Opinion
No. CV 03-0828488
May 31, 2006
MEMORANDUM OP DECISION
Plaintiff, Scott Haber brings this action against defendant, New England Retail Properties, Inc. (hereinafter "NERP") in four counts: Count One — wrongful termination in violation of public policy; Count Two — wrongful termination in violation of plaintiff's constitutional right of free speech; Count Three — failure to pay wages in violation of Conn. Gen. Stat. § 31-72; and Count Four — breach of contract.
I. Counts One and Two
The facts are as follows respecting Counts One and Two:
Plaintiff was hired as a real estate salesperson by defendant, a commercial real estate brokerage firm, in April 2000. The terms of his relationship with the defendant was that plaintiff was entitled to commissions based upon the following schedule.
On gross commissions to NERP:
up to $74,999: 55% agent, 45% house;
up to $75 — $149,999: 60% agent 40% house;
up to $150,000 + — 65% agent, 35% house.
During his first two years with the defendant, plaintiff was successful and earned in 2000 commissions in the amount of approximately $40,000 and in 2001, in the amount of approximately $70,000 However, in the fall of 2001, his production fell off and he had only a few listings. The two principals of NERP, Mr. Mark D'Addabbo and Mr. Matthew J. Halprin became concerned that plaintiff might be planning to leave and take some of defendant's customers. Mr. D'Addabbo went to plaintiff's home in the afternoon of October 5, 2001 and a discussion ensued between them. Plaintiff and Mr. D'Addabbo gave conflicting versions of that conversation.
Plaintiff testified that he had approached Mr. D'Addabbo on several prior occasions, meaning four or five, regarding defendant's practice of having unlicensed agents working for his company. On the afternoon of October 5th the plaintiff testified that when Mr. D'Addabbo came to his house he "kept insisting he wanted his keys. `It's my office. They're my keys. Give them to me.' I kept asking him, `why?' He refused to tell me why."
Q: What happened after that?
A: I told Mr. D'Addabbo at a couple of points in the discussion that he better watch it, he better be careful, better watch what he's doing. I said to Mr. D'Addabbo — I said, Mark you've got unlicensed people working for you and I'll go to the Board.
Q: What was his response.
A: He told me, `Give me the keys. You're fired.' He grabbed the keys out of my hand. I opened the garage door for him and he left.
This is the version plaintiff gave at his hearing for unemployment compensation, but in his deposition, taken on March 23, 2006, plaintiff did not mention that defendant employed unlicensed sales people.
Mr. D'Addabbo testified that plaintiff had been a significant producer of a fair amount of revenue but recently he had not seen him around the office. He had looked at the listing sheets and saw that plaintiff had only one listing that he had secured himself and, "I was concerned that either Scott was, you know, off the road to success or it was conceivable that he was leaving our company to start another company or to go work with another firm."
When Mr. D'Addabbo came to the plaintiff's home on October 5th he asked plaintiff for his keys to the office.
Q: All right. Let me stop you there. Why were you asking him for his keys?
A: While I was suspicious or I had a concern that he might be coming into the office to take files, proprietary information . . . It crossed my mind that perhaps this was happening based upon the lack of phone calls, limited time in the office and the limited number of listing agreements that he had . . . I did ask him to come into the office on Monday morning and told him we would discuss, just have a discussion about this.
Q: Now when you asked him for his keys how did he respond?
A: He got very upset.
Q: And did he say anything?
A: Yes, he kept asking me if I was firing him.
Q: And what did you say?
A: I said no, we'll discuss it on Monday.
Q: Did he ever ask you why you wanted the keys?
A: Yes he did.
Q: And how did you respond?
A: I told him we would discuss it on Monday. He was very upset. I wanted the keys simply to protect the company. That's all I wanted to do. I just wanted to get the keys and talk to him on Monday about it . . .
Q: Did he ever threaten you in this conversation about reporting you because you had unlicensed sales people working for you?
A: Never.
Q: Did he ever mention to you in the office before this occasion that you had unlicensed sales people working for you?
A: Never. No. Not at all.
