Raspberry Junction Holding, LLC v. Southeastern Connecticut Water Authority ( 2021 )

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RASPBERRY JUNCTION HOLDING, LLC v.
SOUTHEASTERN CONNECTICUT
WATER AUTHORITY
(SC 20454)
Robinson, C. J., and McDonald, D’Auria, Mullins,
Kahn, Ecker and Keller, Js.
Syllabus
The plaintiff, the owner of a hotel, sought to recover damages from the
defendant municipal water authority for economic losses it incurred in
connection with an explosion at the defendant’s pumping station, which
allegedly was caused by the defendant’s negligence and resulted in an
extended interruption of water service at the plaintiff’s hotel and loss
of revenue. The defendant moved for summary judgment, contending,
inter alia, that the plaintiff’s claim was barred by the economic loss
doctrine. The trial court granted the defendant’s motion for summary
judgment and rendered judgment thereon, concluding that the defendant
owed the plaintiff no legal duty of care. In reaching its decision, the
court determined that, although the plaintiff’s economic losses were
reasonably foreseeable, imposing a duty on the defendant was inconsis-
tent with public policy, as determined by the applicable four factor test
first articulated in Jaworski v. Kiernan (241 Conn. 399), which requires
a court to consider the normal expectations of the participants in the
activity, the public policy of encouraging participation in the activity
while weighing the safety of the participants, the avoidance of increased
litigation, and the decisions of other jurisdictions. On the plaintiff’s
appeal from the judgment in favor of the defendant, held that the trial
court correctly determined that the defendant owed the plaintiff no legal
duty of care because, although it was reasonably foreseeable that an
extended interruption of water service would cause economic losses
for any of the defendant’s customers whose livelihood depended on the
constant supply of water, each of the four factors in Jaworski militated
against imposing a duty on the defendant, as a matter of public policy,
under the circumstances of the case: the normal expectations of the
parties in the purchase and sale of water militated decisively against
the imposition of a duty because the relevant statutory and case law
compelled the conclusion that neither party reasonably could have
expected that the defendant, a municipal corporation, would be liable
in negligence for economic losses incurred by its customers as a result
of an interruption in water service; moreover, imposing a duty on the
defendant to prevent economic losses from interruptions in water ser-
vice would result in a predictable increase in litigation without a corres-
ponding increase in the physical safety of the defendant’s customers,
and, because water is an essential necessity of life, its use requires
no encouragement by the law; furthermore, the vast majority of other
jurisdictions bar recovery for economic losses in a negligence action
arising out of damage to the person or property of another, and this
court rejected the plaintiff’s contention that this factor weighed in favor
of imposing a duty because a number of jurisdictions recognize an
exception to the general rule barring recovery when a special relation-
ship exists between the parties, as the plaintiff did not identify any
attribute of its relationship with the defendant that would bring the
present case into the extremely limited class of negligence cases that
do not bar recovery for economic losses.
(One justice concurring separately)
Argued January 15—officially released August 18, 2021*
Procedural History
Action to recover damages sustained as a result of
the defendant’s alleged negligence, and for other relief,
brought to the Superior Court in the judicial district of
New London, where the court, Vacchelli, J., granted
the defendant’s motion for summary judgment and ren-
dered judgment thereon, from which the plaintiff
appealed; thereafter, this court reversed the trial court’s
judgment and remanded the case for further proceed-
ings; on remand, the court, Calmar, J., granted the
defendant’s motion for summary judgment and ren-
dered judgment thereon, from which the plaintiff
appealed. Affirmed.
Santa Mendoza, for the appellant (plaintiff).
Stephanie S. Berry, with whom, on the brief, was
Christopher C. Ring, for the appellee (defendant).
Opinion
KELLER, J. The plaintiff, Raspberry Junction Hold-
ing, LLC, the owner of a 164 room hotel in North Ston-
ington, commenced this negligence action against the
defendant, Southeastern Connecticut Water Authority,
a municipal corporation that provides water to twenty-
one towns and boroughs in southeastern Connecticut,
seeking damages for economic losses it incurred when
an explosion at the defendant’s North Stonington pump-
ing station caused an interruption in the hotel’s water
service. The defendant moved for summary judgment,
contending that (1) it was immune from liability under
rules it had adopted pursuant to the rule-making author-
ity conferred on it by the legislature, and (2) the plain-
tiff’s claim was barred by the economic loss doctrine,
a common-law rule, which, ‘‘generally characterized,
reflects the principle that a plaintiff cannot sue in tort
for purely monetary loss unaccompanied by physical
injury or property damage.’’ Raspberry Junction Hold-
ing, LLC v. Southeastern Connecticut Water Authority,
331 Conn. 364, 368 n.3, 203 A.3d 1224 (2019). The trial
court, Vacchelli, J., agreed with the defendant’s first
contention and granted its motion for summary judg-
ment. Id., 368. The plaintiff appealed, and this court
reversed the trial court’s judgment and remanded the
case for consideration of the defendant’s alternative
ground for summary judgment. Id., 378. Presently
before us is the plaintiff’s appeal1 from the judgment
of the trial court, Calmar, J., again granting the defen-
dant’s motion for summary judgment, this time on the
theory that the defendant owed the plaintiff no legal
duty of care. On appeal, the plaintiff claims that the
trial court incorrectly determined that the defendant
could not be held liable for the plaintiff’s losses because
public policy does not support the imposition of a duty
on the defendant under the circumstances of this case.
We disagree and, accordingly, affirm the judgment of
that court.
The following undisputed facts and procedural his-
tory are relevant to our resolution of this appeal. ‘‘The
defendant was created in 1967 by a special act of the
General Assembly as a body politic and corporate of the
state, designated to perform the ‘essential government
function’ of planning, operating, and maintaining a
water supply system for the benefit of the southeastern
Connecticut planning region. 33 Spec. Acts 478, No. 381
(1967) (special act).2 Section 14 of [the special] act sets
forth the powers and duties conferred on the defendant,
including ‘the power . . . to make . . . rules for the
sale of water and the collection of rents and charges
therefor . . . [and] to do all things necessary or conve-
nient to carry out the powers expressly given in [the] act
. . . .’ 33 Spec. Acts 481, 483–84, No. 381, § 14 (1967).’’
(Footnote altered.) Raspberry Junction Holding, LLC
v. Southeastern Connecticut Water Authority, supra,
331 Conn. 366–67.
‘‘The [defendant] is a publicly owned agency of gov-
ernment, not a private company. Its function, simply
stated, is to plan, operate and construct water supply
systems in Southeastern Connecticut. The underlying
consideration in the creation of the [defendant] by the
legislature, in response to local initiatives, was that the
long range public interest is best served by a collective
and cooperative approach to the water supply require-
ments, present and future.’’ Southeastern Connecticut
Water Authority, Rules Governing Water Service, avail-
able at https://www.waterauthority.org/rules-govern
ing-service (last visited August 9, 2021).
