2000 Conn. Super. Ct. 16146 | Conn. Super. Ct. | 2000
Defendant A-B objects to such a hearing because: (1) it agreed only to refer to a judge trial referee the sole question of the issuance of a permanent injunction in this case, and (2) it did not waive its right to a jury trial on damages arising from a violation of CUTPA and CFA counts.
At the outset the court must determine whether or not the plaintiff is entitled to a jury trial under CUTPA and CFA and if so, as to what issues. Clearly if plaintiff is not entitled to a jury trial on those causes of action, there is no need for plaintiff's written consent to a judge trial referee nor for its waiver of the right to trial to jury. §
CFA at §
"No franchisor shall, directly, or through any officer, agent or employee, terminate, cancel or fail to renew a franchise, except for good cause which shall include, but not be limited to the franchisee's refusal or failure to comply substantially with any material and reasonable obligation of the franchise agreement . . . "
Section 42-133(g) provides that franchisee may bring an action for injunctive relief, damages, and, if successful, shall be entitled to reasonable attorney's fees. CT Page 16148
Since CFA obviously is a statutory cause of action, the court must determine whether or not it gives rise to a right to trial by jury. In making that determination, the court must "ascertain whether the action being tried is similar in nature to an action that could have been tried to a jury in 1818 when the state constitution was adopted. This test requires an inquiry as to whether the course [sic] of action has roots in the common law, and if so, whether the remedy involved was one in law or in equity." Skinner v. Angliker,
In Associated Investment Co. Ltd. Partnership v. Williams Associates,
Likewise in Motor Vehicle Manufacturer's Association v. O'Neill,
The very prohibiting language of § 4-133f (a) — "No franchisor shall. . . ." — lends itself to the interpretation that it essentially creates an equitable cause of action, the main purpose of which is for a court to enjoin the prohibited action.
Moreover, CFA creates rights that do not have roots in common law. Section 42-133(a) prohibits a franchisor from failing to renew a franchise except for good cause. Under common law a franchiser can refuse to renew a contract for any reason whatsoever. Section
Moreover, CFA, enacted in 1972 and amended subsequently, has its genesis in a recognition of the disparity between the superior economic strength of franchisors and the inferior economic strength of franchisees, and that historic abuses in the franchise field could not be remedied by common law causes of action brought by franchisees. "Franchising in Connecticut", Richard W. Farrell, 54 Conn. Bar J. No. 5, 446-47 (October 1980) The court in Grand Liqht Supply Co. v.Honeywell,
The injunctive relief provided in CFA is by far its most important provision to effectuate the purpose of the statute and to preserve the franchise relationship.
No Connecticut cases have accorded a right to trial by jury in a CFA case. It may be noted that all the federal opinions, applying CFA, cited in this court's memorandum of decision dated May 28, 1997, are court and not jury cases.
This court concludes that based on the CFA's creation of rights that did not exist in common law and its essentially equitable purpose to protect franchisees, the statute does not give rise to the right to a jury trial.
Moreover, under traditional common law analysis, our courts have held that where legal and equitable issues are combined in a single action, "whether the right to a jury trial attaches depends upon the relative importance of the two types of claims. "Where incidental issues of fact are presented in an action essentially equitable, the court may determine them without a jury in the exercise of its equitable powers.'" Texaco,Inc. v. Golart,
Plaintiff's verified complaint alleges seven counts: the First Count for violation of CFA against defendant A-B; the Second Count for breach of contract against defendant A-B; the Third Count for implied covenant of good faith and fair dealings against defendant A-B; the Fourth Count for violation of CUTPA against defendant A-B; the Fifth Count for violation of CUTPA against defendant Daub; the Sixth Count for violation of CUTPA against defendant Lupone; and Seventh Count for tortuous interference with contract against defendants Daub and Lupone. The plaintiff seeks an injunction in the First and Fourth Counts for violation of CFA and CUTPA; attorney's fees pursuant to CFA and CUTPA; punitive damages pursuant to CUTPA and compensatory damages on all of the counts.1
In the First Count, after alleging the franchise relationship between HESCO and A-B and A-B's violation of CFA, plaintiff alleges the numerous ways it will suffer irreparable harm unless an injunction issues, and that it has no adequate remedy at law. In its prayer for relief the plaintiff seeks an injunction, costs and attorney's fees, pursuant to § 42-133(g) and also compensatory damages. However, the First Count for violation of CFA has as its main thrust and claim for relief an injunction.
The Fourth Count sounding in violation of CUTPA, in which plaintiff also seeks an injunction, relies entirely on violations of CFA. Viewing plaintiff's complaint as a whole, the CUTPA and common law counts are the bases for plaintiff claiming punitive and compensatory damages, but the First Count is the principal ground upon which the plaintiff seeks an injunction. Consequently, the court concludes the First Count, sounding in violation of CFA, is essentially equitable in nature.
