Aaron Manor, Inc. v. Irving
Aaron Manor, Inc. v. Irving
Opinion of the Court
The plaintiff, Aaron Manor, Inc., appeals from the judgment of the trial court, rendered after a trial to the court, in favor of the defendant, Janet A. Irving. The plaintiff claims that the court improperly (1) failed to find that the defendant breached her contract with the plaintiff and (2) awarded attorney’s fees to the defendant pursuant to General Statutes § 42-150bb. We agree with the plaintiffs second claim and reverse in part the judgment of the trial court.
The court’s memorandum of decision and the record reveal the following undisputed facts and procedural history. The plaintiff is a skilled nursing care facility that provides medical care, including long-term care, room and board, and prescription medication for its residents. William P. Ammon, the defendant’s father, was admitted to the plaintiffs facility on October 29, 2002. Upon his admission, the defendant signed a “Patient/Resident Admissions Agreement” (admission agreement) and various other documents as the “responsible party” for the patient. Section II, paragraph 10, of the admission agreement states that “[i]f the responsible party has control of or access to the patient/ resident’s income and/or assets, the responsible party agrees that these funds shall be used for the patient/ resident’s welfare, including but not limited to making prompt payment for care and services rendered to the patient/resident in accordance with the terms of this agreement.”
The defendant never had her father’s power of attorney, nor had she ever been appointed conservatrix of his person or estate, or executrix or administratrix of his estate after he died. When her father was admitted to the facility, the defendant informed the plaintiff that she would be the contact person for matters concerning her father’s personal care, and that her brother, William
The defendant’s father was a resident at the plaintiffs nursing care facility from the date of his admission until his death on July 24, 2003. Initially, the charges for his residency were covered by medicare. His private health insurance then paid for his care until March 1, 2003, at which time the plaintiff was notified by the insurer that the coverage was being discontinued on the ground that he no longer required skilled care. From June 11, 2003, until the date of his death, the private health insurance again paid for the father’s residency. Thus, the period of time uncovered by either medicare or the private health insurance was March 1 through June 10, 2003, which resulted in a total unpaid balance of $27,340.
The father’s bank statements for the period of March 1 through June 30, 2003, indicated account balances fluctuating between $26,000 and $54,000. The father had additional assets, including shares of stock, certificates of deposit and a house in Bridgeport. Although the plaintiff sent monthly invoices to Ammon, Jr., the account for the father remained unpaid. Despite the outstanding bill, Ammon, Jr., wrote a check payable to the defendant for $11,000 from the father’s account as a gift in April, 2003. Similarly, he wrote a check to himself at the same time for $11,000 from the father’s account. After the father’s death, the house in Bridgeport was sold, and Ammon, Jr., gifted the defendant $55,000, and, similarly, gifted himself $55,000 from the proceeds of that sale.
The plaintiff filed the present action against the defendant in March, 2006, claiming breach of contract and fraud. The defendant, represented by her husband, attorney Charles J. Irving, filed an answer with seven special defenses and a four count counterclaim. Pretrial discovery and pleadings were handled by attorney Irving. Shortly before trial, the firm of Krasow, Garlick and Hadley, LLC, filed an appearance in lieu of attorney Irving on behalf of the defendant. The case was tried before the court on April 8, 2008.
By memorandum of decision filed September 24, 2008, the court found that the defendant did not have a power of attorney for her father and did not have access to his checking account or to any of his other financial resources. Accordingly, the court rendered judgment in favor of the defendant on the complaint. The court found the issues in favor of the plaintiff on the counterclaim. Thereafter, the plaintiff filed a motion for reargument and reconsideration pursuant to Practice Book § 11-12, which the court granted but denied the relief requested.
By motion filed October 8, 2008, the defendant requested attorney’s fees pursuant to § 42-150bb and Practice Book § 11-21 for her successful defense against the complaint. The plaintiff filed an objection to the
On September 22, 2009, attorney Irving filed an application for a prejudgment remedy in the amount of $75,000 to secure the attorney’s fees already awarded and to secure “substantial additional [attorney’s] fees for the defense of the plaintiffs appeal, which [attorney’s] fees are subject to a further award to the defendant pursuant to [§] 42-150bb.” The court granted the application in the amount of $50,000. Additional facts and procedural history will be set forth as necessary.