The defendant consists of seven members appointed
by the representative advisory board (advisory board),
which is comprised of two members from each of the
twenty-one towns and boroughs served by the defen-
dant. Id. Advisory board members are appointed by the
board of selectmen or town council from each town or
borough for a term of two years and serve without
compensation. See 33 Spec. Acts 479, No. 381, §§ 4 and 5
(1967). ‘‘The [advisory board], in addition to appointing
[the defendant’s] members, annually audits the financial
records of the [defendant]. It also holds public hearings
on proposed changes in rates. Within the [advisory
board], there are several standing committees, includ-
ing [f]inance, [l]egislative, and [c]ustomer [a]ppeals.
The [c]ustomer [a]ppeals [c]ommittee’s purpose is to
resolve misunderstandings between the [defendant]
and its customers. [Each] town’s [advisory board] mem-
bers are [the] direct representatives [of the defendant’s
customers] . . . .’’ Southeastern Connecticut Water
Authority, supra.
‘‘In 2016, the plaintiff commenced the present action
against the defendant, seeking damages [for] a loss of
water service at [its hotel] . . . . In its one count com-
plaint, the plaintiff alleged that the hotel lost water
service for several days in June, 2015, due to the explo-
sion of a hydropneumatic tank at a pumping station
operated by the defendant as a result of the defendant’s
negligent construction, operation, inspection or mainte-
nance of the tank and its valves. The plaintiff further
alleged that the water outage caused the plaintiff to
lose revenue due to its inability to rent rooms and the
need to give refunds to hotel guests during the water
outage.
‘‘The defendant moved for summary judgment on
two grounds. First, it contended that rule 5 [of the
defendant’s ‘Rules Governing Water Service’] immu-
nized it from liability for the plaintiff’s damages . . . .
Second, it contended that, because the plaintiff was
seeking damages for monetary loss only, the claim is
barred by the common-law economic loss doctrine. The
plaintiff opposed the motion, arguing that the defen-
dant, as a municipal corporation engaged in a proprie-
tary function, is not immune from suit and has no
authority, express or implied, to promulgate rules that
waive liability for negligence. The plaintiff also argued
that the economic loss doctrine does not apply under
the circumstances presented.’’ (Citation omitted; foot-
note omitted.) Raspberry Junction Holding, LLC v.
Southeastern Connecticut Water Authority, supra, 331
Conn. 367–68.
The trial court, Vacchelli, J., agreed with the defen-
dant’s first contention and rendered summary judgment
in the defendant’s favor. Id., 368. On appeal, this court
reversed the trial court’s judgment on the basis of our
determination that the legislature did not authorize the
defendant to promulgate rules immunizing itself from
liability. Id., 370. In light of that determination, we
remanded the case to the trial court for consideration
of the defendant’s alternative ground for summary judg-
ment, namely, that the plaintiff’s claim was barred by
the economic loss doctrine. Id., 378.
On remand, the parties filed additional briefs in sup-
port of their respective positions. Following oral argu-
ment, the trial court, Calmar, J., issued a memorandum
of decision in which it granted the defendant’s motion
for summary judgment. The trial court, citing Lawrence
v. O & G Industries, Inc., 319 Conn. 641, 664, 126 A.3d
569 (2015), explained that the economic loss doctrine
is a common-law rule intended ‘‘to shield a defendant
from unlimited liability for all of the economic conse-
quences of a negligent act, particularly in a commercial
or professional setting, and thus to keep the risk of
liability reasonably calculable.’’ (Internal quotation marks
omitted.) The trial court further explained that this
court previously has declined to apply the economic
loss doctrine as a categorical bar to the recovery of
purely economic losses in a tort action, opting instead
to apply a traditional duty analysis to the question of
whether a defendant’s liability should extend to such
losses. Applying this analysis, the trial court concluded
that the defendant owed the plaintiff no legal duty of
care.
In reaching its determination, the court, quoting Law-
rence, explained that whether a duty exists turns on
two considerations, the foreseeability of the harm and
‘‘a determination, on the basis of a public policy analy-
sis, of whether the defendant’s responsibility for its
negligent conduct should extend to the particular con-
sequences or particular plaintiff in the case.’’ (Internal
quotation marks omitted.), quoting Lawrence v. O & G
Industries, Inc., supra, 319 Conn. 650. The court further
explained that, in determining whether public policy
supports the imposition of a duty, courts apply the well
established test first articulated in Jaworski v. Kiernan,
241 Conn. 399, 407, 696 A.2d 332 (1997), which requires
courts to consider the following four factors: ‘‘(1) the
normal expectations of the participants in the activity
under review; (2) the public policy of encouraging par-
ticipation in the activity, while weighing the safety of
the participants; (3) the avoidance of increased litiga-
tion; and (4) the decisions of other jurisdictions.’’ (Inter-
nal quotation marks omitted.) Lawrence v. O & G Indus-
tries, Inc., supra, 650. Applying these well established
principles, the court determined that, although the
plaintiff’s economic losses were reasonably foresee-
able, imposing a duty on the defendant was inconsistent
with public policy, as determined by the applicable four
factor test.
Specifically, the trial court concluded that, although
the first factor favored the plaintiff ‘‘slightly’’ insofar as
water service customers generally expect an interrup-
tion in service to be ‘‘temporary,’’ lasting hours rather
than days, the remaining three factors weighed against
the imposition of a duty. With respect to the second
factor, the court concluded that using water is not an
activity that requires the encouragement of the law,
and, because the defendant already may be held liable
for personal injury or property damage resulting from
its negligence, ‘‘[i]mposing a duty on the defendant to
hold it liable for economic losses would . . . not posi-
tively impact safety because it would not increase [the
defendant’s] impetus to act with due care.’’ (Internal
quotation marks omitted.) With respect to the third
factor, the court determined that it too ‘‘weigh[ed] heav-
ily against imposing a duty on the defendant,’’
explaining that, ‘‘[s]hould the defendant ever need to
halt its [water] service . . . in the future, it is possible
that all of its affected customers, both residential and
commercial, could initiate an action against [it] . . .
[potentially] flooding the courts with spurious and
fraudulent claims’’ and exposing the defendant to ‘‘end-
less’’ litigation. (Internal quotation marks omitted.)
Finally, the trial court concluded that the fourth fac-
tor also weighed decisively against the imposition of a
duty. Specifically, the court noted that most jurisdic-
tions ‘‘bar a plaintiff from recovering purely economic
losses in [a] tort [action] in the absence of personal
injury or property damage.’’ The court reasoned that,
were it to find that the defendant owed a duty to the
plaintiff, it ‘‘would expose [the defendant] to potentially
limitless liability,’’ the costs of which would be borne
by the defendant’s other customers in the form of
increased rates. The court also noted that, even in those
jurisdictions that permit the recovery of purely eco-
nomic losses in a negligence action, a plaintiff must
establish that a special relationship existed between the
parties such that the plaintiff’s losses were ‘‘particularly
foreseeable’’ to the defendant, which the plaintiff in the
present case could not do.
