Opinion
No. CV 00 0374721
July 30, 2003
MEMORANDUM OF DECISION RE MOTION TO INTERVENE AS PARTY DEFENDANTS
The movants, Zeisler Zeisler, P.C. (Zeisler), on behalf of itself and its client, Robyn Callow O'Reilly (O'Reilly), are seeking to intervene in the above-captioned matter as third-party defendants pursuant to Practice Book § 9-18. The plaintiff, Seaco Insurance Company (Seaco) a/s/o/ Beazley Company Realtors (Beazley) has filed a memorandum in objection to the movants' motion.
Both parties allege the following facts in their memoranda.
In the winter of 1986, the defendants Paul McDonald and Laura Warren (the landlords) owned and resided in a semi-private residence located at 17 Byington Place, Norwalk, Connecticut (the property). The landlords contracted with Devine Brothers (Devine) to provide fuel oil and maintenance for the furnace located in the basement of the property. The furnace developed problems during 1986 and, upon investigation, Devine discovered that the furnace had a cracked heat exchanger, which caused carbon monoxide gas to mix with forced hot air supplied to the living areas of the property by the furnace. Upon information and belief, Devine informed the landlords of the existence of the dangerous defect, tagged the furnace for condemnation, and reported the condition to the Town of Norwalk, who condemned the furnace immediately.
In 1987, Playtex Apparel, Inc. (Playtex) assigned the landlords, both of whom were employees of Playtex at all times relevant hereto, to its office in Mexico City, Mexico. Playtex agreed to pay the fees related to the retention of a home management firm if the landlords agreed to use the management firm retained by Playtex. The landlords agreed, and Playtex entered into a contract with Beazley for the management of the property.
In September 1987, pursuant to an apartment lease entered into between Robyn Callow O'Reilly (O'Reilly) and William O'Reilly, as tenants, and the landlords (the lease), O'Reilly moved into the second-`floor apartment at the property. During the month of October, when the weather turned cold, the furnace would not start. O'Reilly informed Beazley who, in turn, placed a service call to Devine. Upon arrival, Beazley directed Devine to turn on the furnace, and Devine complied. As a result, over the course of the next six weeks, O'Reilly was allegedly exposed to carbon monoxide gas which purportedly caused her to sustain severe, permanent brain damage.
On or about May 3, 1989, O'Reilly, through her counsel, Zeisler, filed a claim against Devine, the landlords and Playtex for injuries sustained as a result of her exposure to carbon monoxide gas.
On or about March 6, 1991, O'Reilly revised the May 3, 1989 complaint to include Beazley as a defendant.
On or about November 1, 1995, the movants and Devine entered into a Settlement Agreement and Full and Final Release (the "settlement agreement"), wherein O'Reilly allegedly agreed to release Devine from all liability arising out of the Claim, to indemnify and hold Devine harmless from all claims arising out of the incident, and to hold in escrow the proceeds of any settlement, judgment or verdict that O'Reilly subsequently received.
On or about March 19, 1999, a settlement was reached between O'Reilly and Beazley (the "Beazley settlement"). Seaco, as Beazley's insurer, purportedly made payments to O'Reilly, in full satisfaction of the Beazley Settlement.
On or about March 16, 2000, Seaco, as subrogee of Beazley, commenced the instant action against Devine and the landlords, seeking to recover the money Seaco paid on Beazley's behalf. As a consequence, the movants now seek to intervene.
Practice Book § 9-18 provides in relevant part: "If a person not a party has an interest or title which the judgment will affect the judicial authority, on its motion, shall direct that person to be made a party. (See General Statutes § 52-107 and annotations.)" When considering a motion to intervene, "the pleadings are accepted as correct, and the interest of [the] intervenor does not have to be proved by testimony or evidence . . . The right to intervene is based on the allegations of the would-be intervener, without regard to their actual validity . . . Further, the rules for intervention should be construed liberally to avoid multiplicity of suits." (Citations omitted.) Rosado v. Bridgeport Roman Catholic Diocesan Corp., 60 Conn. App. 134, 142, 758 A.2d 916 (2000).
