Flater v. Grace

• Decision Date: 05 May 2009
• Docket Number: No. 18253.,18253.
• Citation: 969 A.2d 157,291 Conn. 410
• Court: Connecticut Supreme Court
• Parties: Michael FLATER et al. v. Kevin M. GRACE et al.

969 A.2d 157

291 Conn. 410

Michael FLATER et al. v. Kevin M. GRACE et al.

No. 18253.

Supreme Court of Connecticut.

Argued February 13, 2009.

Decided May 5, 2009.

J. Christopher Kervick, Windsor Locks, for the appellants (defendants).

David M. Moore, for the appellees (plaintiffs).

ROGERS, C.J., and NORCOTT, KATZ, PALMER and VERTEFEUILLE, Js.

KATZ, J.

The defendant, Kevin M. Grace, individually and doing business as Grace Builders,¹ appeals from the trial court's decision denying his motion to open the judgment awarding the plaintiffs, Michael Flater and Tracy Flater, $92,831 in damages for the defendant's failure to complete and perform satisfactorily a home improvement contract. The essence of the defendant's claim is that it was an abuse of discretion and inequitable for the court not to open the judgment because the defendant, in deciding not to defend against the claims, had relied on an estimate that the plaintiffs submitted prior to the hearing in damages of only $7075 for the completion of the contract. We conclude that the trial court did not abuse its discretion in denying the defendant's motion to open the judgment, and, accordingly, we affirm the judgment.

The record reveals the following undisputed facts and procedural history. On September 29, 2006, the plaintiffs filed a four count complaint against the defendant alleging: breach of contract; unjust enrichment; breach of the duty of good faith and fair dealing; and a violation of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. The complaint alleged the following facts. In August, 2002, the plaintiffs had executed a written contract with the defendant, a licensed home improvement contractor, to remove an existing deck on their home in Simsbury and to build in its place a three season enclosed room with an attached deck at a cost of $23,441. The contract called for the work to commence on or about October 1, 2002, and to be completed within three to four weeks after the start date. In mid-October, the defendant commenced work on the project. While the work was proceeding, the parties orally agreed to change the project to a four season room, but that agreement never was memorialized in a written agreement. In December, 2002, in light of the winter weather, the defendant ceased work but promised to complete the project in the spring. The defendant never returned to complete the project, despite numerous unsuccessful efforts by the plaintiffs to contact him in 2003 and 2004. The defendant had failed: to install certain components of the project; to perform certain work in a workmanlike manner; and to perform work that conformed with the Simsbury town building code. The defendant also had failed to obtain the requisite permits and to put the second contract in writing, contrary to the requirements of the Connecticut Home Improvement Act under General Statutes §§ 20-427(i) and 20-429(a). By the time the defendant ceased work on the project, the plaintiffs had made four payments totaling $26,231, which exceeded the original contract cost but was consistent with the subsequent oral agreement.

The plaintiffs sought compensatory damages and court costs, as well as punitive damages and attorney's fees on the CUTPA count. The only count in their complaint that referred to specific damages was the CUTPA count, which alleged "damages, including but not limited to the expenditure of an additional [$7075] to rectify the said breaches of contract." The statement of damages filed with the complaint sought damages "in excess of $15,000...." The defendant filed an appearance on November 16, 2006, but thereafter never filed a responsive pleading.

On January 10, 2007, the plaintiffs filed a motion for default for the defendant's failure to plead. On January 19, 2007, the clerk's office entered a default. On May 3, 2007, the plaintiffs filed a motion for judgment on the default and for an order of payments. See Practice Book §§ 17-32 and 17-33. The order of payment sought a total of $66,412 in damages — "$26,231, the amount paid pursuant to the contract, $7025 to complete the home improvement contracted for ... and $33,256 as double damages pursuant to [CUTPA]," plus $2000 in attorney's fees and costs. The plaintiffs also filed Michael Flater's affidavit of debt in which he attested to the sums paid to the defendant and asserted that he "may need to replace the work done, or spend $7025 to correct the work...." In support of the latter figure, the plaintiffs submitted an estimate from another builder that had been prepared almost three years earlier, which projected a cost of $7075 for the "[c]orrection of code violations and other deficiencies for [the room] addition...."² The affidavit of debt further attested, however, that additional estimates were scheduled to be performed the next weekend "to confirm the sum of money needed to correct the problems created by the [defendant's] failure to complete the work...."