On appeal, the plaintiff claims that the trial court
incorrectly determined that the defendant owed the
plaintiff no duty of care. Specifically, the plaintiff con-
tends that the trial court, in analyzing the second and
third factors of the public policy prong of the duty
analysis, incorrectly concluded that, because the defen-
dant may be held civilly liable for physical injury and
damage to property resulting from its negligence,
imposing an additional duty on the defendant for eco-
nomic losses would not address a valid safety concern.
In support of this contention, the plaintiff argues that,
because the defendant is not subject to extensive state
or federal regulation and knows that ‘‘even an extremely
dangerous event’’ such as a ‘‘catastrophic explosion at
a pumping station’’ is unlikely to cause bodily injury or
damage to the property of another, ‘‘the possibility of
civil liability for economic harm is perhaps the one
and only avenue that would increase [the defendant’s]
impetus to act with due care.’’ (Internal quotation marks
omitted.) The plaintiff further contends that ‘‘[t]he ubiq-
uitous need for water, both for basic hygiene and health
and also [for] fire safety . . . suggests that . . . Con-
necticut law . . . should be encouraging every effort to
ensure the uninterrupted distribution of [that resource]
. . . .’’ The plaintiff finally contends that the trial court,
in applying the fourth factor of the public policy analy-
sis, failed to consider the ‘‘growing list of jurisdictions
willing to extend liability in opposition to the economic
loss doctrine when a special relationship exists [between
the parties].’’ The plaintiff asserts that a special relation-
ship exists between the parties in the present case as
a result of the ‘‘imbalance of power’’ between them,
which allows the defendant ‘‘to take advantage of or
exercise undue influence over’’ the plaintiff, who,
because of the defendant’s monopoly over the supply
of water in the plaintiff’s area, has no choice but to
purchase water from the defendant. (Internal quotation
marks omitted.)
The defendant responds, inter alia, that the trial court
correctly determined that it owed the plaintiff no legal
duty of care. The defendant disagrees, however, with
the trial court’s determination that the plaintiff’s eco-
nomic losses were foreseeable, arguing instead that
nonpotable water was restored to the plaintiff within
twenty-four hours of the initial outage, while potable
drinking water was provided free of charge until a new
water system was installed. The defendant contends
that the plaintiff’s business losses were not the result of
a lack of water but, rather, resulted from unforeseeable
‘‘restrictions put in place by a fire marshal . . . [who]
limited the number of rooms the plaintiff could rent
and required the plaintiff to patrol its hotel to accommo-
date a potential limitation on its ability to operate its
sprinkler system.’’ As for the public policy prong of the
duty analysis, the defendant argues that the trial court
correctly determined that it militates against the imposi-
tion of a duty, although the defendant disagrees with
that court’s determination that the first factor of the
analysis favors the plaintiff, even slightly. The defendant
contends, rather, that the normal expectations of the
parties were met because, although uninterrupted water
service may be the expectation, that expectation does
not apply when, as in the present case, there are exigent
circumstances such as the explosion at the defendant’s
pumping station. The defendant further maintains that
the parties’ expectations were met in any event because
the service interruption did not last for several days,
as the plaintiff claims but, rather, for less than twenty-
four hours, and the parties’ contract alerted the plaintiff
that service interruptions may occur at any time and for
any reason. We conclude that the trial court correctly
determined that the defendant owed the plaintiff no
legal duty of care.
‘‘Practice Book [§ 17-49] provides that summary judg-
ment shall be rendered forthwith if the pleadings, affida-
vits 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 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 . . . . A material fact . . . [is] a fact [that] will
make a difference in the result of the case.’’ (Internal
quotation marks omitted.) Shoreline Shellfish, LLC v.
Branford, 336 Conn. 403, 410, 246 A.3d 470 (2020). The
scope of our review of the trial court’s decision to
grant the defendant’s motion for summary judgment is
plenary. See id.As we previously have explained, ‘‘[a] cause of action
in negligence is comprised of four elements: duty;
breach of that duty; causation; and actual injury. . . .
Whether a duty exists is a question of law for the court,
and only if the court finds that such a duty exists does
the trier of fact consider whether that duty was
breached.’’ (Internal quotation marks omitted.) Law-
rence v. O & G Industries, Inc., supra, 319 Conn. 649.
‘‘If a court determines, as a matter of law, that a defen-
dant owes no duty to a plaintiff, the plaintiff cannot
recover in negligence from the defendant. . . . Duty is
a legal conclusion about relationships between individ-
uals, made after the fact, and imperative to a negligence
cause of action. The nature of the duty, and the specific
persons to whom it is owed, are determined by the
circumstances surrounding the conduct of the individ-
ual. . . . Foreseeability is a critical factor in the analy-
sis, because no duty exists unless an ordinary person
in the defendant’s position, knowing what the defendant
knew or should have known, would anticipate that harm
of the general nature of that suffered was likely to result
. . . . Our law makes clear that foreseeability alone,
however, does not automatically give rise to a duty of
care . . . . A further inquiry must be made, for we
recognize that duty is not sacrosanct in itself . . . but
is only an expression of the sum total of those consider-
ations of policy [that] lead the law to say that the plain-
tiff is entitled to protection. . . . The final step in the
duty inquiry, then, is to make a determination of the
fundamental policy of the law, as to whether the defen-
dant’s responsibility should extend to such results.
(Citations omitted; internal quotation marks omitted.)
Demond v. Project Service, LLC, 331 Conn. 816, 834–35,
208 A.3d 626 (2019).
In Lawrence, in which a group of construction work-
ers sought to recover lost wages after an explosion
destroyed their work site; Lawrence v. O & G Indus-
tries, Inc., supra, 319 Conn. 644–45; this court rejected a
claim that, ‘‘independent of a duty analysis, [we] should
adopt the economic loss doctrine as a ‘categorical bar’
to a plaintiff’s recovery of ‘economic loss . . . in tort
absent damage to [the plaintiff’s] person or property’ ’’
because such a bar was ‘‘ ‘in line’ ’’ with more than one
century of Connecticut case law. Id., 648 n.8. In so
doing, ‘‘we agree[d] with the trial court’s observation
that the ‘[economic loss] doctrine, as employed in tort
cases to preclude a plaintiff’s claim, is merely another
way of saying that the defendant[s] owed no duty to
the plaintiff because the claimed loss was a remote and
indirect consequence of the misconduct of the defen-
dants.’ ’’ Id.; see also Eastwood v. Horse Harbor Foun-
dation, Inc., 170 Wn. 2d 380, 389, 241 P.3d 1256 (2010)
(‘‘A review of [Washington] cases on the economic loss
rule shows that ordinary tort principles have always
resolved th[e] question [of liability]. An injury is remedi-
able in tort if it traces back to the breach of a tort duty
arising independently of the terms of the contract. The
court determines whether there is an independent tort
duty of care, and [t]he existence of a duty is a question
of law and depends on mixed considerations of logic,
common sense, justice, policy, and precedent.’’ (Inter-
nal quotation marks omitted.)).