In Washington Trust Co. v. Smith, 241 Conn. 734, 740, 699 A.2d 73 (1997), the court held that "[t]he nature of the right to intervene in Connecticut . . . has not been fully articulated. Where state precedent is lacking, it is appropriate to look to authorities under the comparable federal rule, in this case [r]u1e 24 of the Federal Rules of Civil Procedure." Rule 24 of the Federal Rules of Civil Procedure separates intervention into two types: intervention of right, and permissive intervention. "The distinction between intervention of right and permissive intervention, such as is found in [r]ule 24 of the Federal Rules of Civil Procedure, has not been clearly made in Connecticut practice . . . Most of our cases discuss the admission of new parties as coming within the `broad discretion' of the trial court . . . But there are also cases which make clear that intervention as of right exists in Connecticut practice." (Citations omitted.) Id., 739-40.
In Connecticut, there is no clear guidance as to the propriety of an indemnitor's intervention. The movants contend, nevertheless, that according to Practice Book § 9-18 and Rule 24 of the Federal Rules of Civil Procedure, they are entitled to intervene as of right, or in the alternative, via permissive intervention based on their interest as Devine's potential indemnitor. Seaco objects on the grounds that the movants, as potential indemnitors, cannot demonstrate a direct and immediate interest in this action, and therefore, they fail to meet the requisite interest to intervene.
I. INTERVENTION AS OF RIGHT
The general rule is that an applicant may intervene as of right "where the applicant's interest is of such a direct and immediate character that the applicant will either gain or lose by the direct legal operation and effect of the judgment." (Internal quotation marks omitted.) Horton v. Meskill, 187 Conn. 187, 195 (1982). Our Appellate Court and courts in other jurisdictions have employed a four-prong test to determine intervention as of right: (1) the motion to intervene must be timely; (2) the movant must have a direct and substantial interest in the subject matter of the litigation; (3) the movant's interest must be impaired by disposition of the litigation without the movant's involvement; and (4) the movant's interest must not be represented adequately by any party to the litigation. Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 140; Federal Rules of Civil Procedure, Rule 24; See also 6 Moore's Federal Practice § 24.03[1] (3rd ed. 2001) citing Washington Elec. v. Mass. Mun. Wholesale Elec., 922 F.2d 92, 96 (2nd Cir. 1990). All of the criteria must be established to intervene as of right. Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 146 (holding that if any one of the four prongs missing, the motion to intervene as of right should be denied). See also 6 Moore's Federal Practice § 24.03[1] (3rd ed. 2001), and cases cited therein.
"The purpose of the rule allowing intervention is to prevent multiplicity of suits where common questions of law or fact are involved. Reich v. Webb, 336 F.2d 153, 160 (9th Cir. 1964), cert. denied, 380 U.S. 915, 85 S.Ct. 890, 13 L.Ed.2d 800 (1965). However, the rule is not intended to allow for the creation of whole new suits by intervenors. See Sierra Club v. United States Army Corps of Eng'rs, 709 F.2d 175, 176-77 (2nd Cir. 1983) (per curiam); Rios v. Enterprise Assn Steamfitters, Local 638, 520 F.2d 352, 358 (2nd Cir. 1975); Stein v. Wirtz, 366 F.2d 188, 1890 (10th Cir. 1966), cert. denied, 386 U.S. 996, 87 S.Ct. 1316, 18 L.Ed.2d 344 (1967)." Washington Elec. v. Mass. Mun. Wholesale Elec., supra, 922 F.2d 97. Moreover, "[c]ourts should not become so zealous in attempting to prevent a multiplicity of actions that they injure or hamper the rights of the original litigants." Kelley v. Pascal System, Inc., 183 F. Sup. 775, 777 (1960). Similarly, this court has discretion to reject intervention when it would have the effect of complicating and confusing the issues for the trier of fact. See Lipsett v. United States, 359 F.2d 956, 959 (2nd Cir. 1966); Washington Elec. v. Mass. Mun. Wholesale Elec., supra, 922 F.2d 98.