I
LIABILITY UNDER THE CONTRACT
The plaintiff claims that the court improperly failed to find the defendant liable under the admission
The following additional facts were found by the court in a supplementary memorandum of decision filed June 1, 2009. The father had a joint checking account with his wife from which Ammon, Jr., paid their bills pursuant to his power of attorney. As previously noted, between March and June, 2003, the period during which the $27,340 balance accrued, Ammon, Jr., transferred various sums of money to himself and to the defendant. The funds transferred to the defendant from the checking account were either reimbursements for funds expended by the defendant on behalf of her father and/ or mother or monetary gifts from her father and/or mother. Specifically, one check to the defendant was the previously mentioned gift in the amount of $11,000. Various other checks reimbursed the defendant for purchases she made for her father for such items as shoes, sweaters and pants, bringing the total amount transferred to the defendant from the checking account to $13,630.89. The court concluded that, upon the defendant’s receipt of the funds, the funds became her property, and not the father’s, and therefore she was under no legal obligation to use these funds to pay the plaintiffs outstanding bill.
On appeal, the plaintiff does not challenge these findings. Rather, it challenges the conclusion that the defendant was under no legal obligation to use the $13,630.89
“We begin by setting forth our standard of review. The standard of review for the issue of contract interpretation is well established. When, as here, there is definitive contract language, the determination of what the parties intended by their contractual commitments is a question of law. . . . Accordingly, our review is plenary. . . . The reviewing court must decide whether [the trial court’s] conclusions are legally and logically correct and find support in the facts that appear in the record.” (Citation omitted; internal quotation marks omitted.) Genua v. Logan, 118 Conn. App. 270, 273-74, 982 A.2d 1125 (2009).
“Whether there was a breach of contract is ordinarily a question of fact. . . . We review the court’s findings of fact under the clearly erroneous standard. . . . The trial court’s findings are binding upon this court unless they are clearly erroneous in light of the evidence and the pleadings in the record as a whole. . . . We cannot retry the facts or pass on the credibility of the witnesses. ... A finding of fact 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 mistake has been committed . . . .” (Citation omitted; internal quotation marks omitted.) Colliers, Dow & Condon, Inc. v. Schwartz, 77 Conn. App. 462, 471-72, 823 A.2d 438 (2003).
It is undisputed that the defendant was the “responsible party,” as that term is used in the admission
The evidence on which the plaintiff relies for the proposition that the defendant had “access” to the patient’s assets is that she received $13,630.89 in gifts and reimbursements from him during the relevant period. We agree with the court’s conclusion that when the defendant received a gift from her father through the power of attorney, title vested in her immediately.
The plaintiffs reliance on Sunrise Healthcare Corp. v. Azarigian, 76 Conn. App. 800, 821 A.2d 835 (2003), is misplaced. Unlike the defendant in the present case, the defendant in Sunrise Healthcare Corp. had executed a contract with a nursing care facility both as the “responsible party” under the contract and as the patient’s power of attorney. Id., 802. As such, she had “ ‘control of or access to the resident’s income and/or assets’ id., 808; and breached the contract with the facility by misusing the patient’s assets. Id., 813. We agree with the court that the defendant in the present case had no such control or access. Accordingly, we conclude that the defendant is not obligated under the admission agreement to remit to the plaintiff any sums that she received from her father as gifts or reimbursements.
II
ATTORNEY’S FEES
Section 42-150bb
We set forth our standard of review and the relevant principles of law. “The general rule of law known as the American rule is that attorney’s fees and ordinary expenses and burdens of litigation are not allowed to the successful party absent a contractual or statutory exception. . . . This rule is generally followed throughout the country. . . . Connecticut adheres to the American rule. . . . There are few exceptions. For example, a specific contractual term may provide for the recovery of attorney’s fees and costs ... or a statute may confer such rights.” (Internal quotation marks omitted.) ACMAT Corp. v. Greater New York Mutual
Whether the defendant is a “consumer” pursuant to the statute presents a question of statutory construction. Statutory construction is “a [question] of law, over which we exercise plenary review. . . . The process of statutory interpretation involves the determination of the meaning of the statutory language as applied to the facts of the case, including the question of whether the language does so apply. . . .
“When construing a statute, [o]ur fundamental objective is to ascertain and give effect to the apparent intent of the legislature. ... In seeking to determine [the] meaning [of a statute], General Statutes § l-2z directs us first to consider the text of the statute itself and its relationship to other statutes. If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered. . . . The test to determine ambiguity is whether the statute, when read in context, is susceptible to more than one reasonable interpretation.” (Citations omitted; internal quotation marks omitted.) Saunders v. Firtel, 293 Conn. 515, 525, 978 A.2d 487 (2009).
