selling the Komatsu on consignment.
Beauregard has been in the construction equipment sales business for 36 years. During that time he has sold hundreds of new and used excavators.
In early May 2008, Beauregard traveled to Cote's office to inspect the Komatsu. Cote brought Beauregard to a nearby storage lot where he kept the excavator. Beauregard noted that the Komatsu had a blade attached to the front end, a bucket attached to a rear boom and a grappler which was not mounted. Beauregard then observed as Cote operated the excavator forward and backward a distance of 30-50 feet on level ground, swivelled the cab 360 degrees and raised and lowered the boom and the blade. Beauregard inspected the pins and bushings by running his hand across the undercarriage. He also noted that the hour meter read 512 hours which was an unusually low number of hours for a machine of its age. Cote explained that the original hour meter had broken at approximately 3300 hours and that he had replaced it. Beauregard told Cote that he was still interested in selling the Komatsu on consignment and that he would get back to him with an offer.
Beauregard testified that it is his practice when evaluating a used excavator to inquire of the seller as to the number of hours, the type of use it has been put to, all necessary repairs and its general condition. He also obtains the serial number, make and model. Beauregard followed that practice with the Komatsu. Beauregard thereafter faxed to Cote an offer to sell the Komatsu for $37,500 in exchange for a commission of $3,750 or 10%. Cote accepted this proposal and in early June 2008, Cote had the excavator delivered to Beauregard's dealership in Concord, New Hampshire. Upon arrival at the defendant's premises, the excavator was off-loaded by Cote's driver and driven approximately 100 yards to a storage area.
Beauregard placed an ad to sell the Komatsu on a website called machinerytrader.com. The ad contained six photographs of the Komatsu along with its year, model number, serial number, a sales price of $46,875 and general information about its condition, the size of its components, the number of hours of prior use and the fact that it had been recertified 512 hours ago.
In early June 2008, the plaintiff's managing member, Real Gallant was the owner of an inoperable Hitachi mini excavator and he was interested in upgrading to a larger unit. Gallant found the defendant's ad at machinerytrader.com, contacted the defendant and spoke to Beauregard. During numerous phone conversations over the succeeding ten days, Beauregard told Gallant that the Komatsu was in very good operating condition with no oil or hydraulic leaks, that it had been recertified within the past 512 hours, that he was selling it on consignment, that he had not inspected it in his shop and that his information regarding the Komatsu came from its owner. Beauregard also recommended that Gallant test drive the Komatsu in the defendant's test pit in Concord, but Gallant declined.
On June 9, 2008 Beauregard faxed a quote of $37,500 to Gallant which Gallant accepted subject to the availability of financing. Beauregard offered to locate a finance company and he approached CNH Capital America, LLC. Beauregard offered Gallant's purchase to CNH in exchange for 3% of the face value of the loan. CNH was interested but could only write the loan if a dealer, such as Beauregard Equipment, was the seller. Accordingly on June 13, 2008, the defendant purchased the Komatsu from Cote. On June 12, 2008, Beauregard faxed a completed copy of CNH's retail installment sales contract/security agreement and a bill of sale to Gallant. Gallant reviewed these documents which included the provisions stating that the Komatsu was being sold "as is" and without warranty, that he had examined the Komatsu and that the Komatsu was in good operating condition. In fact, neither Gallant, nor any agent of his, had ever examined or inspected the Komatsu. Gallant nevertheless signed the contract and the bill of sale and faxed the signed copies back to Beauregard. Delivery was arranged for the following day.
As promised, early on the morning of June 13, 2008, the Komatsu was transported to Gallant's home. Gallant gave the driver the signed original copies of the sales contract and bill of sale as well as a down payment check of $4,450 and the driver off loaded the Komatsu. According to Gallant, he then drove the excavator approximately 600 feet to the end of his driveway. He lowered the blade and attempted to push a pile of earth but the Komatsu had insufficient power to move the pile. Gallant also noticed that the Komatsu lacked power to go forward and backward when it was operated on soft surfaces. Gallant continued to use the Komatsu for approximately one hour but had no success in increasing its power.
