Lead Opinion
The state department of transportation (state) appeals from the trial court’s denial of its motion to dismiss the complaint of the third party plaintiffs, Peabody, N.E., Inc., Peabody International Corporation and the Federal Insurance Company
The state claims that the trial court improperly concluded that Peabody, a general contractor that had contracted with the state to reconstruct Route 8 and the Commodore Hull Bridge between the towns of Shelton and Derby, could maintain this third party action against the state, based on a subcontractor’s claim for damages, even though Peabody has not conceded liability to the subcontractor in the third party complaint. The trial court concluded that the waiver of the state’s sovereign immunity contained in General Statutes § 4-61 (a)
The relevant facts are undisputed. On November 30, 1983, Peabody entered into a contract with the state for the reconstruction of Route 8 and the Commodore Hull Bridge between Shelton and Derby. Peabody thereafter entered into a subcontract with Standard Structural Steel, Inc. (Standard), for the supply and erection of structural steel on the project. During the course of the project, Standard allegedly incurred extra costs for labor, equipment and materials, as well as increased overhead and other assorted costs resulting from delays, work stoppages, and errors and revisions in the plans and specifications for the project. Peabody asserts that the state, not Peabody, was responsible for the delays and errors that caused Standard’s unanticipated expenses.
In May, 1993, the plaintiff, the Federal Deposit Insurance Corporation, as the receiver of the New Connecticut Bank and Trust Company and the successor in interest to Standard, brought the underlying action against Peabody, seeking approximately $14.8 million in damages allegedly suffered by Standard. Thereafter, Peabody answered the plaintiffs complaint and moved to implead the state. The trial court, L. Sullivan, J., granted Peabody’s impleader motion, and Peabody served its third party complaint upon the state. The state moved to dismiss the third party complaint and
I
The resolution of this appeal turns upon the sufficiency of Peabody’s pleadings to survive a motion to dismiss for lack of subject matter jurisdiction. In denying the state’s motion to dismiss, the trial court took cognizance of both Peabody’s initial third party complaint and its amended third party complaint. As a preliminary matter, we must first decide which of Peabody’s two third party complaints should be considered in deciding the issue presented.
In Peabody’s answer to the plaintiffs complaint and in its initial third party complaint, Peabody denied its
Consequently, when the state moved to dismiss Peabody’s initial third party complaint because of a lack of subject matter jurisdiction, the trial court was obligated to construe that complaint in the manner most favorable to Peabody and to rule upon the state’s motion before considering Peabody’s motion to amend. Gurli
II
The state claims that the allegations of Peabody’s third party complaint are, on their face, insufficient to allege a waiver of the state’s sovereign immunity because they fail to allege that Peabody itself has a disputed claim under its contract with the state as required by § 4-61 (a). The state argues that Peabody was required to admit liability to Standard before proceeding with an action against the state. The state claims that in the absence of such an admission, Peabody would not have a “disputed [claim] under [its] contract” with the state within the meaning of § 4-61 (a) because it would have no obligation to pay Standard. The state contends that because Peabody did not admit liability to Standard, Peabody’s third party complaint lacked an essential jurisdictional element, and the trial court was required to dismiss the complaint for lack of subject matter jurisdiction. Peabody contends, to the contrary, that it has adequately pleaded the existence of a disputed claim under its contract with the state so as to bring it within the purview of the statutory waiver
Section 4-61 (a) waives sovereign immunity for any “person, firm or corporation which has entered into a contract with the state ... for the design, construction, construction management, repair or alteration of any highway, bridge, building or other public works of the state . . . .” Such an entity “may, in the event of any disputed claims under such contract . . . bring an action against the state ... for the purpose of having such claims determined.” General Statutes § 4-61 (a). The issue presented by this appeal is whether a general contractor has a “disputed [claim] under [its] contract” with the state, within the meaning of § 4-61 (a), if the general contractor’s claim against the state takes the form of a claim for indemnification that is based upon the pending claim of a subcontractor.
