Opinion
No. CV 08-5022428 S
August 4, 2010
MEMORANDUM OF DECISION
This action arises from the Easter morning, March 23, 2008 arrest of Albert Giusti stemming from his theft of bulk salvaged copper from Heavy Weight, Incorporated's warehouse in Cheshire, Connecticut. On August 12, 2008, Heavy Weight, the plaintiff, filed a nine-count complaint. Counts one through three are directed at Giusti, the defendant for the purposes of this decision, and allege conversion, civil theft and violation of CUTPA, respectively. The defendant asserted several special defenses and counterclaims in response to the plaintiff's complaint.
On June 3, 2010, the plaintiff filed a motion for summary judgment as to the special defenses and counterclaims asserted in the defendant's amended answer, dated July 22, 2009. The defendant filed his objection to the motion on July 15, 2010. The parties appeared for oral argument on July 19, 2010. Additional facts will be set forth as needed.
"Practice Book § 17-49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Provencher v. Enfield, 284 Conn. 772, 790-91, 936 A.2d 625 (2007).
"The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual 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 under Practice Book § [17-45]." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 312, 318-19, 901 A.2d 1207 (2006).
In his first special defense, the defendant argues that on March 23, 2008, the plaintiff's employees' access to the scrap metal, security system and property created the appearance that they had the authority to conduct the scrap metal transaction. "The rules that govern the determination of apparent authority in an agent require an examination of the acts of the principal, rather than of the agent . . . Apparent authority is the semblance of authority that a principal, through either acts or inadvertence, causes or allows third parties to believe his agent possesses." (Citations omitted; internal quotation marks omitted.) Norwalk v. Board of Labor Relations, 206 Conn. 449, 451, 538 A.2d 694 (1988). "[T]he acts of the principal must be such that (1) the principal held the agent out as possessing sufficient authority to embrace the act in question, or knowingly permitted him to act as having such authority, and (2) in consequence thereof the person dealing with the agent, acting in good faith, reasonably believed, under all the circumstances, that the agent had the necessary authority . . . The issue of apparent authority is one of fact, requiring the trier of fact to evaluate the conduct of the parties in light of all of the surrounding circumstances." (Citations omitted; internal quotation marks omitted.) Lettieri v. American Savings Bank, 182 Conn. 1, 8-9 437 A.2d 822 (1980).
The defendant's deposition, taken on September 29, 2009, demonstrates that Carlos Pena, his co-worker from Andy's Oil, asked him to take part in the scrap metal transaction that occurred on March 23, 2008. Giusti's role was to transport and offer for sale the copper from the plaintiff's warehouse in Cheshire. Pena brought Giusti to the plaintiff's warehouse where he came into contact with who he refers to as "the Mexicans." Giusti repeatedly stated that he thought the transaction was legitimate based solely on the fact that the Mexicans, the plaintiff's employees, had keys and access codes to open the gate where the copper was stored.
Giusti did not know on March 23, 2008 that the copper was owned by the plaintiff or that the "Mexicans" were employed by the plaintiff. He did not speak with them, as he did not speak Spanish. Rather, he relied solely on Pena to serve as an interpreter throughout the transaction. Pena had no connection whatsoever to the plaintiff or the plaintiff's business. In support of its opposition to this motion, the defendant offers the deposition of Lee Santopietro, a named co-defendant in this action. In his June 23, 2010 deposition, Santopietro confirms that his and the defendant's views as to the legitimacy of the transaction were based solely on the fact that the "Mexicans" had keys and access codes and opened the gate without breaking into it.
The viability of the defendant's assertion of apparent authority as a special defense to this action depends on whether the plaintiff's employees' access to the copper alone was sufficient for the defendant to infer that they possessed the authority to transport and sell the copper and additionally, whether the defendant reasonably believed, under all the circumstances, that the plaintiff's employees had the authority to transport and sell the copper. Although the court has its doubts about the reasonableness of the defendant's belief that he was involved in a legitimate business transaction on March 23, 2008, the issue of apparent authority is one of fact, requiring the trier to evaluate the conduct of the parties in light of all of the surrounding circumstances. As a result, the court denies the plaintiff's motion for summary judgment as to this special defense.
In his deposition, the defendant admitted that the transaction occurred in the early morning hours of Easter Sunday. Further, the defendant did not communicate directly with the plaintiff's employees because of the language barrier or otherwise verify that they were the owners of or had the authority to sell the metal. Additionally, the defendant paid cash for the copper and was not provided with a receipt.
