John L. Hammon v. Hess Corporation et al. (2013)

MEMORANDUM OF DECISION ON DEFENDANT'S MOTION TO STRIKE (# 103)

On October 25, 2012, the plaintiff, John L. Hammon, filed a four-count complaint against the defendants, Hess Corporation,¹ JAC Transport, LLC (JAC), Carfora Carriers, LLC (Carriers), and Joseph Carfora, respectively.   Counts two, three,² and four are all for violation of General Statutes § 42–110b,³ more commonly known as the Connecticut Unfair Trade Practices Act (CUTPA).   On January 30, 2013, JAC, Carriers and Carfora moved to strike counts two, three, and four.   The plaintiff filed an opposing brief on April 5, 2013.   The motion was argued June 10, 2013.

FACTS

For present purposes, the court takes the facts to be those alleged in the complaint, construed in favor of its legal sufficiency.   See New London County Mutual Ins. Co. v. Nantes, 303 Conn. 737, 747, 36 A.3d 224 (2012);  see also Connecticut Coalition for Justice in Education Funding, Inc. v. Rell, 295 Conn. 240, 252–53, 990 A.2d 206 (2010) (necessarily implied allegations are accepted as true;  complaint is construed broadly and realistically).   Viewing the allegations of counts two through four in this light, the essential facts of this case are as follows.

On May 6, 2011, the plaintiff was employed by JAC as a tanker truck driver.   On that day and in that capacity, the plaintiff parked a JAC tanker truck in a loading bay at the defendant Hess Corporation's facility in Groton, Connecticut, to load the tanker truck with petroleum.   He climbed the rear ladder of the tanker truck to the catwalk on top of the tank and put the product filler pipe into the proper position over the open tank hatch.   He could not begin loading the petroleum unless the face of the volume transfer meter was visible because, unless he could see on the meter how much product had been dispensed, there was a risk of spillage if he started filling the tanker.   The face of the volume transfer meter, however, would rotate away from his view.   Consequently, while on the catwalk of the tanker, the plaintiff reached for the meter housing to move the face of the meter back into view.   In doing so, he lost his balance and fell from the top of the tanker to the concrete below.   As a result, the plaintiff suffered injuries resulting in pain and suffering, a variety of medical treatments and expenses, sleeplessness, emotional distress, possibly permanent disability and loss of earning capacity.

JAC did not have a workers' compensation insurance policy in effect on the day of the plaintiff's fall.   JAC's motive for not having workers' compensation insurance was to increase profit.   Because JAC did not have workers' compensation insurance, the plaintiff incurred significant medical bills, lost wages, suffered delays in receiving workers' compensation benefits, had some medical treatment delayed and/or cancelled, and was subjected to worry and anxiety about the availability of medical care and lost wage reimbursement.

After the plaintiff's injuries, Carriers was established as a successor to JAC ⁴ to continue in the petroleum transport business and to avoid financial liability to the plaintiff and the state.⁵  Carriers is owned and controlled by JAC's owner, Carfora.   Carriers was established at JAC's business address and carries on the same business as JAC.

DISCUSSION

The purpose of a motion to strike is to challenge the legal sufficiency of the allegations of a complaint or count to state a claim upon which relief can be granted.   See Fort Trumbull Conservancy, LLC v. Alves, 262 Conn. 480, 498, 815 A.2d 1188 (2003).   In determining the sufficiency of a pleading, all well-pleaded facts and all necessarily implied facts are taken as admitted.  Coe v. Board of Education, 301 Conn. 112, 116–17, 19 A.3d 640 (2011).   A motion to strike does not admit legal conclusions or the correctness of opinions.   Faulkner v. United Technologies Corp., 240 Conn. 576, 588, 693 A.2d 293 (1997).   A motion to strike must be decided based only on the challenged pleading.  Zirinsky v. Zirinsky, 87 Conn.App. 257, 268 n.9, 865 A.2d 488, cert. denied, 273 Conn. 916, 871 A.2d 372 (2005).   Grounds not specified in the motion may not be considered.  Gazo v. Stamford, 255 Conn. 245, 259, 765 A.2d 505 (2001).   In ruling on a motion to strike, the court must construe the challenged pleading in the manner most favorable to sustaining its legal sufficiency.  Santorso v. Bristol Hospital, 308 Conn. 338, 349, 63 A.3d 940 (2013).   If any facts provable under the stated and implied allegations support a cause of action, the motion must be denied.  Bouchard v. People's Bank, 219 Conn. 465, 471, 594 A.2d 1 (1991).