The principal issue raised by this motion is whether the movants, as potential indemnitors, satisfy the second prong of the four-prong test which requires that the movants have a direct and substantial interest in the subject matter of this litigation. "In discussing `interest' in the context of intervention as of right, the Supreme Court has stated that the interest must be `significantly protectable.'. . . Moreover, it is said that such an interest must be direct as opposed to remote or contingent." (Citations omitted.) Restor-A-Dent Dental Lab. v. Certified Alloy Prod., 725 F.2d 871, 874 (2nd Cir. 1984); see also U.S. v. Peoples Benefit Life Ins. Co., 271 F.3d 411, 417 (2nd Cir. 2001) (holding that an interest under Rule 24(a)(2) must be direct, substantial, and legally protectable); American Lung Ass'n v. Reilly, 141 F.R.D. 19, 22 (E.D.N.Y.), aff'd., 962 F.2d 258, 262 (2nd Cir. 1992) (rejecting argument that Rule 24(a)(2) requires only that an intervenor have a "potential interest" in lawsuit). "An interest that is remote from the subject matter of the proceeding, or that is contingent upon the occurrence of a sequence of events before it becomes colorable, will not satisfy the rule." Washington Electric Cooperative, Inc. v. Massachusetts Mun. Wholesale Elec. Co., supra, 922 F.2d 97; In re David M. Hunt Const. Co., 3 B.R. 256, 258 (Penn. D.C. 1980). Similarly, interests that are collateral or contingent on the future occurrence of an event are insufficient to satisfy the requirements for intervention. 6 Moore's Federal Practice § 24.03[2] (3rd ed. 2001) citing Washington Elec. v. Mass. Mun. Wholesale Elec., supra, 922 F.2d 96; Stilwell Okla. v. Ozarks Rural Elec. Co-op. Corp., 79 F.3d 1038, 1042 (10th Cir. 1996), aff'd., 166 F.3d 1064 (10th Cir. 1999).
An indemnitor can be any party bound by an indemnity contract. Black's Law Dictionary 692 (5th ed. 1979). There is a split of authority discussing the issue of indemnitor intervention. One line of cases takes a more flexible approach, permitting indemnitors to intervene to protect a potential interest. See United States v. C.M. Lane Lifeboat Co., 25 F. Sup. 410, 411 (E.D.N.Y. 1938), aff'd., 118 F.2d 793 (2nd Cir. 1941) (intervention was granted where judgment would indirectly bind indemnitor and indemnitor was inadequately represented); Avery v. Campbell, 279 Minn. 383, 157 N.W.2d 42 (1968) (allowing potential indemnitor to intervene because he would necessarily gain or suffer a loss if he were to become a party); Knapp v. Hankins, 106 F. Sup. 43 (1952) (insurance company as a potential indemnitor allowed to intervene to determine the validity of the insurance policy). Illinois has similarly allowed indemnitors to intervene, reasoning that indemnitors can possess a sufficiently direct interest. See e.g., Preferred America Ins. v. Dulceak, 302 Ill. App.3d 990, 996, 706 N.E.2d 529 (1999) (holding: "[w]here one party is liable to indemnify another against a particular loss, either by law or contract, the primary liability is upon the party indemnifying. In such a case, the party bound to indemnify is in privity with the party to be indemnified, and the indemnifying party therefore has a direct interest in defending any suit whereby there may be a recovery against the party indemnified as to the subject matter of the indemnity"); N.E. Finch Co. v. R.C. Mahon Co., 54 Ill. App.3d 573, 576, 370 N.E.2d 160 (1977) (holding that a prospective indemnitor has a direct interest in defeating the principal action for which indemnity may be later sought).
The movants cited one additional district court opinion, however, they failed to provide a full citation for the opinion. The court was unable to locate the decision through conventional search methods, and therefore, is left to assume that the decision is unpublished. Practice Book § 5-9 requires unpublished decisions be provided to the court. The movants have not provide a copy of this decision with their memorandum. The case, therefore, has not been considered in deciding this motion.
Although federal and sister state precedent is persuasive, "it, of course, is not binding on this court." In re Michaela Lee R., 253 Conn. 570, 602, 756 A.2d 214 (2000).
The other line of cases, dealing primarily with insurer indemnitors, posits that indemnitors generally do not have a sufficiently direct interest to intervene. This is the rationale Connecticut trial courts have adopted. The movants distinguish our trial court opinions on the ground that those decisions involved conflict of interest issues, which do not exist here.