Our analysis of this issue is “guided by settled principles of statutory construction that assist us in ascertaining the intent of the legislature. . . . The legislative intent is to be discerned by reference to the language of the statute, its legislative history and surrounding circumstances, the policy the [statute] was designed to implement, and the statute’s relationship to the existing legislation and common law principles governing the same subject matter.” (Citation omitted; internal quotation marks omitted.) Hunte v. Blumenthal, 238 Conn. 146, 152, 680 A.2d 1231 (1996).
Our analysis is more specifically illuminated by the well settled principle that “the sovereign is immune from suit unless the state, by appropriate legislation, consents to be sued. State v. Chapman, 176 Conn. 362, 364, 407 A.2d 987 (1978); Baker v. Ives, 162 Conn. 295, 298, 294 A.2d 290 (1972); State v. Hartford, 50 Conn. 89, 90-91, 47 A. 622 (1882). When the state waives that immunity by statute ... a party attempting to sue
“As with any issue of statutory interpretation, our initial guide is the language of the statute itself.” (Internal quotation marks omitted.) Herbert S. Newman & Partners v. CFC Constmction Ltd. Partnership, 236 Conn. 750, 756, 674 A.2d 1313 (1996). Section 4-61 (a) expressly states that it shall apply only to “disputed claims” arising under certain types of construction contracts between the state and a party with whom the state has contracted. In this case, only Peabody, the general contractor, has a contract with the state. Standard had no contract with the state and, therefore, could not sue the state directly.
Recognizing the state’s undisputed sovereign immunity as to the subcontractor under § 4-61 (a), the plaintiff, the subcontractor’s successor in interest, brought suit against the general contractor, with whom it does have a contract. The only existing “disputed claim” at this point, therefore, is between the general contractor and the subcontractor.
In § 4-61 (a), the legislature did not, as it has done in the context of private sector claims, allow suits invoking the contingent liability of parties who “may be hable” at some point in the future. See General Statutes § 52-102a (defendant in civil suit may move court for
Our conclusion finds support in the legislative history of § 4-61. That history reflects the narrow and limited purpose for the exception to sovereign immunity contained in § 4-61 (a), and indicates that impleaders like that in the present appeal were not contemplated. At the time § 4-61 (a) was enacted, suits against the state by contractors were not countenanced because of sovereign immunity. Individualized legislative authorization to sue was required to be sought by petition before an action could be brought against the state. The legislature enacted § 4-61 in 1957 because of the mounting prevalence of these petitions for permission to sue the state. 7 S. Proc., Pt. 3, 1957 Sess., p. 1636. “The legislature wanted to reduce the number of petitions for permission to sue the state that it received involving suits over state construction contracts. 7 H.R. Proc., Pt. 4, 1957 Sess., p. 1937.” DeFonce Construction Corp. v. State, 198 Conn. 185, 189, 501 A.2d 745 (1985). Another reason for allowing parties who had contracted with the state to sue the state directly without seeking legislative
If general contractors on state construction projects were allowed to deny liability to subcontractors and then simply implead the state each time a subcontractor brought suit against them, the subcontractors effectively would be able to prosecute their claims against the state indirectly through the general contractors, increasing the complexity and volume of litigation against the state. Section 4-61 (a) expressly grants the right to sue the state only to contractors who have “entered into a contract with the state” and who have a dispute “under such contract.” Nowhere in § 4-61 or elsewhere in the General Statutes is there any provision that grants a subcontractor, who does not have a contract with the state, the right to sue the state.
“[T]he state’s sovereign right not to be sued without its consent is not to be diminished by statute, unless a clear intention to that effect on the part of the legislature is disclosed, by the use of express terms . . . .” (Internal quotation marks omitted.) White v. Burns, supra, 213 Conn. 312-13. In the absence of an expressed legislative intent to the contrary, it would be incongruous
The judgment is reversed and the case is remanded with direction to grant the state’s motion to dismiss the third party complaint and to render judgment thereon.
In this opinion PETERS, C. J., and BORDEN, NORCOTT, KATZ and PALMER, Js., concurred.
