21st Century North American Ins. Co. v. Perez ( 2017 )

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21ST CENTURY NORTH AMERICAN INSURANCE
COMPANY v. GLENDA PEREZ ET AL.
(AC 39060)
Prescott, Beach and Mihalakos, Js.
Syllabus
The plaintiff automobile insurer commenced this action for a declaratory
judgment determining whether it had validly cancelled an automobile
insurance policy that it had issued to the insured defendants, P and S,
and, thus, that it had no duty to defend or indemnify them following
S’s subsequent involvement in an automobile accident that resulted in
a fatality. The defendant N, as the administrator of the estate of L,
raised several special defenses and filed a counterclaim alleging that
the cancellation notice sent by the plaintiff to P and S was fatally
defective. The trial court found that P and S had failed to send the
installment payment required for the month of June and had received
a notice of cancellation, which indicated that they could cure the default
by making both the June payment and the July payment within fifteen
days, or else their coverage would expire. The court, which found that
P and S had failed to make the full payment required by the notice prior
to the expiration of coverage, but that they had made a partial payment
in an amount slightly less than the amount of the June payment, con-
cluded that the amount stated in the notice as the amount due, which
was the equivalent of two monthly installments, was inaccurate, as the
amount actually due was the amount of the June payment only, and
that P and S had substantially complied with their obligations under
the policy by sending the partial payment. The trial court rendered
judgment in favor of the defendants on the complaint and counterclaim,
and the plaintiff appealed to this court. Held:
1. The trial court’s finding that the amount that was actually due when the
plaintiff sent its notice of cancellation was the amount of the June
payment, and not the amount listed on the cancellation notice, was
clearly erroneous; the testimony and documentary evidence adduced
at trial indicated that the cancellation notice provided P and S with the
opportunity to cure their default for failing to timely make the June
payment by making a payment equivalent to two installments before the
cancellation date in order to remain current on their regular installment
billing schedule, and there was no evidentiary support for a contrary
finding nor any authority for the proposition that the amount specified
as necessary to resume regular installment payments cannot exceed the
initial amount of the default.
2. The trial court improperly applied the doctrine of substantial compliance
to excuse the default by P and S in light of the partial payment that
they had made following their receipt of the notice of cancellation; the
defendants provided no authority for the proposition that the doctrine
of substantial compliance or performance applies in the context of the
payment of automobile insurance premiums due on a monthly install-
ment basis, and although the substantial compliance doctrine was an
equitable rule that excused technical contractual breaches in certain
contexts, it had no application in the context of automobile insurance
payments due on a monthly installment basis and could not excuse the
failure of P and S to make full payment of the monthly installment
due under the policy under the circumstances here, where the timely
payment of the automobile insurance premiums due on a monthly install-
ment basis was an essential and material condition to coverage under
the policy and the contractual breach was material in nature, as there
could be no substantial performance where the performance owed was
the payment of money and time was of the essence.
3. This court declined to review N’s unpreserved claims that the cancellation
notice violated the Connecticut Unfair Insurance Practices Act (§ 38a-
815 et seq.), the Connecticut Unfair Trade Practices Act (§ 42-110a et
seq.), and the Creditors’ Collection Practices Act (§ 36a-645 et seq.), as
N failed to allege any such violations in his counterclaim and those
claims were not raised before, or decided by, the trial court.
4. The trial court improperly rendered judgment in favor of the defendants,
as the plaintiff demonstrated that it had validly cancelled the automobile
insurance policy it had issued to P and S: an insurer is authorized by
statute (§ 38a-342) to cancel an insurance policy due to nonpayment of
premium provided that, pursuant to statute (§ 38a-343), the insurer sends
notice of cancellation in a certified manner, provides notice within a
proscribed period of time with respect to nonpayment of the premium
due, provides a statement of the reason for cancellation, and advises
the insured of possible ramifications involving the Commissioner of
Motor vehicles, and the record in the present case indicated that the
plaintiff complied with those requirements; moreover, the plaintiff
offered P and S an opportunity to avert cancellation and thereby resume
regular installment payments by making a payment equivalent to two
installment payments by the date of cancellation, which they failed to do.
Argued May 23—officially released November 7, 2017
Procedural History
Action for a declaratory judgment that, inter alia, an
insurance policy issued to the named defendant et al.
had been cancelled for nonpayment of premiums,
brought to the Superior Court in the judicial district of
Hartford, where the defendant Gregory C. Norsiegian,
the administrator of the state of Leoner Negron, filed
a counterclaim; thereafter, the matter was tried to the
court, Hon. Constance L. Epstein, judge trial referee;
judgment for the defendants on the complaint and for
the defendant Gregory C. Norsiegian, the administrator
of the estate of Leoner Negron, on the counterclaim,
from which the plaintiff appealed to this court; there-
after, the court, Hon. Constance L. Epstein, judge trial
referee, denied the plaintiff’s motion for an articulation.
Reversed; judgment directed.
Yelena Akim, for the appellant (plaintiff).
Adam F. Acquarulo, for the appellee (defendant PV
Holding Corp.).
John-Henry M. Steele, for the appellee (defendant
Gregory C. Norsiegian, Administrator [Estate of
Leoner Negron]).