The defendant asserts equitable estoppel as his second special defense. The doctrine of equitable estoppel is well established. "[T]here are two essential elements to an estoppel: the party must do or say something which is intended or calculated to induce another to believe in the existence of certain facts and to act upon that believe, and the other party, influenced thereby, must actually change his position or do something to his injury which he otherwise would not have done. Estoppel rests on the misleading conduct of one party to the prejudice of the other." (Internal quotation marks omitted.) LaSalle National Bank v. Freshfield Meadows, LLC, 69 Conn.App. 824, 838, 798 A.2d 445 (2002).
"Broadly speaking, the essential elements of an equitable estoppel . . . as related to the party to be estopped, are: (1) conduct which amounts to a false representation or concealment of material facts, or, at least, which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) the intention, or at least the expectation, that such conduct shall be acted upon by, or influence, the other party or other persons; and (3) knowledge, actual or constructive, of the real facts." (Internal quotation marks omitted.) Johnnycake Mountain Association v. Lana M. Oaks, 104 Conn.App. 194, 932 A.2d 472 (2007), cert. denied, 286 Conn. 906, 944 A.2d 978 (2008).
The court finds that the plaintiff is entitled to summary judgment as to this special defense. In the affidavit of John R. Hilzinger, president of Heavy Weight, dated June 1, 2010, he attests to the following. "From time to time Heavy Weight has provided certain agents, servants or employees with access codes and keys to its Cheshire warehouse facility, and those persons were only given said keys and access codes in order to facilitate Heavy Weight's customary business operations, which did not include retail sales from the warehouse location . . . [S]aid employees were only provided said keys and code in order to allow them to facilitate Heavy Weight's storage and inventory of its salvaged bulk scrap metals, during normal business hours, and in the ordinary course of Heavy Weight's business operations . . . [S]aid employees were never given permission or authority to perform such operations, and said employees were never given permission or authority to conduct cash sales from its warehouse facility at any time . . . Prior to March 23, 2008, Heavy Weight was not aware that one or more employees may have been improperly and illegally accessing Heavy Weight's storage warehouse and selling scrap copper therefrom."
The court is satisfied that the plaintiff has met its burden of demonstrating that there are no genuine issues of material fact as to the following. First, the plaintiff did not falsely represent or conceal any material facts in regard to its business or its employees' access to the warehouse. More significantly, the plaintiff did not intend to convey the impression to the defendant or anyone else that its employees had the authority to sell scrap metal from its warehouse. In fact, the president of the company attests that he did not know that Heavy Weight employees were improperly and illegally accessing Heavy Weight's storage warehouse in order to sell scrap copper. As such, the court grants summary judgment as to the defendant's second special defense.
In his first and second counterclaims, the defendant alleges negligent hiring and negligent supervision. Specifically, he alleges that the plaintiff is liable to the defendant because it hired illegal immigrants, who "demonstrated a willingness to break the law and engage in illegal behavior" and subsequently, failed to monitor their access to the scrap metal.
The Appellate Court has stated "that employers may be directly liable for the negligent hiring, retention or supervision of an employee who, through a tortious act, injures a third party." Seguro v. Cummiskey, 82 Conn.App. 186, 196, 844 A.2d 224 (2004). "A common-law claim in negligent hiring exists in any situation where a third party is injured by an employer's own negligence in failing to select an employee fit or competent to perform the services of employment." (Internal quotation marks omitted.) Seda v. Maxim Health Care Services, Superior Court, judicial district of Hartford, Docket No. CV 07 5010811 (April 8, 2008, Elgo, J.); see also Shore v. Stonington, 187 Conn. 147, 155, 444 A.2d 1379 (1982).
As with any negligence action, a plaintiff alleging negligent hiring must demonstrate a breach of duty on the part of the defendant. Moreover, "[t]he existence of a duty is question of law." Shore v. Stonington, supra, 187 Conn. 151. "Existing Connecticut precedents impose only a limited duty to take action to prevent injury to a third person . . . [A]bsent a special relationship of custody or control, there is no duty to protect a third person from the conduct of another . . . In any determination of whether even a special relationship should be held to give rise to a duty to exercise care to avoid harm to a third person, foreseeability plays an important role." (Citations omitted; internal quotation marks omitted.) Fraser v. United States, 236 Conn. 625, 632, 674 A.2d 811, cert. denied, 519 U.S. 872, 117 S.Ct. 188, 136 L.Ed.2d 126 (1996).
"Whether the claim is for negligent hiring, negligent supervision or negligent retention, a plaintiff must allege facts that support the element of foreseeability." (Internal quotation marks omitted.) Engle v. Bosco, Superior Court, judicial district of New Britain, Docket No. CV 05 4006996 (September 14, 2006, Robinson, J.). "Our Superior Court has interpreted this foreseeability requirement as one in which the employer knew or should have known of the employee's propensity to engage in the alleged harmful conduct." (Internal quotation marks omitted.) Ritacco v. Archila, Superior Court, judicial district of New London, Docket No. CV 08 5006526 (December 31, 2008, Martin, J.).
