Opinion
No. CV03-0180724 S
February 2, 2004
MEMORANDUM OF DECISION RE DEFENDANT'S MOTION TO STRIKE (#105)
The defendants, Christopher and Lisa Simo-Kinzer, have moved to strike the second count of the complaint of the plaintiffs, Michael and Elizabeth Perugini. The plaintiffs bring this action as a result of a failed residential real estate transaction. The plaintiffs are seeking money damages, punitive damages and attorneys fees.
In the second count, the plaintiffs allege that they relied upon certain representations concerning water service to the property in signing the purchase agreement and providing defendants with a total deposit of $15,000, that defendants falsely induced plaintiffs to enter into the purchase agreement and have wrongfully withheld the deposit from the plaintiffs, after demand for its return. Plaintiffs further allege that the defendants' conduct "constitutes unfair or deceptive trade practice in violation of Connecticut General Statutes Section 42-110 et seq." The parties have not named as additional defendants either their realtor or the defendants' realtor.
In the first count, the plaintiffs allege that the defendants have wrongfully withheld their deposit and are seeking money damages, and interest pursuant to statute.
Standard of review
The function of a motion to strike is to test the legal sufficiency of the allegations of a complaint to state a claim upon which relief can be granted. Vacco v. Microsoft Corp., 260 Conn. 59, 65 (2002); Sherwood v. Danbury Hospital, 252 Conn. 193, 213 (2000); Novametrix Medical Systems, Inc. v. BOC Group, Inc., 224 Conn. 210, 214-15 (1992); Ferryman v. Groton, 212 Conn. 138, 142 (1989); Practice Book § 10-39. The role of the trial court is to examine the complaint, construed in favor of the pleader, to determine whether the pleader has stated a legally sufficient cause of action. Suffield Development Associates Ltd. Partnership v. National Loan Investors, L.P., 260 Conn. 766, 772 (2002); ATC Partnership v. Windham, 251 Conn. 597, 603, cert. denied, 530 U.S. 1214 (1999); Dodd v. Middlesex Mutual Assurance Co., 242 Conn. 375, 378 (1997); Napoletano v. CIGNA Healthcare of Connecticut, Inc., 238 Conn. 216, 232-33, cert. denied, 520 U.S. 1103 (1996).
In adjudicating a motion to strike, the court must construe the facts alleged in the complaint in the manner most favorable to the plaintiff. Vacco v. Microsoft Corp., supra, 260 Conn. 65; Gazo v. Stamford, 255 Conn. 245, 260 (2001); Bohan v. Last, 236 Conn. 670, 675 (1996); Sassone v. Lepore, 226 Conn. 773, 780 (1993); Novametrix Medical Systems, Inc. v. BOC Group, Inc., supra, 224 Conn. 215; Gordon v. Bridgeport Housing Authority, 208 Conn. 161, 170 (1988). The requirement of favorable construction does not extend, however, to legal opinions or conclusions stated in the complaint, but only to factual allegations and the facts necessarily implied and fairly provable under the allegations." Forbes v. Ballaro, 31 Conn. App. 235, 239 (1993).
Count Two — CUTPA
In this count, the plaintiffs allege that the representations which the defendants made to them through their real estate agents were material and deceptive and therefore, defendants' conduct constitutes an unfair or deceptive trade practice.
Is a single occurrence actionable under CUTPA?
This issue is raised by the plaintiffs in their memorandum in opposition, so the court will address it, as a preliminary matter. The plaintiffs maintain that they have stated a cause of action under CUTPA even though they allege only a single occurrence, not a course of repeated conduct that could be characterized as a practice. Plaintiffs have provided the court with lists of cases in which various trial court judges have weighed in on the issue of whether a single transaction may constitute an unfair trade practice actionable under CUTPA.
CUTPA provides, at Conn. Gen. Stat. § 42-110g(a) for a remedy for an ascertainable loss resulting from a prohibited "method, act or practice." This reference to a remedy for a single act suggests that CUTPA prohibits unfair conduct in a trade or business even if it is engaged in only once. In Larsen Chelsey Realty Co. v. Larsen, 232 Conn. 480 (1995), the plaintiff alleged that the defendant had moved from the plaintiff's real estate agency to another agency and had suggested to others that the plaintiff had gone out of business. The Supreme Court ruled that the trial court had erred in setting aside the verdict of a jury that found a CUTPA violation.