The Federal Insurance Company is the surety on the payment bond secured by Peabody International Corporation and Peabody, N.E., Inc., to guarantee payment for all materials and labor used by subcontractors in the execution of the contract of Peabody International Corporation and Peabody, N.E., Inc., with the state.
General Statutes § 4-61 provides in relevant part: “Actions against the state on highway and public works contracts. Arbitration, (a) Any person, firm or corporation which has entered into a contract with the state, acting through any of its departments, commissions or other agencies, for the design, construction, construction management, repair or alteration of any highway, bridge, building or other public works of the state or any political subdivision of the state 'may, in title event of any disputed claims under such contract or claims arising out of the awarding of a contract by the commissioner of public works, briny an action against the state to the superior court for the judicial district of Hartford-New Britainforthepurpose of having such claims determined . . . .” (Emphasis added.)
In the only reported decision in the state discussing this issue, Walter Kidde Constructors, Inc. v. State, 37 Conn. Sup. 50, 72, 434 A.2d 962 (1981), the trial court concluded that “the first condition precedent to [a general contractor] successfully suing on behalf of its subcontractors [is] an allegation of its own liability to them for the claimed damages.”
General Statutes § 52-265a provides in relevant part: “Direct appeal on questions involving the public interest, (a) . . . [A]ny party to an action who is aggrieved by an order or decision of the superior court in an action which involves a matter of substantial public interest and in which delay may work a substantial injustice, may appeal under this section from the order or decision to the supreme court within two weeks from the date of the issuance of the order or decision. The appeal shall state the question of law on which it is based.
“(b) The chief justice shall, within one week of receipt of the appeal, rule whether the issue involves a substantial public interest and whether delay may work a substantial injustice.
“(c) Upon certification by the chief justice t hat a substantial public interest is involved and that delay may work a substantial injustice, the trial judge shall immediately transmit a certificate of his decision, together with a proper finding of fact, to the chief justice, who shall thereupon call a special session of the supreme court for the purpose of an immediate hearing upon the appeal.
“(d) The chief justice may make orders to expedite such appeals, including orders specifying the manner in which the record on appeal may be prepared.”
Peabody’s initial third party complaint against the state alleges in relevant part: “(2) On or about November 30, 1983 . . . Peabody entered into combined Contracts Nos. 126-119 and 36-137 with . . . the [sjtate of Connecticut [djepartment of [tjransportation for the reconstruction of Route 8 and the Commodore Hull Bridge over the Housatonic River from Shelton to Derby.
“(3) On or about February 8, 1984 . . . Standard entered into a subcontract with Peabody to furnish and erect structural steel and related miscellaneous items in furtherance of Peabody’s aforesaid contract with the [sjtate of Connecticut [djepartment of [tjransportation.
“(4) To the extent [that the] plaintiff incurred the damages and expenses as alleged, such damages and expenses were caused by acts and/or omissions of the [sjtate of Connecticut and not by any acts and/or omissions of Peabody.
“(5) To the extent that [Peabody is] found responsible to Standard for all or part of the claims set forth in [the plaintiff's cjomplaint asserting Standard’s claims, [Peabody is] entitled under the law and under the terms and conditions of their [cjontract with the [s]tate of Connecticut to recover all such sums from the [sjtate of Connecticut [djepartment of [ transportation. . . .” (Emphasis added.)
Peabody’s amended third party complaint alleges in relevant part: “(14) To the extent that Standard incurred damages as alleged, all such damages were caused by the acts, omissions, interferences and delays of [the state] which constituted breaches of [the state’s] contract with Peabody. There is due to Peabody from [the state] such amount as Peabody may be found liable to Standard plus overhead and profit due to [the state’s] contract breaches and delays, disruptions and interferences with Peabody and Standard’s performance of the structural steel and miscellaneous iron work of Peabody’s contract with [the state]. To the extent that Peabody recovers from [the state], except for Peabody’s overhead and profit, Peabody is liable to Standard.” (Emphasis added.)
