DocketNumber: No. 400522
Citation Numbers: 1998 Conn. Super. Ct. 14578, 23 Conn. L. Rptr. 502
Judges: BLUE, Judge. CT Page 14579
Filed Date: 12/4/1998
Status: Non-Precedential
Modified Date: 4/17/2021
On June 8, 1994, the parties, Utica First Insurance Co. ("Utica") and Jane McGuire ("McGuire"), entered into an insurance contract providing coverage for a building (the "building") owned by McGuire. In the event of damage to the building, the policy states that Utica will pay the value of certain losses. The policy also contains important provisions concerning "recoveries," discussed in detail below.
The building subsequently sustained damage from vibrations caused by a road construction project conducted by Martin Brothers, Inc. ("Martin"). McGuire demanded payment from Utica on the policy. McGuire and Utica agreed to have certain differences resolved by a panel of three arbitrators pursuant to a provision of the policy that allows the actual cash value of the property and the replacement cost of the property to be determined by appraisal. The arbitration agreement is facially limited to a determination of three values: (1) replacement cost; (2) replacement cost damages; and (3) sound value loss and damages. On May 22, 1996, the arbitrators returned a document that they entitled an "award." The "award" states that the replacement cost is $300,000; the replacement damage is $14,334.34; the sound value is $225,000; and the sound value loss and damage is $13,794.88.
On August 24, 1995, McGuire commenced an action against Martin in the Superior Court for the Judicial District of New Haven. McGuire v. Martin Brothers, Inc., No. 378015 (the "Martin case"). The complaint in the Martin case seeks compensation for damages to the building caused by the same construction project that caused the damage at issue in the arbitration case. In June 1996, the Martin case was settled for the sum of $20,000. TheMartin case was withdrawn on June 28, 1996. On July 23, 1996, McGuire notified Utica of this fact. The notification states that McGuire "received a net of slightly over $17,000. This was a compromise of the total claim which was $33,947.75. Thus the arbitration award, less outstanding counsel fees, will almost — but not quite — make her home whole." CT Page 14580
On September 6, 1996, McGuire filed an application to confirm the arbitration award in the Superior Court for the Judicial District of New Haven. McGuire v. Utica First Insurance Co., No. 391413 (the "arbitration case"). The application was served on Utica on September 16, 1996. The arbitration case was heard by Hodgson, J. on October 7, 1996. Counsel for Utica prepared an appearance form dated October 7, 1996, although the form was not actually file stamped by the clerk until October 10, 1996. Hodgson, J. entered the order "Granted, absent objection" on the date of the hearing. The clerk formally notified counsel of the court's judgment on October 10, 1996. Utica has at no time moved to have the judgment in the arbitration case set aside.
On March 10, 1997, McGuire filed a property execution proceedings application in the arbitration case. The application states that the "amount of judgment" is $13,794.88. The application also claims a $10 application fee, for a total of $13,804.88. The application was not served on either Utica or its counsel pursuant to P.B. § 121 (now codified as P.B. §
Utica did not file any motion in the arbitration case to have the execution set aside. Instead, it chose to commence the present action. This action was commenced by service of process on June 3, 1997, and filed in the Superior Court for the New Haven Judicial District. A temporary injunction was granted by DeMayo, J. on June 24, 1997. On April 23, 1998, Utica filed a motion for summary judgment (No. 107). On May 12, 1998, McGuire filed her own motion for summary judgment(No. 108). The motions were heard by the court in a consolidated proceeding on November 23, 1998.
A procedural dilemma in which the court finds itself must be addressed at the outset. "Collateral attacks on judgments are disfavored." Convalescent Center of Bloomfield, Inc. v.Department of Income Maintenance,
Having said this, the court is unwilling to visit Utica with excessive punishment for the crime of killing a gnat with an elephant gun. The expense of commencing and litigating a separate action is an appropriate penalty that Utica has already visited on itself. To the extent that an equitable action is an appropriate, or at least recognizable, vehicle for seeking relief against a judicial order obtained by unfair surprise, the injunction case now before the court, should be decided on its merits. A requirement that Utica file yet another motion would merely add to the litany of procedural excess already burdening the court in this controversy.
Is an equitable action a recognized means of seeking relief in a situation like the one now before the court? An imposingly long line of jurisprudence answers this question in the affirmative. More than two hundred years ago, a Connecticut court, sitting in chancery, granted an injunction to prevent a party "from making use of a legal execution, for the purposes of vexation and injustice." Colt v. Cornwell, 2 Root 109, 111 (1794). The guiding principle stated in Colt's brief per curiam opinion was simply that, "Justice is done, the money is where it ought to be, and the petitioners ought to be quieted." Id. This precept seemingly left the trial court with almost unbridled discretion as to when to issue an injunction.