The defendants move to strike counts two, three, and four on the grounds that (1) the complaint does not allege sufficient facts to constitute a claim that is within an exception to the exclusivity provisions of the Workers' Compensation Act, General Statutes § 31–284(a);  (2) the complaint fails to allege that the defendant committed acts in the conduct of any trade or commerce;  and (3) the complaint fails to allege sufficient facts setting forth an ascertainable loss, as required for claims under CUTPA.   The plaintiff argues that (1) § 31–284(b) specifically exempts immunity from civil actions by employees against uninsured employers;  (2) the complaint adequately alleges that the defendants committed acts in the conduct of any trade or commerce;  and (3) the complaint sufficiently alleges facts of ascertainable loss to support a claim for a violation of CUTPA.

“Connecticut's Workers' Compensation Act (act), General Statutes § 31–275 et seq., is the exclusive remedy for injuries sustained by an employee arising out of, and in the course of, his employment ․ Under the act's strict liability provisions, workers are compensated without regard to fault.   In return for a relatively low burden of proof and expeditious recovery, employees relinquish their right to any common-law tort claim for their injuries ․ Generally, then, all rights and claims between employers and employees, or their representatives or dependents, arising out of personal injury or death sustained in the course of employment are abolished as a result of the act's exclusivity bar.”  (Citations omitted;  internal quotation marks omitted.)   Johnson v. Atkinson, 283 Conn. 243, 251, 926 A.2d 656 (2007), overruled on other grounds by Jaiguay v. Vasquez, 287 Conn. 323, 948 A.2d 955 (2008).

Thus, an employee injured during the course of employment has a right to compensation exclusively through the workers' compensation system.  Motzer v. Haberli, 300 Conn. 733, 744, 15 A.3d 1084 (2011).   Generally, he is barred from bringing common-law actions against his employer for his injuries.  Id. Specifically, § 31–284(a) provides, in pertinent part:  “An employer who complies with the requirements of subsection (b) of this section shall not be liable for any action for damages on account of personal injury sustained by an employee arising out of and in the course of his employment or on account of death resulting from personal injury so sustained, but an employer shall secure compensation for his employees as provided under this chapter, except that compensation shall not be paid when the personal injury has been caused by the wilful and serious misconduct of the injured employee or by his intoxication.   All rights and claims between an employer who complies with the requirements of subsection (b) of this section and employees, or any representatives or dependents of such employees, arising out of personal injury or death sustained in the course of employment are abolished other than rights and claims given by this chapter ․”

Section 31–284(b) provides the following exception to the § 31–284(a) bar:  “If the employer fails to comply with the requirements of this subsection [regarding workers' compensation insurance or self-insurance], an employee may bring an action against such employer for damages on account of personal injury sustained by such employee arising out of and in the course of his employment or on account of death resulting from personal injury so sustained ․” Thus, the bar to personal injury claims provided in § 31–284(a) does not apply to employers who fail to carry workers' compensation insurance or to self-insure.

