Maris v. McGrath

• Citation: 269 Conn. 834,850 A.2d 133
• Decision Date: 29 June 2004
• Docket Number: (SC 16394).
• Court: Supreme Court of Connecticut
• Parties: ALAN MARIS, v. PAMELA JO MCGRATH.

269 Conn. 834

850 A.2d 133

ALAN MARIS, v. PAMELA JO MCGRATH.

(SC 16394).

Supreme Court of Connecticut.

Argued February 17, 2004.

Officially released June 29, 2004.

Sullivan, C. J., and Borden, Palmer, Vertefeuille and Zarella, Js.

James E. Mattern, for the appellant (plaintiff).

Jeremiah Donovan, for the appellee (defendant).

Opinion

BORDEN, J.

The so-called "American rule" for the award of attorney's fees to the prevailing party bars such an award "except as provided by statute or in certain defined exceptional circumstances . . . ." (Internal quotation marks omitted.) CFM of Connecticut, Inc. v. Chowdhury, 239 Conn. 375, 393, 685 A.2d 1108 (1996), overruled in part on other grounds, State v. Salmon, 250 Conn. 147, 155, 735 A.2d 333 (1999). The rule does not apply, however, where the other party or his attorney has acted in bad faith. Id., 394. This is what is known as the bad faith exception to the American rule. Id. The principal issue in this certified appeal involves the standard governing an award of attorney's fees to the prevailing party, based upon the bad faith conduct of the other party himself in the litigation, as opposed to the conduct of that other party's attorney. The plaintiff, Alan Maris, appeals, following our grant of certification, from the judgment of the Appellate Court affirming the trial court's award of attorney's fees to the defendant, Pamela Jo McGrath.¹ The plaintiff claims that the Appellate Court applied an improper test in affirming the award of attorney's fees to the defendant, and that, under the appropriate test, no such award was warranted. We affirm the judgment of the Appellate Court.

The plaintiff brought this action against the defendant in four counts alleging: (1) breach of an oral agreement; (2) unjust enrichment;² (3) return of items of personalty; and (4) constructive trust.³ The trial court, after a bench trial, rendered judgment for the defendant on the complaint. The court also awarded attorney's fees to the defendant. The plaintiff appealed from the judgment of the trial court to the Appellate Court, challenging the award of attorney's fees.⁴ The Appellate Court affirmed that award. Maris v. McGrath, 58 Conn. App. 183, 191, 753 A.2d 390 (2000). This certified appeal followed.

The trial court made the following findings of fact. In September, 1985, the defendant began working as a dental assistant in the orthodontic office of the plaintiff and his partner, Kenneth Carlough. Eventually, the defendant began dating the plaintiff. In the spring of 1989, the defendant underwent a hysterectomy, and the plaintiff dated other people. In the summer of 1989, after the defendant had recovered from the operation, the plaintiff sought to resume their relationship. He told her that they would live together, travel together, and spend the rest of their lives together. By the end of that summer, they were living two weeks each month at the defendant's home and two weeks at the plaintiff's home.

The plaintiff and defendant lived in this fashion for approximately one year until, in the summer of 1990, the defendant's relationship with the plaintiff was causing a problem at work because Carlough was uncomfortable supervising a woman who was the equivalent of the wife of his partner. Thus, the defendant was required to leave a job that she enjoyed.

The plaintiff and defendant talked about her future. The plaintiff did not approve of the defendant taking a similar job in another dental office because she would not be available to accompany him on his frequent trips and vacations. They decided that she should attend hairdressing school. The plaintiff offered to set the defendant up in a business: he would own a travel agency, and she would have a hairdressing salon next door. The plaintiff discussed this plan with his accountant. The plaintiff promised the defendant that if she would leave her employment with his dental practice, he would take care of her material wants and needs for the rest of her life.