We realize that § 4-61 requires the general contractor to give notice of a factual basis for its claims against the state within two years of the completion of the contract or the execution of the certificate of acceptance, whichever is earlier. Section 4-61 also requires that a suit be initiated within three years of the earlier of those events. As Peabody points out, these limitation periods impose significant constraints on general contractors. This argument, however, does not change our interpretation of the statute and is more appropriately addressed to the legislature.
Dissenting Opinion
dissenting. Reminiscent of eighteenth century common law pleading, the majority concludes that a third party complaint cannot be amended to allege facts sufficient to establish a court’s jurisdiction. It was my understanding that Connecticut had abandoned this archaic legalism upon entering the twentieth century.
Similarly, this court has held that when a court’s subject matter jurisdiction is contingent on the finding of certain facts, the court must conduct an evidentiary hearing before dismissing the action for lack of jurisdiction. Standard Tallow Corp. v. Jowdy, 190 Conn. 48, 56, 459 A.2d 503 (1983) (“[w]hen issues of fact are necessary to the determination of a court’s jurisdiction, due process requires that a trial-like hearing be held”). It should then follow that, if a court’s subject matter jurisdiction is dependent upon a plaintiffs pleadings, and those pleadings are insufficient, a corrective
Nevertheless, the initial third party complaint provides the trial court with jurisdiction. Pursuant to General Statutes § 4-61, “[a]ny person, firm or corporation which has entered into a contract with the state . . . for the design, construction, construction management, repair or alteration of any highway, bridge, building or other public works of the state ... in the event of any disputed claims under such contract . . . [may] bring an action against the state to the superior court for the judicial district of Hartford-New Britain . . . .” (Emphasis added.) In this case, the relevant allegations in the initial third party complaint against the state are as follows: “To the extent [the] plaintiff [Standard Structural Steel, Inc. (Standard), a subcontractor
The majority narrowly construes the term “disputed claim,” and adopts a definition that is not in the best interest of the state. Specifically, the majority holds that a “disputed claim” exists, thereby allowing a general contractor, who has contracted with the state and who is being sued by its subcontractor for damages for which the state would alternatively be responsible, to implead the state as a third party defendant, only if the general contractor admits liability in the action brought by the subcontractor. I disagree. This decision will likely encourage general contractors to increase their rates when contracting with the state, so that they may insure themselves against the burden the court now imposes.
The majority’s holding places a general contractor in an unacceptable “catch-22” situation. The general-contractor must either defend against the subcontractor with the hope that the statute of limitations provided for in § 4-61 does not expire before any adverse judgment is rendered against it, or admit liability to the subcontractor in the hope that it will be able to recover against the state.
“In construing a statute, common sense must be used and courts must assume that a reasonable and rational result was intended.” Kron v. Thelen, 178 Conn. 189, 192, 423 A.2d 857 (1979); see also State v. Roque, 190 Conn. 143, 153, 460 A.2d 26 (1983) (“ ‘[t]hereisno canon against using common sense in construing laws as saying what they obviously mean’ ”). This principle is equally applicable to statutes that constitute a waiver of sovereign immunity. In this case, common sense dictates that the legislature did not intend to exclude
Accordingly, I dissent.
I recognize that Woodmont Assn. v. Milford, 85 Conn. 517, 524, 84 A. 307 (1912), decided eighty-four years ago, supports the majority’s holding today. Interestingly, however, in that case, Justice Wheeler in dissent a1 tempted to usher the court into the twentieth century: “A complaint, defective for lack of a jurisdictional fact, and capable of amendment, should not be dismissed, but the defect left to be met by plea or demurrer which admit of amendment. Our statutes of amendment, as construed by our
The majority also relies on Gurliacci v. Mayer, 218 Conn. 531, 545, 590 A.2d 914 (1991), for its holding with respect to this issue. The statement cited by the majority, however, is pure dicta because in Gurliacci, the court determined that the trial court had subject matter jurisdiction. Id.
See footnote 6 of the majority opinion.
As noted in the majority opinion, “the Federal Deposit Insurance Corporation as the receiver of the New Connecticut Bank and Trust Company and the successor in interest to Standard, brought the underlying action against [the defendants-third party plaintiffs], seeking approximately $14.8 million in damages allegedly suffered by Standard.”