source: Caselaw Access Project

author: BERDON, J.

license: Public Domain

text:
    ROBERT ENGELMAN, EXECUTOR (ESTATE OF ELLA B. RYDER) v. CONNECTICUT GENERAL LIFE INSURANCE COMPANY
    (15508)
    Berdon, Norcott, Katz, Palmer and McDonald, Js.

      Argued January 16
    officially released March 25, 1997

      William H. Clendenen, Jr., with whom, on the brief, was Nancy L. Walker, for the appellant (plaintiff).

      Timothy F. Woodbridge, for the appellee (defendant).
   Opinion

BERDON, J.

The dispositive issue in this appeal is whether a change of beneficiary in a life insurance policy can be accomplished by substantial compliance with the policy requirements, as opposed to strict compliance, where the policy requires that the change of beneficiary be requested “on a form satisfactory to the company.” The plaintiff, Robert Engelman, is the executor of the estate of the decedent, Ella B. Ryder, who, prior to her death, owned a life insurance policy (policy) issued by the defendant, Connecticut General Life Insurance Company. The trial court, Booth, J., held that Ryder had not effectively changed the beneficiary of the policy and rendered judgment for the defendant. We reverse the judgment of the trial court.

The undisputed facts found by the trial court are as follows. In 1961, the defendant issued a policy insuring the life of Ryder for $100,000. Her husband was listed as the owner and primary beneficiary of the policy, and her nephew, Philip G. Zink, was named as a contingent beneficiary. The policy provided, in pertinent part, as follows: “A new beneficiary may be designated from time to time by filing with the home office a written request therefor on a form satisfactory to the company and signed by the owner. ... No change of beneficiary shall take effect until such change shall have been recorded in writing by the company.” (Emphasis added.) The policy did not define or explain the terms “on a form satisfactory to the company” or “recorded in writing by the company.”

Upon her husband’s death in 1973, Ryder, as executrix of his estate, became the owner of the policy and, as such, had the right to change the beneficiary. Ryder’s relationship with her nephew Zink began to deteriorate and it continued to worsen up to the time of her death. In 1976, through her insurance agent, Ryder unsuccessfully attempted to change the beneficiary on the policy. In 1977, Ryder asked the plaintiff, her attorney, to revise her estate plan. The revised estate plan was predicated, in part, on making Ryder’s estate the beneficiary of the policy. On the basis of the plaintiffs advice, Ryder wrote directly to the defendant in February, 1978, asking it to prepare a change of beneficiary form naming as beneficiaries the executors or administrators of her estate and to send the form to the plaintiff for his review. The trial court found that there was no evidence that the defendant sent Ryder the requested form at that time. Consequently, nothing ever came of this request.

In January, 1979, Ryder sent a letter, prepared by the plaintiff, to the defendant purporting to change the beneficiary from Zink to the executor of her estate. The letter referenced the policy by number and name, was dated January 8, 1979, and was signed by Ryder and witnessed by the plaintiff. The defendant received the letter and placed it in the policy file; however, the defendant did not “record” the change of beneficiary on the policy. Instead, as a result of this letter, the defendant immediately sent the plaintiff a change of beneficiary form, which he forwarded to Ryder at her Florida residence. The change of beneficiary form sent by the defendant was accompanied by a form cover letter which provided, in pertinent part, that “[a]ll forms must be dated, signed, witnessed and returned to us. Until this is done, the changes you have requested cannot be made.” The form was neither returned to the defendant nor to the plaintiff, and it is not known whether Ryder ever received the form from the plaintiff. The trial court found that “[t]here was no evidence that [Ryder] did anything after the letter of January, 1979, to show that she had changed her mind about making her estate the beneficiary.”

Ryder continued to pay the premiums on the policy until her death on July 2, 1990. When the plaintiff, as executor of Ryder’s estate, demanded payment of the policy proceeds from the defendant a few weeks after her death, an appropriate claim form was provided to him. The form was completed and returned to the defendant. The defendant, however, refused to pay the proceeds of the policy, claiming, initially, that Ryder did not have authority to change the beneficiary because she was not the owner of the policy. Subsequently, the defendant changed its position, and, by letter dated June 26,1992, formally denied the plaintiffs claim for the policy proceeds on the ground that Ryder had not effectively changed the beneficiary because she had failed to submit the change on the defendant’s form.