In reliance on the plaintiff's promises, the defendant left her employment in his dental practice and, in September, 1991, began to attend hairdressing school. That education was interrupted by a serious illness in February, 1991, but following her graduation, she began to work as a hairdresser. By renting space in an established hairdressing salon, the defendant was able to take time off as required to accompany the plaintiff in his travels. By the summer of 1992, however, their relationship was ending.⁵

The trial court found that their financial arrangements were as follows. On September 8, 1989, the defendant signed the necessary documents to transform her individual credit union account into a joint account with the plaintiff. The plaintiff made a number of deposits into that account. Of the twenty-three checks deposited into the account, nineteen were made payable to the credit union, and four were made payable to the defendant. On the backs of the checks payable to the credit union, no writing appears except for a single endorsement in the plaintiff's handwriting on one of the checks. On some of the checks, the plaintiff made notations in the memorandum section, most of which were totals for his own use.

The defendant would write checks on that account to cover both her own and their joint expenses. The plaintiff's last check was deposited into the joint account in April, 1992. In an August 17, 1992 letter to the defendant, the plaintiff made a number of trivial arrangements of their practical affairs. In September, 1992, the defendant transformed the account back into a personal account of her own, and returned to the plaintiff the $3500 in the account that was his.

In the trial court's view, the case hinged on credibility. The court noted the plaintiffs assertions that the defendant had made an oral promise to repay the money that he was depositing into their joint account and any amounts that he spent on her house, and that she promised that she would execute a document providing that she would repay him those loan amounts from the proceeds of the house whenever she would sell it. The defendant, however, denied that the plaintiff's deposits into the account and that the amounts he spent on her house were loans. The court found, contrary to the plaintiff's testimony, that the deposits into the account were not loans, and that the defendant never made any such promises to repay the plaintiff.

Furthermore, the court specifically found that the plaintiff was untruthful in his testimony in various significant respects. This finding was based in general on the testimony of four people who, in the court's view, "have been more closely involved with [the plaintiff] than anyone," and who "know [the plaintiff] best." These people included: Peter Demas, the orthodontist with whom the plaintiff began his practice; Carlough, his partner during most of his career; Barry Stark, a dentist who was his former best friend; and the defendant. Each testified that the plaintiff's character for veracity "is miserable"; some testified that "his reputation for veracity in the community of orthodontists is miserable"; and they all shared the view that he "cannot be trusted." The court noted that the plaintiff offered no evidence contradictory to this testimony, and the court consequently gave "great weight" to that evidence. In response to the plaintiff's claim that these witnesses were biased against him because they had been involved in financial disputes with him, the court found, to the contrary, that "they bear ill will toward [the plaintiff] because he cannot be trusted."

In addition, the trial court specifically found that the untruthfulness of the plaintiff's testimony was shown by the fact that it was self-contradictory. The court found that it was not until after the relationship had terminated that the plaintiff began to claim that all the money that he had deposited into the joint account were loans to the defendant. In addition, the August 17, 1992 letter to the defendant made no mention of any such loans.

Further, the plaintiff had testified that, other than the initial cash deposit, he had never made deposits into the joint account personally, suggesting that it was the defendant who did all of the depositing into the account. In this regard, there was a specific check, dated July 27, 1990, that had been deposited into the account; on this check, the plaintiff had written the word "loan" in the memorandum section. The check was not deposited into the account, however, until five days after it was dated, and the trial court credited the defendant's testimony that she denied seeing the word "loan" when she signed it. The court specifically found that the plaintiff wrote the word "loan" into the memorandum section of the check after the defendant had signed it but before the plaintiff himself deposited the check into the joint account. Thus, the court found that the plaintiff's "denials concerning who made the deposits into the joint account [are] clearly contradicted by his own writing at the time he had been making the deposit." In addition, the court specifically credited the testimony of the plaintiff's accountant, James Mason, who testified that the plaintiff was a compulsively meticulous record keeper who would never have entered into a loan agreement without careful documentation. The plaintiff never produced any such documentation, however, except for the word "loan" on the check, which he had added after the check had been endorsed. Thus, the trial court specifically found that the plaintiff was "untruthful when he testified that he and [the defendant] agreed that the amounts of money that he was depositing into their joint checking account [constituted] loans and that they simply never got around to producing any written document." Instead, the court specifically found that "[n]one of [the plaintiff's] explanations for the joint account is persuasive," and...