Lisa Bruno v. Reed Whipple et al. (2011)

CORRECTED RULING ON MOTION FOR SUMMARY JUDGMENT (# 167.00)

(Correction to Ruling dated APRIL 29, 2011

Correction made to enter ruling on all six counts of plaintiff's complaint)

The plaintiff, Lisa Bruno, commenced this action by summons and complaint dated November 10, 2008.   The action arises out of the construction of a new home on property owned by the plaintiff, Lisa Bruno, and her former husband, Stephen Bruno, by the defendant, Heritage Homes Construction Company, LLC and/or its member, the defendant, Reed Whipple.   The operative complaint, amended second revised complaint dated January 26, 2010, alleges as fact the following.   Whipple is the owner and manager of Heritage.   On October 28, 2004, Lisa Bruno and Stephen Bruno entered into a written contract with Heritage and Whipple for the construction of a home on property owned by them for the sum of $2,566,550.   By December 5, 2005, the exterior including roofing, siding, windows as well as the interior systems of the home had been completed.   On December 12, 2005, Stephen Bruno instituted divorce proceedings against Lisa Bruno.   Work continued on the home and the cost began to exceed the initial budget.   The defendants breached the agreement in the following ways:  1) defendants failed to provide Lisa Bruno with periodic accountings, 2) the defendants continued to provide additional work on the home without the authorization of Lisa Bruno, 3) the defendants failed to provide Lisa Bruno a key to the home after the certificate of occupancy was issued but provided a key to Stephen Bruno's mistress, 4) the defendant overbilled for work or billed for work which was never provided, 5) the defendants conspired to launder money for Stephen Bruno through the construction of the home.   Lisa Bruno claims damages resulting from the dissipation of marital assets into the construction of the home.   From this common body of alleged facts the complaint sounds in breach of contract (counts one and two as to Whipple and Heritage respectively), breach of covenants of good faith and fair dealing (counts three and four as to Whipple and Heritage respectively) and CUTPA (counts five and six as to Whipple and Heritage respectively).

The defendants move for summary judgment as to each of the plaintiff's claims as they pertain to Whipple, counts one, three and five, on the basis that Whipple was never a party to the contract between Heritage and the Brunos and that plaintiff's claims of breach of covenants of good faith and fair dealing as well as CUTPA are dependent upon the existence of such a contract.   The defendants move for summary judgment as to each of the plaintiff's claims as they pertain to Heritage, counts two, four and six on the basis that there is no genuine issue of fact that Heritage did not breach its contract with the plaintiff, that the allegations that the defendants engaged in a money laundering scheme with Stephen Bruno are scandalous accusations unsupported by facts and that the remaining allegations asserted by the plaintiff do not give rise to a claim under CUTPA.

The defendants assert the following as undisputed facts.   The Brunos engaged Heritage to construct a mansion for them on a time and materials basis plus a management fee on property which they had recently purchased in Ridgefield for one million dollars.   The Brunos signed the contract jointly as “owners.”   In December 2005, after in excess of two million dollars had been spent on the home the defendants learned of the Brunos' divorce.   Stephen Bruno informed Heritage that he intended to complete the construction and would honor his obligations under the contract.   Heritage continued construction and was paid for all work performed.   On July 10, 2006, the Brunos entered into a stipulation in the pending divorce (Bruno v. Bruno, Superior Court, District of Danbury, Docket No. FA–05–4004906) which was subsequently ordered by the court (Axelrod, J.) that Stephen Bruno would be permitted to finish the construction of the mansion at a cost not to exceed $2,198,564.75.   The construction was completed, Heritage paid and a certificate of occupancy was issued.   Subsequent motions filed by Lisa Bruno for contempt based upon the alleged violation of the stipulation and orders of Judge Axelrod and for dissipation of marital assets were substantially denied by the court (Axelrod, J.).   Neither Heritage nor Whipple returned, or conspired to return, any money to Stephen Bruno.

“Summary judgment is a method of resolving litigation when pleadings, affidavits, and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law ․ The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried.”  (Citations omitted.)  Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989).  “However, since litigants ordinarily have a constitutional right to have issues of fact decided by a jury ․ the moving party for summary judgment is held to a strict standard ․ of demonstrating his entitlement to summary judgment.”  (Citation omitted;  internal quotation marks omitted.)   Kakadelis v. DeFabritis, 191 Conn. 276, 282, 464 A.2d 57 (1983).

