Dorfman v. Smith

• Decision Date: 29 March 2022
• Docket Number: SC 20556
• Citation: 342 Conn. 582,271 A.3d 53
• Parties: Tamara DORFMAN v. Joscelyn M. SMITH
• Court: Connecticut Supreme Court

342 Conn. 582

271 A.3d 53

Tamara DORFMAN

v.Joscelyn M. SMITH

SC 20556

Supreme Court of Connecticut.

Argued April 28, 2021

Officially released March 29, 2022

Proloy K. Das, Hartford, with whom were Leonard M. Isaac, Waterbury, James J. Nugent, Orange, Marilyn B. Fagelson, New Haven, and, on the brief, Brian Parrott, Farmington, for the appellant (plaintiff).

Philip T. Newbury, Jr., Hartford, for the appellee (defendant Liberty Mutual Fire Insurance Company).

Robinson, C. J., and McDonald, D'Auria, Ecker and Keller, Js.

D'AURIA, J.

This appeal requires that we examine the scope of the litigation privilege, which provides absolute immunity from suit, in relation to alleged misconduct by an insurance company. The plaintiff, Tamara Dorfman, appeals from that part of the trial court's judgment dismissing her claims against the defendant Liberty Mutual Fire Insurance Company for breach of the implied covenant of good faith and fair dealing, negligent infliction of emotional distress, and violation of the Connecticut Unfair Trade Practices Act (CUTPA); General Statutes § 42-110a et seq. ; based on a violation of the Connecticut Unfair Insurance Practices Act (CUIPA), General Statutes § 38a-815 et seq. The trial court dismissed these claims on the ground that the litigation privilege deprived the court of subject matter jurisdiction over these claims. The plaintiff argues that, because these claims were the functional equivalent of claims for vexatious litigation, the litigation privilege did not apply. We disagree and, accordingly, affirm the judgment of the trial court.

The following facts and procedural history, as alleged in the complaint, construed in the light most favorable to the plaintiff, and contained in the record, are relevant to our review of these claims. In 2014, the plaintiff was injured when her motor vehicle collided with a vehicle operated by Joscelyn M. Smith, who failed to stop his vehicle at a stop sign. At the time of the collision, the defendant insured the plaintiff under a contract of motor vehicle insurance, which contained a provision for uninsured-underinsured motorist coverage as required by General Statutes § 38a-336. At the time of the collision, Smith was underinsured, and the plaintiff filed a claim with the defendant under the underinsured motorist provision of her insurance contract.

As part of its general business practices, the defendant investigated the collision to determine the cause and legal responsibility. In investigating the plaintiff's claim, the defendant acquired the police report regarding the collision, the plaintiff's recorded statement, and the recorded statement of Birbahadu Guman, a witness to the collision who was not listed in the police report. The report and the statements all noted Smith's failure to stop at the stop sign. Based on this information, two claims specialists employed by the defendant both concluded that Smith was 100 percent liable for the collision and noted their findings in the claim file. The defendant notified the plaintiff that her right to pursue her claim was conditioned on her providing an affidavit of no excess insurance.

To compel payment of the underinsured motorist benefits, the plaintiff brought suit against the defendant, alleging breach of contract.¹ The defendant hired attorneys to represent it in connection with the plaintiff's claim but deliberately withheld from them its file notes regarding the claim, Guman's name and existence, and Guman's recorded statement, even though it knew this information was necessary for its attorneys to prepare accurate responses to the plaintiff's complaint and discovery requests. In answering the complaint, the defendant pleaded that either it denied or did not have sufficient information to admit the allegations that Smith had failed to stop at a stop sign, causing the collision and the plaintiff's resulting injuries. The defendant also asserted a special defense of contributory negligence, even though it knew this to be false. As a result, the plaintiff alleges that the defendant's answer "falsely responded to ... [the] allegation[s]" in the complaint, in violation of General Statutes § 52-99.