Section 42-150bb provides in relevant part: “Whenever any contract or lease ... to which a consumer is a party, provides for the attorney’s fee of the commercial party to be paid by the consumer, an attorney’s fee
“Under § 42-150bb, the court has no latitude to deny [attorney’s fees] to a consumer who successfully defends an action brought against him by a commercial party.” (Emphasis added.) Id., 66. Such attorney’s fees are available, rather, by operation of law. Id. Section 42-150bb provides in relevant part that “[f]or the purposes of this section . . . ‘consumer’ means the buyer, debtor, lessee or personal representative of any of them. . . .” The defendant concedes, and we agree, that she is not a buyer, debtor or lessee as those terms are used in the statute. We agree with both parties that if anyone was a buyer pursuant to the statute, it was the father because it was he who received the plaintiffs services and it was from his assets that outstanding bills were to be paid.
The defendant maintains, however, that she was the buyer’s “personal representative” and is thus a “consumer” for the purposes of the statute. The term “personal representative” is not defined in § 42-150bb
In the present case, no conservator ever was appointed for the defendant’s father. The defendant did not have his power of attorney,
Furthermore, as we previously noted, Connecticut adheres to the American rule. ACMAT Corp. v. Greater New York Mutual Ins. Co., supra, 282 Conn. 582. Section 42-150bb, enacted in 1979, provides for the recovery of attorney’s fees by a consumer who successfully prosecutes or defends an action or a counterclaim based on a consumer contract. “[W]hen a statute is in derogation of common law or creates a liability where formerly none existed, it should receive a strict construction and is not to be extended, modified, repealed or enlarged in its scope by the mechanics of construction.” (Internal quotation marks omitted.) Rawling v. New Haven, 206 Conn. 100, 105, 537 A.2d 439 (1988). Accordingly, § 42-150bb should be strictly construed.
We are particularly reluctant to expand the definition of personal representative to include responsible party because the award of statutory fees under § 42-150bb is mandatory. “[T]he court has no latitude to deny such an award to a consumer who successfully defends an action brought against him by a commercial party.” Rizzo Pool Co. v. Del Grosso, supra, 240 Conn. 66. The court has no discretion; it is obligated to award reasonable attorney’s fees by operation of law. Id. To expand
Because the defendant is not a buyer, debtor, lessee or personal representative, her claim that she is a consumer under § 42-150bb must fail. Accordingly, she was not entitled to attorney’s fees under that statutory provision, and the court improperly awarded those fees to her.
The judgment is reversed only as to the award of attorney’s fees and the case is remanded with direction to vacate that award. The judgment is affirmed in all other respects.
In this opinion LAVINE, J., concurred.
In reviewing attorney Irving’s billing summary, we note that the first three entries are for legal services performed in July and September, 2005, which was prior to the service of process of the complaint, which occurred
A gift is the transfer of property without consideration. The two requisites of a valid gift are a delivery of the possession of the property to the donee and an intent that the title thereto shall pass immediately to him. Guinan’s Appeal from Probate, 70 Conn. 342, 347, 39 A. 482 (1898).
General Statutes § 42-150bb provides: “Whenever any contract or lease entered into on or alter October 1, 1979, to which a consumer is a party, provides for the attorney’s fee of the commercial party to be paid by the consumer, an attorney’s fee shall be awarded as a matter of law to the consumer who successfully prosecutes or defends an action or a counterclaim based upon the contract or lease. Except as hereinafter provided, the size of the attorney’s fee awarded to the consumer shall be based as far as practicable upon the terms governing the size of the fee for the commercial
This issue was not raised by the plaintiff in the trial court. After oral argument, this court requested and received briefs from both parties on the question of whether the defendant was a consumer under the statute.
The legislative history of § 42-150bb provides no guidance in this regard. See Public Acts 1979, No. 79-453.
See, e.g., General Statutes § § 3-94q (pertaining to personal representative of deceased notary), 20-122 (pertaining to personal representative of deceased dentist), 33-182g (pert aining to personal representative of deceased or legally incompetent shareholder).
There also was testimony at trial that the defendant was not a co-owner of her father’s checking or savings accounts.
A consumer is “[a] person who buys goods or services for personal, family, or household use . . . .” (Emphasis added.) Black’s Law Dictionary, supra. In this case, the defendant had no access to her father’s funds and was not in a position to purchase anything for him.
Because the resolution of this issue is dispositive of the plaintiffs appeal with respect to the award of attorney’s fees, we do not reach its claim that the amount awarded by the trial court was unreasonable.
