Karim Sidi v. Juan Diaz et al. (2011)

MEMORANDUM OF DECISION RE MOTION TO STRIKE # 162

FACTS

On August 30, 2010, the plaintiff, Karim Sidi, filed a three-count, second amended complaint alleging that the defendants, Juan Diaz, Alejandro Paulino, Juan Diaz, LLC, Wendy Clarke and Paul Wessel, made misrepresentations upon which the plaintiff relied to his detriment, engaged in conducts that constituted fraud in the inducement and violated the Connecticut Unfair Trade Practices Act (CUTPA).   In the second amended complaint, the plaintiff alleges the following facts.   The plaintiff manages his father's commercial unit located in a condominium association known as the Dixwell Plaza Merchants Association in New Haven.   On or about January 3, 2000, the city of New Haven acquired title to the plaintiff's father's unit as a result of a foreclosure.   On or about February 6, 2005, the city requested bids of proposals for the unit, which were due by March 15, 2005.   The request for proposal called for a closed bidding process.   The plaintiff, as his father's agent, submitted his bid of $150,000 for the property, but the city accepted Juan Diaz, LLC's bid of $250,000.

The plaintiff alleges that prior to the Juan Diaz, LLC's submission of its proposal, Clarke or Wessel approached Diaz or his partner Paulino and gave information that the city wanted a grocery store at the location, and that the amount to bid was $250,000, thereby violating the closed bidding procedures.   The plaintiff alleges further that he learned of these actions during a court proceeding in October or November 2008.   Due to his reliance on their misrepresentation, the plaintiff suffered pecuniary loss.   The plaintiff alleges that communications regarding the type of business that the city desired and the actual amount to bid were concealed intentionally by all defendants since no one informed him of such communications.

As a result, in the first count of his second amended complaint, the plaintiff brings claims of negligent misrepresentation and fraudulent concealment alleging that Clarke and Wessel published false information when they stated that it was going to be a closed bidding process and delayed the plaintiff from being able to pursue a cause of action for their illegal conduct.   In the second count, he alleges that such actions constitute fraud in the inducement.   The plaintiff also brings his third count alleging a violation of the CUTPA by all defendants, pursuant to General Statutes § 42–110b.

On November 18, 2010, Diaz, Paulino and Juan Diaz, LLC ¹ filed a motion to strike the plaintiff's second amended complaint, which is supported by a memorandum of law.²  The plaintiff filed his memorandum in opposition of the motion on October 25, 2010.³  On November 15, 2010, the Superior Court, Silbert, J, entered a judgment for defendants Clarke and Wessel pursuant to the Practice Book § 10–44 based on the finding that no new complaint had been filed within fifteen days of the court's sustaining these defendants' objection to the second amended complaint after the first amended complaint had been stricken in its entirety.

DISCUSSION

“The purpose of a motion to strike is to contest ․ the 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).  “In ruling on a motion to strike, the court is limited to the facts alleged in the complaint.”   (Internal quotation marks omitted.)  Faulkner v. United Technologies Corp., 240 Conn. 576, 580, 693 A.2d 293 (1997).   The court construes “the complaint in the manner most favorable to sustaining its legal sufficiency ․ Thus, [i]f facts provable in the complaint would support a cause of action, the motion to strike must be denied ․ Moreover, [the court notes] that [w]hat is necessarily implied [in an allegation] need not be expressly alleged ․ Indeed, pleadings must be construed broadly and realistically, rather than narrowly and technically.”  (Internal quotation marks omitted.)   Connecticut Coalition for Justice in Education Funding, Inc. v. Rell, 295 Conn. 240, 252–53, 990 A.2d 206 (2010).   Nevertheless, “[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, 262 Conn. 498.

In their memorandum in support of the motion to strike, the defendants argue that the plaintiff has failed to allege facts to support his cause of action under negligent misrepresentation and/or fraudulent concealment because he has failed to establish a relationship between him and the defendants that would create a duty to disclose facts upon which the plaintiff can rely.   Additionally, they argue that the plaintiff has failed to allege that the defendants knew of his submission of the bid.   The defendants also argue that he has not alleged that Diaz or Paulino participated in preparing for the proposal or that either of them received the request for proposal on or about February 6, 2005.   As to the second count, the defendants argue that it should be dismissed on the ground that no contract exists between the defendants and the plaintiff.   Lastly, they argue that because the plaintiff has commenced his CUTPA claim after the three-year statute of limitations has run, it is time-barred.   They argue further that this issue has been addressed by Zoarski, J.T.R. in the July 7, 2010 memorandum of decision [50 Conn. L. Rptr. 264], and therefore, is not subject to further review.