Thus the court concludes that the plaintiff is not entitled to a jury trial on its First Count under CFA, or under its pleadings in this case.
CUTPA, at § 42-110(g), provides that a person bringing a CUTPA cause of action has the right to a jury trial "except with respect to the amount of punitive damages . . . or the award of reasonable attorney's fees . . ." Those issues are reserved to he court. Thus the only issue upon which the plaintiff may be entitled to a jury trial in this case is for compensatory damages under CUTPA. However, as further stated herein, the court finds that the plaintiff waived that right to a jury by express agreement, by conduct, and by judicial admission on the record of the case.
At the outset plaintiff obtained an ex parte temporary order restraining defendant A-B from refusing to continue the franchise CT Page 16151 relationship with HESCO until further order of the court. Judge Marshall Berger, the presiding civil judge, recommended, and the parties agreed to proceed to a hearing before this court on plaintiff's right to a permanent injunction on the basis of alleged violations of CFA and CUTPA. In the course of the trial, because of the flow of evidence, the court became unclear of exactly what issues it was deciding. The court referred the parties back to Judge Berger to clarify the submission to it. Counsel conferred with Judge Berger and the plaintiff's counsel reported to the court, as follows:
"Judge Berger said this hearing before your honor is a hearing on everything except our claim for money damages under whichever counts as those such [sic] might be appropriate but put on hold until the court issues a further order."
Defendant's counsel concurred in this statement and the court gave defendant's counsel the opportunity to take further depositions of witnesses if he had any misunderstanding what the trial was about.
Later on in the trial, the court became aware that the plaintiff had claimed this case for a jury trial. The court asked plaintiff's counsel whether if his client won an injunction on the basis of a violation of CUTPA, the case would be tried all over again before a jury on the question of damages derived from a violation of CUTPA. Plaintiff's counsel said the trial could have been before a judge and jury but defendant did not want to delay the trial because it was under a temporary restraining order. Defendant's counsel, however, disagreed saying, "The parties agreed — we were in there with Judge Berger talking about scheduling the preliminary injunction hearing. We said, well rather than do that and have another trial later on, let's address all of the issues once and for all. And that's what the parties agreed to."
After the trial concluded, the court was still unclear exactly what the parties had agreed that it should decide. Particularly, it seemed wasteful that the court could decide the merits of the CUTPA counts, grant an injunction, and the plaintiff would still have the right to a jury trial for compensatory damages on those counts. It called a meeting of counsel in its chambers and expressed that concern. At that point plaintiff's counsel, Mr. Edward Hennessey, and Mr. David Ryan and defendant's counsel, Mr. Paul Sanson agreed that this court could hear and determine all of the issues respecting the counts of CUTPA and CFA, first as to liability and the issuance of an injunction, and then if there was a finding of liability on these counts, a subsequent hearing as to damages derived from violation of those statutes. Specifically, plaintiff's counsel waived a jury as to the CUTPA and CFA counts. CT Page 16152
At that point the court should have had that agreement put on the record in open court. It was a mistake by an experienced judge who should have known better. However, because the agreement was so clear and unequivocal, and the court felt it could rely on adherence by plaintiff's lawyers from one of Hartford's prestigious law firms, it did not do so.
Fortunately, defendant's counsel was wiser and more prudent than the court. It wrote to the court on December 16, 1996, with a copy to plaintiff's counsel, memorializing the agreement as follows:
Dear Judge Satter:
CT Page 16153The purpose of this letter is to set forth my understanding of the agreements reached at the meeting held in your office on Thursday, December 6, 1996. I had written to Attorney Ryan, HESCO's counsel, in the hope of submitting a joint letter, but he indicated he was not interested, stating that you had not requested such a letter. In light of some of the problems in the past, my clients believed that it would be helpful to have some memorialization of our meeting. My understanding is that the parties agreed that the Court would rule on the issues of:
(1) whether there is liability against Allen-Bradley with respect to counts 1 [CFA] and 4 [CUTPA]; and
(2) if there is liability, whether HESCO is entitled to the injunctive relief it has requested.
In addition, the plaintiff has waived any claim for a jury trial on the above issues. The findings of fact and conclusions of law made by the Court in ruling on these issues will be the law of the case and will be, subject to the appeal rights of the parties, final and binding on the parties. For example, if the Court finds a violation of CUTPA but determines HESCO is not entitled to injunctive relief, the violation has already been proved and HESCO need only prove damages. Similarly, if the Court finds no violation of CUTPA, that is a final determination and HESCO is not entitled to any damages based on that claim.
Please let me know if I have misstated or omitted anything.