Some three to four days later, Gallant informed Beauregard of the Komatsu's lack of power. Beauregard consulted with his service staff who recommended that Gallant release some of the tension from the tracks. Gallant followed this advice but it did not appreciably improve the Komatsu's performance. Beauregard agreed to attempt to further diagnose the issue with the Komatsu and on July 8, he brought the Komatsu back to his shop. The defendant's service technicians unsuccessfully spent many hours in an effort to find the cause of the lack of track power. Finally Beauregard called Cote.
Cote was surprised to hear that the Komatsu was not functioning properly and he directed Beauregard to Mel Willsey, a mechanic who had maintained the Komatsu for Cote. Willsey told Beauregard that he had replaced one of the final drives several years earlier and that he had last changed the lubricant for each of the final drives in the fall of 2007, some fourteen operating hours prior to the sale to the plaintiff. Willsey suggested that Beauregard drain the lubricant to see whether there were any foreign materials in them. After so doing, Beauregard found metal filings in the left hand final drive. Further inspection also showed significant wear in that drive. Either or both of these conditions could explain the power problems with the Komatsu.
Beauregard determined that the cost of repair would be approximately $10,000 and so informed Gallant. Beauregard sought a contribution from Cote but was rebuffed. Beauregard then offered to pay for the labor if Gallant would pay for the parts. Gallant insisted that the Komatsu was inoperable when delivered and refused to pay for the parts. On November 13, 2008, Gallant notified the defendant of its revocation of acceptance of the Komatsu. The Komatsu remained at the defendant's premises until repossessed by CNH and sold for $16,525 in 2010. As of the time of trial, Gallant had paid $9,204 in principal and $3,839 in interest to CNH but owed a balance of $9,510.99 as a deficiency amount.
Gallant financed $34,287 of the purchase price and agreed to pay that sum plus $7,453 in interest over 50 months.
Additional facts will be discussed as necessary.
DISCUSSION
I. THE COMPLAINT
A. Violation of the Connecticut Unfair Trade Practices Act
In the first count of the complaint, the plaintiff alleges that the defendant violated of the Connecticut Unfair Trade Practices Act (CUTPA) by misrepresenting the condition of the excavator, by refusing to repair the excavator and by "attempt[ing] to extract undisclosed finance fees, then unwarranted repair costs, and then additional profits through a bogus trade offers [sic]." The defendant denies the allegations and further claims that the plaintiff has failed to prove any of these acts caused it harm. The court agrees with the defendant.
"To prevail on a CUTPA claim, the plaintiffs must prove that (1) the defendant engaged in unfair or deceptive acts or practices in the conduct of any trade or commerce; General Statutes § 42-110b(a); and (2) each class member claiming entitlement to relief under CUTPA has suffered an ascertainable loss of money or property as a result of the defendant's acts or practices. General Statutes § 42-110g(a). The ascertainable loss requirement is a threshold barrier which limits the class of persons who may bring a CUTPA action seeking either actual damages or equitable relief. . . . Thus, to be entitled to any relief under CUTPA, a plaintiff must first prove that he has suffered an ascertainable loss due to a CUTPA violation. . . .
"A plaintiff also must prove that the ascertainable loss was caused by, or `a result of,' the prohibited act. General Statutes § 42-110g(a) . . . When plaintiffs seek money damages, the language `as a result of' in § 42-110g(a) requires a showing that the prohibited act was the proximate cause of a harm to the plaintiff. . . . [P]roximate cause is [a]n actual cause that is a substantial factor in the resulting harm. . . . The question to be asked in ascertaining whether proximate cause exists is whether the harm which occurred was of the same general nature as the foreseeable risk created by the defendant's act . . ." (Citations omitted; internal quotation marks omitted.) Artie's Auto Body, Inc. v. Hartford Fire Ins. Co., 287 Conn. 208, 217-19, 947 A.2d 320 (2008). See also, Scrivani v. Vallombroso, 99 Conn.App. 645, 652, 916 A.2d 827, cert. den., 282 Conn. 904, 920 A.2d 309 (2007) (to prevail under CUTPA, plaintiff must show both that the defendant engaged in a prohibited act and that the prohibited act was the proximate cause of harm to the plaintiff).