Our reluctance in Lawrence to adopt the economic
loss doctrine as a categorical bar to recovery also
reflected a desire to avoid the confusion that has arisen
in jurisdictions that have adopted such a rule even
though pure economic loss remained recoverable in
those jurisdictions in a variety of tort contexts, includ-
ing negligence. See, e.g., Alma v. AZCO Construction,
Inc., 10 P.3d 1256, 1263 (Colo. 2000) (‘‘[S]ome torts are
expressly designed to remedy pure economic loss (e.g.,
professional negligence, fraud, and breach of fiduciary
duty). It is here that substantial confusion arises from
the use of the term ‘economic loss rule.’ ’’); see also
Restatement (Third), Torts, Liability for Economic
Harm § 1, comment (b), p. 2 (2020) (‘‘[s]tating the
absence of a duty as a general rule can create confusion
by seeming to threaten [well established] causes of
action, by leaving behind an uncertain and unwieldy
number of exceptions, and by implying a needless pre-
sumption against the existence of a duty on facts not
yet considered’’).
The Restatement (Third) of Torts explains: ‘‘Liability
for the unintentional infliction of economic loss
emerged only within the last [forty] years as a distinct
topic for analysis within the law of torts. . . . Refer-
ences to an economic-loss ‘rule’ or ‘doctrine’ began to
appear in American case law for the first time in the
1970s. The expression sometimes referred to the idea
that a plaintiff cannot collect in tort for economic losses
suffered as a result of injury to the person or property
of another—a doctrine covered here in § 7 . . . . Other
courts treated the economic-loss rule as meaning that
plaintiffs cannot collect in tort when they buy products
that disappoint their economic expectations . . . .
Many courts have extended that principle from cases
involving products to other cases [in which] a defen-
dant’s breach of contract causes financial losses to the
plaintiff. . . . When articulating any of these doctrines,
courts sometimes have spoken generally of a rule
against recovery in tort for pure economic loss.
‘‘ ‘Economic loss’ thus has become a significant and
distinct category within the law of liability for negli-
gence. It has become a potent source of confusion as
well. Courts have long assumed, often without much
discussion, that no recovery can be had in tort for cer-
tain types of economic loss; but they also have long
allowed recovery of economic losses in cases of profes-
sional malpractice and in certain other settings. . . .
When some courts began to say that tort law should
not be used to redress pure economic loss, they created
uncertainty about whether [well established] causes of
action still were valid, and about how one might sepa-
rate emerging claims that survive the new rule from
those that do not.’’ (Citations omitted.) Restatement
(Third), supra, § 1, reporter’s note (a), pp. 6–7.
We note, finally, that, regardless of whether this court
applies a duty analysis to the question of liability in
cases such as the present one or applies some iteration
of the economic loss doctrine as a categorical bar to
recovery, as many courts have done, the outcome is
likely to be the same because, as we have explained,
the purpose of a duty analysis is to ascertain the funda-
mental policy of the law, and the economic loss doctrine
is merely an expression of that policy as determined
by other courts, in earlier cases.3 With this background
in mind, we turn to an analysis of the question pre-
sented, namely, whether the defendant owed the plain-
tiff a duty of care.
The first prong of that analysis is whether the harm
complained of was foreseeable. As previously indicated,
the defendant challenges the trial court’s determination
that, in the present case, it was foreseeable, arguing that
the plaintiff’s economic losses were the unforeseeable
result of a fire marshal’s decision to require the plain-
tiff’s hotel to operate at one-half capacity until a new
potable water system was installed, even though nonpo-
table water was restored within twenty-four hours and
potable water was provided free of charge while the
system was under repair. The plaintiff responds, and
our independent review of the record confirms, that
the defendant presented no evidence to the trial court
to establish the factual predicates of this argument, and,
therefore, it is not properly before us. See, e.g., Sena
v. American Medical Response of Connecticut, Inc.,
333 Conn. 30, 53, 213 A.3d 1110 (2019) (‘‘courts are in
entire agreement that the moving party for summary
judgment has the burden of [presenting evidence] show-
ing the absence of any genuine issue as to all the mate-
rial facts’’ (internal quotation marks omitted)); Rom-
prey v. Safeco Ins. Co. of America, 310 Conn. 304, 321,
77 A.3d 726 (2013) (‘‘[i]f the party moving for summary
judgment fails to show that there are no genuine issues
of material fact, the nonmoving party may rest on mere
allegations or denials contained in his pleadings’’ (inter-
nal quotation marks omitted)). For purposes of our
analysis, therefore, we will assume that the water out-
age at the plaintiff’s hotel lasted ‘‘several days,’’ as the
plaintiff alleged in its complaint. Given that assumption,
we agree with the trial court that it was reasonably
foreseeable that a service interruption of that duration
would cause economic losses for any of the defendant’s
customers whose livelihood depended on a constant
supply of water.
Our law makes clear, however, that ‘‘[a] simple con-
clusion that the harm to the plaintiff was foreseeable
. . . cannot by itself mandate a determination that a
legal duty exists. Many harms are quite literally foresee-
able, yet for pragmatic reasons, no recovery is allowed.
. . . The final step in the duty inquiry, then, is to make
a determination of the fundamental policy of the law,
as to whether the defendant’s responsibility should
extend to such results.’’ (Internal quotation marks omit-
ted.) Demond v. Project Service, LLC, supra, 331 Conn.
834–35. As we have explained, in making that determi-
nation, our courts consider the following four factors:
‘‘(1) the normal expectations of the participants in the
activity under review; (2) the public policy of encourag-
ing participation in the activity, while weighing the
safety of the participants; (3) the avoidance of increased
litigation; and (4) the decisions of other jurisdictions.
. . . [This] totality of the circumstances rule . . . is
most consistent with the public policy goals of our
legal system, as well as the general tenor of our [tort]
jurisprudence.’’ (Internal quotation marks omitted.)
Lawrence v. O & G Industries, Inc., supra, 319 Conn.
650–51. For the reasons that follow, we conclude that
each of these factors militates against the imposition of
a duty, and, therefore, imposing a duty on the defendant
would be contrary to sound public policy.
We begin with the normal expectations of the partici-
pants in the activity under review. In the present case,
that activity is the purchase and sale of water, where the
seller is a municipal corporation tasked with planning,
operating, and maintaining a public water supply sys-
tem, and the buyer is a member of the public for whose
benefit the system and the defendant were created.
The trial court concluded that this factor favored the
plaintiff—albeit only ‘‘slightly’’—because ‘‘[t]he normal
expectation of a water delivery service customer is that,
absent exigent circumstances, water will be provided’’
and that any interruption in service that does occur will
be short lived. Although we agree with the trial court’s
analysis as far as it goes, by failing to take into account
the reasonable expectations of the defendant, it did not
go far enough. Our case law also establishes that, in
applying this factor, courts must consider ‘‘Connecti-
cut’s existing body of common law and statutory law
relating to this issue’’; Lawrence v. O & G Industries,
Inc., supra, 319 Conn. 651; which the trial court failed
to do. When these additional considerations are taken
into account, we conclude that the first factor militates
decisively against the imposition of a duty.