That weekend the plaintiff consulted with an attorney recommended by his wife who was a human resource manager at Hartford Insurance Company. The following Monday the Plaintiff went to defendant's office to collect his personal effects. Both the plaintiff, Mr. D'Addabbo and Mr. Halprin tried to talk to plaintiff about his leaving and plaintiff refused because he had been advised against it by his lawyer. Mr. D'Addabbo and Mr. Halprin told plaintiff "You're not fired. Why don't you come in and let's sit down." Mr. D'Addabbo testified in answer to the question "Did you ever fire Mr. Halprin?" that he absolutely had not.
Plaintiff testified at trial that he greatly admired Mr. Halprin and learned a great deal about the commercial real estate business from him. He also testified that in the fall of 2001 he had been in the process of adopting a child he and his wife deeply wanted. After he left defendant, plaintiff put the adoption on hold because he could not afford it and because he and his wife were developing problems in their marriage. In January 2002, his wife started a divorce action. In early 2002 plaintiff studied for and took the examination for a real estate brokerage license. When he passed, he started his own real estate firm in the early summer of 2002.
In Count One plaintiff alleges that he was fired because he accused the defendant of hiring unlicensed real estate personnel, which is a violation of Conn. Gen. Stat. § 20-312. In Sheets v. Teddy Frosted Foods, Inc., 179 Conn. 471 (1980) our Supreme Court recognized that an employee had a common-law action for wrongful discharge when the employee "can prove a demonstrably improper reason for the discharge, a reason whose impropriety is derived from some important violation of public policy." Id. at 475. In that case plaintiff alleged he was fired for complaining to his employer for its repeated violations of state law. In Faulkner v. United Technologies Corporation, 240 Conn. 576 (1997) our Supreme Court held that plaintiff alleged a valid cause of action when he was discharged in violation of federal public policy by claiming his employer engineered a scheme to defraud the United States Government. See also Morris v. Hartford Courant Co., 200 Conn. 676 (1986) and Magnan v. Anaconda Industries, Inc., 193 Conn. 558 (1984). In Count Two plaintiff alleges he was fired because he exercised his First Amendment right of free speech in accusing the defendant of employing unlicensed sales personnel. Conn. Gen. Stat. § 31-51q specifically provides that any employer "who subjects an employee to discipline or discharge on account of the exercise by such employee of rights guaranteed by the First Amendment of the United States Constitution or Sections 3, 4 or 14 of Article First of the Constitution of the State of Connecticut shall be liable to such employee for damages caused by such discipline or discharge, including punitive damages and for reasonable attorneys fees as part of the cost of any such action for damages."
Our courts have been guided by federal precedents construing the comparable federal statute, 42 U.S.C. Section 1983, Levy v. Commission on Human Rights Opportunities, 236 Conn. 96 (1996). Federal cases allow the plaintiff to recover if he was discharged for speaking out on matters of political, social or other concern to the community. Connick v. Myers, 461 U.S. 138 (1983); Johnson v. Ganim, 342 F.3d 105 (2d Cir. 2003). See also Lewis v. Cowen, 165 F.3d 154 (1999); and Glass v. Dachel, 2 F.3d 733 (1993).
In all of the cases for discharge because of accusing the employer of violating federal or state law or because of expressing matters of public concern there must be a causal connection between the discharge and the accusation or speech. Lowe v. Amerigas, 52 F.Sup. 349, 360 (D. Conn. 1999); D'Angelo v. McGoldrick, 239 Conn. 356, 363 (1996). In the instant case the plaintiff failed to prove that causation. Whatever plaintiff may have said to Mr. D'Addabbo on October 5, 2001 about defendant's use of unlicensed personnel, those words did not result in his firing. In fact, on that afternoon Mr. D'Addabbo did not intend to fire plaintiff at all. The court believes that Mr. D'Addabbo asked for the keys to the office in order to protect the security of the office. Plaintiff could reasonably have thought that being asked for the keys meant he was fired, but that was not Mr. D'Addabbo's intent. He kept saying "Let's discuss this on Monday." However, immediately after that Friday afternoon discussion with Mr. D'Addabbo, plaintiff sought an attorney and when he went to the office on Monday he refused to talk to Mr. D'Addabbo or to Mr. Halprin, although they insisted he was not fired.
Plaintiff's testimony that he was a "right and wrong guy" and defendant's allegedly using unlicensed personnel affronted him does not ring true. He had every incentive of staying with the defendant because he was receiving good compensation, anticipated earnings of over $100,000 in 2002, was learning a great deal from Mr. Halprin, and was in the process of adopting a child. It is clear to this court that plaintiff could have retained his job, but he was more interested in pursuing a lawsuit or some other agenda, such as starting his own firm, as he did six months later.