At trial Gallant testified that he purchased the Komatsu because his existing excavator, which was smaller and also inoperable, had been inadequate to move rock and ledge at his residence. Gallant further testified that within minutes of its delivery, he discovered the Komatsu lacked the power to push rock or other material or to travel on soft or inclined surfaces. He waited three-four days to notify the defendant of these deficiencies and Beauregard determined that the left hand final drive had failed. Beauregard put the total cost of repair at $10,000 but offered to do it for $6,000. After Gallant refused this offer, Beauregard offered to credit Gallant the entire purchase price of the excavator toward another machine. Gallant also refused this offer.
The defendant claims that the Komatsu was in good working condition when received from Cote and that it was in the same condition when delivered to Gallant. Beauregard, who has over thirty years experience with large construction equipment, testified that there are many circumstances under which a final drive might fail including misuse, over taxing the excavator's capabilities and normal wear and tear. Beauregard described the final drive as an 18-inch casing containing numerous gears, bearings and seals with a very close tolerance between the gears. The casing contains hydraulic fluid under high pressure and the life span of a final drive can be as long as 15,000-18,000 hours or as little as 1,000 hours. Beauregard further testified that once a final drive is damaged or begins to deteriorate, failure of the drive occurs very quickly. Beauregard claims that although he had no obligation to repair the Komatsu, he offered to absorb the cost of the labor to repair and to take the excavator as a trade-in for the sake of good customer relations. Finally, Beauregard concedes that he never informed Gallant that the defendant was to receive a commission from CNN for arranging financing.
Cote's deposition and his records were introduced at the trial. According to that evidence Cote had been a general contractor in central New Hampshire for fifteen years prior to his retirement. During those years, he owned and operated three excavators, two bulldozers, a backhoe, a grader and two dump trucks. He purchased the Komatsu on September 12, 2003, from a dealer in Michigan. The Komatsu had been recertified six months prior to his purchase and, at that time, it had 2,993 hours on the hour meter.
In the four years in which he owned it, Cote put 75-200 hours per year on the Komatsu and he replaced one of the final drives in 2004 or 2005. The evidence also shows that Cote took good care of the Komatsu. Notably he changed the oil, lubricants and hydraulic fluid every 100-200 hours and he repainted it. Beauregard's own examination of the excavator in May 2008 revealed that the undercarriage was clean with no oil or other fluid leaks. According to Cote, the excavator was in good working order when delivered to Beauregard for consignment and he was very surprised when Beauregard informed him that Gallant had had a problem.
In his testimony, Gallant additionally denied that the sale was on consignment or that he had purchased the Komatsu solely for personal use. Gallant's deposition testimony, however, belies his trial testimony. Moreover, despite his admission that he intended to use the excavator solely for personal purposes, the sales records show that Gallant made his limited liability company the purchaser. In his testimony, Gallant also admitted that he did not inspect the Komatsu prior to the sale and he denied that the Komatsu was in good working order. Gallant conceded, however, that he had read the parties' contract prior to signing it and that the contract averred he had examined the Komatsu prior to the sale, that the Komatsu was in good working order and that the purchase was not for personal use.
Gallant's efforts to portray himself as an unsophisticated buyer, of whom advantage was taken with unscrupulous contract provisions, is unavailing. At the time of the sale, Gallant was a mortgage broker who admittedly was familiar with contracts and commercial instruments. Moreover, he had previously been employed in used car sales and admittedly was familiar with "as is" sales and no warranty sales. Significantly, Gallant did not introduce any expert or other evidence in support of his claim that the Komatsu was inoperable when delivered. While ordinarily the absence of corroborating evidence might not prove fatal, in the present case, Gallant's testimony was the sole evidence before the court that the excavator was not in good working condition when it was delivered.
Having spent over $70,000 in attorneys fees to prosecute this action, it is inconceivable to the court that the plaintiff would not have presented such evidence if it existed.
Although the court did not have the opportunity to observe Cote testify, the court notes Cote had no motive to falsify his testimony and the substance of it rings true. The court thus finds it to be highly credible. The court did have the opportunity to listen to and observe the testimony of Gallant and Beauregard. The court has also read the transcript of their testimony and has reviewed the exhibits. After doing so, the court does not credit Gallant's testimony that Beauregard misrepresented the condition of the Komatsu.
