Opinion
FSTCV156025367S
04-12-2016
Meyer Building Co., LLC v. Simon Rebbechi
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
David R. Tobin, Judge Trial Referee.
The plaintiff commenced this action on May 19, 2015, filing a single-count complaint alleging that the defendant breached a home improvement contract for the renovation of the defendant's residence, located in Rowayton, Connecticut, by wrongfully terminating the contract and failing to pay the plaintiff the sums due under the contract. On August 17, 2015, the defendant filed an answer and special defenses denying the allegations of breach and asserting three special defenses: accord and satisfaction; payment of the balance due; and allegations that the plaintiff's claims are barred by the Home Improvement Act, General Statutes § 20-418 et seq. Specifically, the defendant claims that the contract violates the Home Improvement Act because it fails to contain the entire agreement between the parties, fails to contain a notice of the owner's cancellation rights, and certain change orders were not signed by all necessary parties.
On November 24, 2015, the defendant filed a motion for summary judgment based on his claims that the plaintiff could not maintain an action to enforce the contract because the contract failed to comply with the requirements of the Home Improvement Act. On February 5, 2016, the plaintiff filed an opposition to the motion for summary judgment claiming that any defects in the contract's compliance with the Home Improvement Act were overridden by the defendant's bad faith in terminating the contract. On the same day, the defendant filed a motion to amend its complaint to assert a claim for attorneys fees based on the defendant's alleged bad faith.
On February 25, 2016, the defendant filed additional documents supplementing his motion for summary judgment On February 29, 2016, after hearing argument from counsel, the court offered the parties the opportunity to re-file the motion for summary judgment and the opposition thereto in order to provide the court with coherent sets of papers to decide the motion. The defendant re-filed his motion for summary judgment on March 2, 2016 and the plaintiff re-filed his opposition on March 4, 2016. The court heard additional oral argument from the parties at short calendar on March 7, 2016.
DISCUSSION
" [A]ny party may move for a summary judgment as to any claim or defense as a matter of right . . ." Practice Book § 17-44. " Summary judgment is a method of resolving litigation when 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 . . . The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried . . . However, since litigants ordinarily have a constitutional right to have issues of fact decided by a jury . . . the moving party for summary judgment is held to a strict standard . . . of demonstrating his entitlement to summary judgment." (Citation omitted; footnote omitted; internal quotation marks omitted.) Grenier v. Commissioner of Transportation, 306 Conn. 523, 534-35, 51 A.3d 367 (2012). " In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact . . . To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact . . . As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent . . ." (Internal quotation marks omitted.) Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 10-11, 938 A.2d 576 (2008).
In relevant part, General Statutes § 20-429 provides that " [n]o home improvement shall be valid or enforceable against an owner unless it: (1) Is in writing, (2) is signed by the owner and the contractor, (3) contains the entire agreement between the owner and the contractor, (4) contains the date of the transaction, (5) contains the name and address of the contractor and the contractor's registration number, (6) contains a notice of the owner's cancellation rights in accordance with the provisions of chapter 740, (7) contains a starting date and completion date, (8) is entered into by a registered salesman or registered contractor, and (9) includes a provision disclosing each corporation, limited liability company, partnership, sole proprietorship or other legal entity, which is or has been a home improvement contractor pursuant to the provisions of this chapter or a new home construction contractor pursuant to the provisions of chapter 399a."
