Commissioner of Labor v. Autotether, Inc. et al.
MEMORANDUM OF DECISION RE MOTION TO STRIKE
On August 2, 2012, the plaintiff, the Commissioner of Labor, filed a three-count complaint alleging unpaid wages against the defendants, Autotether, Inc. (Autotether), Autotether, LLC, and Anthony G. Viggiano, respectively.1 On January 14, 2013, the plaintiff filed a revised complaint which alleges the following facts. Autotether is an employer in East Hartford, Connecticut. It entered into an employment agreement with the claimant, Andrea Frickman (the claimant), on August 3, 2010. The claimant filed a complaint with the plaintiff on December 22, 2011, alleging unpaid wages. Upon investigation, the plaintiff found the following facts. Between December 22, 2009 and December 16, 2011, the claimant earned wages in the amount of $45,922.83. The defendant did not pay the claimant any of these wages. Autotether's principal, Viggiano, met with a wage enforcement agent and, following a review of the wage claim, did not dispute the validity of the claim. Viggiano stated that due to lack of funds the claimant was given the option of working without pay in the hope that the wages would be paid if the company's fortunes turned around. Based upon these facts, the plaintiff argues that Autotether and Viggiano were not authorized to withhold any portion of the claimant's earned wages and that any agreement between the defendants and the claimant was not binding on the plaintiff. The plaintiff seeks to collect double the amount of the unpaid wages pursuant to its authority under General Statutes § 31–72.
On February 26, 2013, the defendants filed an answer wherein they raised two special defenses, the expiration of the applicable statute of limitations and the existence of a prior oral agreement. Pending before the court is the plaintiff's motion to strike the special defenses. The matter has been fully briefed and was argued at short calendar on September 23, 2013, at which time the motion to strike the first special defense was granted by agreement of the parties.
MOTION TO STRIKE
“Whenever any party wishes to contest ․ the legal sufficiency of the allegations of any complaint, counterclaim or cross claim, or of any one or more counts thereof, to state a claim upon which relief can be granted ․ that party may do so by filing a motion to strike the contested pleading or part thereof.” Practice Book § 10–39(a). “A motion to strike is the proper vehicle by which to contest the legal sufficiency of any special defense contained in an answer to the complaint.” Doran v. Waterbury Parking Authority, 35 Conn.Sup. 280, 281, 408 A.2d 277 (1979). “The purpose of a special defense is to plead facts that are consistent with the allegations of the complaint but demonstrate, nonetheless, that the plaintiff has no cause of action.” Grant v. Bassman, 221 Conn. 465, 472–73, 604 A.2d 814 (1992). “[A] plaintiff [can move] to strike ․ special defenses, claiming that the allegations [are] insufficient to constitute defenses to the ․ action.” Great County Bank v. Pastore, 241 Conn. 423, 426, 696 A.2d 1254 (1997). “In its ruling on the [plaintiff's] motion to strike, the trial court [has an] obligation to take the facts to be those alleged in the special defenses and to construe the defenses in the manner most favorable to sustaining their legal sufficiency.” Connecticut National Bank v. Douglas, 221 Conn. 530, 536, 606 A.2d 684 (1992). “It is ․ improper for the court to consider material outside of the pleading that is being challenged by the motion.” Tracy v. New Milford Public Schools, 101 Conn.App. 560, 566, 922 A.2d 280, cert. denied, 284 Conn. 910, 931 A.2d 935 (2007).
The special defense at issue in the present action alleges that an oral agreement whereby the claimant would be compensated for her efforts “when and if” the company was sold in such a manner as it would be able to repay its obligations, relieved the defendants of any liability for unpaid wages. The plaintiff advances three arguments in support of the motion to strike this special defense: 1) the special defense must be interpreted as one attempting to deprive the plaintiff of authority to prosecute unpaid wage actions and argues that such authority cannot be revoked by an individual who is not an agent of the commissioner. The plaintiff cites to Commissioner of Labor v. Bednaz Excavating, Inc., Superior Court, judicial district of Hartford, Docket No. CV–06–4020338–S (October 24, 2006, Wiese, J.) (Bednaz ), in support of her argument. Bednaz holds that when “[t]he plaintiff is the commissioner of labor, however [he or she] cannot be estopped by the conduct of any person not its agent.” The plaintiff's second argument is that the defendant has not sufficiently alleged facts that would remove the oral agreement from the statute of frauds and therefore it is barred by that provision. The plaintiff's final argument is that a termination or resignation of an employee transforms all wages to back wages, and that any withholding of back wages is against public policy. The defendants argue in return that (1) the Supreme Court in Ravetto v. Triton Thalassic Technologies, Inc., 285 Conn. 716, 941 A.2d 309 (2008), upheld a factually similar voluntary agreement made between claimant and employer, and according to the holding in Mytech v. May Dept. Stores Co., 260 Conn. 152, 793 A.2d 1068 (2002), the plaintiff is bound by those agreements, and (2) the special defense does allege sufficient facts to take it out of the statute of frauds. The plaintiff does not directly address the defendants' third argument.
The plaintiff first moves to strike the second special defense by characterizing that defense as one of waiver and estoppel and asserting that the plaintiff's power to pursue an action for unpaid wages cannot be estopped by an agreement entered into by one who is not an agent of the commissioner. The defendants maintain that the second special defense is rooted in contract theory and that no wages are due and payable to the claimant pursuant to their agreement.
The defendants' second special defense alleges in relevant part: “[The defendants] repeatedly offered [the claimant] the option to resign and advised her to resign. [The claimant] declined to resign. Instead, [the claimant] sought and entered into an agreement with Autotether, whereby the claimant would be compensated for continued efforts when and if the company was sold in such a manner as it would be able to repay its obligations. The company has not been so sold, and no wages or compensation is due to [the claimant].”