The remaining evidence at trial also does not support Gallant's claim as to the condition of the Komatsu. The final drive lubricants had been replaced some fourteen operating hours prior to delivery and there was no evidence of drive failure at that time. In May 2008, Beauregard watched as Cote operated the excavator for 30-50 feet across Cote's storage lot, in early June, it was driven 100 yards across Beauregard's yard and in mid June was driven that same distance again when it was loaded for transport to Gallant. The driver who delivered the excavator to Gallant and off-loaded it did not report any problem with the machine. Additionally, according to Beauregard, the stress of the travel to Connecticut would have been insufficient to cause the drive to fail. Moreover, it strains credulity that Gallant, having just spent $37,500 for an inoperable machine, would have waited three-four days to notify Beauregard. Thus none of the credible evidence at trial supports Gallant's claim as to the condition of the Komatsu.
The plaintiff's failure to prove, as an initial matter, that Beauregard misrepresented the condition of the Komatsu is fatal to its CUTPA claim. It is also dispositive of its related claims that the defendant unreasonably refused to repair the Komatsu and attempted to extract unwarranted repair costs.
Next the plaintiff alleges that Beauregard misrepresented the timing of the recertification of the excavator, failed to disclose certain finance fees, represented the Komatsu was not a gray market machine and made bogus trade-in offers to him. Even if true, the plaintiff has failed to prove that these actions were the proximate cause of any loss to him. Stated differently, the proximate cause of any loss to Gallant was the failure of the left final drive, not any representations by Beauregard as to recertification, finance fees, provenance or trade-in offers.
B. Revocation of Acceptance
In the second count of the complaint, the plaintiff claims that it revoked its acceptance of the Komatsu, pursuant to § 42a-2-608 of the Uniform Commercial Code, and that the defendant has refused to return the purchase price. The defendant denies that the plaintiff was justified in revoking its acceptance. The court agrees with the defendant.
General Statutes § 42a-2-608 provides: "The buyer may revoke his acceptance of a lot or a commercial unit whose nonconformity substantially impairs its value to him if he has accepted it (a) on the reasonable assumption that its nonconformity would be cured and it has not been seasonably cured; or (b) without discovery of such nonconformity if his acceptance was reasonably induced either by the difficulty of discovery before acceptance or by the seller's assurances. (2) Revocation of acceptance must occur within a reasonable time after the buyer discovers or should have discovered the ground for it and before any substantial change in condition of the goods which is not caused by their own defects. (3) A buyer who so revokes has the same rights and duties with regard to the goods involved as if he had rejected them." "Where . . . the buyer rightly rejects or justifiably revokes acceptance then with respect to any goods involved, and with respect to the whole if the breach goes to the whole contract . . . the buyer may cancel and . . . recover so much of the price as has been paid . . ." General Statutes § 42a-2-711(1). "Whether goods are substantially impaired by non-conformity and whether revocation of acceptance is given within a reasonable time are questions of fact subject to the [trier]'s determination." Conte v. Dwan Lincoln-Mercury, Inc., 172 Conn. 112, 121, 374 A.2d 144 (1976).
In a footnote in its brief, the plaintiff first questions whether it had ever accepted the excavator in that it was "compelled to pay for the [Komatsu] prior to being able to inspect [it]." Plaintiff's Post-Trial Brief, p. 23 n. 5. Section 42a-2-512(2) of the Uniform Commercial Code provides that: "Where the contract requires payment before inspection . . . payment . . . does not constitute an acceptance of the goods . . ." This issue is easily disposed of for the reason that the contract between the parties did not require payment before inspection. Beauregard testified, and Gallant admits, that Beauregard recommended Gallant come to the defendant's sales lot and put the excavator through its paces prior to finalizing the sale. Thus the court concludes that the plaintiff accepted the Komatsu within the definition of the Uniform Commercial Code.
The plaintiff next claims that the value of the excavator was substantially impaired by its inoperable state. The plaintiff relies upon Tirado v. Ofstein, Superior Court, judicial district of Hartford, Docket No. CV-05-4014648-S (March 14, 2008) ( Bentivegna, J.), and Conte v. Dwan Lincoln-Mercury, Inc., supra, 172 Conn. 112, cases in which the plaintiffs purchased cars without discovery of any defects but thereafter revoked their acceptance when the cars became inoperable. Both Tirado and Conte are distinguishable from the present case.