The defendant took this position notwithstanding its admission that Ryder’s letter of January 8, 1979, fully complied with the formalities required by the defendant’s change of beneficiary form, in that it was a signed, dated and witnessed written request, and that it clearly indicated the new beneficiary. The defendant understood that Ryder’s letter expressed her intent to name her estate as the beneficiary on her policy, and it also conceded that Ryder’s intent never changed between the time of her 1979 letter to the defendant and the time of her death in 1990. The defendant, however, refused to commence an interpleader action, which had been proposed by the plaintiff, in order to obtain a judicial determination as to who was entitled to the insurance proceeds. Instead, the defendant sought out Zink, the beneficiary that Ryder had purportedly replaced, sent him a claim form, and subsequently paid the proceeds of the policy to him.

The plaintiff then brought the present action, alleging breach of the life insurance contract, and violations of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq., based upon unfair insurance practices as defined in the Connecticut Unfair Insurance Practices Act (CUIPA). General Statutes § 38a-816 et seq.

The trial court rendered judgment in favor of the defendant on all of the plaintiffs claims. The trial court found that the policy’s requirement that a written request for a change of beneficiary be on a “form satisfactory to the company” meant that the form had to be on a “company approved form.” Although the defendant represented to the plaintiff, in its June, 1992 letter denying the plaintiffs claim for the insurance proceeds, that a “form satisfactory to the company” meant on a “company provided form,” the trial court found that in practice the defendant had approved several different forms for use in making beneficiary changes. The trial court also found that although Ryder’s intent was clear regarding the change of beneficiary, she never requested the change of beneficiary on a “company approved form” as required by the terms of the policy. Consequently, the trial court held that Ryder had failed to do all in her power to comply with the change of beneficiary provision in the policy, and that her failure to do so was not due to circumstances beyond her control. The plaintiff argues on appeal that the trial court applied the wrong legal standard and improperly concluded that Ryder had not legally changed the beneficiary. We agree with the plaintiff.

“One of the most troublesome areas of life insurance law concerns the question of whether the insured who has reserved the right to change the beneficiary without [the beneficiary’s] consent has effected a valid change in [beneficiary] where the contract provisions relative to such change have not been complied with strictly. . . . Generally, the contract provides that the insured must execute a written request for a change and send this request to the insurer along with the policy .... In recent years many old line companies have changed their policy language in policies of current issue so that a change may be effected without endorsement of the change on the policy, the insured merely executing a request for the change, which is then sent in and ‘recorded’ or ‘approved’ by the company.” B. Anderson, Life Insurance (1991 & 1996 Sup.) § 18.2, pp. 525-26.

Although “the general rule [is] that a change of beneficiary of an insurance policy can be effected by following the procedure prescribed in the policy”; Bigley v. Pacific Standard Life Ins. Co., 229 Conn. 459, 464, 642 A.2d 4 (1994); the plaintiff in this case relies on the “substantial compliance doctrine,” an exception to the general rule.

The substantial compliance doctrine has its genesis in Connecticut as a narrow exception to the requirement that the owner of an insurance policy could change the beneficiary only by strictly complying with the terms of the policy. In Bachrach v. Herrup, 128 Conn. 74, 76, 20 A.2d 395 (1941), this court stated that “[t]he general rule is that a change of beneficiary can only be effected by following the mode prescribed by the policy, however clear the intention to make the change may be. Insurance companies usually require . . . that the original policy be surrendered for indorsement. To this rule there is a well recognized exception and a change is effective where the insured has done all in his power to comply therewith but has failed because the policy is beyond his control.” See also O’Connell v. Brady, 136 Conn. 475, 479-80, 72 A.2d 493 (1950).