A. As to the defendant, Whipple:  (counts one, three and five)

The operative issue in this motion for summary judgment is whether Whipple was a party to the contract of October 28, 2004, for the construction of the home.   Both the plaintiff and the defendants have submitted a copy of the contract with their respective briefs.   The contract expressly identifies Heritage as the contractor, “acting herein by Reed L. Whipple, its member.”   The contract is signed by Whipple as a member of Heritage.   Nowhere in the contract is Whipple identified as a party or as an obligee to any of its provisions.   The court finds that there is no genuine issue of fact that Whipple was not a party to the contract as pleaded by the plaintiff.   Further, the viability of the plaintiff's remaining two counts as to Whipple (count three sounding in breach of covenant of good faith and fair dealing and count four in CUTPA) are directly dependent upon the existence of the contractual relationship alleged in count one.   As to breach of covenant of good faith and fair dealing, the governing rule, as restated in Jones v. H.N.S. Management Company, Inc., 92 Conn.App. 223, 226–27, 883 A.2d 831 (2005), is that, “Every contract carries an implied covenant of good faith and fair dealing requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement ․ To constitute a breach of that covenant, the acts by which a defendant allegedly impedes the plaintiff's right to receive benefits that he or she reasonably expected to receive under the contract must have been taken in bad faith ․” Under that rule, the implied covenant of good faith and fair dealing obviously rests upon the express terms of the contract and the parties' reasonable expectations thereunder.  Magnan v. Anaconda Industries, Inc., 193 Conn. 558, 572, 479 A.2d 781 (1984);  Beckenstein Enterprises–Prestige Park, LLC v. Keller, 115 Conn.App. 680, 693–94, 974 A.2d 764 (2009).   As to claims under CUTPA the plaintiff asserts no additional allegations but relied solely upon the allegations in her count for breach of contract.

The plaintiff asserts in her brief that “Reed Whipple is responsible for his own tortious conduct and is not protected by the limited liability shield.”   The court notes that the allegations as to Heritage and Whipple in the plaintiff's complaint are identical and both are alleged to have acted jointly.   None of the claims asserted against either sound in tort.   The plaintiff further asserts in her brief that the court should “pierce the corporate veil” to reach Whipple.   The plaintiff has not pleaded the necessary allegations for such theory of recovery and her unsupported or self-serving assertions in her motion are insufficient to support such a theory.   See Davenport v. Quinn, 53 Conn.App. 282, 300–01, 730 A.2d 1184 (1999).

For the foregoing reasons the court finds there are no genuine issues of material fact regarding the lack of a contractual relationship between the plaintiff and the defendant, Whipple.   In the absence of such a relationship there is no basis for holding Whipple liable under theories of breach of contract, breach of covenants of good faith and fair dealing or CUTPA.   The defendants' motion for summary judgment as to Whipple on counts one, three and five of the complaint is hereby GRANTED.

B. As to the defendant.  Heritage:  (counts two, four and six)

The court finds that there are genuine issues of material fact regarding billing and payment sufficient to defeat a motion for summary judgment as to count two, breach of contract.   As to counts four and six more than allegations of simple breach of contract are required.   With regard to count four the court refers to its discussion of breach of covenant of good faith and fair dealing as to Whipple.   As to CUTPA, count six, while “[t]here is a split of authority in Superior Court decisions regarding what is necessary to establish a CUTPA claim for breach of contract, the majority of courts [have held] that a simple breach of contract, even if intentional, does not amount to a violation of CUTPA in the absence of substantial aggravating circumstances.”  (Internal quotation marks omitted.)  Greene v. Orsini, 50 Conn.Sup. 312, 315, 926 A.2d 708 (2007);  see also Boulevard Associates v. Sovereign Hotels, Inc., 72 F.3d 1029, 1038–39 (2nd Cir.1995) (“the vast majority of courts in Connecticut [have held] that a simple breach of contract is not sufficient to establish a violation of CUTPA, particularly where the count alleging CUTPA simply incorporates by reference the breach of contract claim and does not set forth how or in what respect the defendant's activities are either immoral, unethical, unscrupulous, or offensive to public policy”).   The reason for requiring a showing of substantial aggravating circumstances is that “[a] simple breach of contract does not offend traditional notions of fairness and, standing alone, does not offend public policy so as to invoke CUTPA.”   Greene v. Orsini, supra, 315.

While the plaintiff has alleged conduct that would support a finding of aggravating circumstances sufficient for a CUTPA claim or a claim for breach of covenants of good faith and fair dealing, that the defendants have engaged in a scheme to launder money for Stephen Bruno through the construction contract, those allegations are conclusory and supported by no facts.   The defendants have challenged those assertions in their motion for summary judgment together with supporting affidavits and documents.   If the plaintiff has no evidence and her supporting documents are inadequate, the court is justified in granting summary judgment provided the defendants have met their burden of proof.   2830 Whitney Avenue Corp. v. Heritage Can. Dev. Assoc., 33 Conn.App. 563, 569, 636 A.2d 1377 (1994).   The plaintiff must demonstrate that a genuine issue of material fact exists through “counter affidavits and concrete evidence.”   Pion v. Southern New England Tel., 44 Conn.App. 657, 663, 691 A.2d 1107 (1997).   The court finds that the plaintiff has failed to meet that burden.

For the foregoing reason, the defendants' motion for summary judgment as to count two is hereby DENIED.   As to counts four and six, the court finds that there are no genuine issues of material fact.   Summary judgment as to counts four and six is hereby GRANTED.

Michael G. Maronich, Judge

Maronich, Michael G., J.