331 Conn. 493
Conn.2019Background
- In 2005-07, Essex (plaintiff) hired William Kramer & Associates (defendant) as an independent adjuster to perform a “full adjustment” of hurricane damage to IDM properties, which included identifying mortgages on insured properties.
- IDM’s broker sent a 2006 letter with a schedule listing mortgagees for IDM properties (including Intervest as mortgagee for the Villas). That schedule wound up in an Aspen file the defendant maintained but was not incorporated into the adjuster Oberpriller’s working file.
- In March 2007 Essex issued the final claim payment to IDM on the Villas without naming Intervest as payee after the defendant told Essex there was no mortgage on the Villas; the defendant closed its file in May 2007.
- Intervest sued third parties in 2009; the defendant produced its working-file boxes but not the Aspen file. Intervest later amended to add Essex (2010). While preparing for a 2012 deposition, the defendant discovered the Aspen mortgagee schedule and produced it; Essex thereafter settled Intervest’s claims for $1 million and sued the defendant in 2013 for negligent failure to disclose the mortgage.
- The jury found for Essex, concluding a continuing course of conduct tolled the three‑year statute of limitations, but the District Court granted JMOL for the defendant. The Second Circuit certified to the Connecticut Supreme Court whether the trial evidence was legally sufficient to toll § 52‑577.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a special fiduciary/agency relationship between adjuster and insurer continued after the final payment so as to toll § 52‑577 | The adjuster remained agent; post‑payment contacts (2007 inquiry, 2009 subpoena involvement, 2012 deposition production, billing Essex, use of Essex counsel) show an ongoing special relationship and continuing duty | The adjuster’s agency and fiduciary duties ended when adjustment was completed and file closed; later contacts were discrete business/comply‑with‑process acts, not further adjustment or fiduciary conduct | No — fiduciary/agency relationship ended with completion of adjustment and closing of file; post‑2007 acts did not bear hallmarks of continuing fiduciary duty |
| Whether a duty to warn or correct a prior omission continued after termination of the relationship without the adjuster’s actual knowledge | Even after termination, a duty to disclose a mistake can persist and toll limitations | A continuing duty to warn requires actual knowledge of the underlying facts and an opportunity to cure; plaintiff conceded theory rested on constructive knowledge | No — plaintiff presented no evidence that defendant had actual knowledge of Intervest’s mortgage before 2012, so no continuing duty to warn/correct applied |
| Whether later wrongful conduct (ongoing failure to disclose) tolled the statute through Oct 21, 2010 | The adjuster’s ongoing failure to disclose the mortgage during Intervest litigation and subpoena response constituted wrongful conduct continuing into the limitations period | There was no identified later wrongful act after 2007 that both related to the initial omission and persisted into the limitations period; mere constructive knowledge or compliance with subpoena does not suffice | No — plaintiff failed to identify post‑2007 wrongful conduct sufficient to toll; continuing failure to investigate or disclose without actual knowledge does not extend tolling |
Key Cases Cited
- Certain Underwriters at Lloyd’s, London v. Cooperman, 289 Conn. 383 (recognizes § 52‑577 date‑of‑act rule and statute of repose nature)
- Martinelli v. Fusi, 290 Conn. 347 (continuing course of conduct elements and requirement of continuing duty related to original wrong)
- Connell v. Colwell, 214 Conn. 242 (scope of continuing course of conduct doctrine)
- Saint Bernard School of Montville, Inc. v. Bank of America, 312 Conn. 811 (special/ fiduciary relationship principles and when fiduciary duties arise)
- Rosenfield v. Rogin, Nassau, Caplan, Lassman & Hirtle, LLC, 69 Conn. App. 151 (continuing course of conduct applicable to series of acts or ongoing duties)
- Neuhaus v. DeCholnoky, 280 Conn. 190 (actual knowledge requirement for continuing duty to warn in medical context)
- Flannery v. Singer Asset Financial Co., LLC, 312 Conn. 286 (limits on imposing continuing duty to correct past attorney negligence after representation ends)
- Vanliner Ins. Co. v. Fay, 98 Conn. App. 125 (distinguishable case where adjuster continued to represent insurer and continuing duty found)