Wright Bros. Builders, Inc. v. Dowling

• Decision Date: 03 November 1998
• Docket Number: (SC 15741)
• Parties: WRIGHT BROTHERS BUILDERS, INC. v. JOSEPH A. DOWLING ET AL.
• Court: Connecticut Supreme Court

247 Conn. 218

720 A.2d 235

WRIGHT BROTHERS BUILDERS, INC. v. JOSEPH A. DOWLING ET AL.

(SC 15741)

Supreme Court of Connecticut.

Argued January 15, 1998.

Officially released November 3, 1998.

Borden, Berdon, Katz, Palmer and McDonald, JS.

Alan R. Spirer, for the appellant (plaintiff).

Frank W. Murphy, with whom were Christopher C. Vaugh and, on the brief, Barbara L. Coughlan, for the appellees (defendants).

William H. Ethier filed a brief for the Home Builders Association of Connecticut, Inc., as amicus curiae.

Opinion

BERDON, J.

The dispositive issue in this certified appeal is whether a home improvement contract entered into by the plaintiff, Wright Brothers Builders, Inc., and the defendants, Sandra O. Dowling and her husband, Joseph A. Dowling, complied with the Home Improvement Act (HIA), General Statutes § 20-418 et seq. The plaintiff, a licensed home improvement contractor, instituted this action to foreclose a mechanic's lien on property owned by Sandra Dowling.¹ The plaintiff had filed the lien to secure payment for work that it performed on the residence of Sandra Dowling in accordance with a written home improvement contract (contract). In defending against foreclosure of the lien, the defendants claimed that the contract did not comply with the statutory requirements of General Statutes § 20-429 (a)² of the HIA and, therefore, could not be enforced by an action for foreclosure of the lien or by any other means.

The attorney trial referee to whom the matter was initially referred in accordance with General Statutes § 52-434 (a) (4) and Practice Book § 19-1 et seq., formerly § 428 et seq., concluded (1) that the contract complied with the HIA and (2) that even if the contract failed to comply with the HIA, the defendants were precluded by their own bad faith from invoking the HIA as a defense to the contract. In accordance with his findings, the attorney trial referee recommended judgment for the plaintiff in the amount of $101,275. The trial court rejected the attorney trial referee's recommendations, finding that (1) the contract violated § 20-429 (a), and (2) there was insufficient evidence of bad faith to preclude the defendants from invoking the HIA as a defense to the contract. Consequently, the trial court rendered judgment in favor of the defendants.

On appeal to the Appellate Court, the judgment was affirmed in a per curiam decision. Wright Bros. Builders, Inc. v. Dowling, 45 Conn. App. 918, 694 A.2d 46 (1997). We granted the plaintiffs petition for certification limited to the following two issues: (1) "Did the Appellate Court properly affirm the trial court's decision overruling the attorney trial referee's conclusion that the agreement between the plaintiff and the defendants complied with [the HIA], General Statutes (Rev. to 1993) § 20-429 (a) (6);³ if so, did the Appellate Court also properly affirm the trial court's conclusion that the plaintiff is not entitled to recover under its claim of unjust enrichment?"; and (2) "Did the Appellate Court properly affirm the trial court's decision overruling the attorney trial referee's conclusion that the defendants' bad faith precluded their invocation of [the HIA] as a basis for repudiating the contract?" Wright Bros. Builders, Inc. v. Dowling, 242 Conn. 914, 914-15, 697 A.2d 369 (1997). We conclude that the contract complied with § 20-429 (a) (6) and, therefore, we do not address either the second part of the first certified question or the second certified question.

The attorney trial referee found the following facts, which are not in dispute. "The plaintiff is a licensed home improvement contractor engaged in the business of constructing residential and commercial structures.... Sandra Dowling is the record owner of the premises located at 13 Hitchcock Road, Westport, Connecticut, where she resides with her husband ... Joseph Dowling.

"After several months of preliminary design and estimating work, the parties entered into the agreement dated January 11, 1993. The agreement provided that [the] plaintiff would renovate approximately 2817 square feet of the defendants' house and construct an addition of approximately 3500 square feet. The plaintiff was to be paid on a cost plus basis (10 percent for overhead and 7 percent for profit), and the preliminary budget was set at $528,360. Although [Sandra] Dowling was the record owner, [Joseph] Dowling represented the two in all substantive dealings with [the] plaintiff.