In Jacobs v. Healey Ford-Subaru, Inc., 231 Conn. 707, 726 (1995), the Supreme Court noted that "[t]he question of whether an action or practice can be the basis of a CUTPA action depends upon all the circumstances of the particular case"; however, the Court found that the CUTPA claim had not been established because the defendant's failure to provide an accurate notice of a deficiency on a car repossession "appears to have been an isolated instance of misinterpretation by the defendant of its obligation due to the unique circumstances of this particular case as distinguished from unfair or deceptive acts or practices in the defendant's trade or business." 231 Conn. 729. It is unclear whether the Court's conclusion was that the faulty notice was not a CUTPA violation because it was negligent, not a planned "practice," or whether it was not a CUTPA violation because it was an isolated transaction.
These decisions not withstanding, there is agreement that the Supreme Court has not ruled definitively that CUTPA cannot be the source of a remedy for an unethical or unfair act in a trade or business simply because the unfair act is not repeated. This court nevertheless agrees with the well-reasoned opinion of Hodgson, J. in Gramazio v. Sikorsky Aircraft Corp., and finds that the wording of CUTPA, at § 42-110g(a), is broad enough to indicate application to a single act if the act otherwise is within the definition of a violation of a prohibited unfair trade practice.
No. X01-CV-00-0160391 (Feb. 7, 2001), 2001 Ct. Sup. 2114.
Does misrepresentation by the owner in the course of a residential real estate transaction constitute a CUTPA violation?
The factual allegations set forth in the complaint reveal that the more substantial issue with regard to application of CUTPA to the real estate transaction in question is whether an act that is isolated from or not part of any ongoing business is in trade or commerce and therefore covered by CUTPA. Specifically, does the sale by a person of his or her personal residence, where the person does not otherwise engage in real estate transactions, fall under CUTPA?
Neither the Connecticut Supreme Court nor the Appellate Court has ruled on the issue. As discussed by the defendants in their memorandum (page 4), the Attorney General of Connecticut has taken the position that CUTPA does not apply to isolated non-business transactions. The Superior Court opinions are divided as to the application of CUTPA to one-time residential real estate transactions. It is this court's determination that the better reasoned opinions are those which hold that a single sale of a residential home by parties not involved in the buying and selling of real estate does not give rise to a CUTPA violation. There is no allegation that the defendants' sale of their house was part of, or in any way related to, any trade or business they were conducting. The word "conduct," when used in the context of a trade or commerce means the directing or taking part in the operation or management thereof. Thus it presupposes an existing and continuing enterprise, the antithesis of a one-time, solitary sale.
See Piantidosi v. MacGarvey, Superior Court, judicial district of Stamford-Norwalk at Stamford, DN 174606 (May 25, 2000, D'Andrea, J.) ( 27 Conn. L. Rptr. 252); Gershberg v. Kean, Superior Court, judicial district of Stamford-Norwalk at Stamford, CV 99 017 4316 (June 10, 2002, D'Andrea, JTR) ( 32 Conn. L. Rptr. 305); Walker v. Barrett, Superior Court, judicial district of Stamford-Norwalk at Stamford, CV 99 016 9673 (November 8, 1999, D'Andrea, J.) ( 25 Conn. L. Rptr. 665); Boyce v. Canby, Superior Court, judicial district of Stamford-Norwalk at Stamford, DN 153623 (February 27, 1998, Lewis, J.). Also see the recent case of Twisdale v. Tierney, No. CV 02 018 9029 (Jan. 2, 2003) 2003 Ct. Sup. 123, summarizing and agreeing with these earlier cases.
For the reasons stated above, the motion to strike is granted. Even though a single act may be sufficient to establish a CUTPA violation, the context of the act in this case was not in the course of a "trade or commerce."
ALVORD, JUDGE.