See Dennis F. v. Glownia, Superior Court, judicial district of New London, Docket No. CV 940531604 (April 18, 1996, Hurley, J.) (reasoning that insurer does not have a direct and immediate interest in the underlying suit); Murphy v. Kapura, Superior Court, judicial district of Tolland at Rockville, Docket No. CV 95 056977 (May 19, 1995, Rittenband, J.) ( 14 Conn.L.Rptr. 312, 313) (reasoning that insurer does not have a direct interest in the subject matter of the underlying action); Laminate Designs, Inc. v. Gentile, Superior Court, judicial district of' Waterbury, Docket No. 107048 (July 15, 1993, Pittman, J.) (9 Conn.L.Rptr. 416, 8 C.S.C.R. 849, 849) (citing rationale from Chenkus v. Dickson, infra); Doe v. Fiano, Superior Court, judicial district of Tolland at Rockville, Docket No. CV 89042278 (February 15, 1991, Klaczak, J.) ( 3 Conn.L.Rptr. 237, 6 C.S.C.R. 488, 488) (citing rationale from Chenkus v. Dickson, infra); Chenkus v. Dickson, Superior Court, judicial district of New Haven, Docket No. 282007 (September 7, 1990, Berdon, J.) ( 2 Conn.L.Rptr. 348) (reasoning that insurer is not a necessary party because it does not have an interest in the underlying controversy); but see Knowling v. Hunt, 41 Conn. Sup. 389, 577 A.2d 1144, 1 Conn.L.Rptr. 264 (1990) (permitting intervention by insurer via permissive intervention on the basis of judicial economy).
Dennis P. v. Glownia, supra, Superior Court, Docket No. CV 94 0531604 (motion to intervene denied because of, inter alia, the serious impact on the attorney/client relationship); Murphy v. Kapura, supra, 14 Conn.L.Rptr. 313 (finding that allowing the insurer to intervene may prejudice the general defendant-attorney relationship); Doe v. Fiano, supra, 6 C.S.C.R. 488 (finding that the attorney-client relationship is jeopardized by an insurer's intervention); Chenkus v. Dickson, supra, Superior Court, Docket No. 282007 (finding that the implications of exchanging confidential information jeopardizes the very essence of the attorney-client relationship). Laminate Designs, Inc. v. Gentile, supra, 8 C.S.C.R. 849, is distinguishable on the separate grounds that the court denied intervention because the proposed intervenor had instituted a separate action for a declaratory judgment and was seeking two avenues for the same relief.
According to Seaco, in this case, unlike those cases, there is no inherent conflict of interest between Devine and the movants. While Seaco is correct, there is, nevertheless, an equally significant rationale that these courts employed as a basis for disallowing an insurer to intervene: namely, the insurers failed to establish a direct and immediate interest in the subject matter before the court. Missouri has adopted a similar rationale, holding that "[t]he liability of an insurer as a potential indemnitor of the judgment debtor does not constitute the type of interest required to intervene as of right because the insurer does not either gain or lose from the direct operation of that judgment . . . It is when a claim for potential indemnity becomes a demand for actual indemnity that the insurer acquires the requisite interest to intervene as of right." (Citation omitted.) Augspurger v. MFA Oil Co., 940 S.W.2d 934, 937 (Mo.App.W.D. 1997); see also, Whitehead v. Lakeside Hosp. Ass'n, 844 S.W.2d 475, 479 (Mo.App. 1992); Bogard v. Integrated Nat. Life Ins. Co., 954 S.W.2d 532 (Mo.App.E.D. 1997).
See footnote 4 of this opinion.