In considering the normal expectations of the parties
in Lawrence, we explained that, for well over one cen-
tury and in a variety of factual contexts, this court
has denied recovery in negligence for economic losses
resulting from injury to the person or property of
another, in each instance concluding that the damages
were simply too remote or the relationship between
the parties too attenuated for a duty to be imposed on
the defendant. See, e.g., id., 651–658 (citing and dis-
cussing cases); id., 643–44, 667 (plaintiff construction
workers could not recover economic losses in form
of lost wages from defendant construction companies
whose negligence destroyed plaintiffs’ work site, caus-
ing plaintiffs to lose their jobs); RK Constructors, Inc.
v. Fusco Corp., 231 Conn. 381, 382–83, 650 A.2d 153(1994) (employer could not maintain negligence action
against third-party tortfeasor to recover economic
losses in form of increased workers’ compensation pre-
miums resulting from tortfeasor’s injury of employer’s
employee); Connecticut Mutual Life Ins. Co. v. New
York & New Haven Railroad Co., 25 Conn. 265, 276
(1856) (life insurance company could not recover life
insurance benefits paid on behalf of its insured by bring-
ing direct action against railroad company whose negli-
gence caused insured’s death); see also Gregory v.
Brooks, 35 Conn. 437, 446 (1868) (‘‘[when] one is injured
by the wrongful act of another, and others are indirectly
and consequentially injured, but not by reason of any
natural or legal relation, the injuries of the latter are
deemed too remote to constitute a cause of action’’).
Given this body of case law, which spans more than 150
years, we do not believe that the normal expectations
of the parties in the present case reasonably could have
included an expectation that the defendant would be
liable in negligence for the economic losses of its cus-
tomers under the circumstances of this case.
Our conclusion is reinforced by General Statutes § 52-
557n (a) (1), which provides in relevant part: ‘‘Except
as otherwise provided by law, a political subdivision
of the state shall be liable for damages to person or
property caused by . . . (B) negligence in the perfor-
mance of functions from which the political subdivision
derives a special corporate profit or pecuniary benefit
. . . .’’ (Emphasis added.) By its express terms, § 52-
557n waives a municipal corporation’s governmental
immunity ‘‘for damages to person or property . . . .’’
It does not waive its immunity with respect to purely
economic or commercial losses. E.g., Williams Ford,
Inc. v. Hartford Courant Co., 232 Conn. 559, 583, 657
A.2d 212 (1995) (interpreting General Statutes § 52-572h
(b) and concluding that ‘‘the legislature intended the
phrase ‘damage to property’ to encompass only its usual
and traditional meaning in the law of negligence actions,
namely, damage to or the loss of use of tangible prop-
erty’’ and that, when drafting legislation, ‘‘the legislature
[is] mindful of a distinction between property damage
and commercial losses’’); see Mountain West Helicop-
ter, LLC v. Kaman Aerospace Corp., 310 F. Supp. 2d 459,
465 (D. Conn. 2004) (‘‘Connecticut [S]upreme [C]ourt
has, in the context of other statutes, recognized a cate-
gorical distinction between commercial losses and dam-
age to property’’ and ‘‘[when] the legislature has
employed the term ‘damage to property,’ the . . . court
has held that it [was] not intend[ed] to [permit the]
recover[y] [of] purely [economic] losses unaccompa-
nied by damages to some tangible property’’); see also
General Statutes § 52-572h (a) (distinguishing, in negli-
gence actions, between economic damages and noneco-
nomic damages such as ‘‘physical pain and suffering’’);
Restatement (Third), supra, § 2, comment (a), p. 10
(‘‘When [the] Restatement [(Third) of Torts] refers to
‘property damage,’ it generally means damage to tangi-
ble property. Usually the distinction between physical
injury and pure economic loss is easy to draw, though
it occasionally causes confusion when relatively minor
damage to person or property leads to monetary losses
on a large scale. It may then seem tempting to describe
the plaintiff’s losses as purely economic in character.
They are not. The property damage at the root of such
a loss brings the case within the scope of Restatement
[(Third)], Torts: Liability for Physical and Emotional
Harm, and the rules stated there. Economic loss that
accompanies even minor injury to the plaintiff’s person
or property does not tend to raise the same considera-
tions found when a plaintiff’s losses are economic
alone.’’); id, § 1, comment (c), p. 2 (‘‘[a]n economic loss
or injury, as the term is used [in the Restatement (Third)
of Torts], means a financial loss not arising from injury
to the plaintiff’s person or from physical harm to the
plaintiff’s property’’).
‘‘Section 52-557n . . . specifically delineates cir-
cumstances under which municipalities and its employ-
ees can be held liable in tort and those under which
they will retain the shield of governmental immunity.’’
(Citation omitted.) Durrant v. Board of Education, 284
Conn. 91, 105, 931 A.2d 859 (2007); see also Doe v.
Petersen, 279 Conn. 607, 614, 903 A.2d 191 (2006) (‘‘§ 52-
557n abandons the common-law principle of municipal
sovereign immunity and establishes the circumstances
in which a municipality may be liable for damages’’
(footnote omitted)). It is axiomatic that ‘‘[s]tatutes that
abrogate or modify governmental immunity are to be
strictly construed.’’ Rawling v. New Haven, 206 Conn.
100, 105, 537 A.2d 439 (1988). ‘‘Since the codification
of the common law under § 52-557n [in 1986], this court
has recognized that it is not free to expand or alter the
scope of governmental immunity therein.’’ Durrant v.
Board of Education, supra, 107. In light of the foregoing,
we conclude that the law of Connecticut,4 insofar as it
informs our understanding of the parties’ normal expec-
tations, compels the conclusion that neither party rea-
sonably could have expected that the defendant, a
municipal corporation, would be liable in negligence
for economic losses incurred by its customers as a
result of an interruption in the defendant’s water ser-
vice.
Because they are analytically related, we consider
together the second and third factors, namely, ‘‘the pub-
lic policy of encouraging participation in the activity,
while weighing the safety of the participants, and the
avoidance of increased litigation . . . .’’ (Internal quo-
tation marks omitted.) Lawrence v. O & G Industries,
Inc., supra, 319 Conn. 658. It is readily conceivable that
imposing a duty of care on the defendant under the
circumstances of the present case would encourage
future plaintiffs to initiate actions of their own in the
event of a prolonged interruption in water service.
