Town of Stratford v. Castater

• Decision Date: 03 July 2012
• Docket Number: No. 33314.,33314.
• Citation: Town of Stratford v. Castater, 136 Conn. App. 522, 46 A.3d 945 (Conn. App. 2012)
• Court: Connecticut Court of Appeals
• Parties: TOWN OF STRATFORD v. Eric CASTATER.

136 Conn.App. 522

46 A.3d 945

TOWN OF STRATFORD

v.Eric CASTATER.

No. 33314.

Appellate Court of Connecticut.

Argued March 5, 2012.

Decided July 3, 2012.

Michael S. Casey, for the appellant (plaintiff).

Frank B. Cochran, New Haven, for the appellee (defendant).

DiPENTIMA, C.J., and BEAR and BISHOP, Js.

BISHOP, J.

The plaintiff, the town of Stratford, appeals from the judgment of the trial court, rendered in favor of the defendant, Eric Castater, after a court trial. On appeal, the plaintiff claims that the court improperly (1) concluded that its claim for money had and received was unavailing because the cash out benefits were authorized, (2) concluded that the payment was not detrimental to the plaintiff and (3) balanced the equities of the two parties. ¹ We affirm the judgment of the trial court.

The following procedural history and facts, as found by the court, are relevant to our discussion of the issues on appeal. From March 9, 2009, through December 11, 2009, the defendant was employed as the assistant to James Miron, who served as the plaintiff's mayor from December 11, 2005, through December, 2009. The defendant's responsibilities required him to work in close concert with the mayor. He was a salaried full-time employee and entitled to benefits pursuant to policies incorporated in his employment agreement. The employment agreement, in turn, provided that although the defendant's employment could be terminated without notice during the first six months of his employment, he could be discharged after the initial six months only with sixty days advance notice or immediately without advance notice subject to the plaintiff's paying “full salary and benefits for the sixty (60) day calendar period immediately following your date of termination.” This written employment contract, in turn, incorporated by reference an appendix, effective July 1, 2008, that listed the benefits package applicable to the defendant's position as a nonunion aide to the mayor. These benefits included five personal days per calendar year, ten professional development days, ten vacation days and ten days of sick leave, all prorated in the first year of employment based on the starting month and accruing as of January 1 after the initial year. The agreement provided, as well, that unused vacation and sick leave could be “cashed out” upon termination of employment, but it did not contain a similar provision regarding unused personal and professional development days. It did provide that “[p]erfect attendance days are eliminated.” Finally, and significantly, paragraph XX of the agreement contained the following provision: “This benefits description is for information only and may be changed, altered or modified by the [plaintiff] prospectively in the discretion of the Mayor. Except as otherwise provided in an employment letter, any such revisions shall not adversely affect leave balance accruals or payouts. Except for that limitation, any such revisions will supercede those provided in this package. Employees will be notified of any such changes by communication from the Mayor, the CAO or the HR Director.” ²

Once Miron lost his bid for reelection in November, 2009, he decided to terminate the defendant's employment. By letter dated December 4, 2009, Miron advised the defendant that his employment was terminated effective December 11, 2009, and that the plaintiff would pay “full salary and benefits for the next sixty calendar” days. On the same date, Miron retroactively rescinded the provision in the agreement eliminating payment for perfect attendance days as it related to employees in the defendant's category. A contemporaneous termination notice approved by Miron set forth the categories and accrued hours of benefits and salary that the defendant was to receive as “cash-out” benefits.³ It was Miron's view at the time, and the defendant's during litigation, that the mayor had broad authority to modify the employment agreement to include termination benefits for professional development days and perfect attendance. On December 11, 2009, the plaintiff issued payments to the defendant in accordance with the terms of his termination notice as approved by Miron, the mayor at the time.