Many decisions denying insurer intervention have done so under the rationale that their interest is not direct but rather is contingent on the outcome of the case. "When the insurer offers to defend the insured but reserves the right to deny coverage . . . [for example,] the insurer's interest in the liability phase of the proceeding is contingent on the resolution of the coverage issue. See Restor-A-Dent Dental Laboratories, Inc. v. Certifed Alloy Products, Inc., [ supra, 725 F.2d 874-76]; see also United States Fidelity Guaranty Co. v. Adams, 485 So.2d 720, 721-22 (Ala. 1986) (Alabama Rules of Civil Procedure); Kuperstein v. Superior Court, 204 Cal.App.3d 598, 251 Cal.Rptr. 385, 387 (1988) (California Code of Civil Procedure); Cromer v. Sefton, 471 N.E.2d 700, 704 (Ind.App. 1984) (Indiana Rules of Trial Procedure); Donna C. v. Kalamaras, 485 A.2d 222, 223-24 (Me. 1984) (Maine Rules of Civil Procedure); Kaczmarek v. Shoffstall, 119 App.Div.2d 1001, 500 N.Y.S.2d 902, 903-04 (1986) (New York Code of Civil Procedure); cf. Hartford Insurance Co. v. Birdsong, 69 Md. App. 615, 519 A.2d 219, 221-22 (1987) (same result under local rules of civil procedure when insurer denies coverage). Accordingly, the asserted interest is not cognizable for purposes of Rule 24(a)(2) . . . [T]his conclusion [is not] overly `legalistic' or `mechanical.' Guaranty National Insurance Co. v. Pittman, 501 So.2d 377, 384 (Miss. 1927). Instead, . . . [it reflects] the well-established policy that an insurer who reserves the right to deny coverage cannot control the defense of a lawsuit brought against its insured by an injured party. See Cay Divers, Inc. v. Raven, 812 F.2d 866, 870 (3rd Cir. 1987); United Services Automobile Association v. Morris, 154 Ariz. 113, 741 P.2d 246, 252 (1987); Three Sons, Inc. v. Phoenix Insurance Co., 357 Mass. 271, 257 N.E.2d 774, 777 (1970); Butters v. City of Independence, 513 S.W.2d 418, 424 (Mo. 1974); J. Appleman, 7C Insurance Law Practice § 4686, at 176; A. Windt Insurance Claims and Disputes § 4.24, at 188 (2nd ed. 1988)." Travelers Indem. Co. v. Dingwell, 884 F.2d 629 (1st Cir. 1989).
More recently, courts across the country have labeled putative insurer interests "contingent" and have held them insufficient for purposes of intervention. Guaranty Nat. Ins. Co. v. Pittman, 501 So.2d 377, 383-84 (Miss. 1987), citing Restor-A-Dent Dental Laboratories, Inc. v. Certified Alloy Products, Inc., supra, 725 F.2d 874-76; United States Fidelity Guar. Co. v. Adams, 485 So.2d 720, 721-22 (Ala. 1986); Donna C. v. Kalamaras, 485 A.2d 222, 223-24 (Me. 1984); 3B Moore's Federal Practice § 24.07[2], pp. 24-59 (2nd ed. 1985); but see Su Duk Kim v. H.V. Corp., 688 P.2d 1158, 1161 (Hawaii App. 1984); and Lawrence v. Burke, 6 Ariz. App. 228, 431 P.2d 302, 310 (1967). Other decisions have similarly denied insurer's attempts to intervene on the basis that such intervention is premised on a contingent, rather then direct, interest. See Federal Procedure § 59:316 p. 632 (2002). Likewise, intervention for the purpose of determining the amount of potential damages has been held insufficient to qualify as an interest in the subject matter of the litigation. Restor-A-Dent Dental Laboratories, Inc. v. Certified Alloy Products, Inc., supra, 725 F.2d 874-76.
The issue of intervention by an insurance company is closely analogous to these facts. In this case, the movant's primary interest in this controversy is the possibility that it will have to indemnify Devine. This interest is analogous to a liability insurer's interest in indemnifying its insured. In this case, the validity of the settlement agreement between the movants and Devine is not "directly related" to this case because, like a liability insurer's interest, it will not vest as a direct result of litigating the underlying issues. Although an adverse judgment for Devine could potentially subject the movants to a subsequent claim for indemnity, the validity of such claim will not be determined by any outcome in this case. It is not until a claim for potential indemnity becomes a demand for actual indemnity, that the movants acquire "the requisite interest to intervene as of right." See Augspurger v. MFA Oil Co., supra, 940 S.W.2d 937; Whitehead v. Lakeside Hosp. Ass'n, supra, 844 S.W.2d 479; Borgard v. Integrated Nat'l Life Ins. Co., supra, 954 S.W.2d 532.