Subsequent to Bachrach and O’Connell, this court stated, by way of dicta in Aetna Life Ins. Co. v. Hartford National Bank & Trust Co., 146 Conn. 537, 541-42, 153 A.2d 448 (1959), that in addition to the exception where the insured has done all in his or her power to comply with the procedure set out in the policy, but has failed because of some circumstance beyond his or her control, “there might exist equitable considerations of a character such that they, rather than technical legal principles, should prevail. . . . Proof of intention alone is not sufficient, but where the intention is manifest and substantial affirmative action has been taken by the insured to effectuate a change of beneficiary the courts generally will make the change effective even though there has not been a strict compliance with the terms of the [insurance] contract. . . . The number of cases on the matter involved here is legion. They are resolved primarily on issues of fact.” (Citations omitted.) Indeed, in O’Connell, this court provided a harbinger for the refinement of the substantial compliance doctrine in Aetna Life Ins. Co. by stating that “the insured desiring a change of beneficiary must comply with the requirements of the policy or at least make every reasonable effort to comply with them in order to obtain relief through equitable principles." (Emphasis added.) O'Connell v. Brady, supra, 136 Conn. 480.

We believe that this case presents the opportunity to embrace and apply the substantial compliance doctrine as set forth in Aetna Life Ins. Co. We conclude that the doctrine applies regardless of whether the issue of a purported change of beneficiary is raised in an equitable or legal action. Other courts, assuming that we would adopt the dicta in Aetna Life Ins. Co., have already applied the substantial compliance doctrine as Connecticut law. See Kulmacz v. New York Life Ins. Co., 39 Conn. Sup. 470, 474, 466 A.2d 808 (1983) (quoting dicta from Aetna Life Ins. Co. and referring to it as substantial compliance doctrine); see also Mann v. Metropolitan Life Ins. Co., 683 F. Sup. 27, 30 (D. Conn. 1988) (applying Connecticut law and citing and applying substantial compliance doctrine from Kulmacz and Aetna Life Ins. Co.). “The application of a rule which does not require absolute compliance with all formalities specified in a life insurance policy concerning a change of a beneficiary seems appropriate in some situations. This approach is especially justified when the evidence shows that an insured has taken substantial affirmative action in an attempt to effectuate the change. The majority of the decisions [on] point adopt rules embracing this approach. Several courts have observed or concluded, ‘[a]ll that is required is that every reasonable effort under the circumstances be made to effect the change.’ These decisions are sometimes viewed as having adopted a rule of substantial compliance.” R. Keeton & A. Widiss, Insurance Law (1988) § 4.11 (d) (1), pp. 430-31, quoting Provident Mutual Life Ins. Co. v. Ehrlich, 508 F.2d 129, 133 (3d Cir. 1975) (applying Pennsylvania law); see also Lopez v. Massachusetts Mutual Life Ins. Co., 170 App. Div. 2d 583, 584, 566 N.Y.S.2d 359 (1991) (“even in the absence of such a waiver [of the policy provision requiring a written request satisfactory to the insurance company], we would conclude that the signed letter sent to the insurer constituted substantial compliance with the policy requirements ... so as to effect a valid change of beneficiary” [citations omitted]).

We conclude that, under the substantial compliance doctrine, which we affirm as the law of this state, the owner of a life insurance policy will have effectively changed the beneficiary if the following is proven: (1) the owner clearly intended to change the beneficiary and to designate the new beneficiary; and (2) the owner has taken substantial affirmative action to effectuate the change in the beneficiary.

The trial court in this case narrowly formulated the substantial compliance doctrine by limiting it to the contours of Bachrach, and rejecting the dicta in Aetna Life Ins. Co. Indeed, the trial court held that “[u]nder all the facts and circumstances of the case, the court finds that the insured, [Ryder], failed to do all in her power to comply with the procedures set [out] in the policy and that this failure was not occasioned by circumstances beyond her control.” The trial court based its decision on the failure of Ryder to change the beneficiary on a “company approved form.”

