Aaron Hill et al. v. Navy Federal Credit Union (2011)

MEMORANDUM OF DECISION ON PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT

INTRODUCTION

Each of the plaintiffs has moved for partial summary judgment on their claims that the defendant, Navy Federal Credit Union (“NFCU”), violated Conn. Gen.Stat. § 36a–645 et seq., the Connecticut Creditors' Collection Practices Act (“CCPA”).   In particular, each plaintiff claims that the undisputed facts show that NFCU committed one or more prohibited acts when attempting to collect a debt from him or her.   NFCU has argued that there are genuine issues of material fact as to each plaintiff's claims.   In addition, NFCU argues that it, not each of the plaintiffs, is entitled to summary judgment based on its special defense of set-off and its counterclaim of recoupment.   It claims that because each plaintiff's debt to NFCU is indisputably greater than any damages each plaintiff could recover under the CCPA, NFCU is entitled to have judgment enter in its favor.   Consequently, in order to be entitled to summary judgment, each plaintiff must not only establish that there are no genuine issues of material facts as to his or her claim, each must also establish that there are no genuine issues of material facts as to NFCU's special defense and counterclaim.

SUMMARY JUDGMENT STANDARD

“In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party ․ The party seeking summary judgment has the burden of showing the absence of any genuine issue [of] material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law ․ and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact.”  (Citations omitted;  internal quotation marks omitted.)  Liberty Mut. Ins. v. Lone Star Indus., Inc., 290 Conn. 767, 787, 967 A.2d 1 (2009).  “It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue.   Mere assertions of fact ․ are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court [in support of a motion for summary judgment].”  (Citations omitted;  internal quotation marks omitted.)  Home Ins. Co. v. Aetna Life & Casualty, Co., 235 Conn. 185, 202, 663 A.2d 1001 (1995).

DISCUSSION

In support of their claims that the defendant violated the CCPA, each plaintiff, with the exception of Lori Curry, relies primarily on the defendant's business records in which the defendant's employees recorded notes of their debt collection efforts as to each plaintiff.   Viewing those records in a light most favorable to the nonmoving party, the court concludes that there are genuine issues of material fact as to each plaintiff's claims.   The notes are short-hand summaries of the defendant's efforts and, in all cases, are subject to multiple interpretations.   Because, at this stage of the case, the court must accept any reasonable interpretation that favors NFCU, none of the plaintiffs who rely on those notes are entitled to summary judgment.¹

As noted above though, Lori Curry does not rely on the defendant's business records.   Instead, her motion is based on her affidavit.   In her affidavit, Curry avers that:  she told NFCU that she had hired a bankruptcy attorney;  she provided NFCU with the attorney's name, address and telephone number;  and she told NFCU to contact the attorney directly.   Affidavit of Lori Curry, ¶ 7.   She further avers that despite providing this information, NFCU continued to contact her, and told her that it would continue to call her regardless of whether or not she had retained an attorney.  Id., ¶¶ 8–9.   The defendant has offered no evidence in response to Curry's affidavit.

Curry argues that the undisputed facts set forth in her affidavit establish two violations of the CCPA. First, she claims that NFCU violated section 36a–647–3 of the regulations adopted pursuant to the CCPA. That regulation provides that it is a violation of the CCPA to “communicate with any person other than the attorney for the consumer debtor or consumer debtor agent after the creditor knows the consumer debtor or consumer debtor agent is represented by an attorney with regard to the subject debt and has knowledge of such attorney's name and address ․” Regs., Conn. State Agencies § 36a–647–3(b)(5).   While Curry's affidavit states that she provided the name and address of her attorney to NFCU, it does not state that NFCU communicated with her after receiving such information.   Curry instead avers that NFCU continued to contact her.   Viewing the evidence in a light most favorable to NFCU, the court cannot conclude that any contact by NFCU necessarily involved communication from NFCU to Curry.   For example, a call from NFCU that was not answered by Curry could constitute contact, but not communication.   Consequently, Curry is not entitled to summary judgment on this claim.

Second, Curry claims that NFCU violated section 36a–647–6 of the regulations, which provides that “a creditor shall not use any fraudulent, deceptive or misleading representation, device or practice in connection with the collection of any debt,” and prohibits a creditor from threatening “to take any action that cannot legally be taken ․” Regs., Conn. State Agencies § 36a–647–6(A)(6).   She claims that NFCU's statement that it would continue to call her even though she had an attorney was a misrepresentation of NFCU's rights and her rights, and constituted a threat to take an action NFCU had no right to take.