In interpreting the Home Improvement Act, the Supreme Court has previously held that a contractor who fails to comply with the act is prohibited from recovery under either a breach of contract claim or quasi-contractual methods of recovery, such as unjust enrichment or quantum meruit. Liljedahl Bros., Inc. v. Grigsby, 215 Conn. 345, 350, 576 A.2d 149 (1990); A. Secondino & Son, Inc. v. LoRicco, 215 Conn. 336, 340, 576 A.2d 464 (1990); Barrett Builders v. Miller, 215 Conn. 316, 322-23, 576 A.2d 455 (1990). In Habetz v. Condon, 224 Conn. 231, 618 A.2d 501 (1992), however, the Supreme Court articulated an exception to their previous holdings and held that a homeowner could not invoke the protections of the Homeowner Improvement Act when the homeowner terminated the contract in bad faith. The Supreme Court stated that " we recognized that proof of bad faith on the part of the homeowner is an exception to what might otherwise be a harsh lesson to the home improvement contractor unable to recover due to a violation of the act. The central element giving rise to this exception is the recognition that to allow the homeowner who acted in bad faith to repudiate the contract and hide behind the act would be to allow him to benefit from his own wrong, and indeed encourage him to act thusly. Proof of bad faith therefore serves to preclude the homeowner from hiding behind the protection of the act." Id., 237. " Thus, a contractor, otherwise precluded from recovering moneys owed for his work because of a violation of the act, must be permitted to assert that the homeowner's bad faith precludes him from safely repudiating the contract and hiding behind the act in order to bar the contractor's recovery." Id., 238.
In Habetz, the defendant contractor allegedly violated the Home Improvement Act by failing to provide adequate notice of the homeowner's cancellation rights in the contract. Id., 235. Although this allegation constitutes a violation of the Homeowner Improvement Act, the Supreme Court held that " [t]he law does not permit the exercise of a right to repudiate a contract when the exercise of such a right in bad faith would work an injustice." Id., 238. In Habetz, the Supreme Court defined bad faith as " both actual or constructive fraud, or a design to mislead or deceive another, or a neglect or refusal to fulfill some duty or some contractual obligation, not prompted by an honest mistake as to one's rights or duties, but by some interested or sinister motive . . . Bad faith means more than mere negligence; it involves a dishonest purpose." (Citation omitted; internal quotation marks omitted.) Id., 237. The homeowner's bad faith in Habetz included his request for extra work to be performed then failing to sign agreed upon change orders to the contract despite repeated requests from the contractor to do so. Id., 233. In a footnote, the Supreme Court noted that the trial court had found that the plaintiff's bad faith had " permeated the dealings between the parties and thus related to work performed under the original contract as well as the list of extras." Id., n.8. " It is the burden of the party asserting the lack of good faith to establish its existence and whether that burden has been satisfied in a particular case is a question of fact." Id., n.11.
In 1993, the legislature amended the Home Improvement Act by adding subsection (f) to General Statute § 20-429 which reads: " [n]othing in this section shall preclude a contractor who has complied with subdivisions (1), (2), (6), (7)and (8) of this section from the recovery of payment for work performed based on the reasonable value of services which were requested by the owner, provided the court determines that it would be inequitable to deny such recovery." " Recognizing that strict enforcement of the Home Improvement Act sometimes leads to harsh results, the new subsection affords access to equitable relief for home improvement contractors who meet some, but not all of the requirements stated in the remainder of the statute." New England Custom Concrete, LLC v. Carbone, 102 Conn.App. 652, 659, 927 A.2d 333 (2007).
These aforementioned subsections require that the contract: " (1) Is in writing, (2) is signed by the owner and the contractor . . . (6) contains a notice of the owner's cancellation rights in accordance with the provisions of chapter 740, (7) contains a starting date and completion date, (8) is entered into by a registered salesman or registered contractor . . ."
In the present case, the plaintiff's complaint alleges that his contract with the defendant was terminated not for cause, but rather for the defendant's convenience and, therefore, the defendant owes the plaintiff the gross balance due on the contract plus overhead and profit on the work not executed. No additional claims are set forth alleging that the plaintiff is entitled to the reasonable value of work actually performed. The complaint alleges that the plaintiff's damages consist of $19,640.99 for work performed and $56,220.76 for " reasonable overhead and profit on the Work not executed." The plaintiff alleges that, in total, the defendant owes $75,861.75. The court concludes that the plaintiff has elected to not avail itself of the potential benefits of § 20-429(a)(1). Thus, it appears that, absent proof of the defendant's bad faith in repudiating the contract, the plaintiff cannot prevail on his breach of contract claim if the court determines that the home improvement contract prepared by the plaintiff fails to satisfy any of the requirements of § 20-429(a)(1) through (8). The plaintiff claims that the question of the defendant's bad faith in repudiating the contract presents a genuine issue of material fact and, therefore, the court should deny summary judgment.