Opinion
BEACH, J. This appeal concerns the cancellation of
an automobile insurance policy. The plaintiff, 21st Cen-
tury North America Insurance Company, appeals from
the judgment of the trial court in favor of the defen-
dants, Glenda Perez, Ariel Seda,1 Gregory C. Norsiegian,
the administrator of the estate of Leoner Negron
(administrator), Orlando Soto, Carmello Pacheco, Edg-
ardo Contreras, Eric Valentin, John Skouloudis, and PV
Holding Corporation (corporation). Because it allegedly
complied with all applicable cancellation requirements
contained in both the insurance policy and the General
Statutes, the plaintiff claims that the court improperly
failed to conclude that it validly had cancelled that
policy. The plaintiff further claims that the court
improperly applied the doctrine of substantial compli-
ance to excuse nonpayment of the amount due to avert
cancellation. We agree and, accordingly, reverse the
judgment of the trial court.
The relevant facts are not in dispute. The insured
defendants purchased an automobile liability insurance
policy from the plaintiff for a term of six months (pol-
icy). They made payments on an installment basis; the
payments included a monthly ‘‘installment fee’’ of $5.
The insured defendants renewed the policy in May,
2012, and paid their first installment on May 10, 2012.
The second installment of $62.24 was due before June
11, 2012.2 When the insured defendants failed to make
any payment on that installment, the plaintiff on June
19, 2012, sent them a certified notice of cancellation
(cancellation notice).3 That notice conveyed two
important messages. First, it advised the insured defen-
dants ‘‘that your insurance will cease at and from [12:01
a.m. on July 4, 2012] due to nonpayment of premium.’’
Second, the cancellation notice provided the insured
defendants with the opportunity to avert cancellation
by making payment of $124.48 prior to the cessation
of coverage on July 4, 2012.4 The plaintiff at that time
also sent the insured defendants a billing invoice stating
that $124.48 was due before July 4, 2012.
On June 26, 2012, the insured defendants made a
partial payment of $62. In response, the plaintiff sent
the insured defendants another billing invoice. That
invoice acknowledged receipt of their partial payment
and indicated that the remaining balance of $62.48 was
‘‘due before’’ July 4, 2012. The invoice advised the
insured defendants in relevant part that ‘‘if we do not
receive the [remaining balance] by the date shown, your
policy will be terminated. . . . [T]he payment must be
received by 12:01 a.m. (one minute after midnight) Stan-
dard Time on [July 4, 2012] to avoid cancellation.’’ It is
undisputed that the insured defendants made no further
payment to the plaintiff prior to that date.
The ‘‘Statement of Account’’ admitted into evidence,
which documents activity on the policy, states that the
policy was cancelled on July 4, 2012, due to ‘‘[n]on
[p]ayment [e]ffective 07/04/12.’’ On July 11, 2012, the
plaintiff issued a refund of $5.01 to the insured defen-
dants with respect to coverage that had been provided
under the policy until July 4, 2012.
On July 18, 2012, the insured defendants sent an addi-
tional payment of $62 to the plaintiff. On July 25, 2012,
the plaintiff returned that payment to the insured defen-
dants because the policy already had been cancelled.
In the early morning hours of July 28, 2012, Seda
was operating a 1996 Honda Accord previously covered
under the policy. At approximately 2:26 a.m., Seda’s
vehicle collided with a 2013 Lincoln MKT near the inter-
section of Broad Street and Allen Place in Hartford. As
a result of that collision, a passenger in the 2013 Lincoln
was killed.
On May 15, 2014, the plaintiff filed the present declar-
atory judgment action, in which it requested a declara-
tion that (1) the policy ‘‘had been cancelled by virtue
of the non-payment of premiums as of July 4, 2012’’5
and (2) the plaintiff had no duty to indemnify or to
defend the insured defendants. On August 25, 2015,
the administrator filed a counterclaim alleging that the
cancellation notice was ‘‘fatally defective,’’ in that it
specified an ‘‘amount due’’ in excess of the $62.24
installment amount that triggered that notice. The
administrator also alleged, as a special defense, that
the insured defendants ‘‘substantially performed all of
their obligations under the policy.’’ In answering the
administrator’s counterclaim, the plaintiff denied all
allegations. The plaintiff, the administrator, and the cor-
poration thereafter filed motions for summary judg-
ment, which the court denied.
A trial was held on October 7, 2015. The plaintiff
submitted a dozen documents that were admitted into
evidence. Among them was a copy of the policy, which
provides in relevant part that the plaintiff may cancel
the policy due to nonpayment of premiums. The plaintiff
also offered the testimony of Diana Yeager, the plain-
tiff’s underwriting staff consultant, who was familiar
with the plaintiff’s business records and general billing
practices. During her testimony, Yeager detailed how
the plaintiff arrived at the $124.48 figure as the amount
necessary to cure the default and avoid cancellation of
the policy, noting the distinction in the plaintiff’s billing
practices between installment billing cycles and cancel-
lation billing cycles.6 Following the conclusion of Yea-
ger’s testimony, the plaintiff rested. The defendants did
not offer evidence of any kind at trial.
In its subsequent memorandum of decision, the court
acknowledged Yeager’s explanation of the amount
specified on the cancellation notice.7 The court never-
theless found that ‘‘[t]he [$124.48] amount stated in the
[cancellation notice] was not the amount due . . . .’’
Rather, the court found that $62.24 ‘‘was actually due
. . . .’’
The court found that the insured defendants failed
to make a payment of $62.24 prior to the expiration of
coverage on July 4, 2012. It also found that they made
a partial payment of $62 on June 26, 2012. On that
basis, the court found that the insured defendants had
substantially complied with their obligations under the
policy, noting that ‘‘incorrect and misleading notices
should not be construed to provide an insurer with
absolute power that obliterates any rights of the
insureds to the coverage for which they had contracted
and paid. . . . [T]he ability to mislead an insured and
then revoke coverage for a premium payment that is
twenty-four cents less than the amount due does not
comport with the fairness our law attempts to extend
to all parties in such transactions.’’ (Citations omitted.)