In response, the plaintiff counters that he and the defendants were bidders, and when the city or its agent(s) violated the terms of the closed bidding process, the defendants “became beneficiaries of the negligent misrepresentation.”   Moreover, the plaintiff argues that because all participants in the bidding process signed a non-collusion provision, all defendants were a part of the negligent misrepresentation when they violated such provision.   He also argues that the city frustrated the bidding process while he acted in good faith in his submission of the bid.   Lastly, the plaintiff argues that he has alleged sufficient facts to demonstrate fraudulent concealment.

I

FIRST COUNT:  NEGLIGENT MISREPRESENTATION AND FRAUDULENT CONCEALMENT

The Supreme Court has “long recognized liability for negligent misrepresentation ․ The governing principles [of negligent misrepresentation] are set forth in similar terms in § 552 of the Restatement (Second) of Torts (1977):  One who, in the course of his business, profession or employment ․ supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.”   (Internal quotation marks omitted.)  Sturm v. Harb Development, LLC, 298 Conn. 124, 143–44, 2 A.3d 859 (2010).  “Traditionally, an action for negligent misrepresentation requires the plaintiff to establish (1) that the defendant made a misrepresentation of fact (2) that the defendant knew or should have known was false, and (3) that the plaintiff reasonably relied on the misrepresentation, and (4) suffered pecuniary harm as a result ․ Whether evidence supports a claim of negligent misrepresentation is a question of fact.”  (Internal quotation marks omitted.)  Sovereign Bank v. Licata, 116 Conn.App. 483, 502, 977 A.2d 228, cert. granted on other grounds, 293 Conn. 935, 981 A.2d 1080 (2009).

Proving fraudulent concealment requires one to show that the defendant:  “(1) had actual awareness, rather than imputed knowledge, of the facts necessary to establish the plaintiffs' cause of action;  (2) intentionally concealed these facts from the plaintiffs;  and (3) concealed the facts for the purpose of obtaining delay on the plaintiffs' part in filing a complaint on their cause of action.”  Falls Church Group, Ltd. v. Tyler, Cooper & Alcorn, LLP, 281 Conn. 84, 105, 912 A.2d 1019 (2007).

In the second amended complaint, the plaintiff alleges that Clark and/or Wessel and not the defendants, made a misrepresentation about the closed bidding process.   The plaintiff has failed to allege that the defendants made a misrepresentation of fact on which he relied to his detriment.

As to his claim of fraudulent concealment, the plaintiff alleges that the defendants, along with other named defendants, intentionally concealed the alleged actions, such as the city's agents communicating to the defendants about the type of business the city desired, the amount to bid in order to prevail and the closed bidding procedures having been changed to the open bidding procedures.   Additionally, the plaintiff alleges that no one informed him of the type of business or the amount to bid in order to avail.

Nevertheless, the plaintiff has failed to allege sufficient facts to meet the elements of fraudulent concealment because the second amended complaint does not contain sufficient allegations of facts to support that the defendants were actually aware of necessary facts to establish the plaintiff's cause of action and that they intentionally concealed those facts from him for the purpose of delaying his filing a complaint on the cause of action.   Therefore, the court strikes the first count in the second amended complaint.

II

SECOND COUNT:  FRAUD IN THE INDUCEMENT

“A cause of action for fraud in the inducement is the same as a common law claim to fraudulent misrepresentation.”   Tamborino v. Velocity Express, Inc., Superior Court, judicial district of Stamford–Norwalk at Stamford, Docket No. CV 05 05000234 (June 6, 2008, Tierney, J.).  “The four essential elements of fraud are (1) that a false representation of fact was made;  (2) that the party making the representation knew it had to be false;  (3) that the representation was made to induce action by the other party;  and (4) that the other party did so act to her detriment ․ Because specific acts must be pleaded, the mere allegation that a fraud has been perpetrated is insufficient.”  (Internal quotation marks omitted.)  Whitaker v. Taylor, 99 Conn.App. 719, 730, 916 A.2d 834 (2007).

