Esposito v. Specyalski

Decision Date06 April 2004
Docket Number(SC 17063).
Citation844 A.2d 211,268 Conn. 336
CourtConnecticut Supreme Court
PartiesRAYMOND ESPOSITO, EXECUTOR (ESTATE OF NEIL ESPOSITO) v. HEATHER SPECYALSKI ET AL.

Borden, Norcott, Katz, Vertefeuille and Zarella, Js.

Wesley W. Horton, with whom were Robert M. Shields, Jr., Howard A. Jacobs and, on the brief, Charles A. Deluca, Kimberly A. Knox, Tricia Morris Porto, Julia K. Ulrich, legal intern, and Jeffrey J. White, legal intern, for the appellants (plaintiff and third party defendant).

Cesar A. Noble, with whom, on the brief, was Thomas J. Sansone, for the appellee (defendant and third party plaintiff Mercedes-Benz Credit Corporation).

Opinion

KATZ, J.

This is a joint appeal of the plaintiff and of the third party defendant from the summary judgment rendered in favor of the defendant Mercedes-Benz Credit Corporation (Mercedes-Benz Credit) on both its counterclaim and its third party complaint. Because we determine that the decision of the trial court is not yet ripe for adjudication, we dismiss the appeal.

The record discloses the following undisputed facts. The plaintiff, Raymond Esposito (Esposito), the executor of the estate of Neil Esposito (decedent), commenced this action for damages1 against the defendants, Heather Specyalski and Mercedes-Benz Credit. Esposito's complaint alleged that the decedent was a passenger in a motor vehicle, which was owned by and leased from Mercedes-Benz Credit2 and negligently operated by Specyalski, that left the traveled portion of the highway, struck numerous trees and ultimately rolled over, thereby causing the decedent's death.3 The lessee of the vehicle was Rubbish Removal of Hartford, Inc. (Rubbish Removal), and the decedent was the guarantor of all amounts owed under the lease between Rubbish Removal and Mercedes-Benz Credit.4

Thereafter, Mercedes-Benz Credit filed a third party complaint against Rubbish Removal seeking indemnification for any judgment that may be rendered against Mercedes-Benz Credit in favor of Esposito or Specyalski, along with costs, expenses and attorney's fees for defending the actions brought by either Esposito or Specyalski. Mercedes-Benz Credit also filed a counterclaim against Esposito, based upon the decedent's guarantee, seeking indemnification for all claims, losses, injuries, costs, expenses and attorney's fees for any judgment that may be rendered against it in favor of either Esposito or Specyalski. Finally, Mercedes-Benz Credit filed a cross claim against Specyalski, seeking indemnification from her for any judgment that may be rendered against it, as well as for costs, expenses and attorney's fees for defending against Esposito's action.

Thereafter, pursuant to Practice Book § 17-44, Mercedes-Benz Credit separately moved for summary judgment on its third party complaint against Rubbish Removal and on its counterclaim against Esposito based on the indemnification and guarantee provisions of the lease. See footnote 4 of this opinion. Specifically, Mercedes-Benz Credit claimed that it was entitled to judgment under the lease thereby obliging Rubbish Removal and Esposito to indemnify it for any judgment and all costs, including attorney's fees, resulting from the claims of Esposito and/or Specyalski. Rubbish Removal objected to the motion, arguing that the indemnification provision of the lease violates public policy under General Statutes § 14-154a because Rubbish Removal was not directly involved in the accident that caused the injuries for which that statute renders Mercedes-Benz Credit liable. See footnote 3 of this opinion. Similarly, Esposito argued that it would be against public policy for the decedent's estate to indemnify Mercedes-Benz Credit because the decedent was a nonnegligent passenger of the motor vehicle at the time of the accident. Additionally, both Esposito and Rubbish Removal argued that: the indemnification clause was unconscionable in that Mercedes-Benz Credit was insured for losses related to the motor vehicle and reimbursement would allow Mercedes-Benz Credit an improper double recovery; the language of the indemnification clause obligated Rubbish Removal and Esposito to pay only costs, expenses and attorney's fees resulting from claims made against Mercedes-Benz Credit, but not pay the claims or judgments themselves; and, because a genuine dispute of material fact existed as to the identity of the operator of the motor vehicle at the time of the accident, an issue important to the limitations of the indemnification clause in this case, Mercedes-Benz Credit's motion for summary judgment was inappropriate.