Accordingly, the court rendered judgment ‘‘against the
plaintiff and in favor of the defendants in this declara-
tory judgment action.’’ From that judgment, the plaintiff
appealed to this court.
I
We first address the court’s determination that the
installment payment of $62.24, rather than the $124.48
listed on the cancellation notice, was the amount ‘‘that
was actually due’’ to avoid cancellation of the policy.
On appeal, the plaintiff challenges the propriety of that
determination. When the trial court has resolved factual
disputes that underlie insurance coverage issues, those
findings are reviewable on appeal subject to the clearly
erroneous standard. National Grange Mutual Ins. Co.
v. Santaniello, 290 Conn. 81, 90, 961 A.2d 387 (2009).
‘‘Such a finding of fact will not be disturbed unless it
is clearly erroneous in view of the evidence and plead-
ings in the whole record . . . . [A] finding is clearly
erroneous when there is no evidence in the record to
support it . . . or when although there is evidence to
support it, the reviewing court on the entire evidence
is left with the definite and firm conviction that a mis-
take has been committed.’’ (Internal quotation marks
omitted.) Id.
It is undisputed that the installment payment due
before June 11, 2012 was $62.24. It also is undisputed
that the insured defendants did not make that payment.
The plaintiff subsequently sent the cancellation notice
to the insured defendants on June 19, 2012. In that
notice, the plaintiff advised them that the policy would
be cancelled in fifteen days on July 4, 2012. The cancella-
tion notice also provided the insured defendants with
the opportunity to cure their default by making payment
of $124.48 prior to July 4, 2012. The corresponding bill-
ing invoice sent to the insured defendants explained
that payment of that amount was necessary ‘‘in order
to maintain regular installment billing.’’ At trial, the
court heard testimony from the plaintiff’s underwriting
staff consultant that the $124.48 amount listed on the
cancellation notice was necessary to maintain regular
installment billing under the policy. In other words, the
amount due reflected the $62.24 installment payment
that was past due and an additional $62.24 that the
insured was obligated to pay for the July installment
in order to be current on premiums due pursuant to
the installment billing cycle. The defendants did not
present any evidence to the contrary.
The court nevertheless found that the amount ‘‘that
was actually due’’ by July 4, 2012, to cure the insured
defendants’ default on their June installment was
$62.24. There is no evidence in the record to substanti-
ate that determination. Moreover, the court provided
no authority, and we are aware of none, for the proposi-
tion that the amount specified as necessary to resume
regular installment payments cannot exceed the initial
amount of default. In response to the court’s memoran-
dum of decision, the plaintiff requested an articulation
of the factual and legal bases for the court’s finding as
to the actual amount due to avert cancellation and its
conclusion ‘‘that the cancellation premium as stated in
the cancellation notice was required to mirror the regu-
lar installment premium that had not been paid.’’ The
court summarily denied that request.
Our review of the record reveals no evidentiary sup-
port for a finding that $62.24, rather than the $124.48
listed on the cancellation notice, was the amount actu-
ally due to the plaintiff to avoid cancellation of the
policy. The cancellation notice, the June 15, 2012 billing
invoice, the subsequent billing invoice sent on June
26, 2012, following the partial payment by the insured
defendants, and Yeager’s testimony at trial all indicate
otherwise. The record reflects that the insured defen-
dants did not pay $124.48 by July 4, 2012, which was
the amount of premiums due by that date to remain
current on the installment billing cycle. The court’s
finding, therefore, was clearly erroneous.
II
The plaintiff further claims that, irrespective of
whether the amount due to cure the default was $62.24
or $124.48, the undisputed evidence is that the insured
defendants failed to tender such payment and that the
court improperly applied the doctrine of substantial
compliance to excuse their nonpayment. We agree.
‘‘The substantial compliance rule is an equitable doc-
trine’’;8 In re Eagle-Picher Industries, Inc., 285 F.3d
522, 529 (6th Cir.), cert. denied sub nom. Baltimore v.
West Virginia, 537 U.S. 880, 123 S. Ct. 90, 154 L. Ed.
2d 137 (2002); that has been applied in limited circum-
stances in this state. As our Supreme Court has
observed, ‘‘[t]he substantial compliance doctrine has
its genesis in Connecticut as a narrow exception to the
requirement that the owner of an insurance policy could
change the beneficiary only by strictly complying with
the terms of the policy.’’ Engelman v. Connecticut Gen-
eral Life Ins. Co., 240 Conn. 287, 295, 690 A.2d 882
(1997). In Engelman, the court formally affirmed the
substantial compliance doctrine ‘‘as the law of this
state’’; id., 298; and concluded that ‘‘the owner of a
life insurance policy will have effectively changed the
beneficiary if the following is proven: (1) the owner
clearly intended to change the beneficiary and to desig-
nate the new beneficiary; and (2) the owner has taken
substantial affirmative action to effectuate the change
in the beneficiary.’’ (Emphasis in original.) Id. Through-
out this country, numerous jurisdictions have applied
the substantial compliance doctrine in that context.9
Although the court here cited to Engelman in its memo-
randum of decision, that precedent is plainly distin-
guishable from the present case, as it involved neither
an automobile insurance policy nor nonpayment of
insurance premiums.
Our Supreme Court also has applied the substantial
compliance doctrine in the context of a contractual
option to purchase real estate conditioned on a lessee’s
compliance with a lease. Pack 2000, Inc. v. Cushman,
311 Conn. 662, 680, 89 A.3d 869 (2014). Although the
present case does not arise in that context, that decision
nevertheless merits attention.