The parties each argue that this pleading is a particular type of special defense. However, but because it is not a proper special defense, both have missed the mark on this issue. “As a general rule, facts must be pleaded as a special defense when they are consistent with the allegations of the complaint but demonstrate, nonetheless, that the plaintiff has no cause of action ․ Whether facts must be specially pleaded depends on the nature of those facts in relation to the contested issues.” (Internal quotation marks omitted.) Coughlin v. Anderson, 270 Conn. 487, 501, 853 A.2d 460 (2004).
Read in the light most favorable to the defendants, the second special defense essentially alleges that due to the existence of an alternative agreement concerning compensation between employer and employee, wages were never due to the claimant. A proper special defense pleads facts that are consistent with the plaintiff's complaint. However, the facts set forth in the second special defense are inconsistent with the allegations of the complaint because the special defense essentially denies that wages are due. This issue is appropriately raised by a general denial, not by way of special defense. The fact that the defendants must prove the existence and terms of their agreement with the claimant does not transform a general denial into a special defense. “Even under a denial, a party generally may introduce affirmative evidence tending to establish a set of facts inconsistent with the existence of the disputed fact.” Pawlinski v. Allstate Ins. Co., 165 Conn 1, 6, 327 A.2d 583 (1973).
Because the plaintiff has sought to characterize the second special defense as one for waiver and estoppel, which it clearly is not, the motion to strike must be denied on this ground. As previously discussed, while the special defense may be improper on other grounds, it is not improper for the specific ground raised by the plaintiff. “In ruling on a motion to strike the trial court is limited to considering the grounds specified in the motion.” Meredith v. Police Commission, 182 Conn. 138, 140, 438 A.2d 27 (1980); see also Scott v. Foltz, Superior Court, judicial district of New London, Docket No. CV–543218–S (December 16, 1998, Mihalakos, J.) (“The ․ special defense could be stricken on the basis that the claim should be proved under a general denial. However, the plaintiff has failed to assert this ground ․”).
The plaintiff next argues that the agreement as alleged by defendants in the second special defense is barred by the statute of frauds, and therefore, legally sufficient. The defendants counter that the uncertain duration of the contract as pleaded in their special defense takes the agreement outside of the statute of frauds, and thus the agreement is not barred. The statute of frauds is set forth in General Statutes § 52–550.
At issue in the present case is that portion of the statute of frauds concerning any contract that is not to be performed within one year of the making of the contract. “[T]he enforceability of a contract under the one-year provision [of the statute of frauds] does not turn on the actual course of subsequent events, nor on the expectations of the parties as to the probabilities. Contracts of uncertain duration are simply excluded; the provision covers only those contracts whose performance cannot possibly be completed within a year.” (Emphasis in original; internal quotation marks omitted.) C.R. Klewin, Inc. v. Flagship Properties, Inc., 220 Conn. 569, 579, 600 A.2d 772 (1991). “It is the law of this state, as it is elsewhere, that a contract is not within this clause of the statute unless its terms are so drawn that it cannot by any possibility be performed fully within one year.” (Emphasis altered; internal quotation marks omitted.) Id., 580. “If no time is definitely fixed but full performance may occur within one year through the happening of a contingency upon which the contract depends, [the contract] is not within the statute [of frauds].” (Emphasis in original; internal quotation marks omitted.) Id., 579.
The defendants further allege in their second special defense that “[The defendants] repeatedly offered [the claimant] the option to resign and advised her to resign. [The claimant] declined to resign. Instead, [the claimant] sought and entered into an agreement with Autotether, Inc. whereby the claimant would be compensated for continued efforts when and if the company was sold in such a manner as it would be able to repay its obligations.”
Thus, the second special defense contains no allegation concerning a definite time by which the stated contingency on which the contract hinged, the sale of the company, would occur. The uncertain duration during which the agreement operated does not render the special defense legally insufficient by reason of the statute of frauds. The sale of the company could have occurred within one year of the agreement. Because full performance of the contract could have occurred within the timeframe of one year, the oral agreement as pleaded does not violate the statute of frauds.
The plaintiff argues as the third ground of its motion to strike that pursuant to General Statutes § 31–71c, upon termination or discharge, all of an employee's wages become back wages and deferral of back wages has been ruled to violate public policy. “An agreement to defer wages already due unquestionably violates the public policy underlying the wage statutes.” State v. Lynch, 287 Conn. 464, 477, 948 A.2d 1026 (2008). Under General Statutes § 31–71c(a), “[w]henever an employee voluntarily terminates his employment, the employer shall pay the employee's wages in full not later than the next regular pay day ․ (b) Whenever an employee discharges an employee, the employer shall pay the employee's wages in full not later than the business day next succeeding the date of such discharge.”
The plaintiff's argument hinges on the fact that the employee was terminated or otherwise discharged from her employment. There are no allegations in either the second special defense or the complaint stating or implying that the employee resigned or was otherwise discharged from her employment. Because this argument requires the court to rely upon facts beyond those set forth in the pleadings, a motion to strike must be rejected on this ground.
Accordingly, for all the foregoing reasons, to motion to strike the defendants' second special defense is hereby denied.
FN1. The summons lists only Autotether, Inc. and Anthony G. Viggiano as defendants. Only these two defendants were served with process and only they have entered an appearance. Moreover, the motion to strike is filed by only Autotether, Inc. and Anthony G. Viggiano.. FN1. The summons lists only Autotether, Inc. and Anthony G. Viggiano as defendants. Only these two defendants were served with process and only they have entered an appearance. Moreover, the motion to strike is filed by only Autotether, Inc. and Anthony G. Viggiano.
Peck, A. Susan, J.