Another reason why the movants seek to intervene in this action is to adjudicate the validity of their alleged indemnity agreement with Devine. For reasons discussed infra, however, this is not a valid basis for intervening in this case.
The alleged indemnity agreement between Devine and the movants and the alleged cause of action for indemnity by Seaco against Devine do not involve common questions of law and fact. Rather, they involve separate transactions and separate legal issues between different parties at different times. Moreover, interjecting the collateral issue of an alleged agreement to indemnify Devine would likely confuse and complicate the underlying issues in this case. Any motion dealing with the propriety of intervention necessarily encompasses an analysis of various factors. Many of the cases finding in favor of intervention did not involve the type of collateral issues presented in this case, but instead involved issues of inadequate representation and judicial economy, two significant factors that, for reasons discussed infra, are not problematic here.
The movants contend that their interest in this case includes personal defenses against liability to the plaintiff, which will be lost if not adjudicated in this action. Specifically, the movants claim that even if they did in fact enter into the alleged agreement with Devine to hold them harmless, they did so in reliance on then existing law. Accordingly, issues related to the legality of the settlement agreement can only be asserted by them. (Movants' Response Memorandum, p. 8-9.) This argument is misplaced. The movants' obligations under their indemnity agreement will not be adjudicated in this case. The issue being adjudicated is the liability of these parties for the alleged injuries. The legality of the movants' agreement to indemnify Devine is collateral. Accordingly, the movants cannot intervene to interject collateral issues. Washington Elec. v. Mass. Mun. Wholesale Elec., supra, 922 F.2d 97.
The movants also contend that they have a direct interest in this case because Devine may be collaterally estopped from challenging liability in a subsequent action. According to the plaintiff, that could then have the adverse affect on them, pursuant to their agreement to indemnify Devine. The fundamental principles underlying collateral estoppel are well established." `Collateral estoppel, or issue preclusion, is that aspect of res judicata which prohibits the relitigation of an issue when that issue was actually litigated and necessarily determined in a prior action between the same parties upon a different claim . . . For an issue to be subject to collateral estoppel, it must have been fully and fairly litigated in the first action. It also must have been actually decided and the decision must have been necessary to the judgment." (Internal quotation marks omitted.) RR Pool Patio Inc. v. Zoning Board of Appeals, 257 Conn. 456, 466, 778 A.2d 62 (2001). Collateral estoppel precludes relitigating issues and facts determined not only between the same parties, but also between those in privity with the same parties. Dowling v. Finley Associates, Inc., 248 Conn. 364, 373, 727 A.2d 1245 (1999).
The concept of privity is relevant in this case because if the movants are in privity with Devine it is likely that a full and fair resolution of an issue could be binding on the movants. "While it is commonly recognized that privity is difficult to define, the concept exists to ensure that the interests of the party against whom collateral estoppel . . . is being asserted have been adequately represented because of his purported privity with a party at the initial proceeding . . . A key consideration in determining the existence of privity is the sharing of the same legal right by the parties allegedly in privity . . . This is to ensure that the interests of the party against whom collateral estoppel is being asserted have been adequately represented because of his purported privity with a party at the initial proceeding . . . Privity is not established by the mere fact that persons may be interested in the same question or in proving or disproving the same set of facts. Rather, it is, in essence, a shorthand statement for the principle that collateral estoppel should be applied only when there exists such an identification in interest of one person with another as to represent the same legal rights so as to justify preclusion." (Citations omitted; internal quotation marks omitted.) Mazziotti v. Allstate Ins. Co., 240 Conn. 799, 813-14, 695 A.2d 1010 (1997).