In Pack 2000, Inc., the court noted that ‘‘[t]he doc-
trine of substantial compliance is closely intertwined
with the doctrine of substantial performance.’’ (Empha-
sis added; internal quotation marks omitted.) Id., 675.
The court explained that ‘‘[t]he doctrine of substantial
performance shields contracting parties from the harsh
effects of being held to the letter of their agreements.
Pursuant to the doctrine of substantial performance, a
technical breach of the terms of a contract is excused,
not because compliance with the terms is objectively
impossible, but because actual performance is so simi-
lar to the required performance that any breach that
may have been committed is immaterial.’’ (Emphasis
added; internal quotation marks omitted.) Id. The court
then stated that ‘‘the present case does not involve a
material breach of the terms of the parties’ agreements.’’
Id., 680 n.10. Accordingly, the court concluded that
‘‘when an option is conditioned on a lessee’s compliance
with a lease, in the absence of explicit contractual lan-
guage to the contrary, a substantial rather than strict
compliance standard applies so that, if the lessee is
not in material breach of the lease when he seeks to
exercise the option and has not previously been
defaulted under the terms of the lease, the option is
enforceable against the lessor.’’ (Emphasis added.)
Id., 680.
Thus, the proper application of the doctrine of sub-
stantial performance requires a determination as to
whether the contractual breach is material in nature.
As one commentator has observed, ‘‘[s]ubstantial per-
formance is the antithesis of material breach; if it is
determined that a breach is material, or goes to the root
or essence of the contract, it follows that substantial
performance has not been rendered . . . .’’ 15 R. Lord,
Williston on Contracts (4th Ed. 2014) § 44:55, p. 271; see
also 2 Restatement (Second), Contracts § 237, comment
(a), p. 215 (1981) (‘‘a material failure of performance,
including defective performance as well as the absence
of performance, operates as the non-occurrence of a
condition’’). For that reason, the doctrine of substantial
performance applies only ‘‘where performance of a
nonessential condition is lacking, so that the benefits
received by a party are far greater than the injury done
to him by the breach of the other party.’’ (Emphasis
added; internal quotation marks omitted.) Officer v.
Chase Ins. Life & Annuity Co., 541 F.3d 713, 718 (7th
Cir. 2008).
The doctrine of substantial performance arises ‘‘in
many guises’’; 8 C. McCauliff, Corbin on Contracts (J.
Perillo ed., Rev. Ed. 1999) § 36.5, p. 342; including ‘‘con-
tracts for the sale of land or of goods, contracts for
the rendering of personal service, and contracts for
manufacture and transportation, as well as contracts
for the building of buildings or for other creative con-
struction.’’ (Footnotes omitted.) Id., § 36.2, pp. 336–37;
accord 15 R. Lord, supra, § 44:52, pp. 248–51 (doctrine
of substantial performance ‘‘applies to construction
contracts, service agreements, settlement agreements,
and employment contracts, among others’’ [footnotes
omitted]). The doctrine has been applied frequently by
the courts of this state in the context of construction
contracts. See, e.g., Vincenzi v. Cerro, 186 Conn. 612,
617, 442 A.2d 1352 (1982); Absolute Plumbing & Heat-
ing, LLC v. Edelman, 146 Conn. App. 383, 399, 77 A.3d
889, cert. denied, 310 Conn. 960, 82 A.3d 628 (2013);
Clem Martone Construction, LLC v. DePino, 145 Conn.
App. 316, 341, 77 A.3d 760, cert. denied, 310 Conn. 947,
80 A.3d 906 (2013); DuBaldo Electric, LLC v. Montagno
Construction, Inc., 119 Conn. App. 423, 437–39, 988
A.2d 351 (2010).
At the same time, resort to the doctrine has been
expressly foreclosed in certain contexts. For example,
in Fidelity Bank v. Krenisky, 72 Conn. App. 700, 715,
807 A.2d 968, cert. denied, 262 Conn. 915, 811 A.2d 1291
(2002), the defendants claimed that ‘‘by timely making
their mortgage payments for nine years, they had sub-
stantially performed their obligations despite their fail-
ure to make timely payments of property taxes and to
send receipts of property tax payments to the plaintiff.’’
This court disagreed, stating in relevant part: ‘‘The
defendants have failed to show . . . that the doctrine
of substantial performance applies in the context of a
mortgagor’s obligation to make payments to a mort-
gagee pursuant to a note and mortgage. . . . [T]he pre-
sent case does not involve circumstances under which
the traditional contract principles of strict compliance
should yield. Here, the defendants failed to make tax
payments as required by the terms of their note and
mortgage, which resulted in foreclosure; they have suf-
fered no prejudice and do not bear the burden of a
disproportionate forfeiture by strictly enforcing the
terms of their contract.’’ (Citations omitted.) Id., 715–16.
The court further noted the practical implications of
the defendants’ proposed reliance on the doctrine of
substantial performance, noting that ‘‘to allow mortgag-
ors to make partial payments on their mortgages, and
then avoid foreclosure by way of a claim of substantial
performance, would result in the unsettling of the real
estate market and an increase in litigation.’’ Id., 716. The
court thus concluded ‘‘that the doctrine of substantial
performance does not apply to the present situation.’’
Id.; accord Gibson v. Neu, 867 N.E.2d 188, 195 (Ind. App.
2007) (concluding that ‘‘[t]he doctrine of substantial
performance does not apply’’ in mortgage context
where ‘‘timely payment of the debt was an essential
condition of the promissory note [and] mortgage’’).