The court concludes that plaintiff was not fired on August 5, 2001 and most certainly was not fired because of accusing the defendant of violating the state real estate licensing law. As a consequence, Counts One and Two of plaintiff's complaint must fail.
II. Counts Three and Four
The Monday after October 5, 2001, when the plaintiff left the defendant's place of employment he was given a check for a real estate commission he had earned. Plaintiff testified that at that time he also gave the defendant a list of deals on which he was entitled to commissions. Mr. D'Addabbo denies this and insists that he did not receive that list until plaintiff provided it in response to a discovery request in December 2005. The court believes Mr. D'Addabbo on this point. On April 8, 2002, Mr. D'Addabbo wrote to the plaintiff requesting that the Plaintiff provide a list of deals remaining as to which he felt he may be entitled to any money. The letter goes on to state, "To ensure there is no misunderstanding between New England Retail Properties, Inc. and yourself, I will need to have you provide a conclusive list stating the transactions and remaining dollars to which you feel you were entitled as a result of your working here at New England Retail Properties, Inc." The plaintiff never responded to that request.
At the trial the Plaintiff endeavored to prove that he was entitled to commissions on two deals in which he was involved while working for the defendant. The first deal involved the leasing of space to Royal Buffet at Freshwater Commons in Enfield. Mr. Halprin obtained this listing but allowed the Plaintiff be a co-lister. The owner of Royal Buffet was induced to look at Freshwater Commons through Ryan Howse, an agent working with the defendant at the time. Ryan Howse, with the help of Mr. Halprin, negotiated the business terms of a signed letter of intent. Mr. Halprin negotiated the lease with the owner and after it was signed, he worked with the owner to get him to contribute to some building improvements and to get the deal approved through the town. Mr. Halprin conceded that plaintiff had some minor involvement in the lease negotiations and attended a few meetings. The lease was consummated in the latter part of 2002 and defendant received a gross commission of $50,400. In December 2005, plaintiff made a demand that his share of that commission amounted to $23,000. In his list of pending deals Plaintiff purportedly gave to the defendant when he left the firm in October 2001, but the court finds was not given until response to discovery in December 2005, plaintiff claimed his share of the Royal Buffet commission to be $10,080. He completely ignored the participation of Ryan Howse in the transaction.
Mr. Halprin testified the fairest way to divide that commission was as follows:
Commission $50,400
45% to defendant $22,680
55% to agents $27,720
18.3% to plaintiff $9,240
18.3% to Ryan Howse $9,240
18.3% to Matthew Halprin $9,240
The court finds this to be very a reasonable calculation and finds that plaintiff is entitled to the sum of $9,240 as his share of the commission in the Royal Buffet deal.
The second commission plaintiff contends he is entitled to involves the Auto Zone deal in Chicopee, Massachusetts. It is significant that his complaint filed in September 2003 never alluded to that deal and his list of commissions owed on pending deals, which he finally disclosed to the defendants in December 2005, did not refer to that deal.
The facts surrounding the deal are as follows:
Mr. Halprin had procured the listing from Attorney Draymore who owned the property in Chicopee, Massachusetts. Attorney Charles Gersten had referred Mr. Draymore to Matthew Halprin because of Attorney Gersten's longstanding relationship with Mr. Halprin. Mr. Halprin brought the plaintiff to a meeting with Mr. Draymore in Massachusetts and introduced him as the individual who would help market the property. Though the plaintiff signed the listing agreement with Attorney Draymore, he admitted that in fact he had absolutely nothing to do with bringing Auto Zone to the site. In fact, Auto Zone was not introduced to the property until some time during October 2002, several months after the defendant's listing on the property had expired and over a year after the plaintiff had left the company.
The original listing contained the following language, "If we provide a buyer or tenant who contracts or leases for the property subsequent to this agreement's expiration, you agree to pay us the full commission stated above." That listing agreement expired on May 31, 2002. On September 23, 2003, Mr. Halprin entered into a new brokerage agreement with Attorney Draymore which provided for a different commission structure. In February 2004, the defendants, primarily through the skillful negotiations of Mr. Halprin, realized a commission of $15,000 on the Auto Zone deal.