In his motion for summary judgment, the defendant alleges that the home improvement contract between the parties is deficient in three respects. First, that the contract does not contain the entire agreement between the owner and the contractor in violation of § 20-429(a)(3). Second, that the contract fails to provide adequate notice of the owner's cancellation rights in violation of § 20-429(c) and chapter 740. Third, that certain change orders that purported to amend the contract were not signed in violation of § 20-429(a)(2). The court will subsequently address each of these allegations in turn. The defendant further alleges that the plaintiff failed to properly allege that the defendant acted in bad faith. The defendant contends there are no genuine issues of material fact because the plaintiff violated the home improvement act and failed to properly plead the bad faith exception; therefore, the defendant is entitled to summary judgment.
Preliminarily, the court must address the admissibility of the defendant's exhibits. " [B]efore a document may be considered by the court [in connection with] a motion for summary judgment, there must be a preliminary showing of [the document's] genuineness, i.e., that the proffered item of evidence is what its proponent claims it to be . . . Documents in support of or in opposition to a motion for summary judgment may be authenticated in a variety of ways, including, but not limited to, a certified copy of a document or the addition of an affidavit by a person with personal knowledge that the offered evidence is a true and accurate representation of what its proponent claims it to be." (Citation omitted; internal quotation marks omitted.) Bruno v. Geller, 136 Conn.App. 707, 714-15, 46 A.3d 974, cert. denied, 306 Conn. 905, 52 A.3d 732 (2012). The trial court has discretion in determining whether to consider documentary evidence submitted by a party in support of or in opposition to a motion for summary judgment to which there is no objection. See Bruno v. Whipple, 138 Conn.App. 496, 506, 54 A.3d 184 (2012). In the present case, the plaintiff did not object to the admissibility of any of the defendant's documents. " [T]hus, 'any objection is deemed waived and all documents are admissible' within the court's discretion." Tassmer v. McManus, Superior Court, judicial district of New Haven, Docket No. CV-09-5028470-S, (January 15, 2010, Wilson, J.).
1. CONTRACT DID NOT CONTAIN ENTIRE AGREEMENT
The defendant claims that the contract signed by the parties fails to contain the entire agreement between the parties because the contract utilized the American Institute of Architects (AIA) Document A105-2007, which is the standard form of agreement between owner and contractor for a residential or small commercial project. The defendant alleges that the plaintiff should have used AIA Document A141-2014 instead, which is the standard form of agreement between owner and design builder. The defendant asserts that as a result of the choice of the inappropriate form the agreement refers to an independent architect when, in fact, no such architect was involved in the project. The defendant alleges that the contract fails to contain the entire agreement between the parties because the agreement contains provisions which are inapplicable to the project at issue. However, the defendant does not identify any essential term & the agreement between the parties that was missing from the written contract, only provisions which were extraneous to their understandings.
The defendant fails to cite any case law supporting his position that the inclusion of extraneous or ambiguous provisions in a home improvement contract violates § 20-429(a)(3). The defendant has failed to show that either some essential term to the contract was missing or that the inclusion of extraneous terms in the contract would invalidate the contract under § 20-429. The defendant, as the moving party, has failed to meet his burden of showing that there are no genuine issues of material facts with respect to the allegation that the entire agreement was not contained in the document.