In the present case, Hilzinger attests: "Prior to March 23, 2008, Heavy Weight had no knowledge of any prior criminal activity of any of its employees, all employees were properly entered into Heavy Weight's payroll system, and Heavy Weight paid all required state and federal payroll taxes, and performed all required payroll withholding, for said employees . . . I do not personally know which Heavy Weight employees, if any, were involved in the activities that occurred on Easter Sunday morning, March 23, 2008." In light of this evidence, the court finds that the plaintiff has met its burden of showing that there is no genuine issue of material that it had no knowledge of the employees' alleged propensity to engage in illegal conduct. As a result, the plaintiff is entitled to summary judgment on the defendant's counterclaims alleging negligent hiring and supervision.
In his third counterclaim, the defendant alleges that the plaintiff's hiring of illegal immigrants violated the Connecticut Unfair Trade Practices Act, § 42-110a et seq. As a preliminary matter the court notes that it is well established that: "[S]tanding . . . implicates a court's subject matter jurisdiction, which may be raised at any point in judicial proceedings." Stamford Hospital v. Vega, 236 Conn. 646, 656, 674 A.2d 821 (1996).
Moreover, the Supreme Court has stated: "[I]t strains credulity to conclude that CUTPA is so formless as to provide redress to any person, for any ascertainable harm, caused by any person in the conduct of any trade or commerce . . . Thus, notwithstanding the broad language and remedial purpose of CUTPA, we have applied traditional common-law principles of remoteness and proximate causation to determine whether a party has standing to bring an action under CUTPA." (Citation omitted; internal quotation marks omitted.) Vacco v. Microsoft Corp., 260 Conn. 59, 88, 793 A.2d 1048 (2002).
In Ganim v. Smith Wesson Corp., 258 Conn. 313, 372-73, 780 A.2d 98 (2001), the Supreme Court reasoned that: "[T]he ascertainable loss requirement of CUTPA does not displace the remoteness doctrine as a standing limitation . . . [A]pplying [the principle of ascertainable loss] to confer standing . . . irrespective of the remoteness doctrine, would render CUTPA virtually limitless. We do not think that the legislature intended such a result . . . If the only standing requirement under CUTPA were that, as a result of [a] defendant's prohibited conduct, the plaintiff suffered an `ascertainable loss of money or property' then any plaintiff who could, in a `but for' cause sense, trace his or her loss to the defendant's wrongful conduct, would have standing to assert a CUTPA claim against the defendant, irrespective of how remote or derivative that loss was. That would render CUTPA subject to yielding bizarre results. We do not read statutes to yield such results . . . and CUTPA is no exception." (Citation omitted.); see also Vacco v. Microsoft Corp., supra, 260 Conn. 90-92.
The Ganim court described the remoteness/standing test as follows: "[T]hree policy factors . . . guide courts in their application of the general principle that plaintiffs with indirect injuries lack standing to sue . . . First, the more indirect an injury is, the more difficult it becomes to determine the amount of . . . damages attributable to the wrongdoing as opposed to other, independent factors. Second, recognizing claims by the indirectly injured would require courts to adopt complicated rules apportioning damages among plaintiffs removed at different levels of injury from the violative acts, in order to avoid the risk of multiple recoveries. Third, struggling with the first two problems is unnecessary [when] there are directly injured parties who can remedy the harm without these attendant problems." (Citation omitted; internal quotation marks omitted.) Id., 353.
In the present case, the court finds as a matter of law that the defendant does not have standing to pursue a CUTPA claim against the plaintiff and as a result, the plaintiff is entitled to dismissal of this counterclaim. Hilzinger's affidavit demonstrates that prior to March 23, 2008, the plaintiff was not aware that one or more of its employees had been improperly and illegally accessing its storage warehouse and selling scrap copper. Furthermore, prior to March 23, 2008, the plaintiff had no knowledge of any prior criminal activity of any of its employees.
In light of this evidence, the court finds that the defendant's damages are simply too remote and derivative for the defendant's CUTPA claim to stand. To rule otherwise, would yield "bizarre results." Contra Pinto Lavado Enterprises, Inc. v. Allstate Cleaning, Inc., Superior Court, judicial district of New London, Docket No. 522150 (June 7, 1995, Hurley, J.) (both parties were in the commercial floor cleaning business and plaintiff alleged defendants' practice of hiring illegal immigrants violated CUTPA because defendants unfairly competed with plaintiffs by circumventing wage and labor laws that reduced their total overall cost of operation).
CONCLUSION
The court hereby denies summary judgment as to the defendant's first special defense. The court hereby grants summary judgment as to the defendant's second special defense and first, second, and third counterclaims.