Republic Ins. Co. v. Pat DiNardo Auto Sales, Inc., CV930300662S

• Citation: 44 Conn.Supp. 207,678 A.2d 516
• Decision Date: 23 February 1995
• Docket Number: No. CV930300662S,CV930300662S
• Court: Superior Court of Connecticut
• Parties: REPUBLIC INSURANCE COMPANY v. PAT DiNARDO AUTO SALES, INC., et al. File

Page 516

678 A.2d 516

44 Conn.Supp. 207

REPUBLIC INSURANCE COMPANY v. PAT DiNARDO AUTO SALES, INC., et al.

File No. CV930300662S.

Superior Court of Connecticut,

Judicial District of Fairfield.

Feb. 23, 1995.

Friedman, Mellitz & Newman, Fairfield, for plaintiff.

Willinger, Shepro, Tower & Bucci, Bridgeport, for defendants.

LEVIN, Judge.

This is an action to recover monetary damages under an indemnity agreement. On September 25, 1978, the plaintiff, Republic Insurance Company, and the defendants, Pat DiNardo Auto Sales, Inc., Patrick M. DiNardo, Julia DiNardo and Salvatore J. DiNardo, entered into an indemnity agreement. The agreement provided in part that the defendants would indemnify the plaintiff "from and against any and all liability, loss, costs, damages, attorney's fees and expenses of whatever kind or nature which [the plaintiff] may sustain or incur by reason or in consequence of executing any such bond or bonds as surety...."

On October 26, 1978, the plaintiff, as surety, and the defendants, as principals, executed a surety bond for the completion of subdivision improvements for the town of Monroe (town), by the defendants. The plaintiff executed the surety bond in consideration for the defendants' signing the indemnity agreement. The defendants breached the terms of their contract with the town. As a result of the breach, the town filed an action against the defendants and against the plaintiff, pursuant to the bond. The plaintiff filed a cross complaint against the defendants. The defendants failed to file a responsive pleading to that cross complaint. The issues in the cross complaint were neither joined nor adjudicated. On May 13, 1991, in accordance with the findings of the attorney trial referee, the court, Spear, J., rendered judgment against the defendants and the plaintiff. In satisfaction and discharge of its obligation, the plaintiff paid the town $91,000 on May 2, 1991.

The plaintiff then brought the present action on December 18, 1992, to recover monetary damages from the defendants pursuant to the indemnity agreement. In response to the plaintiff's one count amended complaint the defendants filed an answer and three special defenses; collateral estoppel, statute of limitations and failure to allege sufficient facts to prove the existence of an enforceable agreement. The plaintiff and the defendants filed trial memoranda in support of their respective claims. The court requested that the parties submit supplemental trial memoranda discussing the applicability of Public Acts 1993, No. 93-370 (P.A. 93-370), to the present action. Both parties complied with this request.

The defendants contend that because the plaintiff filed a cross complaint in the earlier action brought by the town, collateral estoppel bars the present action. "[C]ollateral estoppel, or issue preclusion, prohibits the relitigation of an issue when that issue was actually litigated and necessarily determined in a prior action.... For an issue to be subject to collateral estoppel, it must have been fully and fairly litigated in the first action. It also must have been actually decided and the decision must have been necessary to the judgment." (Citations omitted; internal quotation marks omitted.) Mulligan v. Rioux, 229 Conn. 716, 751, 643 A.2d 1226 (1994), on remand, 38 Conn.App. 546, 662 A.2d 153 (1995). The plaintiff's cross complaint was not answered or litigated in the earlier action. The doctrine of collateral estoppel, therefore, does not bar the present action. Heritage Village Master Assn., Inc. v. Heritage Village Water Co., 30 Conn.App. 693, 697-700, 622 A.2d 578 (1993); cf. A.J. Masi Electric Co. v. Marron & Sipe Building & Contracting Corp., 21 Conn.App. 565, 568, 574 A.2d 1323 (1990).

The plaintiff claims that it is entitled to recover monetary damages pursuant to its indemnity agreement with the defendants. The defendants claim that the statute of limitations for contract actions, General Statutes § 52-576, bars the plaintiff's action. Section 52-576 provides that "[n]o action ... on any contract in writing, shall be brought but within six years after the right of action accrues...."

The indemnity agreement in the present action states that the defendants will indemnify the plaintiff "from and against any and all liability, loss, costs, damages, attorney's fees and expenses of whatever kind or nature which [the plaintiff] may sustain or incur by reason or in consequence of executing any such bond or bonds as surety...." (Emphasis added.) By its very terms, the agreement indemnifies against both loss and liability. See Balboa Ins. Co. v. Zaleski, 12 Conn.App. 529, 534-35, 532 A.2d 973, cert. denied, 206 Conn. 802, 535 A.2d 1315 (1987).

In Balboa, the Appellate Court addressed the issue of whether an action for indemnification based upon an agreement indemnifying against both loss and liability was barred by the statute of limitations on contract actions contained in § 52-576. Balboa Ins. Co. v. Zaleski, supra, 12 Conn.App. at 535, 532 A.2d 973. The court determined in Balboa that the cause of action accrued at the time of the default on the underlying contract, more than six years earlier, and that, therefore, the plaintiff's cause of action was barred by § 52-576. Id., at 538, 532 A.2d 973.