Despite the predictable increase in litigation that would
follow such a decision, however, there would be no
corresponding increase in public safety. This is so
because the receipt of water is an inherently harmless
activity, requiring the defendant’s customers to do no
more than turn a faucet and, periodically, write a check
to cover the cost of the water each has used. See id.,658–59 (‘‘It is easy to fathom how affirmatively imposing
a duty on the defendants . . . could encourage simi-
larly situated future plaintiffs to litigate on the same
grounds; this is true anytime a court establishes a poten-
tial ground for recovery. . . . At the same time, the
recognition of such a duty fails to provide a correspond-
ing increase in safety . . . .’’ (Citation omitted; foot-
note omitted; internal quotation marks omitted.)); see
also id., 660 (‘‘[t]he probability that an increase in litiga-
tion will not be offset by an increase in safety gives us
particular pause with respect to recognizing a duty’’).
In arguing to the contrary, the plaintiff contends that
extended interruptions in water service implicate ‘‘a
host of safety and sanitary public health problems.’’
Relying on this court’s statement in Raspberry Junction
Holding, LLC, that, under § 24 of the special act, ‘‘the
defendant is not subject to comprehensive regulation
of its rates, services, and facilities by this state’s public
utilities regulatory authority’’; Raspberry Junction Hold-
ing, LLC v. Southeastern Connecticut Water Authority,
supra, 331 Conn. 375–76; the plaintiff contends that,
because the defendant is not subject to any such regula-
tion, ‘‘the possibility of civil liability for economic harm
is perhaps the one and only avenue’’ to ensure that the
defendant acts with due care to maintain an uninter-
rupted supply of water, so as to avoid an array of public
health and sanitation problems. The statement in Rasp-
berry Junction Holding, LLC, was made in the context
of explaining why the trial court’s reliance on case law
from other jurisdictions, as a basis for concluding that
the defendant had the authority to immunize itself from
liability, was misplaced, namely, because all of the cited
cases ‘‘involved water authorities subject to such regu-
latory restrictions and thus implicated a corresponding
public policy justification for the right to limit liability
. . . .’’ Raspberry Junction Holding, LLC v. Southeast-
ern Connecticut Water Authority, supra, 376. Contrary
to the plaintiff’s contention, however, the defendant is
subject to formidable health and safety regulation by
various state agencies, the purpose of which is to ensure
a safe and continuous supply of water to the defendant’s
customers. See, e.g., 33 Spec. Acts 493, No. 381, § 34
(1967) (‘‘[n]othing contained in this act shall be held to
alter or abridge the powers and duties of the state
[D]epartment of [Public] [H]ealth or of the water
resources commissions over water supply matters’’).
One such regulation requires the defendant to have
in place a contingency plan for providing water to its
customers in the event of a systemwide failure. Specifi-
cally, ‘‘[u]nder General Statutes § 25-32d (a), water com-
panies are required to submit a water supply plan to
the [Commissioner] of [P]ublic [H]ealth for approval
‘with the concurrence of the Commissioner of [Energy
and] Environmental Protection.’ A water supply plan is
required to ‘evaluate the water supply needs in the
service area of the water company submitting the plan
and [to] propose a strategy to meet such needs.’ General
Statutes § 25-32d (b). The plan must ‘include . . .
[inter alia] (1) [a] description of existing water supply
systems; (2) an analysis of future water supply
demands; (3) an assessment of alternative water supply
sources which may include sources receiving sewage
and sources located on state land; [and] (4) contingency
procedures for public drinking water supply emergen-
cies, including emergencies concerning the contami-
nation of water, the failure of a water supply system
or the shortage of water . . . .’ General Statutes § 25-
32d (b).’’ (Emphasis added; footnotes omitted.) Miller’s
Pond Co., LLC v. New London, 273 Conn. 786, 820–22,
873 A.2d 965 (2005).
In light of the foregoing, we are not persuaded that
imposing a duty on the defendant to prevent economic
loss resulting from interruptions in its water service is
required to address the health and sanitation concerns
identified by the plaintiff. It is apparent that those con-
cerns have already been addressed by the legislature.5
See Lawrence v. O & G Industries, Inc., supra, 319
Conn. 659 (concluding that imposing duty on defen-
dants to prevent economic loss would not improve
physical safety of plaintiffs ‘‘given that companies like
the defendants are subject to extensive state and federal
regulation, and already may be held civilly liable to a
wide variety of parties who may suffer personal injury
or property damage as a result of their negligence’’).
Thus, because improving public safety is a primary
reason duties are imposed in the first instance, the fact
that no duty we could impose on the defendant in the
present case would be likely to increase the physical
safety of the defendant’s customers is a compelling
reason not to impose one. See, e.g., Rizzuto v. Davidson
Ladders, Inc., 280 Conn. 225, 235–36, 905 A.2d 1165(2006) (‘‘It is sometimes said that compensation for
losses is the primary function of tort law . . . [but it]
is perhaps more accurate to describe the primary func-
tion as one of determining when compensation [is]
required. . . . An equally compelling function of the
tort system is the prophylactic factor of preventing
future harm . . . .’’ (Internal quotation marks omit-
ted.)); Lodge v. Arett Sales Corp., 246 Conn. 563, 583, 717
A.2d 215 (1998) (declining to impose duty on defendants
when doing so ‘‘would achieve little in preventing the
type of harm suffered by the plaintiffs’’); see also, e.g.,
Ruiz v. Victory Properties, LLC, 315 Conn. 320, 340,
107 A.3d 381 (2015) (‘‘imposing a duty . . . will likely
prompt landlords to act more responsibly toward their
tenants in the interest of preventing foreseeable harm
caused by unsafe conditions in areas where tenants are
known to recreate or otherwise congregate’’); Monk v.
Temple George Associates, LLC, 273 Conn. 108, 119–20,
869 A.2d 179 (2005) (imposing duty on parking garage
owner to ‘‘protect customers by [taking] reasonable
care to decrease the likelihood of crime occurring on
[its] premises’’); Jagger v. Mohawk Mountain Ski Area,
Inc., 269 Conn. 672, 703, 849 A.2d 813 (2004) (imposing
duty on skiers because ‘‘requiring [them] to participate
in the reasonable manner prescribed by the rules of the
sport . . . will promote participation in the sport of
skiing’’ and ‘‘protect the safety’’ of those who do partici-
pate). We note lastly, with respect to the issue of
whether the law should be used to encourage participa-
tion in the activity under review, the plaintiff concedes,
as it must, that water is an essential necessity of life,
and, as such, its use requires no encouragement by the
law. In light of the foregoing, we conclude that the
second and third factors also weigh heavily against the
imposition of a duty.