The issue that stands to be estopped in this case is Devine's culpability and contribution to O'Reilly's injuries. Disposition of the instant action without the movants' participation will not operate to bar, under the doctrine of collateral estoppel, any attempts by the movants to litigate issues related to the validity of their indemnity agreement. It is of no occasion that the issue of liability may be precluded from being raised in a subsequent action. The gravamen of the concept of collateral estoppel is that the issue has been fully and fairly litigated once. This case, for reasons discussed supra, can be fully and fairly litigated without the movants. Assuming the movants and Devine are in privity, and this issue has the potential for being estopped in the future, this is not sufficient to qualify as an "interest" of direct and immediate character that will cause the movants to either gain or lose by direct operation and effect of this judgment. Horton v. Meskill, supra, 187 Conn. 195. The movants offer no legal authority in support of the argument that the possibility of collateral estoppel qualifies as an "interest" under intervention rules. In addition, it is counterintuitive to argue that an issue, which was originally fully and fairly litigated, is subsequently unfair. If an issue is not fully and fairly litigated in the first place, it cannot be subject to collateral estoppel. RR Pool Patio Inc. v. Zoning Board of Appeals, supra, 257 Conn. 466.
Construing the pleadings liberally under these facts, the movants have not established that they have an "interest" in this case, as required by the four-part test for establishing intervention as of right. The failure to satisfy any one of the four requirements is sufficient grounds to deny a motion to intervene. In re Bank of New York Derivative Litigation, 320 F.3d 291, 300 (2nd Cir. 2003), citing Catanzano by Contanzano v. Wing, 103 F.3d 223, 232 (2nd Cir. 1996) (quoting Farmland Dairies v. Comm'r, 847 F.2d 1038, 1043 (2nd Cir. 1988) (internal quotation marks omitted)); see also 6 Moore's Federal Practice § 24.03[1] (3rd ed. 2001), and cases cited therein. For the foregoing reasons, therefore, the movants' motion to intervene as of right is denied.
II. PERMISSIVE INTERVENTION
Although the movants do not have a sufficient direct or personal interest in this case to qualify for intervention of right, the movants argue that they ought to be allowed to intervene as a permissive intervenor. Horton v. Meskill supra, 187 Conn. 197. "The consideration of permissive intervention involves numerous factors including the [1] timeliness of the intervention, [2] the proposed intervenor's interests in the controversy, [3] the adequacy of representation of such interests by existing parties, [4] the delay in the proceedings or other prejudice to the existing parties the intervention may cause, and [5] the necessity for or value of the intervention in terms of resolving the controversy before the court." Milford v. Local 1566, 200 Conn. 91, 94, 510 A.2d 177 (1986); see also Federal Rules of Civil Procedure, Rule 24(b).
In regard to the first consideration, timeliness, it is well settled that "any motion for intervention, whether permissive or of right, must be timely . . . The right to intervene is lost, not merely weakened, if it is not exercised in a timely fashion . . ." (Citations omitted, internal quotation marks omitted.) Washington Trust Co. v. Smith, supra, 241 Conn. 744. Timeliness of a motion to intervene is determined by examining "how long the intervenor was aware of an interest before he or she tried to intervene, any prejudicial effect of intervention on the existing parties, any prejudicial effect of a denial on the applicant and consideration of any unusual circumstances either for or against timeliness." Rosado v. Bridgeport Roman Catholic Diocesan Corp, supra, 60 Conn. App. 147. "On a motion to intervene . . . the proposed intervenor bears the burden of proving the right to intervene. Washington Trust Company v. Smith, [ supra, 241 Conn. 745-46]. To sustain that burden of proof, `[a] proposed intervener must allege sufficient facts, through the submitted motion and pleadings, if any, in order to make a showing of his or her right to intervene.'" Sammarco v. Hillside Village Condominium Assoc., Superior Court, judicial district of Fairfield, Docket No. 403926 (January 5, 1998, Levin J.). There are no absolute ways to measure timeliness. Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 147.
In this case, the complaint was filed in April 2000. The movants' motion to intervene was filed in April 2002.
The movants have not indicated the date they became aware of their interest in this case. Arguably, however, the movants knew their interest was at risk in or around March 2000, the date Devine's attorney sent them a letter putting them on notice of Devine's intent to seek indemnity from them in the event of an adverse ruling in the present action. (Movants' Motion, Exhibit A.)