The defendants in the present case have furnished
no authority for the proposition that the doctrine of
substantial performance applies in the context of the
payment of automobile insurance premiums due on a
monthly installment basis. Our research likewise has
uncovered no such authority. As with mortgage pay-
ments, the timely payment of insurance premiums is
an essential and material condition to automobile insur-
ance policies issued throughout this state. See Panizzi
v. State Farm Mutual Automobile Ins. Co., 386 F.2d
600, 604 (3d Cir. 1967) (‘‘[t]he agreed exchange for the
insurer’s promise is the payment of the premium’’). The
doctrine of substantial performance has no application
in such instances, as ‘‘there can be no substantial perfor-
mance when the performance owed is the payment of
money and time is of the essence . . . .’’ 15 R. Lord,
supra, § 44:52, pp. 253–54. As the United States Court
of Appeals for the Eleventh Circuit recently noted,
‘‘[t]here is almost always no such thing as substantial
performance of payment . . . when the duty is simply
the general one to pay. . . . Payment is either made
in the amount and on the date due, or it is not.’’ (Citation
omitted; internal quotation marks omitted.) Cafaro v.
Zois, Docket No. 16-15522, 2017 WL 2258535, *4 (11th
Cir. May 23, 2017).
The policy at issue in the present case provides in
relevant part that ‘‘[s]ubject to the limit of liability stated
on your Declaration Page, if you pay the premium for
Liability Coverage, we will pay damages for which an
insured becomes legally liable . . . .’’ (Emphasis in
original.) The policy further provides that ‘‘[w]e have
no duty to provide coverage under this policy unless
you have paid the required premium when due . . . .’’
(Emphasis in original.) Under the policy, then, timely
payment is an essential and material condition to the
contract between the parties. Because timely payment
under the policy goes to the root and essence of the
contract, the doctrine of substantial performance can-
not excuse an insured’s failure to make full payment
of the monthly installment due under the policy.
To conclude otherwise would fundamentally upend
the nature of automobile insurance in this state. ‘‘If
the insured could force the insurer to accept premium
payments in whatever portion of the total premium that
the insured felt like paying at any given time, insurers
would do business in a world of financial chaos that
would adversely affect both insurers and insureds: with
budgeting impossible, it would be a matter of pure
chance whether a given insurer has sufficient funds
available to pay major losses. As a consequence, it is
universally acknowledged that an insurer cannot be
forced to accept less than the premium due . . . .
[W]hen the insurer has agreed to installment payments
. . . an insurer cannot be compelled to accept a sum
less than the full installment due at a given time.’’ 5 S.
Plitt et al., Couch on Insurance (3d Ed. Rev. 2012) § 72:1,
pp. 724–25. We therefore conclude that the doctrines
of substantial performance and substantial compliance
have no application in the context of automobile insur-
ance payments due on a monthly installment basis.10
III
In his appellate brief, the administrator attempts to
raise what he characterizes as ‘‘alternative grounds’’ of
affirmance, arguing that the cancellation notice violates
the Connecticut Unfair Insurance Practices Act
(CUIPA), General Statutes § 38a-815 et seq., the Con-
necticut Unfair Trade Practices Act (CUTPA), General
Statutes § 42-110a et seq., and the Creditors’ Collection
Practices Act (CCPA), General Statutes § 36a-645 et seq.
It is undisputed that those grounds never were raised
before, or decided by, the trial court. See Connecticut
Ins. Guaranty Assn. v. Fontaine, 278 Conn. 779, 784 n.4,
900 A.2d 18 (2006) (alternative grounds for affirmance
must be raised before trial court); New Haven v.
Bonner, 272 Conn. 489, 497–99, 863 A.2d 680 (2005)
(declining to consider alternative ground for affirmance
that was not raised before trial court). ‘‘It is fundamental
that claims of error must be distinctly raised and
decided in the trial court.’’ State v. Faison, 112 Conn.
App. 373, 379, 962 A.2d 860, cert. denied, 291 Conn. 903,
967 A.2d 507 (2009). Our rules of practice require a
party, as a prerequisite to appellate review, to distinctly
raise such claims before the trial court. Practice Book
§ 60-5; see Practice Book § 5-2 (‘‘[a]ny party intending
to raise any question of law which may be the subject
of an appeal must . . . state the question distinctly to
the judicial authority’’); see also Remillard v. Remil-
lard, 297 Conn. 345, 351, 999 A.2d 713 (2010) (raised
distinctly means party must bring to attention of trial
court precise matter on which decision is being asked).
As our Supreme Court has explained, ‘‘[t]he reason for
the rule is obvious: to permit a party to raise a claim
on appeal that has not been raised at trial—after it is
too late for the trial court or the opposing party to
address the claim—would encourage trial by ambus-
cade, which is unfair to both the trial court and the
opposing party.’’ (Internal quotation marks omitted.)
Travelers Casualty & Surety Co. of America v. Nether-
lands Ins. Co., 312 Conn. 714, 761–62, 95 A.3d 1031
(2014). For that reason, Connecticut appellate courts
generally ‘‘will not address issues not decided by the
trial court.’’ Willow Springs Condominium Assn., Inc.
v. Seventh BRT Development Corp., 245 Conn. 1, 52,
717 A.2d 77 (1998); see also Crest Pontiac Cadillac,
Inc. v. Hadley, 239 Conn. 437, 444 n.10, 685 A.2d 670
(1996) (claims ‘‘neither addressed nor decided’’ by trial
court are not properly before appellate tribunal). More-
over, we note that although the administrator filed a
counterclaim in the present case, he did not raise any
claim regarding CUIPA, CUTPA, or CCPA therein. We
therefore decline to consider such claims in this appeal.