Plaintiff claims he is entitled to 60% of the listing brokers commission or $9,000, with the balance going to the defendant. However, he concedes that in view of the work Mr. Halprin performed to resurrect the deal, he should only receive half of the listing brokerage portion, or $4,500, for this transaction.
Although the defendant claims the plaintiff is entitled to nothing because the original listing agreement had expired and an entirely new one was arranged with the owner of the property, the original agreement did provide that even though the original listing agreement had expired, the agent would be entitled to a commission and it still pertained to the same property. Consequently the original agreement entitled Plaintiff to some portion of the commission realized.
Under the practice of the defendant, a listing agent received one-half of a commission and the selling or leasing agent received the other half of the realized commission. In this case the commission realized was $15,000. Since in 2004, when it was realized, the plaintiff had not brought in any commissions, in accordance with the schedule of the original arrangement with the defendant, the defendant was entitled to 45% of the commission and the agents were entitled to 55%. Although the plaintiff was listed as the listing agent on the Chicopee, Massachusetts property, in fact he was introduced to the deal by Mr. Halprin and clearly Mr. Halprin is a co-lister. Consequently the court calculates plaintiff's commission as follows:
Total Commission $15,000.00
45% to the defendant $6,750.00
Balance of the Commission $8,250.00
1/2 to Listing Agents, Halprin and Plaintiff $4,125.00
1/2 to Plaintiff as Co-Lister $2,062.50
Based on the foregoing, the court finds the plaintiff is entitled to commissions from the defendant of $9,240 on the Royal Buffet deal and $2,062.50 on the Auto Zone, Chicopee, Massachusetts deal, for a total of $11,302.50.
Plaintiff claims, pursuant to Sections 31-72, that he is entitled to twice the full amount of his unpaid commissions plus reasonable attorneys fees. Section 31-72 does provide:
"When an employer fails to pay an employee wages in accordance with the provisions of Sections 31-71a to 31-71i, inclusive . . . such employee . . . may recover, in a civil action, twice the fall amount of such wages with costs and such reasonable attorneys fees as may be allowed by the court."
However, in order to sustain a claim under that section, the court must find that the employer acted in bad faith, arbitrarily or unreasonably. Sansone v. Clifford, 219 Conn. 217, 229 (1991). In that case the court held that where there was an atmosphere of uncertainty as to the plaintiff's right for the claimed wages and where the plaintiff never submitted any bill and did not make written demand upon the city officials for payment of his salary, "[n]othing in the evidence compelled a finding that the failure to pay was the result of bad faith or unreasonableness." at 230. See also Matheson v. Great Eastern Development, Ltd., 18 Conn.App. 31 (1989).
In the instant case this court finds that the defendant did not act in bad faith, arbitrarily, or unreasonably. The defendant continued to make commission payments to the plaintiff after his departure in October of 2001. In April 2002 when Mr. D'Addabbo asked the plaintiff to give an accounting of what commissions he claimed to be owed to him, plaintiff never responded to that request until he filed a response to discovery in December 2005. During the pendency of this action, defendant served interrogatories on the plaintiff requesting all the evidence to support his commission claims. The plaintiff's response was, "We will provide a damage analysis at a later time." In another interrogatory the defendant asked for the amount in dollars of damages the plaintiff was claiming and the plaintiff responded he was claiming $120,000 for unpaid wages. Asked in another interrogatory to explain how he arrived at that number he responded, "We will provide a damage analysis at a later time." It was not until a pretrial in mid-December 2005 that the plaintiff finally responded to the defendant's request for details as to the commissions owed. As it turned out, he claimed he was owed on the Royal Buffet deal $23,000 and on the Auto Zone deal $27,000, plus commissions on other deals for which he had been paid before the pretrial.
On these facts, the court concludes that the defendant did not act in bad faith, arbitrarily, or unreasonably with respect to the commissions owed the plaintiff, but, rather, that the plaintiff himself was unreasonable in making conflicting demands for these commissions, withholding information as to his calculation of those commissions until the eve of the trial, and creating an atmosphere of uncertainty as to exactly what he was owed. Consequently plaintiff's claim for double damages or reasonable attorneys fees pursuant to Section 31-72 is denied.
Based on the foregoing, plaintiff may recover of the defendant the sum of $11,302.50.