Nevertheless, the trial court found that Ryder had submitted a dated, signed, witnessed and unequivocal letter to the defendant, by which she sought to change the beneficiary in her policy, which finding none of the parties dispute. It is also undisputed that the letter referenced the policy by number and name. These are the same requirements that the defendant required in its company provided form. The trial court also found, and the parties do not dispute, that the defendant received this letter, understood it to mean exactly what it expressed, and placed the letter in Ryder’s policy file but did not record the change in its records. Finally, the trial court found that it was Ryder’s intention to change the beneficiary, and that there was no evidence that she had ever abandoned that intention. Counsel for the defendant conceded at oral argument that if we were to embrace what we have today denominated as the substantial compliance doctrine from Aetna Life Ins. Co., then Ryder’s letter requesting the beneficiary changes would be in substantial compliance with the policy provisions. On the basis of these undisputed facts found by the trial court, we hold, as a matter of law, that Ryder substantially complied with the change of beneficiary provision in the policy.

The plaintiff also argues that the trial court improperly concluded that the defendant had not violated CUTPA, based upon unfair insurance practices as defined in CUIPA, and, accordingly, must be reversed. We agree. The plaintiff alleged unfair insurance practices, as defined in CUIPA, as the basis of violations of CUTPA. See Mead v. Burns, 199 Conn. 651, 663, 509 A.2d 11 (1986) (holding “that it is possible to state a cause of action under CUTPA for a violation of CUIPA”). The trial court in this case rendered judgment in favor of the defendant on the breach of contract claim because it found that “the defendant was entitled to rely on its policy provisions” and that “the plaintiff failed to demonstrate that his alleged damages would not have been avoidable by action on the part of [Ryder] or himself.” Because of those findings, the trial court concluded, as a matter of law, that the defendant had not violated CUIPA or CUTPA. As a result of our disposition of the primary issue in this appeal, we reverse the trial court’s determination on those claims and remand the matter to the trial court for a determination of whether there had been in fact any CUTPA violations. In addition, on remand, the trial court must also consider whether the plaintiff should be awarded compensatory interest under General Statutes § 37-3a and offer of judgment interest under General Statutes § 52-192a. See Blakeslee Arpaia Chapman, Inc. v. EI Constructors, Inc., 239 Conn. 708, 687 A.2d 506 (1997).

The judgment is reversed and the case is remanded with direction to render judgment for the plaintiff on the breach of contract claim, for further proceedings as to the plaintiffs CUTPA claims, and for a determination of any interest that may be due.

In this opinion the other justices concurred.

       This case had previously been before the Appellate Court. See Engelman v. Connecticut General Life Ins. Co., 88 Conn. App. 134, 135-36, 658 A.2d 983 (1995). The Appellate Court reversed the judgment of the trial court, DeMayo, J., in favor of the defendant and remanded the case for further proceedings after concluding that the trial court lacked subject matter jurisdiction because the plaintiff had sought a declaratory judgment and all the necessary parties were not made parties to the action or given reasonable notice of the action. Id., 137-38. On remand, the plaintiff amended his complaint to delete the claim for a declaratory judgment. See Mannweiler v. LaFlamme, 232 Conn. 27, 36 n.11, 653 A.2d 168 (1995). The trial court on remand, Booth, J., thereafter, pursuant to the agreement of the parties, decided the merits of the case relying on the transcripts and exhibits from the first trial and judgment was again rendered for the defendant. See id.

       The plaintiff appealed from the judgment of the trial court to the Appellate Court, and we transferred the appeal to this court pursuant to Practice Book § 4023 and General Statutes § 51-199 (c).

       This attempt to change beneficiaries was unsuccessful because Ryder had not provided the defendant with a policy number and, therefore, the defendant was unable to locate the policy in its files. The record does indicate that the defendant advised the plaintiff of this problem by letter and requested the necessary information. The record is silent as to whether the plaintiff ever responded to this request.