On May 7, 2007, pursuant to Practice Book § 17-34, the trial court, Graham, J., conducted a hearing in damages, which the defendant did not attend. At that hearing, the plaintiffs submitted affidavits, dated May 5, 2007, from two registered contractors who had inspected the defendant's work. Michael Flater testified that he had been informed by these contractors that it would be impossible to repair the project because it contained numerous code violations and was structurally unsound, thus necessitating replacement instead of repair. The affidavits reflected the contractors' estimates for replacement at $66,600 and $69,000. In light of this recently obtained information, the plaintiffs informed the court that they were seeking actual replacement cost rather than the amount paid to the defendant. At the end of the hearing, the trial court awarded damages on all four counts in the total amount of $92,831, plus court costs, and $2000 in attorney's fees on the CUTPA violation.³

On July 7, 2007, after unsuccessfully seeking to set aside the default because judgment already had entered; see Practice Book § 17-42; the defendant filed a motion to open the judgment. The defendant alleged as grounds for the motion that: (1) service of process was defective; (2) a good defense exists, namely, that the claim for damages is "grossly inflated"; and (3) the defendant "did not have the benefit of counsel but has since retained counsel." The plaintiffs filed an objection to the defendant's motion, asserting that: (1) the improper service claim is without merit because the defendant filed an appearance in the case prior to the entry of default and the ability to challenge personal jurisdiction had been extinguished; (2) the "grossly inflated" damages claim is unavailing because the plaintiffs presented affidavits and testimony in support of the damages awarded and the defendant waived his opportunity to challenge that evidence by choosing not to attend the hearing in damages; and (3) the plaintiffs' counsel had advised the defendant to obtain counsel, but he had declined to avail himself of counsel until after the entry of judgment.

Thereafter, the trial court, Elgo, J., conducted a hearing on the motion to open, which was attended by both parties. At that hearing, the defendant argued that he had not defended against the action because he had accepted the notion that it was fair to pay the plaintiffs the $7025 that had been estimated to complete the project, but that he had obtained counsel once damages "blossom[ed]" to more than $90,000. The defendant contended that good cause existed to defend against the claim on the ground of mistake in the calculation of damages because only $7025 was owed pursuant to the plaintiffs' own estimate. The plaintiffs' counsel explained the components of the damages award and the basis for the change in the estimates and noted that Judge Graham could have awarded double or treble damages under CUTPA.

The trial court made no findings at the hearing and thereafter issued an order summarily sustaining the plaintiffs' written objection to the motion to open the judgment. The defendant did not seek an articulation of the basis of the trial court's decision. He did file a motion for reconsideration, alleging, inter alia, that new grounds had come to light, namely, that the plaintiffs' counsel either intentionally or negligently had misled the defendant as to the extent of the plaintiffs' claim. The trial court summarily denied the motion.

The defendant appealed from the trial court's judgment to the Appellate Court, and we thereafter transferred the appeal to this court pursuant to General Statutes § 51-199(c) and Practice Book § 65-1. On appeal, the defendant contends that the trial court's decision denying the motion to open was an abuse of discretion because: (1) his decision not to defend against the claims was the result of "fraud, deceit and trickery"; and (2) the underlying judgment was based on a misapplication of the law of damages. Specifically, with respect to the first claim, the defendant contends that fraud is demonstrated by the fact that Michael Flater's affidavit of debt alleged that the cost of completing the project was $7025 but that the plaintiffs subsequently submitted affidavits alleging more than $66,000 in corrective work. With respect to the second claim, the defendant contends that the correct measure of damages should have been no more than the $26,231 paid by the plaintiffs plus the cost to restore the property to its original condition by removing the work performed, not the $26,231 paid plus the cost to replace the work with a new four season room. The defendant further contends that equitable considerations dictate that the judgment be opened.

In response, the plaintiffs contend that the defendant has raised claims on appeal that were not raised at the hearing on the motion to open and thus he is not entitled to a review of those claims. The plaintiffs...