Edson Casseus et al. v. Nationwide Property and Casualty Insurance Company (2010)

MEMORANDUM OF DECISION RE MOTION TO STRIKE # 102

BACKGROUND

The plaintiffs filed a writ, summons and complaint dated July 2, 2009 which is the subject of the motion to strike by the defendant, Nationwide Property and Casualty Insurance Company (Nationwide).   The complaint consists of six counts.   The defendant seeks to strike counts three, four, five and six.   The plaintiffs' complaint alleges that they were passengers in a vehicle that was hit by a vehicle operated by Elsa Cardona (Cardona), and that they were insured by the defendant under an automobile insurance policy, which provided for underinsured motorist benefits.

Counts one and two provide the injuries sustained by the plaintiffs as a result of Cardona's actions and allege that Cardona's insurance policy was insufficient to compensate the plaintiffs.   The plaintiffs aver that the injuries and losses are the legal responsibility of the defendant and that each plaintiff has been unable to agree with the defendant as to damages.   In counts three and five, respectively, the plaintiffs allege that each plaintiff provided the defendant with all of the medical records and bills substantiating their injuries and damages.   Additionally, each plaintiff attempted to engage in settlement discussions with the defendant.   The plaintiffs state that the defendant refused to cover the plaintiffs because the per person limit of the underinsured motorist coverage under the Defendant's policy was equal to the per occurrence limit of Cardona's policy.   The plaintiffs maintain that this contention has no basis in the law and that the defendant has violated the Connecticut Unfair Insurance Practices Act (CUIPA) by misrepresenting the plaintiffs' benefits and by engaging in unfair claims settlement practices.   In counts four and six, the plaintiffs allege that the defendant's acts occurred with such frequency that they constitute a general business practice, and by engaging in these unfair acts, the defendant violated the Connecticut Unfair Trade Practices Act (CUPTA).   The plaintiffs state that as a result of these violations, the plaintiffs have suffered actual damages and economic injury.

On August 19, 2009, the defendant filed a motion to strike counts three, four, five and six.

The defendant submitted a memorandum in support.   The plaintiffs filed an objection with a memorandum in support of the motion to strike on September 18, 2009.   The court heard argument on November 9, 2009.

DISCUSSION

“The purpose of a motion to strike is to contest ․ tie legal sufficiency of the allegations of any complaint ․ to state a claim upon which relief can be granted.”  (Internal quotation marks omitted.)  Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 498, 815 A.2d 1188 (2003).  “[T]he moving party admits all facts well pleaded.”  RK Constructors, Inc. v. Fusco Corp. et al., 231 Conn. 381, 383 n.2, 650 A.2d 153 (1994).  “If facts provable in the complaint would support a cause of action, the motion to strike must be denied.”  (Internal quotation marks omitted.)  Batte-Holmgren v. Commissioner of Public Health, 281 Conn. 277, 294, 914 A.2d 996 (2007).  “A motion to strike is properly granted if the complaint alleges mere conclusions of law that are unsupported by the facts alleged.”  (Internal quotation marks omitted.)  Fort Trumbull Conservancy, LLC v. Alves, supra, 498.   The court should “construe the complaint in the manner most favorable to sustaining its legal sufficiency.”  (Internal quotation marks omitted.)  Sullivan v. Lake Compounce Theme Park, Inc., 277 Conn. 113, 117, 889 A.2d 810 (2006).

“[A] claim under CUIPA predicated upon alleged unfair claim settlement practices in violation of § 38a-816(6) requires proof that the unfair settlement practices were committed or performed with such frequency as to indicate a general business practice.”  (Internal quotation marks omitted).   Lees v. Middlesex Insurance Company, 229 Conn. 842, 847-48, 643 A.2d 1282 (1994).   In one case, the Connecticut Supreme Court held that a motion to strike was properly granted, because a litigant did not prove more than one act of insurance misconduct in a CUIPA claim based on unfair settlement practices.  Mead v. Burns, 199 Conn. 651, 509 A.2d 11 (1986).   The court stated “we believe that claims of unfair settlement practices under CUIPA require a showing of more than a single act of insurance misconduct.”  Id., 659.   In that case, the plaintiff had an accident on an icy highway, and the plaintiff argued that the state's insurer violated CUIPA by refusing to pay his claim without conducting a reasonable investigation.  Id., 652-53.