       The letter provided as follows:
      “1377 Boston Post Road
      Milford, Connecticut 06460
      January 8, 1979
      Connecticut General Life Insurance Co.
      950 Cottage Grove Road
      Bloomfield, Connecticut 06002
      Re: Policy No. 1021625
      Mrs. Ella B. Ryder
      Gentlemen:
      I hereby revoke all previous beneficiary designations with respect to the death proceeds on the above policy on my life, and I direct that the death proceeds shall be paid in one sum to the Executor of my estate.
      I retain all rights of ownership on the policy and all right[s] to make a future change of beneficiary.
      My intention is that this change of beneficiary become effective immediately; however, if you wish confirmation of this beneficiary change on your own form, please supply the form to my attorney, Robert J. Engelman, Esq., Schwartz & Knight, P.O. Box 679, New Haven, Connecticut, 06503.
      Very truly yours,
      Witnessed:
      /s/ Robert Engelman /s/ Ella B. Ryder’

       The June, 1992 letter provided in pertinent part as follows: “The policy records contain a letter signed by the Insured, Ella B. Ryder, dated January [8], 1979, revoking all previous beneficiaries and directing that the death proceeds be payable to the Executor of her estate. ... It is Company practice to require that a Change of Beneficiary be submitted on a company provided form [in order] to constitute a ‘form satisfactory to the Company’ [as required by the terms and conditions of the policy]. This condition was not satisfied by the Insured. The Company was under no legal obligation to change the beneficiary pursuant to the letter request and did not, in fact, record a Change of Beneficiary on its records.”

       The proposed interpleader action would have been governed by General Statutes § 52-484, which provides: “Action in nature of interpleader. Whenever any person has, or is alleged to have, any money or other property in his possession which is claimed by two or more persons, either he, or any of the persons claiming the same, may bring a complaint in equity, in the nature of a bill of interpleader, to any court which by-law has equitable jurisdiction of the parties and amount in controversy, making all persons parties who claim to be entitled to or interested in such money or other property. Such court shall hear- and determine all questions which may arise in the case, may tax costs at its discretion and, under the rules applicable to an action of interpleader, may allow to one or more of the parties a reasonable sum or sums for counsel fees and disbursements, payable out of such fund or property; but no such allowance shall be made unless it has been claimed by the party in his complaint or answer.” (Emphasis added.)
      In O’Connell v. Brady, 136 Conn. 475, 481, 72 A.2d 493 (1950), this court stated that ‘'[o]rdinarily, the requirements in an insurance policy as to the steps to be taken to make a change of beneficiary are for the protection of the insurer and, unless rights have become vested, the insurer may waive them and change the beneficiary although they have not been complied with. . . If the insurer does not change the beneficiary but pays the proceeds into court in an interpleader action, it thereby waives any right it had to insist that the requirements of the policy be complied with; but this does not work a change in the beneficiary, and it is for the court to determine who has the better right to the proceeds.” (Citations omitted; emphasis added.) Furthermore, policy formalities are intended to protect not only the insurance company from rival claims, but also the owner’s choice of beneficiary and the interests of the beneficiaries. See Bigley v. Pacific Standard Life Ins. Co., 229 Conn. 459, 464, 642 A.2d 4 (1994) (holding that insurance company bears loss for payment to person fraudulently substituted for beneficiary where policy provided that only owner could change beneficiary); R. Keeton, Insurance Law (1971) § 4.11 (e), pp. 254-55 (stating that change of beneficiary clauses are for protection of insurer, owner and third party beneficiaries).
      The plaintiff argues that, because he demanded that the defendant institute an interpleader action pursuant to § 52-484, the trial court should have applied the reasoning of O’Connell by holding that the defendant waived any right it had to insist on the policy formalities. Although the defendant could have brought an interpleader action, it did not do so. We agree with the trial court that the defendant was under no obligation to bring an interpleader action. Nevertheless, as the defendant conceded before the trial court, having paid Zink rather than follow the interpleader procedure, the defendant did so at its own peril.