The plaintiff's attorney then noticed the defendant's deposition to address, in part, the factual basis behind its answer and special defense. The defendant moved for a protective order. Additionally, the defendant provided false responses to the plaintiff's discovery requests, including that it did not know of the existence of any witnesses not listed in the police report and whether any recorded statements existed. In further response to the deposition notice, the defendant's corporate designee testified under oath, admitting that "[t]here was no basis in fact for [the defendant's] accusation that [the plaintiff] was in any way responsible for causing the accident" and that the defendant "had known that there was nothing [the plaintiff] could have done to avoid the accident ...." The defendant's designee also admitted that the defendant was aware that Guman had witnessed the accident and made a recorded statement but failed to disclose this information in its interrogatory responses. On the basis of this conduct, the plaintiff alleges that the defendant "used intentional misstatements, intentional misrepresentations, intentionally deceptive answers, and violated established rules of conduct in litigation," and "knowingly and intentionally engaged in dishonest and sinister litigation practices by taking legal positions that were without factual support" to try to prevent the plaintiff from receiving the benefits owed to her under the contract.

The defendant's designee also testified under oath that, in addition to this misconduct, "[the defendant] did not single out [the plaintiff] for special or unique treatment when it conditioned [her] receipt of [underinsured motorist] benefits [on] the provision of an affidavit of no excess insurance but was instead pursuing conduct that Liberty Mutual Corporation routinely takes in its handling of claims from other policyholders as well." Similarly, the defendant's designee "testified under oath that [the defendant] did not single out [the plaintiff] for special or unique treatment when it responded falsely to [her] discovery requests."

Following this deposition, the trial court granted the plaintiff permission to amend her complaint to include claims for breach of the implied covenant of good faith and fair dealing, negligent infliction of emotional distress, and violation of CUTPA based on a violation of CUIPA. The defendant moved to bifurcate the breach of contract claim from the extracontractual claims, which the trial court granted. Prior to trial on the breach of contract claim, the defendant withdrew its special defense of contributory negligence. At trial on the breach of contract claim, the defendant admitted liability, and a jury awarded the plaintiff $169,928.

After the verdict, the defendant moved to dismiss the remaining claims for lack of subject matter jurisdiction on the ground that the litigation privilege barred those claims. The trial court granted the motion in part and denied it in part. Specifically, as to the plaintiff's claims for breach of the implied covenant of good faith and fair dealing and negligent inflection of emotional distress, the trial court held that, because the claims were predicated on communications and statements filed in the course of and related to a judicial proceeding, the litigation privilege applied. For the same reason, as to the plaintiff's claim for violation of CUTPA based on a violation of CUIPA, the trial court determined that the allegations regarding a business practice of responding falsely to discovery requests also were privileged. The trial court determined, however, that, to the extent the plaintiff's CUTPA claim alleged that the defendant maintained an improper business practice of conditioning receipt of underinsured motorist benefits on the provision of an affidavit of no excess insurance, in violation of General Statutes § 38a-336c (c), the litigation privilege did not bar such a claim because this practice did not occur during the judicial proceedings but occurred before the action commenced. Thus, the trial court granted the motion to dismiss except as to the plaintiff's CUTPA claim to the extent it was premised on a violation of § 38a-336c (c).

The plaintiff appealed from the trial court's decision on the defendant's motion to dismiss, but the Appellate Court dismissed the appeal for lack of a final judgment in light of the continued viability of the CUTPA claim. The plaintiff subsequently requested and received permission to amend her complaint to remove all allegations regarding the alleged violation of § 38a-336c (c). Because the alleged violation of § 38a-336c (c) was the only claim to have survived the motion to dismiss, the trial court determined that the withdrawal of these allegations effectively withdrew this theory of liability. Accordingly, the court rendered judgment in favor of the defendant on all of the plaintiff's extracontractual claims. The plaintiff then appealed to the Appellate Court. The appeal was then transferred to this court pursuant to General Statutes § 51-199 (c) and Practice Book § 65-1.

I

Before addressing the applicability of the litigation privilege, "[w]e begin our analysis with a review of [this] doctrine ... as set forth in Simms v. Seaman , 308 Conn. 523, 531–40, 69 A.3d 880 (2013). In Simms , we noted that the doctrine of absolute immunity originated in response to the need to bar persons accused of crimes from suing their accusers for defamation. ... The doctrine then developed to encompass and bar defamation claims against all participants in judicial proceedings, including judges, attorneys, parties , and witnesses. ... We further noted that, [l]ike other jurisdictions, Connecticut has long recognized the litigation privilege, and that [t]he general rule is...