The plaintiff claims that, because JAC was an uninsured employer, § 31–284(b) provides an exemption to the workers' compensation bar for his CUTPA claim against JAC. That claim is unpersuasive.  “Exceptions to statutes are to be strictly construed with doubts resolved in favor of the general rule rather than the exception ․” (Internal quotation marks omitted.)  Suprenant v. Burlingham, 64 Conn.App. 409, 414, 780 A.2d 219 (2001).   The act's bar is sweeping:  “All rights and claims between an employer who complies with the requirements of subsection (b) of this section and employees ․ arising out of personal injury or death sustained in the course of employment are abolished other than rights and claims given by this chapter.” § 31–284(a).   The exception in § 31–284(b) is specific and limited:  “If the employer fails to comply with the requirements of this subsection [regarding workers' compensation insurance or self-insurance], an employee may bring an action against such employer for damages on account of personal injury ․ “ (Emphasis added.)

“The meaning of a statute shall, in the first instance, be ascertained from the text of the statute itself and its relationship to other statutes.   If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered.”  General Statutes § 1–2z.

The plain meaning of § 31–284(b) is that it provides only one exception to the § 31–284(a) bar ⁶ and that exception is “an action against such employer for damages on account of personal injury” when the employer has not complied with § 31–284(b).  Section 31–284(b) does not provide an exemption for CUTPA claims.

At oral argument, the plaintiff's attorney claimed that JAC's decision not to comply with the act—not to carry workers' compensation insurance and not to self-insure—was outside the employee-employer relationship and therefore outside the act's bar to other claims.   That is a creative sort of ultra vires argument.   However, its logical extension reveals its fundamental flaw.   First, if an employer's decision not to comply with § 31–284(b) took that noncompliance out of the § 31–284(a) bar, the limited § 31–284(b) exception would be meaningless.   Second, if every decision of an employer which broke, or allegedly broke, a law protecting workers—from an impulsive decision involving one worker to a calculated decision affecting thousands—was outside the employee-employer relationship, the boundaries of that relationship would become meaningless.

The plaintiff argues that count two sufficiently alleges a CUTPA claim because it alleges a violation by JAC of a statutory duty.   Even assuming, for the sake of analysis, that § 31–284(a) does not abolish CUTPA claims, count two fails to state a claim for violation of CUTPA.   It is true that our state Supreme Court has held that violations of statute may give rise to CUTPA claims.   See, e.g., Cheshire Mortgage Service, Inc. v. Montes, 223 Conn. 80, 105, 612 A.2d 1130 (1992) (violations of § 36–224l and federal Truth in Lending Act);  Conaway v. Prestia, 191 Conn. 484, 491, 464 A.2d 847 (1983) (violations of certain landlord-tenant statutes).   However, no court has held that every violation of a statute is also a violation of § 42–110b.   On the contrary, “[w]hen the legislature has intended to make the violation of a consumer statute an automatic violation of CUTPA, it has done so expressly.   See, e.g., General Statutes § 20–427(b) of the Home Improvement Act;  General Statutes § 42–141 of the Home Solicitation Sales Act;  see also General Statutes §§ 14–16c, 16a–22k, 16a–23a, 20–341y, 20–427, 20–457, 21–35h, 21a–222, 21a–404, 35–1, 36–435l, 36–573, 38a–355, 42–103k, 42–103aa, 42–115r, 42–115t, 42–115u, 42–126c, 42–141, 42–232, 42–251.”  Jacobs v. Healey Ford–Subaru, Inc., 231 Conn. 707, 726, 652 A.2d 496 (1995).⁷  Because the court finds the § 31–284(a) bar of other claims by employees has no exception for CUTPA claims and the court finds no other statute creating such an exception, the court finds that count two must be stricken because of the exclusivity of the Workers' Compensation Act.

