184 Conn. App. 643
Conn. App. Ct.2018Background
- In March 2014 Gause purchased a 2004 Cadillac SRX from A Better Way Wholesale Autos; she later discovered the dealer failed to disclose the vehicle was a manufacturer buyback (a "lemon").
- Gause submitted an unrestricted arbitration claim alleging violations of state and federal consumer-protection laws, including CUTPA and statutes/regulations requiring conspicuous manufacturer-buyback disclosures.
- The arbitrator found the dealer failed to display the buyback disclosure on the windshield and in the purchase order, concluded these were per se CUTPA violations, and found additional misconduct (preventing testing, inducing signature before inspection, delivering an unsafe vehicle).
- The arbitrator awarded $1,279 compensatory damages, $5,000 punitive damages, and $10,817.02 in attorney’s fees and costs (total $17,096.02).
- The dealer filed an application to vacate the arbitration award under Conn. Gen. Stat. § 52-418(a)(4); Gause moved to confirm. The trial court denied vacatur and confirmed the award.
- The dealer appealed, arguing the punitive damages award was a manifest disregard of the law; the appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the appeal is moot because plaintiff failed to oppose the motion to confirm | Plaintiff argued appeal is live (sought vacatur before confirmation motion) | Gause argued plaintiff’s failure to oppose made the appeal moot | Not moot: vacatur application was filed before confirmation motion so reversal could provide practical relief |
| Whether the arbitrator manifestly disregarded law by awarding punitive damages under CUTPA | Award of punitive damages was excessive and beyond arbitrator’s power; thus vacatur is warranted | Arbitrator properly exercised discretion based on per se CUTPA violations and other misconduct | No manifest disregard: punitive damages discretionary under §42-110g and supported by findings; appellate court will not second-guess factual determinations in unrestricted submission |
| Whether the arbitrator exceeded powers because award contradicted governing legal principles | Plaintiff asserted the award contravened statutory proscriptions in §52-418 | Gause maintained award was within submission and followed law | Arbitrator did not exceed powers; three-element test for manifest disregard not met |
| Whether punitive/ratio challenge raises preserved constitutional due process claim | Plaintiff suggested punitive-to-compensatory ratio approach | Gause argued ratio claim was unpreserved and constitutional in nature | Ratio/due process claim was unpreserved; court declined to address it |
Key Cases Cited
- Garrity v. McCaskey, 223 Conn. 1 (1992) (standards for vacating awards on unrestricted submissions)
- Industrial Risk Insurers v. Hartford Steam Boiler Inspection & Ins. Co., 273 Conn. 86 (2005) (manifest-disregard test and limits on appellate review of factual findings in unrestricted submissions)
- Harty v. Cantor Fitzgerald & Co., 275 Conn. 72 (2005) (arbitrator power/exceeding submission framework)
- Bridgeport v. Kasper Group, Inc., 278 Conn. 466 (2006) (review standard for vacatur under §52-418 involves questions of law)
- Ulbrich v. Groth, 310 Conn. 375 (2013) (punitive damages under CUTPA appropriate when conduct shows reckless indifference to rights)
- Shays v. Local Grievance Committee, 197 Conn. 566 (1985) (mootness and requirement of an actual controversy)
- MBNA America Bank, N.A. v. Bailey, 104 Conn. App. 457 (2007) (preservation rule: appellate courts generally do not consider issues not decided by trial court)