2. CONTRACT FAILED TO INCLUDE CANCELLATION RIGHTS
The defendant's second claim is that the contract fails to comply with the provisions of Chapter 740. Specifically, the defendant contends that the body of the contract does not refer to the owner's cancellation rights " in ten-point, boldface type, in immediate proximity to the signature line, " which is in violation of General Statutes § 42-135a. The defendant relies on Kronberg Bros., Inc. v. Steele, 72 Conn.App. 53, 804 A.2d 239 (2002), in which the Appellate Court affirmed the decision of the trial court finding in favor of a homeowner and against a contractor based on the contractor's failure to comply with the Home Improvement Act with respect to the notice of cancellation rights. In the present case, the defendant alleges that because no such notice of cancellation form appears within the body of the contract, that the plaintiff violated the requirements of the Home Improvement Act.
The contract signed by the parties is attached to the affidavit of the defendant as an exhibit. Page twelve of the contract bears the signatures of the president of the plaintiff, which is dated July 11, 2014, and the purported undated signature of the defendant. The next page of the contract contains a Certification of Document's Authenticity (AIA Document D401-2003), which is signed by the plaintiff and dated July 11, 2014. The next page is the Notice of Right of Rescission, which is dated June 10, 2014.
In Kronberg, upon which the defendant's argument relies, the Appellate Court noted that in Wright Bros. Builders, Inc. v. Dowling, 247 Conn. 218, 231, 720 A.2d 235 (1998), the Supreme Court stated: " While the purposes of the statute are advanced by an interpretation that makes compliance with the requirements of § 20-429(a) mandatory, it does not necessarily follow that advancement of that purposes, also requires that the mandatory compliance with each subsection be technically perfect." Kronberg Bros., Inc. v. Steele, supra, 72 Conn.App. 58. The problem with the notice in Dowling was that it failed to contain the date of the transaction and the date on which the defendants could cancel. Id., 59. In Wright Bros., the Supreme Court noted that both dates could be found by " even the most cursory review of the contract" and held that " [u]nder the circumstances" the deviation did not compel the conclusion that the contract was not compliant with the act. Wright Bros. Builders, Inc. v. Dowling, supra, 234. The Appellate Court did not reach the same result as Dowling noting that, in the case before it, " not only did the cancellation notice fail to contain the date of the transaction and the date by which the defendants could cancel, the contract itself lacked a transaction date. Furthermore, the contract did not contain the required cancellation notice in immediate proximity to the space provided in the contract for the signature of the buyer." Kronberg Bros., Inc. v. Steele, supra, 59.
Recently, the Appellate Court upheld an arbitration award in a dispute between an owner and a home improvement contractor. Ippolito v. Olympic Constr., 163 Conn.App. 440 (2016). The owner claimed that a notice of cancellation rights was either absent or not set forth in close proximity to the signature line. Id., 453. The arbitrator noted that immediately above the signature line was the statement that the contract includes AIA Document A201--General Conditions of the Contract for Construction, a separate thirty-nine page document Id. The owner's cancellation rights were set forth on the thirty-eighth page of AIA Document A201. Id., 450. Relying on Dowling, the Appellate Court found that the arbitrator's finding that the contract did not violate the Home Improvement Act did not demonstrate a manifest disregard for the law and declined to set aside an award in favor of the contractor pursuant to § 52-418(a)(4). Id., 455-56.
In its opposition to the defendant's motion for summary judgment, the plaintiff included exhibit J, an excerpt from the deposition of the defendant in which the defendant testifies that he did not read the contract before signing. The court finds that the failure of the defendant to read the contract may well be considered " circumstances" which can be considered in determining whether the plaintiff's failure to comply with all technical requirements of § 20-429 renders the home improvement contract unenforceable. See Wright Bros. Construction, Inc. v. Dowling, supra, 247 Conn. 234. The defendant has failed to meet his burden of showing that no genuine issue of material fact exists as to whether the cancellation notice in the subject contract violated § 20-429.