Concurring in Part
concurring in part and dissenting in part. Although I agree with part I of the majority opinion, I respectfully disagree with part II. The plaintiff, Aaron Manor, Inc., claimed in its breach of contract action that the defendant, Janet A. Irving, was the party responsible for payments for the care of its patient, her late father, William Ammon. The defendant successfully defended the action. In my view, the defendant was a “consumer” entitled to recover attorney’s fees from the plaintiff under General Statutes § 42-150bb.
The plaintiff provided care and services for which it was not paid by either medicare or the patient’s insurance carrier. The plaintiff, a commercial party, commenced the present action against the defendant, alleging in its complaint that she had agreed, by signing the admission agreement, to apply her father’s income
The defendant successfully defended this breach of contract action based on the plaintiffs failure to prove that she had the requisite control of or access to her father’s income or assets. The defendant requested the court to award her attorney’s fees pursuant to § 42-150bb and Practice Book § 11-21, which the court granted in the amount of $36,000.
Section 42-150bb provides that a “consumer” may recover attorney’s fees against a commercial party when the consumer successfully defends an action based upon a contract “in which the money, property or service which is the subject of the transaction is primarily for personal, family or household purposes” if the contract provides for attorney’s fees for the commercial party. General Statutes § 42-150bb. Section 42-150bb provides in relevant part that “[f]or the purposes of this section . . . ‘consumer’ means the buyer, debtor, lessee or personal representative of any of them. ...” As noted by the majority, the issue in the present appeal is whether the defendant was the “personal representative” of her father, and therefore, a “consumer” entitled to avail herself of the statute.
As the majority points out, the statute is in derogation of the common law American rule that attorney’s fees and ordinary expenses and burdens of litigation are not awarded to the successful party absent a contractual or statutory exception. ACMAT Corp. v. Greater New York Mutual Ins. Co., 282 Conn. 576, 582, 923 A.2d 697 (2007). While there axe few exceptions to this rule, it does not necessarily follow that the statute must be construed narrowly, as the majority determines. “The law expects parties to bear their own litigation expenses, except where the legislature has dictated otherwise by way of statute. . . . Section 42-150bb clearly authorizes an award of attorney’s fees to the consumer who successfully prosecutes or defends an action or a counterclaim on a consumer contract or lease.” (Citations omitted; emphasis added; internal quotation
The purpose of § 42-150bb is to make attorney’s fees clauses reciprocal in order to bring parity between a commercial party and a consumer. Rizzo Pool Co. v. Del Grosso, 240 Conn. 58, 75, 689 A.2d 1097 (1997). In Rizzo Pool Co., our Supreme Court examined the legislative history of the statute, noting that “[i]n 1979, the Connecticut legislature enacted No. 79-453 of the 1979 Public Acts, entitled ‘An Act Concerning Attorney’s Fee Clauses in Consumer Contracts.’ ” Id., 74.
I conclude that, as a consumer protection statute, § 42-150bb has a remedial purpose that should be interpreted broadly in favor of those persons whom the legislature intended to protect. See, e.g., Rizzo Pool Co. v. Del Grosso, 232 Conn. 666, 678, 657 A.2d 1087 (1995) (noting that “[a]s remedial legislation [the Home Improvement Act, General Statutes § 20-418 et seq.] must be afforded a liberal construction in favor of those whom the legislature intended to benefit”); Cagiva North America, Inc. v. Schenk, 239 Conn. 1, 14, 680 A.2d 964 (1996) (noting that “the Lemon Law [General Statutes §§ 42-179 through 42-186] is a remedial statute that ought to be read broadly in favor of those consumers whom the law is designed to protect”).
In the present case, the issue is whether the defendant is a “personal representative” of the buyer. As noted by the majority, the term “personal representative” is not defined in § 42-150bb but is commonly used in various statutes to refer to a person who acts as a custodian or guardian of a person who lacks capacity or one with authority to act on behalf of a decedent. In this instance, however, unlike such statutes as the Uniform Transfer on Death Security Registration Act
The plaintiff commenced this action against this defendant precisely because she was the party who
The purpose of § 42-150bb is to bring parity between a commercial party and a consumer who defends successfully an action on a contract prepared by the commercial party. The plaintiff bears full responsibility for placing the defendant in the position of having to defend a breach of contract action by alleging that, as the “responsible party,” she was responsible for paying certain outstanding bills by virtue of her authority to act on behalf of the patient. It cannot now maintain that, because it failed to prove that she had access to or control of the patient’s financial assets, she had no authority to act on behalf of the patient and is not entitled to recover the fees she incurred defending that action. Under the facts and circumstances of this case, I would conclude that the defendant was the “personal representative” of the patient buyer for the purposes of the statute and, accordingly, is a “consumer” under
Because the majority concluded that the defendant was not entitled to attorney’s fees, it did not reach the question of whether the fees awarded were reasonable. Because I conclude that the defendant was entitled to reasonable attorney’s fees by operation of law as provided in the contract, I will address the plaintiffs argument.