IV
The remaining question is whether the court improp-
erly rendered judgment in favor of the defendants. The
plaintiff maintains that it complied with every cancella-
tion requirement set forth in both the General Statutes
and the policy. As such, the plaintiff claims that the
court improperly failed to conclude that it validly can-
celled that policy. We agree.
At the outset, we note that ‘‘when written notice of
cancellation is required, an insurer must comply strictly
with policy provisions and statutory mandates.’’ Majer-
nicek v. Hartford Casualty Ins. Co., 240 Conn. 86, 95,
688 A.2d 1330 (1997). Our analysis begins with the
requirements contained in the General Statutes, the
applicability of which presents a question of law over
which our review is plenary. Dairyland Ins. Co. v.
Mitchell, 320 Conn. 205, 210, 128 A.3d 931 (2016).
General Statutes § 38a-342 authorizes an insurer to
cancel an insurance policy due to ‘‘[n]onpayment of
premium,’’ which is defined in relevant part as the ‘‘fail-
ure of the named insured to discharge when due any
of his obligations in connection with the payment of
premiums on the policy, or any installment of such
premium . . . .’’ General Statutes § 38a-341 (3). Gen-
eral Statutes § 38a-343 specifically delineates the
requirements of a notice of cancellation furnished to
an insured.11 It requires the insurer to (1) send the notice
of cancellation in a certified manner; (2) provide fifteen
days’ notice with respect to nonpayment of the first
premium of a new policy, and ten days’ notice with
respect to nonpayment of all other premiums; (3) pro-
vide a statement of the reason for cancellation; and (4)
advise the insured of possible ramifications involving
the Commissioner of Motor Vehicles. See General Stat-
utes § 38a-343 (a) and (b). The policy in the present
case contains similar requirements.
The plaintiff submits, and we agree, that the record
indicates that it complied with the foregoing require-
ments. At trial, a certificate of mailing was admitting
into evidence. See footnote 3 of this opinion. That mail-
ing was sent to the insured defendants on June 19,
2012—fifteen days prior to the July 4, 2012 cancellation
date.12 In addition, the cancellation notice stated in rele-
vant part: ‘‘You are hereby notified . . . that your insur-
ance will cease at and from the hour and date mentioned
above due to nonpayment of premium. . . .’’ The can-
cellation notice also warned the insured defendants of
possible ramifications involving the Commissioner of
Motor Vehicles.13 That undisputed evidence demon-
strates that the plaintiff strictly complied with the appli-
cable statutory and policy requirements.14
Under Connecticut law, an insurer is not obligated
to provide an insured who has failed to pay his or her
premium with an opportunity to cure that default, nor
is the insurer obligated to specify the amount of the
insured’s payment delinquency. At the same time, ‘‘[t]o
be effective, a notice of cancellation must be definite
and certain.’’ Travelers Ins. Co. v. Hendrickson, 1 Conn.
App. 409, 412, 472 A.2d 356 (1984). The cancellation
notice here meets that standard, as it plainly apprised
the insured defendants that the policy would be can-
celled due to their nonpayment of the June installment
unless they tendered payment of $124.48 before July
4, 2012.
The undisputed facts of this case indicate that the
insured defendants failed to make their June installment
payment, which served as a proper basis for the cancel-
lation of the policy. In addition to properly notifying
them that their policy would be cancelled due to that
nonpayment, the notice furnished by the plaintiff
offered the insured defendants an opportunity to avert
cancellation and thereby resume regular installment
payments. The record demonstrates, and the defen-
dants do not dispute, that the insured defendants did
not make the payment necessary to avert cancellation
by July 4, 2012. We therefore agree with the plaintiff
that it validly cancelled the policy in the present case.
The judgment is reversed and the case is remanded
with direction to render judgment in favor of the plain-
tiff on its complaint and on the counterclaim filed by
the administrator.
In this opinion the other judges concurred.
1
Glenda Perez and Ariel Seda were the insureds under the automobile
insurance policy at issue in this appeal. We refer to them collectively as the
insured defendants in this opinion.
2
A copy of the May 15, 2012 billing invoice furnished to the insured
defendants was admitted into evidence. It defines ‘‘Amount Due’’ in relevant
part as ‘‘[t]he amount that must be paid in order to maintain regular install-
ment billing. . . . If we do not receive the amount by the date shown, your
policy will be terminated. Please Note: the payment must be received by
12:01 a.m. (one minute after midnight) Standard Time on the Payment due
date to avoid cancellation.’’ That invoice further specified an ‘‘Amount Due’’
of $62.24.
3
In accordance with General Statutes § 38a-344, a certificate of mailing
was admitted into evidence. At trial, the court took judicial notice of the
Domestic Mail Manual and the certificate’s compliance therewith. See Echa-
varria v. National Grange Mutual Ins. Co., 275 Conn. 408, 416 n.8, 880 A.2d
882 (2005).
4
The cancellation notice stated in relevant part: ‘‘Cancellation can be
avoided if premium due is paid prior to the effective date of the cancellation.
There will be no extension of coverage unless the cancellation is specifically
rescinded by the company and the policy will be reinstated.’’ The notice
further indicated that the ‘‘premium amount’’ due was $124.48.
