No. CV 04 4002003 S
November 12, 2004
RULING ON MOTION TO DISMISS OR TO STAY APPLICATION FOR PREJUDGMENT REMEDY (#111)
I have reviewed the materials submitted in connection with this motion and have read the authority in support of and in opposition to the motion. The matter may be considered in light of the following general propositions.
1. An application for a prejudgment remedy brought pursuant to § 52-278a et seq. is limited to "a civil action" and must be followed by a writ, summons and complaint within thirty days. Such application is not authorized, then, in the context of arbitration.
2. Similar remedies are available in the arbitration context pursuant to § 52-422, but a currently pending arbitration proceeding is a prerequisite.
3. Arbitration is a preferred remedy. Especially where there is a broadly worded clause providing for arbitration, arbitration will be compelled whenever the court lacks "positive assurance" that the dispute is not arbitrable:
We initially note that, because we favor arbitration, we will defer to this alternative method of dispute resolution if the contractual arbitration provisions fall within the grey area of arbitrability, employing the "positive assurance" test as set out in United Steelworkers of America v. Warrior Gulf Navigation Co., 363 U.S. 574, 582-83, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960). Under this test, "`judicial inquiry . . . must be strictly confined to the question whether the reluctant party did agree to arbitrate the grievance . . . An order to arbitrate the particular grievance should not be denied unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute. Doubts should be resolved in favor of coverage.'" (Emphasis in original.) Board of Education v. Frey, 174 Conn. 578, 582, 392 A.2d 466 (1978), quoting United Steelworkers of America v. Warrior Gulf Navigation Co., supra, 582-83.
White v. Kampner, 229 Conn. 465, 472-73 (1994).
The facts, developed rather informally at the hearing on October 25, 2004, are that the plaintiff SSC entered into a set of written contracts with Columbus Circle on December 26, 1997. One of the documents specifically provided that "[a]ny dispute arising out of or relating to this contract" shall be submitted to arbitration. ¶ 11.12 of the Software Licensing Agreement. The same document provided that the contract could not be assigned without consent of the other party; but if substantially all assets were transferred, then an assignment would be effective as to the other party. ¶ 9. Over the course of time a related company, Circle Trust, seems to have stepped into the shoes of Columbus Circle. The precise business history has not been shown. Finally, it was represented at the hearing that Pimco has acquired Circle Trust.
In the current state of affairs, it is quite clear that the action should be stayed as to Columbus Circle, with whom SSC specifically contracted. The contractual claim is clearly embraced by the broadly worded arbitration clause; the claims sounding in quantum meruit and accord and satisfaction surely are "related to" the contractual agreement.
The situation regarding Circle Trust is less clear, largely because the business relationship between the two entities and the nature of the transfer of the SSC rights and obligations were not developed in the evidence. It is impossible to tell, in the current state of the evidence, whether or not the provisions of ¶ 9 effectively transfer the applicability of the arbitration clause. I am, therefore, also staying consideration of the application for a prejudgment remedy as to Circle Trust, without prejudice to additional evidence being presented and of course without prejudice to an application for a remedy pursuant to § 52-422, if arbitration is initiated.
The motion for a stay is granted.