We turn, therefore, to the final factor, the decisions
of other jurisdictions. As the trial court noted and the
plaintiff does not dispute, the vast majority of jurisdic-
tions bar recovery of economic losses in a negligence
action arising out of damage to the person or property
of another. See, e.g., Lawrence v. O & G Industries,
Inc., supra, 319 Conn. 661–64 (discussing majority rule
and reasons for it). ‘‘Courts that reject claims . . .
under the economic loss doctrine reason that the pri-
mary purpose of the rule is to shield a defendant from
unlimited liability for all of the economic consequences
of a negligent act, particularly in a commercial or pro-
fessional setting, and thus to keep the risk of liability
reasonably calculable. . . . They posit that the foresee-
ability of economic loss, even when modified by other
factors, is a standard that sweeps too broadly in a pro-
fessional or commercial context, portending liability
that is socially harmful in its potential scope and uncer-
tainty. . . . [See] In re Chicago Flood Litigation, [176
Ill. 2d 179, 198, 680 N.E.2d 265 (1997)] (observing that
the economic consequences of any single accident are
virtually limitless and that [i]f [the] defendants were
held liable for every economic effect of their negligence,
they would face virtually uninsurable risks far out of
proportion to their culpability, and far greater than is
necessary to encourage potential tort defendants to
exercise care in their endeavors . . .).’’ (Citations omit-
ted; footnote omitted; internal quotation marks omit-
ted.) Lawrence v. O & G Industries, Inc., supra, 664;
see also Southern California Gas Leak Cases, 7 Cal.
5th 391, 403, 441 P.3d 881, 247 Cal. Rptr. 3d 632 (2019)
(majority consensus ‘‘cuts sharply against imposing a
duty of care to avoid causing purely economic losses in
negligence cases like this one: where purely economic
losses flow not from a financial transaction meant to
benefit the plaintiff (and which is later botched by the
defendant), but instead from an industrial accident
caused by the defendant (and which happens to occur
near the plaintiff’’)).
The majority rule and its rationale are set forth in
the Restatement (Third) of Torts, which provides that,
‘‘[e]xcept as provided elsewhere in this Restatement, a
claimant cannot recover for economic loss caused by:
(a) unintentional injury to another person; or (b) unin-
tentional injury to property in which the claimant has
no proprietary interest.’’ Restatement (Third), supra,
§ 7, p. 64. Comment (a) to § 7 explains that ‘‘[t]he two
limits on recovery stated in this [s]ection are related
applications of the same principle, and they apply to
facts that usually have certain features in common.
The plaintiff and defendant typically are strangers. The
defendant commits a negligent act that injures a third
party’s person or property, and indirectly—though per-
haps foreseeably—causes various sorts of economic
loss to the plaintiff: lost income or profits, missed busi-
ness opportunities, expensive delays, or other disrup-
tion. The plaintiff may suffer losses, for example,
because the defendant injured someone with whom the
plaintiff had a contract and from whom the plaintiff
had been expecting performance, such as an employee
or supplier. . . . Or the plaintiff may be unable to make
new contracts with others, such as customers who can-
not conveniently reach the plaintiff’s business because
the defendant’s negligence has damaged property that
now blocks the way. . . . The common law of tort does
not recognize a plaintiff’s claim in such circumstances.’’
(Citations omitted.) Id., comment (a), p. 65.
The Restatement (Third) of Torts further explains
that the rule ‘‘is justified by several considerations. The
first . . . is that economic losses can proliferate long
after the physical forces at work in an accident have
spent themselves. A collision that sinks a ship will cause
a well-defined loss to the ship’s owner; but it also may
foreseeably cause economic losses to wholesalers who
had expected to buy the ship’s cargo, then to retailers
who had expected to buy from the wholesalers, and
then to suppliers, employees, and customers of the
retailers, and so on. Recognizing claims for those sorts
of losses would greatly increase the number, complex-
ity, and expense of potential lawsuits arising from many
accidents. Recognition of such claims might also result
in liabilities that are indeterminate and out of propor-
tion to the culpability of the defendant. These costs do
not seem likely to be justified by comparable benefits.
Courts doubt that threats of open-ended liability would
usefully improve the incentives of parties to take pre-
cautions against accidents or would make a material
contribution to the cause of fairness.
‘‘At the same time, the victims of economic injury
often can protect themselves effectively by means other
than a tort suit. They may be able to obtain first-party
insurance against their losses,6 or recover in contract
from those who do have good claims against the defen-
dant. Those contractual lines of protection against eco-
nomic loss, where available, are considered preferable
to judicial assignments of liability in tort. . . . The
rationales just stated are general, and no one of them
is conclusive. They prevail by their cumulative force.
And while they do not apply equally to every claim
that arises under this [s]ection, most courts reject such
claims categorically.’’ (Citation omitted; footnote
added.) Id., comment (b), p. 66.
The plaintiff contends, nevertheless, that a number
of jurisdictions recognize an exception to this general
rule when a special relationship exists between the
parties. In those cases, the plaintiff argues, courts have
permitted recovery when ‘‘the plaintiff was an intended
beneficiary of a particular transaction but was harmed
by the defendant’s negligence in carrying it out’’; South-
ern California Gas Leak Cases, supra, 7 Cal. 5th 400;
or when ‘‘a special and narrowly defined relationship
can be established between the tortfeasor and a plaintiff
who was deprived of an economic benefit . . . . In
cases of that nature, the duty exists because of the
special relationship. The special class of plaintiffs
involved in those cases were particularly foreseeable
to the tortfeasor, and the economic losses were proxi-
mately caused by the tortfeasor’s negligence.’’ Aikens
v. Debow, 208 W. Va. 486, 500, 541 S.E.2d 576 (2000);
see also Lips v. Scottsdale Healthcare Corp., 224 Ariz.
266, 268, 229 P.3d 1008 (2010) (‘‘Courts have not recog-
nized a general duty to exercise reasonable care for the
purely economic well-being of others, as distinguished
from their physical safety or the physical safety of their
property. . . . This reticence reflects concerns to
avoid imposing onerous and possibly indeterminate lia-
bility on defendants and undesirably burdening courts
with litigation. . . . Consequently, commentators have
recognized that liability for negligence [in such cases]
. . . must depend upon the existence of some special
reasons for finding a duty of care.’’ (Citations omitted;
internal quotation marks omitted.)).
The plaintiff argues that a special relationship existed
between the parties in the present case by virtue of the
‘‘imbalance of power’’ between them, as evidenced by
the parties’ water service agreement, which the plaintiff
argues ‘‘[is] really an adhesion contract . . . .’’ The
plaintiff further argues that its losses were particularly
foreseeable to the defendant because it is universally
understood that hotels require a constant supply of
water to provide ‘‘comfort and cleanliness’’ to their
guests. We are not persuaded.
Indeed, the plaintiff has not cited a single case in
which a special relationship was found to exist on
remotely similar facts. As is evident from each of the
cases cited in the plaintiff’s appellate brief, courts have
found a special relationship to exist between the parties
when the plaintiff was either the intended beneficiary
of a particular transaction or was physically situated
within the zone of risk created by the defendant’s negli-
gence such as to make the plaintiff’s economic losses
particularly foreseeable to the defendant. See, e.g., Mat-
tingly v. Sheldon Jackson College, 743 P.2d 356, 358
(Alaska 1987) (plaintiff’s economic losses were particu-
larly foreseeable when defendant excavated and braced
a trench so plaintiff’s employees could perform work
and trench subsequently collapsed on three employees,
causing plaintiff to incur business losses due to injured
employees’ absence from work); People Express Air-
lines, Inc. v. Consolidated Rail Corp., 100 N.J. 246,
248–49, 495 A.2d 107 (1985) (airline’s commercial losses
resulting from forced cancellation of flights due to
chemical leak in railroad yard adjacent to airport were
particularly foreseeable to defendant railroad).