In Tirado, the buyer test drove the vehicle prior to her purchase but some four days later, the vehicle became inoperable and needed a new engine. Although the trial court determined that the condition of the vehicle substantially impaired its value to her, it made no findings as to whether the defect had been difficult of discovery or whether the seller's assurances had induced her acceptance. Under the facts of that case, however, the court could well have found that since Tirado had driven the car prior to her acceptance and yet did not discover the defect, the defect had been difficult or incapable of discovery. Alternatively, since the court found that the seller committed fraud, it could also have concluded that the seller's fraud had reasonably induced her acceptance.
In Conte v. Dwan Lincoln-Mercury, Inc., supra, 172 Conn. 112, the vehicle in question was sold as a new vehicle, with a twelve-month repair or replacement warranty. Within a day of the buyer's acceptance, the car began to develop a series of different problems which resulted in it becoming inoperable on five separate occasions over the course of seven months. The buyer, at that point, informed the defendant that he was revoking his acceptance. At trial, the jury found in favor of the buyer. On appeal, the defendant seller challenged only the jury's conclusion that the condition of the vehicle substantially impaired its value to the buyer but did not challenge the jury's necessary predicate conclusion that the buyer's acceptance had been reasonably induced by the difficulty of discovery or by the seller's assurances. Moreover, in affirming the verdict, the Supreme Court discussed only the issue of substantial impairment.
The plaintiff also relies on Tibbetts v. Riverside Motorcars, LLC., Superior Court, judicial district of Ansonia-Milford, Docket No. CV-06-4006894-S (July 14, 2008) [ 45 Conn. L. Rptr. 866] ( Tyma, J.). Tibbetts is a decision on the plaintiff's post-judgment motion for attorneys fees after the trial court found the plaintiff justifiably revoked his acceptance of an automobile. The Tibbetts court's decision on attorneys fees makes reference to, but does not fully set forth the trial court's findings and conclusions on the question of difficulty of discovery or seller's assurances. Thus Tibbetts also lends no support to the plaintiff here.
In the present case, the court need not decide whether the plaintiff proved substantial impairment of value in that the plaintiff has failed to prove the necessary predicate facts to bring itself within the revocation statute. As stated previously, the plaintiff has failed to prove the excavator was nonconforming when accepted. The plaintiff has also failed to prove that his acceptance of the excavator was reasonably induced by the difficulty of discovery of any defect or by the seller's assurances. Gallant freely admits that he did not inspect or operate the Komatsu prior to the sale even though Beauregard recommended that he do so. It is inconceivable based upon the time line testified to by Gallant that had he put the Komatsu through its paces in the defendant's test pit, its defect would not have been discovered. Finally, as discussed more fully infra, reliance by Gallant on any statement of Beauregard that the excavator was in good working order was not sufficiently reasonable to justify the remedy of revocation. Accordingly, the plaintiff was not justified in revoking its acceptance of the excavator.
Section 42a-2-106(2) provides that "goods . . . are `conforming' or conform to the contract when they are in accordance with the obligations under the contract."
C. Breach of Warranty
In the third count of the complaint, the plaintiff alleges that Beauregard's representations that the Komatsu was in good working condition and that it was recertified 512 hours prior to the sale created express warranties as to the condition of the excavator. The defendant responds that the as is clause in the parties' contract disclaimed all warranties and, moreover, no statement of Beauregard created an express warranty. The court agrees with the defendant.
". . . General Statutes § 42a-2-313(1)(a) . . . provides that an express warranty is created by `[a]ny affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain . . .' Subsection (1)(b) provides that `[a]ny description of the goods which is made part of the basis of the bargain creates an express warranty that the goods conform to the description.' . . . The plaintiff bears the burden of proving the existence of an express warranty. The question of whether an express warranty exists is one of fact . . .