In 1836, Story, J. wrote a more rigorous — and, as will be seen, influential — description of when injunctions may be used to stay proceedings at law. "In general it may be stated, that in all cases, where by accident, mistake, fraud, or otherwise, a party has an unfair advantage in proceeding in a Court of Law, which must necessarily make that Court an instrument of injustice, and it is, therefore, against conscience, that he CT Page 14582 should use that advantage, a Court of Equity will interfere, and restrain him from using the advantage, which he has thus improperly gained." 2 Joseph Story, Commentaries on EquityJurisprudence 172-73 (1836). This formulation was swiftly adopted by our Supreme Court as "[t]he general principle on this subject, and which controls our opinion in regard to it." Tucker v.Baldwin,
The Court has attempted other formulations as well. An influential decision in the early years of this century states that, "fraud, collusion, accident, mistake, surprise and ignorance of the defense, when the negligence of the party is not one of the producing causes, are frequently recognized as creating situations justifying equitable interference, where it is also shown that a meritorious defense has been lost thereby, that the execution of the judgment would be against equity and good conscience, and that there is no other adequate remedy."Allis v. Hall,
Courts of equity may grant relief from the operation of a judgment when to enforce it is against conscience, and where the appellant had no opportunity to make defense, or was prevented from so doing by accident, or the fraud or improper management of the opposite party, and without fault on his [or her] own part . . . Fraud, accident, mistake, and surprise are recognized ground for equitable interference, when one, without his [or her] own negligence, has lost an opportunity to present a meritorious defense to an action, and the enforcement of the judgment so obtained against him [or her] would be against equity and good conscience, and there is no adequate remedy at law.
Cavallo v. Derby Savings Bank,
The authority just cited suggests that an injunction may appropriately issue in the case now before the court if Utica is entitled to relief on the merits. Utica has squarely established a case of surprise. The execution order in the arbitration case was obtained, in violation of the Rules of Practice, without any notification of Utica or its counsel. This procedure plainly involved "improper management of the opposite party" and just as CT Page 14583 plainly did not involve any fault on Utica's part. Although McGuire attempts to fault Utica for not appealing the original judgment in the arbitration case, this asserted failure cannot be considered negligence or inattention on Utica's part under the peculiar circumstances now before the court. Utica, by its own admission, has no problem with the judgment in question. That judgment, as already discussed, merely fixes the value of curtain property losses that McGuire has incurred. The question of how much money she is ultimately entitled to under her insurance policy is a question that cannot be resolved solely by reference to the decision of the arbitrators as affirmed by the court. Other calculations must be made as well. It is for this reason that McGuire's act of obtaining an execution without notification of Utica was a particularly serious matter and that the enforcement of that execution — if, for purposes of argument, Utica is right on the merits — "would be against equity and good conscience."
McGuire's principal argument focuses on another procedural issue. She contends that injunctive relief is precluded because Utica has not applied for a writ of audita querela. "Audita querela is a common law writ that may be granted when a defense to a judgment arises for the first time after the judgment has been rendered." Oakland Heights Mobile Park, Inc. v. Simon,
If anything, a long history of jurisprudence informs us that it is audita querela, and not injunction, that should be disfavored. The writ of audita querela has long since been abolished in the country of its birth; 37 Halsbury's Laws ofEngland ¶ 90 n. 1 (4th ed. 1982); and in federal practice on this side of the Atlantic; Fed.R.Civ.P.
The dispute between the parties on the merits focuses on the "recoveries" clause of the insurance policy in question. That clause provides in full as follows:
CT Page 14585
Recoveries — This applies if we pay for a loss and lost or damaged property is recovered, or payment is made by those responsible for the loss.
a. The insured must inform us or we must inform the insured if either recovers property or receives payment.
b. Proper costs incurred by either party are paid first.
c. The insured may keep the property. The amount of the claim paid or a lesser amount to which we agree, must be returned to us.
d. If the claim paid is less than the agreed loss due to a deductible, or other limiting terms, the recovery is prorated between the insured and us based on the interest of each in the loss.
The "subrogation" provision of the policy, immediately following, states that, "If we pay a loss to or for an insured and the insured recovers from another party for the same loss, the insured must pay us as stated in Recoveries."
A provision of the policy dealing with "payment of loss or claim" is also important in the context of this case. The provision states that, "If you and we do not agree, we pay within 30 days after the filing of an appraisal award with us. Payment is made to you unless a loss payee is named."
These provisions, read together, firmly establish that Utica is prohibited by the terms of its own policy from taking the procedural course that it has taken in this case. An appraisal of McGuire's loss was made with the consent of both parties. The appraisal award was duly filed with Utica. Under the "payment of loss or claim" provision of the policy, Utica must pay McGuire within 30 days.
It is unquestionably true that Utica has certain rights against McGuire as a result of her settlement with Martin. "The principle that an insurer which has paid a claim for property destroyed through the fault of a third person may, in certain circumstances, be reimbursed out of the funds received by the insured in satisfaction of his claim against the third person, is generally recognized." Continental Insurance Co. v. ConnecticutNatural Gas Corp. ,
The procedure just described is obviously a rather complicated mechanism for arriving at an ultimate resolution of the dispute between the parties. It is, however, the mechanism plainly required by Utica's own policy. "Where rights, duties and obligations are fully stated in a written contract between the parties . . . [i]t is not within the power of the court to make a new and different agreement." On Site Energy Corp. v. Sperry RandCorp. ,
This analysis makes it clear that Utica is prohibited by the terms of its own policy from obtaining the equitable relief it seeks in this action. For this reason, the plaintiff's motion for summary judgment must be denied, and the defendant's motion for summary judgment must be granted. Judgment shall enter for the defendant.
Jon C. Blue Judge of the Superior Court