City of Norwich v. Silverberg

• Decision Date: 08 July 1986
• Citation: 200 Conn. 367,511 A.2d 336
• Court: Connecticut Supreme Court
• Parties: CITY OF NORWICH v. Guerson R. SILVERBERG. CITY OF NORWICH v. Richard N. ZIFF.

Page 336

511 A.2d 336

200 Conn. 367

CITY OF NORWICH v. Guerson R. SILVERBERG.

CITY OF NORWICH v. Richard N. ZIFF.

Supreme Court of Connecticut.

Argued May 7, 1986.

Decided July 8, 1986.

Alan E. Lieberman, with whom, on brief, was Robert J. Cathcart, Hartford, for appellant (defendant in No. 12775).

Joseph F. Skelley, Jr., with whom, on brief, was Arthur A. Palmunen, Hartford, for appellant (defendant in No. 12776).

Wesley W. Horton, with whom were David T. Ryan, and, on brief, Susan M. Cormier and Thomas A. Young, Hartford, for appellee (plaintiff in both cases).

Before PETERS, C.J., and SHEA, CALLAHAN, NOVACK and HAMMER, JJ.

PETERS, Chief Justice.

The sole issue on this appeal is a determination of the scope of the indemnification provisions of General Statutes § 7-101a. The plaintiff, the city of Norwich, brought suit against the defendants, Richard N. Ziff and Guerson D. Silverberg, for legal malpractice. Ziff was corporation counsel to the plaintiff and Silverberg was assistant corporation counsel. In its malpractice action, the plaintiff complained that the defendants had provided inadequate representation in litigation involving a disputed tax assessment. ¹ Each defendant answered by denying the plaintiff's allegations and by filing a counterclaim demanding reimbursement from the plaintiff under General Statutes § 7-101a ² for any amount that the court might order the defendants to pay as well as for all expenses incurred by the defendants as a result of the suit. The trial court granted the plaintiff's motions to strike these counterclaims. The defendants appeal from the judgments thereafter rendered against them on the counterclaims. ³

General Statutes § 7-101a(a) requires a municipality to "protect and save harmless any municipal officer, whether elected or appointed, of any board, committee, council, agency or commission, or any full-time municipal employee, of such municipality from financial loss and expense, including legal fees and costs, if any, arising out of any claim, demand, suit or judgment by reason of alleged negligence, or for alleged infringement of any person's civil rights, on the part of such officer or such employee while acting in the discharge of his duties." The trial court, in striking the defendants' counterclaims, held that this statute requires the municipality to indemnify officers and employees only when they are sued by third parties and not when the municipality itself is the plaintiff.

On appeal, the defendants claim that the trial court erred in its judgement because § 7 101a, by its plain language, applies to "any claim, demand, suit or judgment." They urge us to hold that, in cases where a municipality sues its officials for negligence, the municipality must indemnify the officials for the amount it recovers as well as for costs to the officials that arise as a result of the action. In their view, § 7-101a effectively immunizes municipal officers and employees from any liability to their municipality for negligence. We find no error in the ruling of the trial court.

We note preliminarily the procedural framework that governs our inquiry on this appeal. "It is well settled that '[w]here an appeal is taken from a judgment following the granting of a motion to strike, we take the facts to be those alleged in the [appellant's pleadings] construed in a manner most favorable to the pleader. Sheets v. Teddy's Frosted Foods, Inc., 179 Conn. 471, 472, 427 A.2d 385 [1980]; Stradmore Development Corporation v. Commissioners, 164 Conn. 548, 550-51, 324 A.2d 919 [1973]; Senior v. Hope, 156 Conn. 92, 97, 239 A.2d 486 [1968]; Rossignol v. Danbury School of Aeronautics, Inc., 154 Conn. 549, 557, 227 A.2d 418 [1967]. For purposes of appeal, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted. DeMello v. Plainville, 170 Conn. 675, 677, 368 A.2d 71 [1976]; McAnerney v. McAnerney, 165 Conn. 277, 282, 334 A.2d 437 [1973]. See Practice Book, 1978, § 151.' Amodio v. Cunningham, 182 Conn. 80, 82-83, 438 A.2d 6 (1980)." Mead v. Burns, 199 Conn. 651, 655, 509 A.2d 11 (1986). Accordingly, in this case, we must assume that the defendants were, as they have alleged, municipal officers who qualified for whatever protection § 7-101a provides. The only question before us is whether the statute affords indemnity to municipal officers whom the municipality itself sues for negligence.