"The Uniform Commercial Code recognizes that some statements of sellers are merely `puffing' and do not create express warranties. Section 42a-2-313(2), for example, provides that `an affirmation merely of the value of goods or a statement purporting to be merely the seller's opinion or commendation of the goods does not create a warranty.' Drawing the line between puffing and the creation of a warranty is often difficult, but several factors have been identified as helpful in making that determination . . . One such factor is the specificity of the statements made. A statement such as `this truck will give not less than 15.1 miles to the gallon when driven at 60 miles per hour' is more likely to be found to create an express warranty than a statement such as `this is a top-notch car.' . . . Statements to the effect that a truck was in `good condition' and that a motor was in `perfect running order' have been held not to create express warranties . . . Another factor to be considered in determining whether a statement creates an express warranty is whether it was written or oral, the latter being more likely to be considered puffing . . ."
"The defendant [New London Motors] made various oral statements to the effect that the vehicle was `excellent,' in `mint' condition and that it was an `unusual' one. These statements certainly cannot be considered specific in nature. Moreover, the plaintiff was allowed to examine and test drive the vehicle prior to purchase. Under the facts of this case, the trial court's failure to find an express warranty . . . cannot be considered clearly erroneous." (Citations omitted.) Web Press Services Corp. v. New London Motors, Inc., 203 Conn. 342, 351-52, 525 A.2d 57 (1987).
The facts of the present case are indistinguishable from those of Web Press Services. Applying the principles of Web Press Services to the present case, the court concludes Beauregard's statement that the Komatsu was in good working condition, without more, did not create an express warranty as to the condition of the excavator.
Next the plaintiff claims that Beauregard represented the Komatsu had been recertified 512 hours prior to the sale. Even if this statement could be considered an express warranty, the plaintiff has failed to establish any connection between any misstatement as to the number of hours since recertification and the failure of the final drive. Beauregard's misstatement as to the number of hours was in no way the proximate cause of the failure of the final drive.
D. Intentional Misrepresentation
In the fourth count of the complaint, the plaintiff alleges that with intent to induce the plaintiff to purchase the Komatsu, Beauregard misrepresented the condition of the Komatsu, its provenance, its number of hours and its condition. Additionally the plaintiff claims that Beauregard failed to disclose the replacement of the hour meter.
"[A]t common law, fraudulent misrepresentation and intentional misrepresentation are the same tort." Kramer v. Petisi, 285 Conn. 674, 684 n. 9, 940 A.2d 800 (2008). "The essential elements of a cause of action in fraud 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 that false representation to his injury . . . All of these ingredients must be found to exist; and the absence of any one of them is fatal to a recovery . . ." (Citations omitted; internal quotation marks omitted.) Citino v. Redevelopment Agency, 51 Conn.App. 262, 275-76, 721 A.2d 1197 (1998).
As stated in the first part of this opinion, the plaintiff has failed to prove that the excavator was not in good working condition at the time of its delivery to Gallant. Thus Beauregard's statement to that effect was not false. Next Gallant claims, and Beauregard admits, that Beauregard informed Gallant the excavator was recertified 512 hours prior to the sale. There is no evidence before the court that Beauregard made this statement with intent to defraud or mislead Gallant. The evidence shows that Beauregard very likely assumed that the hour meter in the Komatsu, which showed 512 hours, had been replaced at the time the excavator was recertified. This misrepresentation was, at best, a negligent misstatement on Beauregard's part.
Next Gallant claims that Beauregard told him the Komatsu was not a gray market or Japanese made machine. The court credits Beauregard's testimony that he never told Gallant the Komatsu was a non Japanese machine. Notwithstanding this, even if Beauregard did so inform Gallant, Gallant has failed to show how he was damaged by this misrepresentation. Finally Gallant claims that Beauregard failed to disclose the replacement of the Komatsu's hour meter. The evidence shows that the ad for the Komatsu which appeared on machinerytrader.com disclosed that the excavator had been used for 3,812 hours. Indeed, Gallant admits that prior to the purchase, he was aware that the Komatsu had 3,812 hours on it. The plaintiff has thus failed to show how it was damaged by any failure to disclose the replacement of the hour meter.