"Work began on the project in February, 1993. Thereafter, the defendants initiated a number of changes and upgrades, which raised the total contract budget to $875,579 as of August 30, 1993. Leading up to that point there had been a great deal of communication between the parties, and [the] plaintiff regularly updated [the] defendants regarding the cost and progress of the work. This information was conveyed orally, in correspondence and in periodic billings.

"Problems commenced when the work was nearing completion. After receiving billing no. 7, dated August 30, 1993, which showed the revised budget of $875,579, [Joseph] Dowling expressed concerns about the cost of the job. Whereas before [the] defendants had promptly paid [the] plaintiffs billings, they failed to pay billing no. 7 in a timely fashion. On September 20, 1993, [Joseph] Dowling and Kelly M. Wright, [the] plaintiffs president, signed a one page document entitled `Amendment to Contract dated 11 January, 1993 ....' Among other things, [the amendment] provided that:

"`1. Contractor agrees to finish Project at 13 Hitchcock Road, Westport, CT for a final guaranteed price of $835,579...

"`7. There will be no change in the plans for construction and no alteration of material. The house will be delivered to Owner in "Turnkey" condition....

"`9. The final payment ($67,474) shall be due sixty days after the issuance of Certificate of Occupancy and the approval of said work by the architect whose approval will not be unreasonably withheld. Builder agrees to assist Owner in preparing documents necessary for financing....

"`11. Owner will pay $75,000 towards Contract upon signing of this Agreement...

"Pursuant to this amendment, the [defendants] paid $75,000 to [the] plaintiff. Thereafter, the project was completed. [The] [p]laintiff claims that $141,275 is due, whereas [the] defendants claim only $67,474 is [owing]. [The] [p]laintiff seeks the larger amount because it claims the scope of work was enlarged by the owner after the signing of the amendment. As a result, when [the] defendants tendered $67,474 in full and final settlement, [the] plaintiff refused the tender."

In January, 1994, the plaintiff filed a multicount complaint⁴ against the defendants seeking, in part, to foreclose on the mechanic's lien it had filed on Sandra Dowling's property. In the defendants' answer, they interposed a special defense⁵ claiming that the contract failed to comply with General Statutes § 42-135a (2) and (3) of the Home Solicitation Sales Act (HSSA),⁶ the requirements of which are incorporated into § 20-429 (a) (6) of the HIA.

The attorney trial referee, having found that the contract complied with the HIA, recommended judgment in the amount of $101,275 on the plaintiff's breach of contract claim, together with a dismissal of the defendants' counterclaim.⁷ The plaintiff moved that the trial court accept the attorney trial referee's recommended ruling with respect to the award of monetary damages, but at the same time filed certain exceptions to the ruling. The trial court, rejecting the attorney trial referee's recommendations, concluded that (1) the contract violated the HIA and (2) the factual findings of the attorney trial referee were insufficient to allow the plaintiff to invoke the bad faith exception to the HIA.⁸ Accordingly, the trial court rendered judgment in favor of the defendants on the complaint and on the Connecticut Unfair Trade Practices Act (CUTPA) count of their counterclaim, but awarded no damages to the defendants, reasoning that, although the plaintiff technically had violated the HIA, the defendants were not entitled to even nominal damages pursuant to CUTPA because they "not only did not suffer any loss, they actually received a windfall as the [attorney trial] referee found that they had received approximately $100,000 of construction, for which the defendants are absolved from paying because of the violation of the HIA." That determination is not before us on this appeal.

The plaintiff appealed from the judgment of the trial court to the Appellate Court and that court affirmed the judgment. Wright Bros. Builders, Inc. v. Dowling, supra, 45 Conn. App. 918. This certified appeal followed. On this appeal, the plaintiff claims that the contract complies with the provisions of the HIA. The defendants dispute this contention, arguing that the contract failed to satisfy two requirements of the HSSA that are incorporated by reference into the HIA. Specifically, the defendants argue that the plaintiff did not attach two copies of the notice of cancellation to the copy of the contract that it provided to Sandra Dowling, as required by § 42-135a (2), and did not enter the date of the transaction or the date by which the transaction could be canceled on the notice of cancellation, as required by § 42-135a (3). The defendants claim that these defects in compliance preclude the plaintiff from enforcing the contract. The plaintiff responds that strict compliance with those sections is not required and that, despite the discrepancies, the contract complies with the HIA. We agree with the plaintiff.

The determination of the requirements of the HIA is a matter of statutory construction and, therefore, a matter of law over which this court's review is plenary. Crandall v. Gould, 244 Conn. 583, 590, 711 A.2d 682 (1998). "[T]he process of statutory interpretation involves a reasoned search for the intention of the legislature." (Internal quotation marks...