The movants claim that the reason it took them so long to intervene is because the plaintiff failed to prosecute this action with reasonable diligence. The manner in which the plaintiff pursued its action, however, should not dictate when the movants decide to intervene. The movants have offered no authority, nor has this court found any authority, indicating that this is a valid basis for not timely moving to intervene. The movant is expected to intervene soon after it learns of its interest in the matter, regardless of how the plaintiff chooses to pursue its claim. See Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 147. Although a two-year time gap is not in and of itself, fatal; see, e.g., Faires v. Pageau, Superior Court, judicial district of New Haven, Docket No. CV 970403163 (October 26, 1999, Alander, J.) ( 25 Conn.L.Rptr. 635) (granting a motion to intervene where motion was filed more than two years after the filing of the complaint); under these facts, the movants have not met their burden of establishing that this motion was timely filed.
The movants argue that it was the plaintiff's failure to prosecute that prevented them from intervening, noting that in May 2003, the case was dismissed on dormancy grounds. The movants intervened in April 2002, however, prior to the court dismissing the plaintiff's case on grounds of dormancy. The movants' rationale for waiting over two years to intervene because the case was dismissed on dormancy grounds does not conform with the fact that they intervened prior to the judgment of dismissal.
A determination of permissive intervention also encompasses an analysis of adequacy of representation. The movants argue that their interest is inadequately represented by the parties to this litigation. "The most significant factor in assessing the adequacy of representation is how the interests of the absentees compare with the interests of the present parties; the weight of the would-be intervenors' burden varies accordingly. If, for instance, the interests are identical or there is a party charged by law with representing a proposed intervenor's interest, a presumption of adequate representation arises that the would-be intervenor can overcome only through a compelling showing of why this representation is not adequate . . . At the other end of the spectrum, a presumption of inadequacy arises when an absentee must rely on his opponent or one whose interests are adverse to his." Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 148-49. The moving intervenor bears the burden of demonstrating inadequate representation. Id., 148.
According to the movants, Devine has made representations that it fully intends to seek reimbursement from them if it suffers an adverse ruling in this case, and that because Devine intends to seek indemnification, it has "no real incentive to vigorously defend this action." (Movants' Memorandum, Exhibits A, C and D.) The movants' argument fails for three critical reasons. First, if Devine is held liable, it stands to suffer the very real and significant stigma of being labeled the cause of O'Reilly's alleged severe, permanent brain damage. For obvious reasons, this stigma is not only personally damaging, but professionally detrimental as well. Second, Devine is certainly not neglecting its defense in this case on the basis that it intends to seek indemnity from the movants for any loss it ultimately suffers in this action. The movants themselves have indicated that the alleged agreement to indemnify Devine is likely invalid, as it was entered into "in reliance of then existing law . . . under which Devine could not be liable to Beazley for indemnification without an independent legal relationship between the parties." (Movants' Response Memorandum, p. 8-9.) Third, any judgment against Devine as to the issue of liability has the potential of being collaterally estopped in the future, and therefore, binding against Devine. This is another incentive for Devine to zealously defend itself. The movants' interest here is identical to Devine's, i.e. a judgment in favor of Devine. In this type of situation, there is a presumption of adequate representation. Rosado v. Bridgeport Roman Catholic Diocesan Corp., supra, 60 Conn. App. 149. The movants have not persuaded this court that Devine lacks incentive to defend itself, and the movants are, therefore, adequately represented.
The movants' argument here is curious. On one hand, the movants argue that their indemnity agreement is invalid and that they are not legally required to indemnify Devine. On the other hand, the movants argue that Devine's misguided reliance on the validity of that agreement prevents it from adequately defending itself in this action, such that the movants must intervene to protect Devine and themselves.
Another factor germane to permissive intervention is the necessity of the movants' intervention to resolve the underlying controversy. The issue before the court is the comparative liability of Devine and Beazley. The movants' intervention is not necessary to resolve this issue. As for the final two factors, although there is no evidence that intervention will necessarily delay the proceedings or that it will prejudice the parties, for the reasons discussed supra, the movants do not have an adequate interest in this controversy worthy of intervention. For the foregoing reasons, therefore, the movants' motion for permissive intervention is denied.
For the reasons stated herein above, the court finds that the movants have not satisfied the requisite conditions necessary to intervene as of right or by permissive intervention. Accordingly, the movants' motion to intervene is hereby denied.
By the Court,
Joseph W. Doherty, Judge