Later, in January, 2010, after a new administration had taken office, the plaintiff notified the defendant that it was contesting the scope and extent of the benefits he had received as part of his termination package. Also, based on the distribution received by the defendant in conjunction with the termination of his employment, he was informed by the state department of labor's unemployment compensation department (department) that he would be ineligible for unemployment compensation through March 13, 2010. Notwithstanding the plaintiff's position that it overpaid the defendant in December, 2009, the defendant made no repayment to the plaintiff. He did not make any claims against the plaintiff arising from the termination of his employment or tenure as a municipal employee, and he did not appeal from the decision of the department concerning his date of eligibility for unemployment compensation.

The plaintiff thereafter brought this action. In the first count, the plaintiff alleged a cause of action for money had and received. More specifically, the plaintiff claimed that it overpaid the defendant in the amount of $4744.37, that it had no moral or legal obligation to make the overpayment, that it was entitled to be repaid the amount of the overpayment, and that, even though the defendant in equity and good conscience had no right to retain the overpayment, he refused to reimburse the plaintiff for the amount of the overpayment. In the second count, the plaintiff repeated the operative allegations of the first count and added to them the allegation that the defendant did not earn and was not otherwise entitled to the overpayment and that his continued retention of the unwarranted benefit resulted in unjust enrichment. Finally, in count three, sounding in conversion, the plaintiff repeated the allegations of count one and added to them a claim that although the plaintiff had demanded repayment of funds rightly belonging to it, the defendant had assumed and exercised ownership and control over such funds to the plaintiff's detriment.

In response to the complaint, the defendant filed an answer, generally denying the inculpating allegations of the complaint. Additionally, the defendant filed three special defenses. In his first special defense, he alleged that he had accepted payment in full settlement of claims he could have made against the plaintiff, includingthe termination of his employment contract, that the plaintiff had informed the state of all payments made to him for purposes of calculating his eligibility for unemployment compensation, and that the conduct of the parties amounted to an accord and satisfaction for all claims arising from his employment and termination. The defendant alleged in his second special defense that he had paid all applicable federal and state income taxes on the amounts paid to him by the plaintiff and that he did not appeal from the decision of the department denying benefits to him for the period of time encompassed by the disputed distribution to him. Finally, in his third special defense, the defendant claimed that the plaintiff's newly elected mayor, shortly after he took office, cast aspersions on him by publicly stating that he was going to seek repayment of amounts improperly paid to the defendant and, as a result, the defendant's reputation had been sullied, requiring him to seek counsel and making it more difficult for him to secure employment. The defendant claimed, in this special defense, that, because of this conduct, the plaintiff was guilty of unclean hands in its quest for repayment of funds paid to him. Finally, in a pleading captioned “Motion for Judgment,” the defendant sought not only judgment on his behalf but an award of counsel fees from the plaintiff.

During trial, the court dismissed the third count of the complaint for failure to make out a prima facie case and thereafter rendered judgment in favor of the defendant on counts one and two of the complaint.⁴ The court concluded, as to the first count, that the payments to the defendant were authorized and, to the extent that the defendant was overpaid by Miron because he exceeded his authority or made factual mistakes leading to the amount of the benefits paid, the plaintiff, nevertheless, did not have a superior right in equity to repayment by the defendant. Balancing the equities, the court determined that it would be inequitable to require the defendant to return the disputed payments to the plaintiff pursuant to the plaintiff's claim for money had and received. Additionally, as to the count alleging unjust enrichment, the court concluded that the plaintiff suffered no detriment in making the disputed payments to the defendant and that the defendant, moreover, had paid taxes on the amounts received and that his receipt of unemployment benefits was delayed due to his receipt of the disputed benefits. Therefore, the court concluded, the equities balanced in favor of the defendant retaining the distribution he received from the plaintiff. This appeal followed.

I

The plaintiff claims that the court improperly concluded that its claim for money had and received was inapplicable because the cash out benefits were authorized. More specifically, the plaintiff contends that the mayor did not have the broad powers to modify the employment agreement. We need not reach the merits of the plaintiff's claim regarding the mayor's authority because we affirm the decision of the trial court on the ground that the court properly exercised its equitable powers.

As a prelude to our assessment of the court's decision, we set forth the parametersof the relevant decisional law. An action for money had and received has an ancient pedigree. “Common-law courts...