5
Although the plaintiff’s prayer for relief avers that the policy was can-
celled due to ‘‘non-payment of premiums,’’ paragraph five of its complaint
alleges in relevant part that the cancellation notice advised the insured
defendants ‘‘that the [p]olicy would be cancelled unless payment of the
required monthly installment payment was received on or before July 4,
2012. . . .’’ On appeal, the corporation contends that the foregoing amounts
to a judicial admission ‘‘that a single monthly payment was due to avoid
the cancellation, not twice that amount.’’ The corporation did not advance
such a claim before the trial court. Indeed, in its April 23, 2015 motion for
summary judgment, the corporation averred that ‘‘[t]his is an action for
declaratory judgment by the plaintiff for orders that [the policy] had been
cancelled by virtue of nonpayment of premiums as of July 4, 2012 . . . .’’
(Emphasis added.) In its appellate brief, the administrator likewise states
that ‘‘the plaintiff sought in its complaint a declaration that the [p]olicy had
been cancelled by virtue of the nonpayment of premiums as of July 4, 2012
. . . .’’ (Emphasis added.) Moreover, we note that, in its order denying the
respective motions for summary judgment filed by the parties, the court
specifically indicated that ‘‘[t]here are several questions of fact that preclude
the entry of any of the parties’ motions for summary judgment,’’ including
those pertaining to the proper amounts due to the plaintiff. We therefore
reject the corporation’s contention that the plaintiff’s complaint contains a
judicial admission that a single monthly installment payment was due to
avoid cancellation of the policy.
6
At trial, the following colloquy transpired:
‘‘[The Plaintiff’s Attorney]: [W]hat happened when [the plaintiff] did not
receive a payment from [the insured defendants] on June 11, [2012]?
‘‘[Yeager]: We have an automated billing system [that] looks at the policy
and determines whether or not the policy would stay in an installment billing
cycle or be switched to a cancellation billing cycle . . . . [A]t that point
[the policy] was switched to a cancellation billing cycle. . . .
‘‘[The Plaintiff’s Attorney]: Can you tell us what a cancellation [billing
cycle] means?
‘‘[Yeager]: Sure. What that means is that when it switches from an install-
ment to a cancellation billing cycle the policy is . . . no longer in that
installment [cycle] and it goes into that cancellation phase to where it looks
for mailing notice requirements based on the state that it’s in, when the
next payment is due based off of when the policy is looked at, what’s not
received and by the date, the amount not received and the date not received
by. . . .
***
‘‘[The Plaintiff’s Attorney]: [Y]ou told us . . . that as soon as the policy
is in cancellation mode, okay, it’s gone from the installment . . . pay
dates. Correct?
‘‘[Yeager]: That’s correct.
‘‘[The Plaintiff’s Attorney]: All right; so can you tell the court why the
insured was [asked] to pay two times the premium in order to avoid cancella-
tion on July 4, [2012]?
‘‘[Yeager]: Sure. The reason—our internal system . . . is an automated
system. . . . [T]he system [examines] the policy, and it determines
[whether] the payment [has] been made by the due date and then also based
off of the next installment payment—this is a monthly payment. It looks at
also the equity in the policy to make sure that, you know, we are within . . .
a twenty-one day mailing which means that . . . we send our customers
this billing invoice twenty-one days prior to their next current installment.
For the [insured defendants] their next current installment after they missed
the June payment is July 11, [2012]. And with the notice of cancellation we
would [require] both payments because we are outside of or past that twenty-
one days prior to the [July 11, 2012] installment. . . .
‘‘[The Court]: So . . . when you send the amount that’s due you include
not only the last installment but the next installment.
‘‘[Yeager]: Right. We include the past due amount that we didn’t receive
and then because of where the policy is at the monthly payment then [the
internal system] automatically [determines whether] we need to include
that next installment based off of the equity and where the policy is.’’
7
The court stated: ‘‘As an explanation regarding the $124.48 listed as the
amount not paid in the [cancellation notice], rather than the $62.24 that was
actually due, [the plaintiff’s representative] advises the court that this was
an amount ‘calculated internally by the plaintiff’s automated premium com-
putation system’ that somehow calculates an amount the company believes
would restore ‘premium equity.’ ’’
8
Although ‘‘[i]n an action seeking a declaratory judgment, the sole function
of the trial court is to ascertain the rights of the parties under existing law’’;
Middlebury v. Steinmann, 189 Conn. 710, 715, 458 A.2d 393 (1983); our
Supreme Court has recognized that ‘‘the trial court may, in determining the
rights of the parties, properly consider equitable principles in rendering its
judgment.’’ Id.
9
See, e.g., Metropolitan Life Ins. Co. v. Johnson, 297 F.3d 558, 564 (7th
Cir. 2004) (‘‘[t]he Illinois doctrine of substantial compliance applies generally
to life insurance policy beneficiary designations’’); Green v. Jackson
National Life Ins. Co., 195 Fed. Appx. 398, 402 (6th Cir. 2006) (‘‘[u]nder Ohio
law, where the insured has an unconditional right to change the beneficiary
of an insurance policy, a change may be effected even if the provisions of
the policy setting forth the manner of effecting the change were not complied
with exactly’’ [internal quotation marks omitted]); Haste v. The Vanguard
Group, Inc., 502 S.W.3d 611, 614 (Ky. App. 2016) (‘‘[t]he substantial compli-
ance doctrine has commonly been applied when the only question concerns
the identity of a beneficiary under a life insurance policy’’), review denied
sub nom. Haste v. Moore, Docket No. 2016-SC-00380-D (2016 Ky. LEXIS 607)
(Ky. December 8, 2016); Bowers v. Kushnick, 774 N.E.2d 884, 887 (Ind.