At this point, it is appropriate to discuss the motion to strike counts three and four against Carriers and Joseph Carfora, respectively.   The plaintiff does not allege that he was an employee of either Carriers or Carfora.   Therefore, the plaintiff's CUTPA claims against Carriers and Carfora cannot be stricken on the ground that they are barred by the Workers' Compensation Act. In the absence of a explicit legislative creation of a violation of CUTPA, the court must examine all the facts surrounding the defendant's noncompliance in applying the threshold test for CUTPA recovery.   See Jacobs v. Healey Ford–Subaru, Inc., supra.   In the absence of a per se violation of CUTPA, the burden is on the plaintiff to show that the defendant's conduct was immoral, unethical, oppressive or unscrupulous and that it caused substantial injury to consumers, competitors or other businesspersons.   State v. Magner, Superior Court, judicial district of Hartford, Docket No. CV–07–4033475–S (November 2, 2011, Peck, J.) (violations of General Statutes § 19–296(c) and state sales tax law are not per se violations of CUTPA).   It is the nature of the defendant's conduct, not just the nature of the parties' relationship, that determines whether CUTPA is applicable.   See Fink v. Golenbock, 238 Conn. 183, 214, 680 A.2d 1243 (1996).  “The fact that the plaintiff was allegedly employed by the defendants ․ is not dispositive.   Even if an employer-employee relationship exists, the court must examine whether the defendants' alleged conduct falls outside the confines of that relationship and within CUTPA's ambit.”   Evans v. Tiger Claw, Inc., Superior Court, judicial district of New Haven, Docket No. CV–07–5013346–S (May 16, 2008, Licari, J.).

In determining whether a practice violates CUTPA, our Supreme Court has adopted the criteria set out in the “cigarette rule” by the Federal Trade Commission for determining when a practice is unfair:  “(1) [W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise—in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness;  (2) whether it is immoral, unethical, oppressive, or unscrupulous;  (3) whether it causes substantial injury to consumers, [competitors or other business persons] ․ All three criteria do not need to be satisfied to support a finding of unfairness.   A practice may be unfair because of the degree to which it meets one of the criteria or because to a lesser extent it meets all three.”   (Internal quotation marks omitted.)  Naples v. Keystone Bldg. and Development Corp., 295 Conn. 214, 227–28, 990 A.2d 326 (2010).  “In McLaughlin v. Ford Motor Co., 192 Conn. 558, 473 A.2d 1185 (1984), we concluded that CUTPA is not limited to conduct involving consumer injury and that a competitor or other business person can maintain a CUTPA cause of action without showing consumer injury.”  (Internal quotation marks omitted.)  Fink v. Golenbock, supra, 238 Conn. 215;  see Macomber v. Travelers Property and Casualty Corp., 261 Conn. 620, 643, 804 A.2d 180 (2002).

In Quimby v. Kimberly Clark Corp., 28 Conn.App. 660, 661–62, 613 A.2d 838 (1992), the plaintiff employee contended that her employer, which was self-insured for workers' compensation, had administered her claim of injury improperly.   Specifically, the plaintiff claimed “the defendant's failure to pay benefits in a timely manner, to investigate reasonably and promptly the plaintiff's claim and to enter into a reasonable resolution of the plaintiff's claim” constituted a CUTPA violation.  Id., 669–70.   The Appellate Court, however, rejected this claim, noting that “[t]he plaintiff does not allege that the defendant committed these acts in the conduct of any trade or commerce ․ The relationship in this case is not between a consumer and a commercial vendor, but rather between an employer and an employee.   There is no allegation in the complaint that the defendant advertised, sold, leased or distributed any services or property to the plaintiff.”  (Citation omitted;  internal quotation marks omitted.)  Id., 670.   As a result, the court rejected the employee's CUTPA claim because the failure to pay workers' compensation benefits was not alleged to have occurred within the conduct or any trade or commerce.  Id.

Similarly, in the present case, the plaintiff fails to bridge the gap between noncompliance with § 31–284(b) and the elements of a CUTPA claim.   More particularly, the complaint does not allege that the defendants' failure to carry workers' compensation insurance occurred within the context of any trade or commerce.   Rather, the complaint merely alleges that the plaintiff was employed by JAC and that JAC was in the business of transporting petroleum products.