In the present case, the defendants argue that, according to Balboa, the plaintiff could have sued upon the agreement as soon as the underlying contract with the town was breached. This breach occurred more than six years before this indemnity action was brought and, therefore, the action would be barred by the statute of limitations. The plaintiff argues that the cause of action accrued at the time of the payment, May 2, 1991, and that the statute of limitations would not bar the action.

During the pendency of this action, however, the General Assembly enacted P.A. 93-370, which, if applicable, renders moot the dispute as to the time the cause of action accrued. P.A. 93-370, now codified as General Statutes § 52-598a and entitled, "An Act Concerning the Statute of Limitations in Actions for Indemnification and Attorney Grievance Procedures," provides in pertinent part: "Notwithstanding any provision of chapter 926 of the general statutes, an action for indemnification may be brought within three years from the date of the determination of the action against the party which is seeking indemnification by either judgment or settlement." Section 52-576, which would otherwise time bar this action, is codified in chapter 926 of the General Statutes.

The effective date of P.A. 93-370 is October 1, 1993. See General Statutes § 2- 32. ¹ It would be plain error for this court to ignore a clearly applicable statute. Campbell v. Rockefeller, 134 Conn. 585, 588, 59 A.2d 524 (1948) (statute of limitations); see State v. Preyer, 198 Conn. 190, 199, 502 A.2d 858 (1985); Persico v. Maher, 191 Conn. 384, 403-404, 465 A.2d 308 (1983); State v. Burke, 182 Conn. 330, 331-32, 438 A.2d 93 (1980); Hartford Federal Savings & Loan Assn. v. Tucker, 181 Conn. 607, 609, 436 A.2d 1259 (1980); Stoni v. Wasicki, 179 Conn. 372, 377, 426 A.2d 774 (1979); Adley Express Co. v. Town of Darien, 125 Conn. 501, 504, 7 A.2d 446 (1939); Schmidt v. Town of Manchester, 92 Conn. 551, 555, 103 A. 654 (1918); Cunningham v. Cunningham, 72 Conn. 157, 160, 44 A. 41 (1899); In re Jonathan P., 23 Conn.App. 207, 211, 579 A.2d 587 (1990); DeVita v. Esposito, 13 Conn.App. 101, 111, 535 A.2d 364 (1987), cert. denied, 207 Conn. 807, 540 A.2d 375 (1988). The issue is whether P.A. 93-370 is clearly applicable to the present case. ² The court concludes that it is.

The legislature enacted P.A. 93-370 in response to the Appellate Court's decision in Protter v. Brown Thompson & Co., 25 Conn.App. 360, 593 A.2d 524 (1991), cert. granted, 220 Conn. 910, 597 A.2d 335 (appeal withdrawn). In that case, the court ruled that the statute of limitations for indemnification began to run upon the commission of the negligent conduct underlying the original action. The fourth party plaintiff's action for indemnification, therefore, was barred before the right to indemnification even accrued. P.A. 93-370 "legislatively overruled" this decision. See, e.g., Lane v. Aetna Casualty & Surety Co., 203 Conn. 258, 524 A.2d 616 (1987); Security Ins. Co. of Hartford v. DeLaurentis, 202 Conn. 178, 520 A.2d 202 (1987); Michel v. Planning & Zoning Commission of Town of Monroe, 28 Conn.App. 314, 612 A.2d 778, cert. denied, 223 Conn. 923, 614 A.2d 824 (1992).

"When the language [of a statute] is plain and unambiguous, we need look no further than the words themselves because we assume that the language expresses the legislature's intent." Oller v. Oller-Chiang, 230 Conn. 828, 848, 646 A.2d 822 (1994). The plain language of the statute makes it unambiguous and clear that P.A. 93-370 applies to all actions for indemnification. Actions for indemnification arise from statute, between joint tortfeasors, or by express contracts. See Kyrtatas v. Stop & Shop, Inc., 205 Conn. 694, 698, 535 A.2d 357 (1988). P.A. 93-370 applies, notwithstanding any statute of limitations contained in chapter 926, including § 52-576, and not solely to the "act or omission complained of" language of § 52-577. P.A. 93-370, therefore, in effect, also "legislatively overruled" Balboa Ins. Co. v. Zaleski, supra, 12 Conn.App. 529, 532 A.2d 973.

Since P.A. 93-370 was enacted during the pendency of this civil action, there is a question as to whether and to what extent that enactment is retroactive. On occasion, the legislature itself has determined this issue with specific language in its legislation. See, e.g., Champagne v. Raybestos-Manhattan, Inc., 212 Conn. 509, 520, 562 A.2d 1100 (1989) (applying language of Public Acts 1979, No. 79-631, § 107, that its provisions will be applicable to " 'all product liability claims brought on or after October 1, 1979' "). The language of P.A. 93-370 does not provide such...