Curry's affidavit does not set forth any representation by NFCU as to either NFCU's or Curry's legal rights or responsibilities.   NFCU merely told Curry what it intended to do.   There is at least a factual issue as to whether this statement of intention was misleading or deceptive.

Nor does Curry's affidavit establish that the statement by NFCU was a threat.   Our Appellate Court has adopted the following definition of “threat”:  “[a]ccording to Webster, Third New International Dictionary, ‘threat’ means:  ‘1:  an indication of something impending and [usually] undesirable or unpleasant ․ a:  an expression of an intention to inflict evil, injury, or damage on another [usually] as retribution or punishment for something done or left undone ․ b:  expression of an intention to inflict loss or harm on another by illegal means and [especially] by means involving coercion or duress of the person threatened ․’ “ State v. Newton, 8 Conn.App. 528, 541, 513 A.2d 1261 (1986).   Again, viewing the evidence in a light most favorable to NFCU, there is nothing in the Curry affidavit from which the court could definitively conclude that NFCU's stated intention to continue to call Curry was an indication of something unpleasant, an expression of an intention to inflict damage upon Curry, or an attempt to coerce her.   While Curry may be able to establish such facts at trial, she has not done so in connection with her motion for summary judgment.

Because none of the plaintiffs has established that they are entitled to summary judgment on their claims that NFCU violated the CCPA, the court need not address NFCU's set-off special defenses.   In fact, the law is clear that unless resolution of a special defense would be dispositive of the case, the court should not address a special defense on a motion for summary judgment.   Riley v. Pierson, 51 Conn.Sup. 513, 522–24, 13 A.3d 732 (2009), aff'd, 126 Conn.App. 486, 12 A.3d 581 (2011).

That still leaves NFCU's counterclaims seeking recoupment.  “Recoupment ․ refers to the defendant's right, in the same action, to cut down the plaintiff's demand, either because the plaintiff has not complied with some cross obligation of the contract on which he or she sues or because the plaintiff has violated some legal duty in the making or performance of that contract.   The practice serves to avoid needless delay and unnecessary litigation.”  (Internal quotation marks omitted.)  Premier Capital, Inc. v. Grossman, 68 Conn.App. 51, 58, 789 A.2d 565 (2002).  “The defense of recoupment has two characteristics:  (1) the defense arises out of the transaction constituting the plaintiff's cause of action;  and (2) it is purely defensive, used to diminish or defeat the plaintiff's cause, but not as the basis for an affirmative recovery.”  Genovese v. J.N. Clapp Co., 4 Conn.App. 443, 445–46, 495 A.2d 1079 (1985).   And while recoupment has been traditionally pled as a counterclaim, because a defendant can only use it defensively, it is for all practical purposes a special defense.   Vile v. Chamberlain, judicial district of New London at New London, Docket No. 542830 (July 1, 1999, Martin, J.);   The Frederick Corp. v. Scheckter, judicial district of Litchfield at Litchfield, Docket No. 0084350 (April 26, 2001, Cremins, J.);  Nickerson v. Martin, 34 Conn.Sup. 22, 29–30, 374 A.2d 258 (1976).²

Treating the defendant's recoupment counterclaims as special defenses, the court will not consider the plaintiffs' motion for summary judgment as to those defenses for the same reason that it will not consider the motion as to the defendant's special defenses of set-off.

CONCLUSION

For all of the foregoing reasons, the plaintiffs' motion for summary judgment is DENIED.

Bright, J.

FOOTNOTES

FN1. During argument on the plaintiffs' motion, the court reviewed in great detail with counsel the particular records relied upon by each plaintiff.   Given that the transcript of the hearing identifies each record at issue and the ambiguities that preclude the granting of summary judgment, the court will not recount them all here..  FN1. During argument on the plaintiffs' motion, the court reviewed in great detail with counsel the particular records relied upon by each plaintiff.   Given that the transcript of the hearing identifies each record at issue and the ambiguities that preclude the granting of summary judgment, the court will not recount them all here.

FN2. The only relevant difference in this case between a special defense of set-off and a counterclaim of recoupment is that recoupment requires that the defendant's claim arise out of the same transaction as does the plaintiff's claim.   Equitable set-off, as claimed by the defendant, has no such requirement..  FN2. The only relevant difference in this case between a special defense of set-off and a counterclaim of recoupment is that recoupment requires that the defendant's claim arise out of the same transaction as does the plaintiff's claim.   Equitable set-off, as claimed by the defendant, has no such requirement.

Bright, William H., J.