194 Conn.App. 316
Conn. App. Ct.2019Background
- A.C. Consulting (Dolan) and Alexion entered a written service contract in Jan. 2013 stating a term running to Dec. 31, 2016 but expressly allowing Alexion to terminate the agreement upon five (5) days’ written notice; the contract included a merger clause requiring written modification.
- Dolan alleges pre‑contract oral assurances by Alexion (via its director) that A.C. Consulting would have the security business "so long as he wanted it" and an almost four‑year commitment.
- Alexion reduced the plaintiff’s hours and terminated the contract on November 17, 2014; plaintiff alleges inadequate notice and lost business as a result.
- Plaintiff filed suit alleging breach of contract, negligent misrepresentation, and breach of the covenant of good faith and fair dealing; the trial court twice granted motions to strike (including the substitute complaint) and then entered judgment for Alexion.
- On appeal, plaintiff argued (1) contract ambiguity should be construed against the drafter, (2) allegation of "insufficient notice" sufficiently pleaded breach, and (3) estoppel/negligent misrepresentation based on oral assurances should bar Alexion from invoking the termination clause.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Contract ambiguity (term vs. termination clause) | The 2016 term vs. five‑day termination clause are irreconcilable; any ambiguity should be construed against Alexion. | The term expressly says "unless terminated earlier in accordance with Paragraph 7," so provisions are reconciled and not ambiguous. | Court: No ambiguity — read together the parties agreed to a multi‑year term subject to Alexion’s five‑day termination right. |
| Sufficiency of pleading breach based on "insufficient notice" | Allegation that Alexion gave "insufficient notice under the contract" is a breach of the notice provision. | Pleading fails to specify how notice was insufficient (timing vs. writing) and fails to allege damages from the alleged notice defect. | Court: Allegation is conclusory and factually deficient; plaintiff did not plead the required elements (specific breach facts and damages). |
| Estoppel / promissory estoppel from oral assurances | Pre‑contract and in‑course assurances estop Alexion from invoking termination clause; reliance barred termination. | Merger clause produced a fully integrated contract; reliance on prior oral promises was unreasonable as a matter of law. | Court: Plaintiff’s reliance was unreasonable as a matter of law given the fully integrated written contract with a merger clause; estoppel theory fails. |
| Negligent misrepresentation (reliance on oral promises) | Oral assurances induced plaintiff’s reliance (e.g., refraining from pursuing other clients). | Same integration/merger clause argument — written contract supersedes prior oral statements; reliance unreasonable. | Court: Claim fails because reasonable reliance on oral statements was precluded by the integrated written contract; negligent misrep claim insufficient. |
Key Cases Cited
- Enviro Express, Inc. v. AIU Ins. Co., 279 Conn. 194 (2006) (explains when a contract is ambiguous and rules for construing contract language in context)
- EH Investment Co., LLC v. Chappo, LLC, 174 Conn. App. 344 (2017) (court gives effect to all contract language and disfavors interpretations that render provisions superfluous)
- Dainty Rubbish Service, Inc. v. Beacon Hill Assn., Inc., 32 Conn. App. 530 (1993) (distinguishes cases involving truly conflicting contract clauses)
- U.S. Bank Nat’l Assn. v. Blowers, 332 Conn. 656 (2019) (standard of plenary appellate review for motions to strike)
- Doe v. Cochran, 332 Conn. 325 (2019) (pleading rules: take complaint facts as admitted on motion to strike)
- Ferrucci v. Middlebury, 131 Conn. App. 289 (2011) (estoppel requires reasonable reliance and detriment)
- National Groups, LLC v. Nardi, 145 Conn. App. 189 (2013) (negligent misrepresentation requires proof of reasonable reliance)
- Perugini v. Giuliano, 148 Conn. App. 861 (2014) (Practice Book §10‑44 limits repleading to curing pleaded defects, not adding wholly new claims)