2002) (‘‘[w]hen the terms of the [life insurance] policy have not been met,
substantial compliance is an equitable doctrine employed to aid in complet-
ing an incomplete change of beneficiary in an insurance policy’’ [internal
quotation marks omitted]); Kentucky Central Life Ins. Co. v. Vollenweider,
844 S.W.2d 460, 462 (Mo. App. 1992) (‘‘Missouri does recognize the equitable
doctrine of substantial compliance to carry out the intent of a person with
authority to change beneficiaries under an insurance policy where said
person has not strictly complied with the method provided by an insurance
policy to change a beneficiary’’); Adams v. Jefferson-Pilot Life Ins. Co., 148
N.C. App. 356, 360, 558 S.E.2d 504 (substantial compliance doctrine ‘‘has
evolved over time to address situations such as the present one, in which
an insured completes a change of beneficiary form, only to die before
recordation and filing of the document is completed’’), review denied, 356
N.C. 159, 568 S.E.2d 186 (2002); Empire General Life Ins. Co. v. Silverman,
379 N.W.2d 853, 856 (Wisc. App. 1985) (‘‘[t]he substantial compliance doc-
trine, followed in the majority of jurisdictions, states that when an insured
has substantially complied with policy requirements for a beneficiary change
by doing all in his or her power to conform to policy formalities, but dies
before completion, the change will be deemed effective’’), modified on other
grounds, 135 Wis. 2d 143, 399 N.W.2d 910 (1987).
10
We do not imply that the insured defendants’ payment obligation would
have been satisfied even if the doctrines did apply.
11
General Statutes § 38a-343 (a) provides in relevant part: ‘‘No notice of
cancellation of a policy to which section 38a-342 applies shall be effective
unless sent, by registered or certified mail or by mail evidenced by a certifi-
cate of mailing, or delivered by the insurer to the named insured, and any
third party designated pursuant to section 38a-323a, at least forty-five days
before the effective date of cancellation, except that (1) where cancellation
is for nonpayment of the first premium on a new policy, at least fifteen
days’ notice of cancellation accompanied by the reason for cancellation
shall be given, and (2) where cancellation is for nonpayment of any other
premium, at least ten days’ notice of cancellation accompanied by the reason
for cancellation shall be given. . . . The notice of cancellation shall state
or be accompanied by a statement specifying the reason for such cancella-
tion. . . .’’
Section 38a-343 (b) provides: ‘‘Where a private passenger motor vehicle
liability insurance company sends a notice of cancellation under subsection
(a) of this section to the named insured of a private passenger motor vehicle
liability insurance policy, or a third party designee, such company shall
provide with such notice a warning, in a form approved by the Commissioner
of Motor Vehicles and the Insurance Commissioner, that informs the named
insured that (1) the cancellation will be reported to the Commissioner of
Motor Vehicles; (2) the named insured may be receiving one or more mail
inquiries from the Commissioner of Motor Vehicles, concerning whether or
not required insurance coverage is being maintained, and that the named
insured must respond to these inquiries; (3) if the required insurance cover-
age lapses at any time, the Commissioner of Motor Vehicles may suspend
the registration or registrations for the vehicle or vehicles under the policy
and the number plates will be subject to confiscation and any person
operating any such vehicle will be subject to legal penalties for operating
a motor vehicle with a suspended registration; (4) the named insured will
not be able to have the registration restored or obtain a new registration,
or any other registration or renewal in the insured’s name, except upon
presentation to the Commissioner of Motor Vehicles of evidence of required
security or coverage and the entering into of a consent agreement with the
commissioner in accordance with the provisions of section 14-12g.’’
12
Because the cancellation notice did not pertain to the first premium
of a new policy, the plaintiff was required to provide ten days’ notice of
cancellation to the insured defendants pursuant to § 38a-343.
13
The notice stated in relevant part: ‘‘WARNING—Enforcement of Manda-
tory Insurance Requirements for Private Passenger Motor Vehicles: This
cancellation will be reported to the Commissioner of Motor Vehicles. If you
do not immediately return your registration marker plates you may receive
one or more written inquiries from the Commissioner concerning whether
or not the required minimum insurance has been maintained. You must
respond to these inquiries. If your insurance coverage lapses, the Commis-
sioner may suspend the registration(s) for the vehicle(s) covered under the
policy. Your registration marker plates will be subject to confiscation. If
you continue to operate the vehicle after the registration has been suspended,
you will be subject to penalties for operating a motor vehicle with a sus-
pended registration. You will not be able to have the registration restored
or obtain a new registration or any other registration or renewal in your
name until you: (1) present evidence of the required insurance coverage to
the Commissioner of Motor Vehicles; (2) enter into a consent agreement
with the Commissioner of Motor Vehicles which will include payment of a
civil penalty of $200; (3) pay a fee of $50 if your plates have been confiscated.’’
14
In its memorandum of decision, the court suggested that the cancellation
notice misled the insured defendants. Such a determination is clearly errone-
ous, as there is no evidence in the record to substantiate that finding. The
defendants did not present any evidence at trial and neither of the insured
defendants testified.
Furthermore, at no time since the commencement of this litigation have
the insured defendants maintained that they were misled by the cancellation
notice provided by the plaintiff. We note that, in moving for summary judg-
ment, the plaintiff submitted the April 15, 2013 deposition of insured defen-
dant Perez as an exhibit thereto. In that deposition testimony, Perez made
no claim that she was confused or misled by the cancellation notice provided
by the plaintiff. Rather, she repeatedly stated that she understood that if
she did not make payment of $124.48 by July 4, 2012, the policy would be
cancelled. Perez further admitted that she did not make ‘‘full payment’’ by
that date. Apart from that deposition testimony, the record before us contains
no other statements by the insured defendants regarding the cancellation
notice.