In Lees v. Middlesex Insurance Company, supra, 229 Conn. 848, the court held that “proof of an insurer's commission of two or more unfair claim settlement practices in relation to only one insurance claim” does not satisfy the general business practice requirement.   The court further stated that “[i]n requiring proof that the insurer has engaged in unfair claim settlement practices with such frequency as to indicate a general business practice, the legislature has manifested a clear intent to exempt from coverage under CUIPA isolated instances of insurer misconduct.”  (Internal quotation marks omitted.)  Id., 849.   The court concluded that “the defendant's alleged improper conduct in the handling of a single insurance claim, without any evidence of misconduct by the defendant in the processing of any other claim does not rise to the level of a general business practice as required by § 38a-816(6).”  (Internal quotation marks omitted.)  Id., 849.

The defendant argues that counts three and five should be stricken because the plaintiffs fail to allege that the defendant's actions constituted a “general business practice” as required by CUIPA.   The plaintiffs counter that the complaint sufficiently alleges a “general business practice” because the complaint alleges deceptive acts and practices in the plural.   Additionally, the plaintiffs argue that both plaintiffs are asserting individual causes of action for CUIPA violations, and this substantiates the presence of a “general business practice.”

The plaintiffs argue that they asserted individual causes of action for CUIPA violations, however, there appears to be only one insurance claim.   With regard to the number of insurance claims in the present proceeding, the complaint states:  “On or about January 24, 2008, plaintiff's claim.”  (Emphasis added).   Additionally, the defendant's response to the plaintiffs' insurance inquiry is directed at the plaintiffs together, rather than in their individual capacity, which further characterizes the plaintiffs' inquiry as a singular claim.   The plaintiffs allege that “[t]he [d]efendant finally responded on May 6, 2009, through counsel who claimed on behalf of the [d]efendant that underinsured motorist coverage was not available to plaintiffs because the per person limit of underinsured motorist coverage under the [d]efendant's policy was equal to the per occurrence limit of the tortfeasor's policy ․” (Emphasis added).   Because all of the alleged deceptive acts and practices arise out of one insurance claim, CUIPA violations are alleged improperly.

In Lees v. Middlesex Insurance Company, the Connecticut Supreme Court stated that because there was no “general business practice” under CUIPA, the “plaintiff's CUTPA claim could not survive the failure of her CUIPA claim.”   Lees v. Middlesex Insurance Company, supra, 229 Conn. 851.   Similarly, in Mead v. Burns, the court held that where a plaintiff alleged that a general business practice existed based on one instance of misconduct, it was not possible for the plaintiff to maintain a claim under either CUIPA or CUTPA.   Mead v. Burns, supra, 199 Conn. 664.

The defendant argues that if the CUIPA claim is legally insufficient, the CUTPA claim will also be legally insufficient.   The plaintiffs argue that a CUIPA violation claim may be based on a single transaction.   Following the precedents of Mead v. Burns and Lees v. Middlesex Insurance Company, the plaintiffs' CUTPA claims are legally insufficient because the plaintiffs' CUIPA claims were based on a single insurance claim.

The defendant's final argument is that there is no private cause of action under CUIPA.   The plaintiffs have responded that this assertion is not supported by an appellate authority.   The plaintiff is correct there neither the Supreme Court nor the Appellate Court has ruled on whether there is a private cause of action under CUIPA.   However, in Mead v. Burns, the court declined to answer the question of who is authorized to bring CUIPA claims.   Mead v. Burns, supra, 199 Conn. 657, n.5. The court stated that this question “would come into play only if we were to conclude ․ that the plaintiff's complaint had alleged conduct that constituted a violation of CUIPA.”  Id., 657.   Because the court has determined that the complaint does not state a cause of action pursuant to CUIPA, the question does not come into play and this court will not address it in following the Appellate court's ruling in Mead. Mead v. Burns, Id., 657.

CONCLUSION

Because the allegations of multiple unfair claims settlement practices in this matter arose out of one insurance claim as discussed above, the plaintiffs have failed to sufficiently allege a “general business practice” and the motion to strike counts three, four, five and six is granted.

THE COURT

Brazzel-Massaro, J.

Brazzel-Massaro, Barbara, J.