LLC v. Irene Forbotnick et al. (2013)

MEMORANDUM OF DECISION RE DEFENDANT IRENE FORBOTNICK'S AND GLORIA HUGHES'S MOTION FOR SUMMARY JUDGMENT (# 171)

Defendants Irene Forbotnick and Gloria Hughes move for summary judgment on plaintiff Tim–El Construction, LLC's (hereinafter “Tim–El”) claim for unpaid fees on a construction project.   Irene Forbotnick is the owner of a residence located at 16 Bishop Street in Bristol, Connecticut.   Gloria Hughes is Ms. Forbotnick's cousin and serves as her attorney-in-fact pursuant to a General Power of Attorney dated April 3, 2008.

By contract dated May 17, 2010, Ms. Hughes hired Tim–El to perform work on their Bishop Street property, which had been damaged by fire.   The cost of the rehabilitation project was $124,000.00, which was to be paid for by Ms. Forbotnick's insurance company.   Problems arose on the project and Ms. Hughes fired Tim–El on October 7, 2010, at which time Tim–El had been paid $93,875.00 under the contract.   Subsequent to Tim–El's termination, Ms. Hughes filed complaints against Tim–El with the Better Business Bureau, the Connecticut Attorney General's Office and the Bristol Police Department.   There is no evidence that any of these complaints bore fruit.

Defendants filed a Motion for Summary Judgment dated March 13, 2013 on their Special Defense that asserts that plaintiff cannot recover on his claims because the contract at issue did not comply with the dictates of the Home Improvement Act, Connecticut General Statutes § 20–419 et seq. (hereinafter “HIA”).   Plaintiff contractor filed an Objection dated April 8, 2013 and Supplemental Objection dated May 6, 2013.   The parties presented oral argument before the court on May 6, 2013.

“Practice Book § 17–49 provides that summary judgment shall be rendered forthwith if the 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.   In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party.”  Connecticut Medical Insurance Co. v. Kulikowski, 286 Conn. 1, 4–5 (2008).   This does not mean, however, that the nonmoving party can prevail simply by invoking the mantra “genuine issue of material fact” over and over:  “[T]he party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact.”   Rivera v. Double A Transportation, Inc., 248 Conn. 21, 24 (1999).

None of the parties dispute the fact that the contract at issue does not comply with the HIA. “Absent proof of bad faith on the part of the homeowner, [the HIA] permits no recovery by a home improvement contractor under theories of quantum meruit or unjust enrichment if the home improvement contract fails to comply with the statutory requirements of the act.”  Dinnis v. Roberts, 35 Conn.App. 253, 257 (1994).  “It is the burden of the party asserting lack of good faith to establish its existence and whether the burden has been satisfied in a particular case is a question of fact,” Habetz v. Condon, 224 Conn. 231, 237 n.11 (1992).   As a result, in order to successfully defend against this Motion for Summary Judgment, plaintiff must present an evidentiary foundation that an issue of fact exists regarding the issue of whether defendants acted in bad faith.   See, e.g., Dinnis, supra, 261.

Defendants convincingly claim that they had no idea the HIA existed when the contract was signed and that they only later learned that it was invalid.   The law is clear that the use of subsequent knowledge of contractual non-compliance does not rise to the level of bad faith:  “There is nothing dishonest or sinister about homeowners proceeding on the assumption that there is a valid contract, enforcing its provisions, and later, in defense to a suit by the contractor, upon learning that the contract is invalid, then exercising their right to repudiate it.”  Wadia Enterprises, Inc. v. Hirschfeld, 224 Conn. 240, 249 (1992).   However, the bad faith exception is not limited to circumstances where the homeowner repudiates a contract it entered with knowledge that it violated the HIA. See, e.g., Walpole Woodworkers, Inc. v. Manning, 126 Conn.App. 94, 101 (2011), affirmed 307 Conn. 582 (2012).  “A bad faith exception is designed to prevent a party's disavowal of previous conduct if such repudiation would not be responsive to the demands of justice and good conscience.”  Habetz, supra, 238.   In this case, plaintiff has laid a factual predicate for a bad faith claim by raising the possibility that Ms. Hughes terminated him because he would not cooperate in a kickback scheme to funnel some of the insurance proceeds to her.   While these are only unsubstantiated allegations at this point that by no means serve to demonstrate that such a scheme existed, they do serve to provide plaintiff with the requisite evidentiary foundation to withstand a Motion for Summary Judgment on the issue of bad faith.

Defendants' Motion for Summary Judgment is hereby denied.

James W. Abrams, Judge

Abrams, James W., J.