3. CONTRACT CONTAINED UNSIGNED CHANGE ORDERS
The defendant's third claim for summary judgment is that " a number of Change Orders . . . were never signed by [the defendant] or [defendant's wife]." The defendant claims that the plaintiff's failure to obtain the defendant's signature on the change order is a violation of § 20-429(a)(2). Specifically, the defendant claims that change orders numbers 4, 5, 8, 10, 12, 13, 14, and 15 were not signed. In response, the plaintiff argues that either the work identified in the change orders was ultimately not performed, or that the plaintiff received email approval for the change orders.
The defendant's claim that the failure to obtain the homeowner's signature on change orders constitutes a violation of § 20-429(a)(2) is based on All Am. Custom Pools & Spas v. Schwindeman, Superior Court, judicial district of Stamford, Docket No. FST 04-4001335 S, (March 9, 2007, Downey, J.). In that case, the home improvement contractor entered into a written agreement with homeowners to install a pool on their property for a stated price of $85,500. Id. When rock was encountered in excavating for the pool, additional costs were incurred. Id. The parties disagreed as to whether they had reached agreement on 1) capping the cost of additional site work at $10,000; 2) capping such costs at $25,000; or 3) not imposing any costs on the additional site work. Id. The plaintiff contractor presented the defendant homeowners with a bill for $157,877, which was $65,135 more than the contract price. Id. At that point, after the homeowners had paid the contractor $55,585, the pool was not yet complete and they refused to pay the contractor more. Id. Thereafter, the contractor engaged in outrageous behavior threatening the homeowner's builder with violence and threatening to bury him beneath the pool. Id. The homeowners refused to work with the contractor any further and paid another contractor $66,081 to complete the pool. Id. After discussing the elements of each contract violation and tort alleged in the complaint and in the defendants' counterclaim, the court simply stated: " Certain change orders were not signed by the homeowners. The contract with All American did not comply with the Home Improvement Act." Id. The court in Schwindeman did address the then recent case of Economos v. Liljedahl Bros., Inc. in which the Supreme Court stated: " It is undisputed that the Home Improvement Act § 20-429(a) is the applicable law; it is not, however, well defined. Section 20-429(a) explicitly requires, inter alia, that a home improvement contract be in writing and signed by the owner and the contractor in order to be valid and enforceable against an owner. Even if we were to assume, however, that the plain language of § 20-429(a) requires change orders to be signed by both the owner and the contractor, that subsection cannot be read by itself when evaluating the arbitrator's actions in the present case. We construe a statute as a whole and read its subsections concurrently in order to reach a reasonable overall interpretation." (Footnote omitted; internal quotation marks omitted.) Economos v. Liljedahl Bros., Inc. 279 Conn. 300, 309, 901 A.2d 1198 (2006).
Based on the above-cited case law, the court cannot conclude that there are no genuine issues of material fact relating to the work performed under the change orders, including whether the failure of the defendant to sign certain change orders: 1) does not preclude the plaintiff from recovering under the contract and all the change orders, signed and unsigned; 2) only precludes the plaintiff from recovering under the unsigned change orders; 3) precludes the plaintiff from recovering under all of the change orders, signed and unsigned; or 4) precludes the plaintiff from recovering under the contract or any of the change orders. With these questions unanswered, the defendant has failed to meet his burden of showing that there are no genuine issues of material fact.
CONCLUSION
The court finds that the defendant has not demonstrated the absence of a genuine issue of material fact relevant to the question of whether the plaintiff is precluded from asserting claims against the defendant because of the plaintiff's non-compliance with the Home Improvement Act. In light of this finding, the court finds that it is unnecessary to address the question as to whether there are any issues of material fact concerning the plaintiff's claim that the defendant's reliance on the plaintiff's violations of the Home Improvement Act is barred by the defendant's bad faith.
The defendant's motion for Summary Judgment is, accordingly, denied.