As the California Supreme Court explained in South-
ern California Gas Leak Cases, which also is cited in
the plaintiff’s brief: ‘‘What we mean by special relation-
ship is that the plaintiff was an intended beneficiary of
a particular transaction but was harmed by the defen-
dant’s negligence in carrying it out. Take, for example,
Biakanja v. Irving [49 Cal. 2d 647, 320 P.2d 16 (1958)].
There, we held that the intended beneficiary of a will
could recover for assets she would have received if the
notary had not been negligent in preparing the docu-
ment. . . . A special relationship existed between the
intended beneficiary and the notary in Biakanja, we
emphasized, because the end and aim of the transaction
between the nonparty decedent and the notary [were] to
ensure that the decedent’s estate passed to the intended
beneficiary.’’ (Citation omitted; internal quotation
marks omitted.) Southern California Gas Leak Cases,
supra, 7 Cal. 5th 400; see id. (plaintiff business owners
could not recover economic losses resulting from
forced closure of their businesses due to massive gas
leak).
It is clear, moreover, that to be particularly foresee-
able within the meaning of the exception means that
‘‘the particular plaintiff is affected differently from soci-
ety in general [and the plaintiff’s economic losses were
particularly foreseeable to the defendant]. It may be
evident from the defendant’s knowledge or specific rea-
son to know of the potential consequences of the wrong-
doing, the persons likely to be injured, and the damages
likely to be suffered.’’ Aikens v. Debow, supra, 208 W.
Va. 499. Suffice it to say that the plaintiff has not identi-
fied any attribute of the relationship between itself and
the defendant that would bring the present case into
the ‘‘extremely limited group of cases [in which] the
law of negligence extends its protections to a party’s
economic interest.’’ (Internal quotation marks omitted.)
Blahd v. Richard B. Smith, Inc., 141 Idaho 296, 301,
108 P.3d 996 (2005). The plaintiff is simply one of thou-
sands of customers throughout southeastern Connecti-
cut who subscribe to the defendant’s water service. The
plaintiff’s assertions to the contrary notwithstanding,
there is nothing to suggest that a water outage affects
the plaintiff materially differently from any of the defen-
dant’s other customers in the restaurant and hospitality
industry, or that, based on the defendant’s specific
knowledge of the plaintiff’s business, the plaintiff’s
losses, in contrast to those of other customers, were
particularly foreseeable and calculable to the defen-
dant. Accordingly, we reject the plaintiff’s contention
that the fourth factor favors the plaintiff because the
present case falls within an exception to the general
rule barring recovery of economic losses in cases such
as the present one.
In light of the foregoing, we conclude that the trial
court correctly determined that public policy does not
support the imposition of a duty on the defendant under
the circumstances of this case.
The judgment is affirmed.
In this opinion ROBINSON, C. J., and McDONALD,
D’AURIA, MULLINS and KAHN, Js., concurred.
* August 18, 2021, the date that this decision was released as a slip opinion,
is the operative date for all substantive and procedural purposes.
1
The plaintiff appealed from the trial court’s judgment to the Appellate
Court, and we transferred the appeal to this court pursuant to General
Statutes § 51-199 (c) and Practice Book § 65-1.
2
Although the special act has been amended several times since 1967,
those amendments are not relevant to this appeal. All references herein are
to the 1967 special act.
3
We note that the parties have not asked us to apply a different analysis
to the question of whether the defendant should be liable for the plaintiff’s
economic losses; rather, they have briefed the issue in conformance with
the duty analysis adopted in Jaworski and applied in Lawrence.
4
We recognize, as we did in Raspberry Junction Holding, LLC v. South-
eastern Connecticut Water Authority, supra, 331 Conn. 369 n.5, that the
defendant did not raise governmental immunity as a special defense in the
trial court, and, therefore, that issue is not presently before us. We rely
on § 52-557n only insofar as it informs our understanding of the normal
expectations of the participants in the activity under review.
5
We note in this regard that the plaintiff does not actually dispute the
defendant’s repeated assertion, throughout its brief to this court, that nonpo-
table water was restored to all of the defendant’s customers within twenty-
four hours of the explosion at its pumping station such that ‘‘the plaintiff’s
hotel guests could utilize showers, sinks, and flush toilets . . . .’’ Nor does
the plaintiff dispute that the defendant provided drinking water to all of its
customers, including the plaintiff, free of charge throughout the outage. In
other words, it would appear that, following the explosion, the defendant
implemented the contingency plan required by § 25-32d (b). In its brief, the
defendant asserts that it ‘‘responded to [the explosion at its pumping station]
around 3:30 a.m. and immediately contacted [the] state police, the local fire
department, the Connecticut Department of Public Health, the Connecticut
Department of Energy and Environmental Protection, and the [federal] Envi-
ronmental Protection Agency, all of whom responded to and investigated
the scene. [It] was not allowed back on the property until it was cleared
by these authorities at approximately 7 p.m. Once [it] regained access to
the property, it began taking measures to provide water to its customers.
It activated an interagency emergency response network, CTWARN, and
the Connecticut Water Company responded to [its] request by shipping
water to North Stonington from Groton. [It] also immediately began installing
a temporary valve in the water main . . . [such that] [n]onpotable water
was restored to all North Stonington customers by late evening . . . .’’
6
We agree with the trial court’s observation that ‘‘[t]he economic loss
doctrine seeks to maintain the fundamental distinction between tort law
and contract law, and encourages the party best situated to assess the risk
of economic loss, generally the commercial purchaser, to assume, allocate,
or insure against that risk. . . . Here, the plaintiff did exactly that. It
assessed the risk of the economic losses it could sustain due to an interrup-
tion in its water service, and [insured] against that risk [through the purchase
of utility service interruption insurance].’’ (Citations omitted.) The trial court
further observed, and the record reflects, that the plaintiff ‘‘was in fact
compensated for some of the economic losses it sustained through [that]
insurance [policy],’’ only ‘‘not enough to cover its losses, which led to the
commencement of this action.’’ Finally, the court noted that the defendant’s
rules governing water service, which are incorporated by reference into the
parties’ contract, reserve the right of the defendant ‘‘at any time, without
notice, to shut off the water in its mains for the purpose of making repairs
or . . . for other purposes.’’ Southeastern Connecticut Water Authority,
supra. As the trial court aptly noted, this provision put ‘‘the defendant’s
customers . . . on notice that they should obtain utility service interruption
insurance,’’ and, ‘‘[g]iven the number and variety of customers it serves, the
defendant has no ability to predict the severity of economic damages that a
prolonged interruption in its water services could cause . . . any individual
customer,’’ whereas the defendant’s customers are perfectly capable of
making that determination for themselves.