The trial court’s memorandum of decision did not go into detail on the issue of the reasonableness of the fee awarded. The court found that the defendant was entitled to “reasonable” attorney’s fees pursuant to § 42-150bb and the contract for defending the complaint but not for prosecuting the counterclaim on which she did not prevail. Although the defendant requested $39,000 in fees, the court awarded $36,000 without making any other findings pertaining to the reasonableness of the fees.
The plaintiff objects primarily to the portion of the attorney’s fees awarded that were incurred by the defendant’s husband, which was the basis for approximately $25,500 of the amount claimed. The itemized bill from the defendant’s husband was admitted as a full exhibit at trial, but the plaintiff did not challenge the bill at that time. At oral argument on the motion for counsel fees, the court asked the plaintiff whether it challenged the amount of counsel fees or the reasonableness of the counsel fees claimed, and the court heard the plaintiffs argument. In light of this record, I find the plaintiffs claim that it had no opportunity to challenge the reasonableness of the fees to be unavailing. The plaintiff had at least two such opportunities.
General Statutes § 42-150bb provides: “Whenever any contract or lease entered into on or after October 1, 1979, to which a consumer is a party, provides for the attorney’s fee of the commercial party to be paid by the consumer, an attorney’s fee shall be awarded as a matter of law to the consumer who successfully prosecutes or defends an action or a counterclaim based upon the contract or lease. Except as hereinafter provided, the size of the attorney’s fee awarded to the consumer shall be based as far as
See Traystman, Coric & Keramidas, P.C. v. Daigle, 282 Conn. 418, 432, 922 A.2d 1056 (2007) (“the proper procedural vehicle for requesting an award of attorney’s fees pursuant to § 42-150bb is a motion for attorney’s fees pursuant to [Practice Book] § 11-21”).
I note that the plaintiff also argues that the statute is inapplicable because the admission agreement to the nursing care facility is not a contract “ ‘in which the money, property or service which is the subject of the transaction is primarily for personal, family or household purposes’ ” pursuant to the statute. The agreement states in part II, paragraph 1, that the plaintiff “agrees
I am not persuaded by the plaintiffs argument that the contract was not for “personal, family or household purposes” under § 42-150bb because the patient, not the defendant, received the services rendered. The services described in the contract itself, and thus the “service [s] which [are] the subject of the transaction” pursuant to the statute, are of a personal nature, regardless of whom the plaintiff designates as a defendant. Accordingly, I agree with the court’s conclusion that the contract at issue is the type of contract for which attorney’s fees may be recovered under § 42-150bb.
The issue in Rizzo Pool Co. v. Del Grosso, supra, 240 Conn. 73, was whether the term in § 42-150bb limiting a consumer’s award of attorney’s fees to “ ‘the terms governing the size of the fee for the commercial party’ ” incorporated General Statutes § 42-150aa by reference, thereby limiting attorney’s fees awarded to the holder of a contract to 15 percent of the amount of the judgment. Our Supreme Court answered that question in the negative. Id., 74.
See General Statutes § 45a-468a (5): “ ‘Personal representative’ includes executor, administrator, successor personal representative, special administrator and persons who perform substantially the same function under the law governing their status.”
See General Statutes § 45a-557a (12): “ ‘Personal representative’ means an executor, administrator, successor personal representative or temporary administrator of a decedent’s estate or person legally authorized to perform substantially the same functions.”
Compare with statutes that do not define the term, including General Statutes §§ 3-94q (pertaining to personal representative of deceased notary), 20-122 (pertaining to personal representative of deceased dentist), 33-182g (pertaining to personal representative of deceased or legally incompetent shareholder).
I would note that many of the documents that the defendant was required to sign pertain to matters commonly incorporated in a designation of attorney-in-fact or health care surrogate.
Although the defendant did not have control of or access to her father’s assets, she was not relieved of her other obligations under the admission agreement. For example, pursuant to that agreement, the defendant, as the responsible party, was bound to “apply promptly for, or assist the facility as necessary in establishing eligibility or otherwise applying for any applicable [mjedicare or other insurance benefits” and to “provide all information that may be requested” in connection with any application for medicaid assistance. The plaintiff did not allege that the defendant breached the contract in any respect, other than failing to pay the bill.
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