In deciding the motions, the trial court noted that "[t]he identity of the driver of the automobile is a fiercely contested issue," but nevertheless that court decided the motions irrespective of the decedent's liability. The court determined that the indemnification clause in the lease entitled Mercedes-Benz Credit to judgment against Rubbish Removal and Esposito, as a matter of law, regardless of whether the decedent or Specyalski was operating the vehicle.

In granting Mercedes-Benz Credit's motion against Rubbish Removal, the trial court rejected the argument that the indemnification clause "limits the indemnification to `costs' only, as that term is defined in Black's Law Dictionary . . . ." The court determined that the indemnification clause5 was clear and unambiguous and that Rubbish Removal's liability to Mercedes-Benz Credit would not be limited to costs and expenses, but would include any damages awarded in a judgment on the claims themselves. The trial court also rejected Rubbish Removal's claim that it is against public policy to enforce an indemnification clause against a nonnegligent lessee such as itself because Rubbish Removal was a business entity that had "agreed to a particular allocation of the cost of the risk of accidents."

With regard to Esposito, the trial court made numerous determinations, all leading to the ultimate conclusion that the decedent's estate is bound by the provisions of the lease that the decedent had with Mercedes-Benz Credit. The court concluded that enforcement of the indemnification and guarantee6 clauses of the lease would not constitute a violation of public policy and that adherence to the contract provision would not be unconscionable. Specifically, the trial court determined that, because an indemnification agreement is not against public policy when a lessee is the tortfeasor, and because a guarantor steps into the shoes of the lessee, if, in the present case, the decedent were found to have been the operator of the motor vehicle, his estate would be subject to the terms of the indemnification clause. If the decedent were found not to have been the operator, the trial court reasoned, his estate still would be bound by the indemnification clause if, as alleged in the special defense, he were found to have been negligent for having allowed Specyalski to operate the motor vehicle while she was intoxicated. Finally, if the decedent were not found to have been the operator, and if he were not found negligent for having allowed Specyalski to operate the motor vehicle, the trial court determined that the decedent, a sophisticated businessman, would nevertheless be bound by the lease, and would therefore be liable.7 Therefore, the trial court entered an order in favor of Mercedes-Benz Credit on the issues of indemnity by the lessee, Rubbish Removal, and the guarantor, the decedent, and accordingly, rendered judgment for Mercedes-Benz Credit on its counterclaim against Esposito and on its third party claim against Rubbish Removal.

Thereafter, on January 6, 2003, Esposito and Rubbish Removal filed a petition for certification to appeal pursuant to General Statutes § 52-265a.8 The petition was denied and, on January 13, 2003, Esposito and Rubbish Removal filed an appeal pursuant to General Statutes § 52-2639 with the Appellate Court. Additionally, pursuant to Practice Book § 61-4,10 they filed a motion for permission to appeal with the Appellate Court and a motion for a § 61-4 determination with the trial court. On January 23, 2003, after the appeal was filed, the trial court found, pursuant to § 61-4 (a), that "the issues resolved by [the] judgment are of such significance to the determination of the outcome of the case that delay incident to an appeal would be justified . . . ." On July 10, 2003, Esposito, Rubbish Removal and Mercedes-Benz Credit thereafter, pursuant to General Statutes § 51-199 (c) and Practice Book § 65-2, requested that the appeal be transferred to this court. On July 24, 2003, the Appellate Court ordered the parties to file supplemental briefs on the issue of whether the appeal should be dismissed for lack of a final judgment. On September 17, 2003, the Appellate Court marked the matter "off," and that same day issued a corrected order that determined that no action was necessary on the § 61-4 motion for permission to appeal. Thereafter, on September 30, 2003, we granted the motion to transfer the appeal to this court.

On appeal, Esposito and Rubbish Removal claim that the trial court improperly determined that: the indemnification clause in the lease imposing the duty to pay the indemnitee's costs and expenses also required them to pay Mercedes-Benz Credit for any judgment that might be rendered against it in the underlying action; the guarantee clause of the lease obligated Esposito to indemnify Mercedes-Benz Credit despite the fact that the clause is ambiguous; the enforcement of the indemnification and guarantee clauses against a nonnegligent lessee or guarantor does not violate the public policy embodied in § 14-154a; and the indemnification and guarantee clauses are not unconscionable. Mercedes-Benz Credit defends the trial court's decision on the merits. It also asserts that the issues regarding unconscionability are not reviewable.11

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