Ring v. Litchfield Bancorp
167 A.3d 462
| Conn. App. Ct. | 2017Background
- Mary Ann Ring paid contractor Chamberlin $40,000 (part of larger contract) for water-damage remediation; Chamberlin then provided no labor or materials after that payment.
- Chamberlin maintained an account at Litchfield Bancorp; the $40,000 was deposited and had cleared by the time of events in dispute.
- Litchfield Bancorp exercised its contractual right of setoff against Chamberlin’s account, offsetting the account balance (which included Ring’s $40,000).
- Chamberlin’s owner notified the bank that $40,000 in the account belonged to Ring and demanded restoration; the bank refused Ring’s counsel’s demands to return the funds.
- Ring sued the bank under CUTPA; the trial court granted the bank’s motion to strike Ring’s original complaint and later granted a motion to strike her amended complaint; judgment entered for the bank and Ring appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether allegations supported a CUTPA claim against the bank for exercising setoff | Ring claimed the bank’s setoff and refusal to return her funds constituted unfair or deceptive acts under CUTPA | Bank argued deposits become account owner’s money once cleared absent a stop-payment or designation, so setoff was lawful; amended complaint added no material facts | Appeal waived: amended complaint merely reiterated struck claim and did not materially alter allegations; judgment affirmed |
| Whether amended complaint cured deficiencies identified in original strike | Ring contended added facts (post-setoff communications) materially altered and supported CUTPA claim | Bank maintained new allegations did not address CUTPA elements (duty to consumer, unfair practice, or bank’s knowledge of Ring’s interest pre-setoff) | Court found new facts did not cure deficiencies; waiver of appeal from prior ruling |
| Whether bank had prior knowledge funds were held for Ring to bar setoff | Ring alleged communications showed bank knew funds belonged to her | Bank said no allegation it knew of any relationship or that funds were held for Ring before setoff; deposit was for contractor’s services | Court agreed bank lacked alleged prior knowledge; funds treated as Chamberlin’s after clearance, permitting setoff |
| Whether merits of CUTPA claim required resolution | Ring sought review on merits of alleged unfair practices | Bank argued appeal was barred by waiver and merits unnecessary; also that precedent disfavors Ring’s position | Court declined to reach merits because waiver applied; noted that precedent (e.g., Southington Savings Bank v. Rodgers) would likely defeat Ring’s claim |
Key Cases Cited
- St. Denis v. de Toledo, 90 Conn. App. 690 (discussing amendment after a motion to strike and waiver)
- Caltabiano v. L & L Real Estate Holdings II, LLC, 128 Conn. App. 84 (amended complaint not materially different prevents appeal from striking it)
- Kovacs Constr. Corp. v. Water Pollution & Control Auth., 120 Conn. App. 646 (construction of pleadings is a question of law; plenary review)
- Artie’s Auto Body, Inc. v. Hartford Fire Ins. Co., 287 Conn. 208 (elements required to state a CUTPA claim)
- Ulbrich v. Groth, 310 Conn. 375 (requirements and standards for proving CUTPA violations)
- In re Colonial Realty Co., 208 B.R. 616 (deposit becomes depositor’s money and may be subject to setoff absent specific application)
- Southington Sav. Bank v. Rodgers, 40 Conn. App. 23 (recognizing bank’s right of setoff against cleared deposits)