Very truly yours,
Paul D. Sanson
The plaintiff's counsel never responded to that letter and never disavowed that statement of the agreement reached. The court construed plaintiff's counsel's silence as concurrence.
Our law is clear that "consent" or "assent" may be inferred from the attendant circumstances and conduct of the parties. Seal Audio. Inc. v.Bozak, Inc.,
Here it was not only appropriate but obligatory for plaintiff's counsel to respond and indicate dissent from the agreement stated in defendant's counsel's letter of December 18, 1996, if any, because they knew the court was going to rely on that agreement in framing its decision.
In fact, the court's decision did reflect the agreement. The court held defendant A-B liable under CFA and CUTPA, issued an injunction, and indicated it would then hear the issue of damages in a separate subsequent hearing.
Defendant on June 17, 1997 moved this court to make a determination to permit an immediate appeal of the court's decision of May 28, 1997. The court conferred with counsel in its chambers and indicated to them that an appellate court was more likely to allow an interlocutory appeal if the trial court first heard and decided the issues of damages, so that the appellate court had the trial court's final decision on the CFA and CUTPA counts. Defendant's counsel did not want to proceed that way because the trial of those issues was likely to take too long and it wanted a quicker appellate review of the issue of liability under CPA. Plaintiff's counsel however, did agree to this court deciding damages on the CPA and CUTPA counts. This indicated they felt bound by the agreement that the court consider all of the issues under the CUTPA and CFA counts.
Later in this case, plaintiff moved for counsel fees under CPA, again indicating it agreed that the court should consider the issues of damages. The court denied the motion explaining that it would not determine damages piecemeal, but rather all elements of damages after a full hearing. CT Page 16154
The attorneys undertook discovery both on the issues of damages under CPA and CUTPA and on the common law counts to be tried to the jury. When their discovery conflicts came to the court, it ruled it wanted discovery issues relating to damages resolved and pursued first in order that the damages issue could be quickly decided, and that discovery issues relating to the common law counts could be resolved and pursued later. On April 10, 2000 in open court, while the court was attempting to resolve controversies respecting discovery, the following colloquy occurred:
THE COURT: Look, on CUTPA, as well as on the Connecticut Franchise Act, my understanding is those were submitted to me and not to the jury. There is no jury issue alive with respect to CUTPA. You agreed to have those cases tried to me.
MR. HENNESSEY: There is no issues alive; they have been decided. But all I'm saying, your Honor — all I was saying is that you haven't decided attorney's fees under CUTPA yet, you haven't decided punitive damages under CUTPA yet and you haven't decided other fees under the CFA yet.
THE COURT: And I haven't decided general damages under CFA.
MR. HENNESSEY: That's right.
THE COURT: or general damages under CUTPA.
MR. HENNESSEY: Absolutely. And I agree. I think we're on the same page.
The court construes plaintiff's counsel Mr. Hennessey's statement as a judicial admission. In State v. Smith,
The court concludes that the plaintiff's judicial admission that the court could hear damages under CFA and CUTPA constituted a waiver of jury trial on those counts and was as effective as if in writing.
Thus the court concludes, (1) CFA is a statutory action that does not entitle plaintiff to a jury trial and the manner plaintiff pleaded its CFA count made it essentially an equitable claim; (2) respecting both CPA and CUTPA, plaintiff waived the right to a jury trial by: (a) its counsel's silence after receiving defendant counsel's letter of December 18, 1996 stating the agreement that plaintiff's counsel had expressly waived a jury trial on the statutory counts, particularly when counsel knew the court was relying on that agreement in framing its decision; (b) its counsel's conduct indicating concurrence with that agreement by assenting to the court hearing damages on the statutory counts in order to expedite the interlocutory appeal, and by moving for counsel fees under CFA; and (c) its counsel admitting in open court that the court could hear damages on the statutory counts, having the effect of a written waiver of jury trial.
Thus the court will proceed to a hearing on all of the elements of damages pertaining to the CFA and CUTPA counts on the second Tuesday of February in 2001, as previously ordered. The parties are also to comply with previous orders of this court relating to scheduling of depositions of experts, completing discovery, and filing pretrial briefs.
With respect to pretrial briefs, the court requests the parties to brief three issues that are likely to arise in the hearing on damages: (1) The court, having found a violation of CUTPA based on a violation of CFA, can it in the hearing on damages consider any other acts of the defendant A-B amounting to violations of CUTPA ? (2) The court rendered its decision on May 28, 1997. Normally in a bifurcated case, after liability is determined, the hearing in damages follows immediately. Can the court consider plaintiff's entitlement to damages based on events occurring after its May 28, 1997 decision ? (3) Since damages for the common law counts to be submitted to a jury may overlap with damages for the statutory counts, the court requests that plaintiff specify in its pretrial brief damages claimed under CFA and under CUTPA.
Robert Satter State Judge Referee