The separate allegation that the defendants did not have workers' compensation insurance is an employment issue outside the trade or commerce of transporting petroleum products.   Moreover, in relation to JAC, Carriers and Carfora, the plaintiff is not a consumer, competitor, or other business person.   A mere employer-employee relationship does not rise to the level of trade or commerce cognizable under CUTPA.   See United Components, Inc. v. Wdowiak, 239 Conn. 259, 264–65, 684 A.2d 693 (1996) (CUTPA not applicable because plaintiff's claim involved employer-employee relationship, not trade or commerce for CUTPA purposes).

Paragraphs 20 and 25 alleges that JAC's motive for not complying with the act was to increase profit and that Carriers “was established” and owned by JAC's owner, Carfora, to carry on JAC's business and avoid financial liability to the plaintiff and the state is insufficient to state a claim for violation of CUTPA.   If increased profit as a motive by a business for noncompliance with the law was enough to allege a practice in the course of trade or commerce, virtually any cost-cutting measure by a business would become a CUTPA violation.   Such a determination is for the General Assembly, not this court.   Treating paragraph 25 as alleging that Carfora established Carriers,⁸ count two, which is against JAC, does not allege that JAC established Carriers.   In any event, the establishment of Carriers occurred after the plaintiff's fall and injuries.   In count three, it is not alleged that Carriers established itself.   In count four, against Carfora personally, paragraph 25, even read in light of paragraph 26, which alleges the legal conclusions that Carfora's conduct was oppressive, unethical, against public policy and committed for improper motives, does not allege a practice in the course of trade or commerce that violates § 42–110b (let alone one that caused an ascertainable loss to the plaintiff).

In sum, count two of the plaintiff's complaint must be stricken against JAC on the ground that it is barred by the Workers' Compensation Act. Section 31–284 provides an exclusive set of remedies against his employer—a workers' compensation claim where § 31–284(a) has been complied with and a personal injury claim where § 31–284(a) is violated.   Additionally, counts two, three, and four against the defendants must be stricken on the ground that they do not sufficiently allege a violation of § 42–110b.   Specifically, the alleged failure to carry workers' compensation insurance, the profit motive for that failure, and the establishment of Carriers, even taken together, are not acts within the conduct of its trade or commerce for CUTPA purposes.   Accordingly, because counts two, three, and four are stricken on these grounds, the court does not need to address the defendants' third ground for the present motion, insufficient allegations of ascertainable loss under CUTPA.

For the foregoing reasons, the defendants' motion to strike counts two, three, and four is granted.

Cole–Chu, J.

FOOTNOTES

FN1. Count one against Hess Corporation is not the subject of this motion.   JAC Transport, LLC, Carfora Carriers, LLC, and Joseph Carfora will be collectively referred to as “defendants” in this decision.   The court substitutes words for the Roman numerals of counts used by the plaintiff..  FN1. Count one against Hess Corporation is not the subject of this motion.   JAC Transport, LLC, Carfora Carriers, LLC, and Joseph Carfora will be collectively referred to as “defendants” in this decision.   The court substitutes words for the Roman numerals of counts used by the plaintiff.

FN2. Count three refers to the first “Count IV” in the complaint, while count four refers to the second “Count IV.”.  FN2. Count three refers to the first “Count IV” in the complaint, while count four refers to the second “Count IV.”