E. Negligent Misrepresentation
The fifth count is merely a reformulation of the plaintiff's claims in the preceding count. "[A]n action for negligent misrepresentation requires the plaintiff to establish (1) that the defendant made a misrepresentation of fact (2) that the defendant knew or should have known was false, and (3) that the plaintiff reasonably relied on the misrepresentation, and (4) suffered pecuniary harm as a result." Nazami v. Patrons Mutual Ins. Co., 280 Conn. 619, 626, 910 A.2d 209 (2006). "Section 552B(1) of the Restatement (Second) of Torts provides: `The damages recoverable for a negligent misrepresentation are those necessary to compensate the plaintiff for the pecuniary loss to him of which the misrepresentation is a legal cause . . .'" Updike, Kelly Spellacy, P.C. v. Beckett, 269 Conn. 613, 645, n. 25, 850 A.2d 145 (2004).
As stated previously, Beauregard's statement that the excavator was in good working order was not a misstatement. Additionally, the plaintiff has wholly failed to prove that he suffered any damages as a result of any misrepresentation as to the provenance of the Komatsu, its number of hours or the failure to disclose the replacement of the hour meter. Accordingly this claim of the plaintiff also fails.
F. Mutual Mistake CT Page 18648
In the sixth count of the complaint, the plaintiff alleges it is entitled to a rescission of the contract in that the parties were mutually mistaken that the excavator was in good working order and had been recertified within 512 hours.
"Rescission of a contract on the ground of mutual mistake may be granted in a proper case where the mistake is common to both parties and by reason of it each has done what neither intended." (Citations omitted.) Buol Machine Co. v. Buckens, 146 Conn. 639, 641, 153 A.2d 826 (1959). In the present case, the plaintiff has failed to prove that the excavator was not in good working order at the time of its delivery. It follows, therefore, that the plaintiff has also failed to prove that the parties were mistaken as to its condition. Although the parties were mutually mistaken as to the timing of the recertification, under the facts of this case, this mistake was not a mistake of a material fact. Thus, without more, this mistake is insufficient to allow for recission of the contract.
In the court's opinion, neither party was mistaken as to the Komatsu's condition. Although Beauregard testified that he was mistaken as to the condition of the Komatsu, it is clear from his testimony that this conclusion was based solely on Gallant's representations to him and not on any other evidence. A mistake induced by self-serving representations of the other party can hardly be considered a mutual mistake. Additionally the court does not credit Gallant's testimony that he was mistaken as to the condition of the Komatsu.
II. THE COUNTERCLAIM
In its contingent counterclaim, the defendant claims that pursuant to the parties' contract, it is entitled to attorneys fees if the court finds for the defendant on the complaint. While neither admitting or denying this claim, the plaintiff asserts special defenses of subject matter jurisdiction and unenforceability of the contract due to intentional or negligent misrepresentation, unfair or deceptive trade practices, mutual mistake and unconscionability.
Paragraph nine of the Retail Installment Contract entered into by the parties provides that: ". . . [the plaintiff] shall reimburse [the defendant] or assignee . . . for any expense incurred by [the defendant] or the assignee . . . in protecting or enforcing their rights under this Agreement, including without limitation, reasonable attorneys fees and legal expenses. . . ." As evidence the defendant submitted an affidavit to the court detailing the cost of its attorneys fees to defend this action. The plaintiff counters that the defendant assigned of all of its rights and interests under the contract to CNH Capital thus precluding it from enforcing any right it may have had to attorneys fees. The defendant counters that despite its assignment to CNH, it retained the right to collect its legal fees by the use, in paragraph nine of the disjunctive `or.' The court agrees with the plaintiff.
In the first paragraph on page six of the parties' contract, the defendant assigned "all its rights, title and interest to the agreement and to the equipment to CNH Capital America LLC." By so doing, the defendant divested itself of any of its rights under the contract including its right to recover attorneys fees. To hold otherwise would render the defendant's assignment superfluous or meaningless as to paragraph nine. "[I]n construing contracts, we give effect to all the language included therein, as the law of contract interpretation . . . militates against interpreting a contract in a way that renders a provision superfluous." (Citation omitted; internal quotation marks omitted.) Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 14, 938 A.2d 576 (2008).
CONCLUSION
For the foregoing reasons, judgment enters in favor of the defendant on the complaint and in favor of the plaintiff on the counterclaim.