Well-established principles of statutory construction govern our analysis of § 7-101a. Our objective is to construe the language of the section so as to give effect to the apparent intent of the legislature. State v. Kozlowski, 199 Conn. 667, 673, 509 A.2d 20 (1986); Hayes v. Smith, 194 Conn. 52, 57, 480 A.2d 425 (1984); 2A Sutherland, Statutory Construction (4th Ed. Sands 1984) § 45.05. In our pursuit of that objective, we look to the language of the statute itself, its legislative history, and previous judicial construction. State v. Kozlowski, supra, 199 Conn. at 673-74, 509 A.2d 20; DeFonce Construction Corporation v. State, 198 Conn. 185, 187, 501 A.2d 745 (1985); State v. Parmalee, 197 Conn. 158, 161, 496 A.2d 186 (1985). Mindful of inherent statutory interrelationships, furthermore, we endeavor "to read the statute as a whole and so as to reconcile all parts as far as possible." Grodis v. Burns, 190 Conn. 39, 44, 459 A.2d 994 (1983); see also P.X. Restaurant, Inc. v. Windsor, 189 Conn. 153, 159-60, 454 A.2d 1258 (1983); Connecticut Theatre Foundation, Inc. v. Brown, 179 Conn. 672, 677, 427 A.2d 863 (1980).

The defendants' argument that they may rely on § 7-101a for immunity from liability to their municipal employers depends primarily on the language of subsection (a) of § 7-101a. They point out that this subsection purports to govern "any" claim of negligence and therefore argue that this unqualified coverage conclusively establishes a legislative intent that § 7-101a apply to two-party as well as to three-party indemnity claims. We are unpersuaded.

Read as a whole, § 7-101a refutes a construction affording the defendants the immunity they seek, because the section demonstrates, in its remaining subsections, that the transactions that the legislature sought to address were transactions in which an injured third person was seeking relief from a municipal employee and, indirectly, from a municipality itself. None of these subsections contemplates reimbursement for a municipal employee who has negligently failed to discharge his duties to his municipal employer.

Subsection (c) is instructive to a reading of "any claim" that excludes the municipality itself, because this subsection authorizes municipalities to purchase insurance to cover "the liability imposed by this section." Liability insurance is designed to protect an insured from claims for damages owed to a third person, and not from losses that the insured suffers directly. Cain v. American Policyholders' Ins. Co., 120 Conn. 645, 653, 183 A. 403 (1936); see Alcorn Bank & Trust Co. v. United States Fidelity & Guarantee Co., 705 F.2d 128 (5th Cir.1983); Keeton, Insurance Law § 4.8 (1971). The fact that subsection (c) speaks only to liability insurance implies that the legislature did not contemplate a need for a municipality to insure against its own losses to deal with the risk assigned to it by subsection (a). Although broader municipal insurance might well be available to provide a more extended all-risk coverage, the legislature was clearly of the view that "this section" required municipalities only to "insure against ... liability."

Even more definitively, subsection (d) imposes procedural preconditions on municipal liability that are entirely inconsistent with the defendants' expansive interpretation of subsection (a). No municipality need indemnify a municipal officer for his losses unless the prospective claimant (1) notifies the municipality of his intention to bring suit against the municipality's officer within six months of the accrual of the cause of action and (2) initiates suit within two years after the accrual date. Failure to comply with these procedural prerequisites affects only the right to indemnification; it does not impair a claimant's cause of action against the defendant officer himself. See Orticelli v. Powers, 197 Conn. 9, 13-14, 495 A.2d 1023 (1985); see also Wakelee v. DeSanto, 152 Conn. 44, 202 A.2d 833 (1964). The application of § 7-101a to suits brought by municipalities would result in the anomaly of requiring municipalities to notify themselves of their intention to commence suit against their own officers. The municipality could avoid the obligation to indemnify by simply failing to file notice with itself within six months or neglecting to bring suit within two years. ⁴ We cannot conclude that the legislature intended § 7-101a to operate in this way. Read as a whole, § 7-101a does not apply to actions brought by municipalities against their officers or employees.

There are no previous judicial constructions of § 7-101a that point in a different direction, nor is there any illuminating legislative history to lend support to the defendants' argument that the statute was intended to shield municipal officers from liability to their own municipalities. The defendants note that a remark by Representative Kevin P. Johnston during a 1977 house debate demonstrates his belief that § 7-101a applies to suits brought by municipalities. ⁵ It was, however, a 1971 enactment that provided the language of § 7-101a(a) which the defendants claim requires indemnification when the municipality is the claimant. Representative Johnston, who was not in the legislature in 1971, made his statement six years later in support of an amendment to § 7-101a that, when enacted, left this language intact and did not involve the issue of whether the statute should apply when municipalities sue their employees and officers. The remark therefore lacks authority as a guide to our ...