FN3. At paragraph 26 of counts two, three and four, the plaintiff alleges a violation of General Statutes § 42–110g et seq.  Section 42–110g follows § 42–110b, which, in subsection (a), defines and prohibits unfair trade practices:  “No person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.” § 42–110g is an enabling statute for suits for damages and other relief from violations of § 42–110b.   For present purposes, construing the plaintiff's complaint toward sustaining its legal sufficiency;  Santorso v. Bristol Hospital, 308 Conn. 338, 349, 63 A.3d 940 (2013);  the court regards the plaintiff as alleging violation of § 42–110b..  FN3. At paragraph 26 of counts two, three and four, the plaintiff alleges a violation of General Statutes § 42–110g et seq.  Section 42–110g follows § 42–110b, which, in subsection (a), defines and prohibits unfair trade practices:  “No person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.” § 42–110g is an enabling statute for suits for damages and other relief from violations of § 42–110b.   For present purposes, construing the plaintiff's complaint toward sustaining its legal sufficiency;  Santorso v. Bristol Hospital, 308 Conn. 338, 349, 63 A.3d 940 (2013);  the court regards the plaintiff as alleging violation of § 42–110b.

FN4. Counts two, three and four do not say to what company Carriers was “a successor company,” but the necessary implication is that Carriers is alleged to be successor to JAC. The interpretation of pleadings is a question of law for the court.  Boone v. William W. Backus Hospital, 272 Conn. 551, 559, 864 A.2d 1 (2005)..  FN4. Counts two, three and four do not say to what company Carriers was “a successor company,” but the necessary implication is that Carriers is alleged to be successor to JAC. The interpretation of pleadings is a question of law for the court.  Boone v. William W. Backus Hospital, 272 Conn. 551, 559, 864 A.2d 1 (2005).

FN5. By motion filed February 15, 2013, the Treasurer of the state of Connecticut, as custodian of the workers' compensation second injury fund, intervened as co-plaintiff pursuant to General Statutes §§ 31–293 and 31–352.   The Treasurer's “Intervening Complaint of The Second Injury Fund” alleges, in essence, that the plaintiff was injured as alleged in the plaintiff's complaint, while the plaintiff was employed by JAC “dba Northeast Carriers”;  that the employer was not insured for workers' compensation benefits and that the second injury fund has become or may become liable to pay the plaintiff's workers' compensation benefits.   The intervening complaint seeks apportionment between the second injury fund and the plaintiff of damages recovered in this suit..  FN5. By motion filed February 15, 2013, the Treasurer of the state of Connecticut, as custodian of the workers' compensation second injury fund, intervened as co-plaintiff pursuant to General Statutes §§ 31–293 and 31–352.   The Treasurer's “Intervening Complaint of The Second Injury Fund” alleges, in essence, that the plaintiff was injured as alleged in the plaintiff's complaint, while the plaintiff was employed by JAC “dba Northeast Carriers”;  that the employer was not insured for workers' compensation benefits and that the second injury fund has become or may become liable to pay the plaintiff's workers' compensation benefits.   The intervening complaint seeks apportionment between the second injury fund and the plaintiff of damages recovered in this suit.

FN6. There is an exception to the § 31–284(a) bar for claims that an employer intentionally injured an employee or intentionally created a condition that made injury substantially certain.   See Motzer v. Haberli, 300 Conn. 733, 743–44, 15 A.3d 1084 (2011).   The plaintiff does not allege such a claim..  FN6. There is an exception to the § 31–284(a) bar for claims that an employer intentionally injured an employee or intentionally created a condition that made injury substantially certain.   See Motzer v. Haberli, 300 Conn. 733, 743–44, 15 A.3d 1084 (2011).   The plaintiff does not allege such a claim.

FN7. Even where a CUTPA claim is allowed by statute, violation of the statute may not be a violation of CUTPA.   See Naples v. Keystone Bldg. and Development Corp., 295 Conn. 214, 231 n.17, 990 A.2d 326 (2010) (New Home Warranties Act breach not a per se violation of CUTPA)..  FN7. Even where a CUTPA claim is allowed by statute, violation of the statute may not be a violation of CUTPA.   See Naples v. Keystone Bldg. and Development Corp., 295 Conn. 214, 231 n.17, 990 A.2d 326 (2010) (New Home Warranties Act breach not a per se violation of CUTPA).

FN8. See footnote 4..  FN8. See footnote 4.

Cole–Chu, Leeland J., J.