In the present case, as stated above, the plaintiff has failed to allege that the defendants made any false representation of fact on which the plaintiff relied to his detriment.   Therefore, because the plaintiff has failed to plead facts to support his allegation of fraud in the inducement, count two of the second amended complaint is stricken.

III

THIRD COUNT:  CUTPA VIOLATION

General Statutes § 42–110b(a) provides:  “[n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.”  “Pursuant to the clear and unambiguous language of [General Statutes] § 42–110g(f), no cause of action can be maintained under CUTPA if brought more than three years after the unfair practice occurs.”  Bellemare v. Wachovia Mortgage Corp., 94 Conn.App. 593, 606 n.6, 894 A.2d 335 (2006), aff'd, 284 Conn. 193, 931 A.2d 916 (2007).

“Underlying the law of the case doctrine is the view that [a] judge should hesitate to change his own rulings in a case and should be even more reluctant to overrule those of another judge ․ The doctrine provides that [w]here a matter has previously been ruled upon interlocutorily, the court in a subsequent proceeding in the case may treat that decision as the law of the case, if it is of the opinion that the issue was correctly decided, in the absence of some new or overriding circumstance ․ Nevertheless, [a] judge is not bound to follow the decisions of another judge made at an earlier stage of the proceedings, and if the same point is again raised he has the same right to reconsider the question as if he had himself made the original decision.”   (Citation omitted;  emphasis added;  internal quotation marks omitted.)   Ocwen Federal Bank, FSB v. Charles, 95 Conn.App. 315, 327 n.12, 898 A.2d 197, cert. denied, 279 Conn. 909, 902 A.2d 1069 (2006).

In the present case, the plaintiff alleges that the proposals were due by March 15, 2005, and that some time prior to defendant Juan Diaz's submission of the proposal, all the named defendants were in violation of the CUTPA because they allegedly knew that they broke the rules of the closed bidding procedure and failed to communicate to the plaintiff that the rule had changed.   The plaintiff's original complaint dated October 31, 2008, which contained the CUTPA cause of action was filed on December 15, 2008.   In the memorandum of decision dated July 7, 2010, the court, Zoarski, J.T.R., held that the plaintiff's claim of violation of CUTPA should be stricken because it was barred by the three-year statute of limitations pursuant to § 42–110g(f).  Because § 42–110g(f) provides that an action for a violation of CUTPA may not be brought more than three years after the occurrence of the violation, despite the plaintiff's allegation that he learned of the defendants' alleged actions during October or November of 2008, the court grants the defendants' motion to strike the third count as it is time-barred by the statute of limitations.

CONCLUSION

For the foregoing reasons, the court grants the defendants' motion to strike the second amended complaint in its entirety.

BY THE COURT

Richard E. Burke, Judge

FOOTNOTES

FN1. As Diaz, Paulino and Juan Diaz, LLC are represented by the same attorney, they will be collectively referred to as “the defendants.”.  FN1. As Diaz, Paulino and Juan Diaz, LLC are represented by the same attorney, they will be collectively referred to as “the defendants.”

FN2. It appears from the attached certification filed by the defense counsel that, the defendants' motion to strike, which is dated September 24, 2010, has been served on all parties on September 24, 2010.   The record also reveals that the said motion had not been filed with the court until November 18, 2010..  FN2. It appears from the attached certification filed by the defense counsel that, the defendants' motion to strike, which is dated September 24, 2010, has been served on all parties on September 24, 2010.   The record also reveals that the said motion had not been filed with the court until November 18, 2010.

FN3. Although the plaintiff filed his memorandum of law on October 25, 2010, which was before the defendants filed their motion to strike with the court, the plaintiff's memorandum of law was filed in opposition to the defendants' motion at issue..  FN3. Although the plaintiff filed his memorandum of law on October 25, 2010, which was before the defendants filed their motion to strike with the court, the plaintiff's memorandum of law was filed in opposition to the defendants' motion at issue.

Burke, Richard E., J.