       The defendant claims, as an alternate ground on which to affirm the judgment of the trial court, that the plaintiffs breach of contract claim is barred by the six year statute of limitations contained in General Statutes § 52-576 (a), which provides in pertinent part that “[n]o action ... on any contract in writing shall be brought but within six years after the right of action accrues . . . .” The defendant claims that the breach of contract occurred in 1979 when it did not change the beneficiary. We disagree. This claim is simply without merit. “While the statute of limitations normally begins to run immediately upon the accrual of the cause of action, some difficulty may arise in determining when the cause or right of action is considered as having accrued. The true test is to establish the time when the plaintiff first could have successfully maintained an action.” (Internal quotation marks omitted.) Wynn v. Metropolitan Property & Casualty Ins. Co., 30 Conn. App. 803, 807-808, 623 A.2d 66 (1993), aff'd, 228 Conn. 436, 635 A.2d 814 (1994). The breach of contract occurred, as the trial court found, when the defendant denied payment of the claim to the plaintiff in 1992. The plaintiff commenced his action in 1992, when the cause of action accrued and, therefore, the statute of limitations had not run.

       A policy is “beyond the control” of the owner when, for example, the named beneficiary refuses to surrender the policy to the owner so that a change of beneficiary can be endorsed on the policy. See Bachrach v. Herrup, supra, 128 Conn. 76.

       Because Aetna Life Ins. Co. was decided on the basis that the owner of the policy had abandoned her plan to change the beneficiaries on her policy, there existed no intent under the first prong of the exception to the general rule expressed in Bachrach. Furthermore, we recognize that Aetna Life Ins. Co. must be viewed in the context of an interpleader action brought by the insurer. See O’Connell v. Brady, supra, 136 Conn. 481; see also footnote 6.

       See footnote 6.

       We also point out that if the owner of the policy has done all in his or her power to comply with the change of beneficiary provision in the policy, but has failed because of some circumstance beyond his or her control, that owner has satisfied the second prong of the rule. See Aetna Life Ins. Co. v. Hartford National Bank & Trust Co., supra, 146 Conn. 541; see also Bachrach v. Herrup, supra, 128 Conn. 76. The owner, under these circumstances, will be deemed to have taken substantial affirmative action to effectuate a change in beneficiary.

       See footnote 4.

       At oral argument, the defendant’s counsel could not point to any material difference between the information Ryder provided in her letter and the information requested by the defendant’s form.


author: BORDEN, J.

text:
    ERIC ANTHONY ABRAHAMS v. YOUNG AND RUBICAM, INC., ET AL.
    (15404)
    Callahan, C. J., and Borden, Norcott, Katz and Peters, Js.

      Argued December 10, 1996
    officially released April 8, 1997

      Ridgely W. Brown, with whom, on the brief, was Heather M. Brown, for the appellant (plaintiff).

      Stephen S. Madsen, pro hac vice, with whom were Steven D. Ecker and, on the brief, Matthew White, pro hac vice, for the appellees (named defendant et al.).
   Opinion

BORDEN, J.

The sole issue in this appeal, on certification from the United States Court of Appeals for the Second Circuit, is whether, under the circumstances presented herein, the plaintiff can maintain a claim under the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes §§ 42-110a through 42-1 lOq. The plaintiff, Eric Anthony Abrahams, a Jamaican citizen, filed a ten count complaint in the United States District Court for the District of Connecticut, alleging, inter alia, that the named defendant, Young & Rubicam, Inc. (Young & Rubicam), a New York advertising agency, had violated CUTPA by engaging in a scheme wherein it paid approximately one million dollars to a third party in the mistaken belief that the money would be used to bribe the plaintiff, a former Jamaican public official. The plaintiff sought compensation under CUTPA for the damage to his reputation that resulted when Young & Rubicam erroneously reported to Connecticut and federal authorities that the plaintiff had accepted the bribe.

The District Court dismissed the CUTPA claim, concluding that the acts constituting the alleged violation were not the proximate cause of the plaintiffs injuries. Abrahams v. Young & Rubicam, Inc., 793 F. Sup. 404, 407 (D. Conn. 1992). The plaintiff appealed to the United States Court of Appeals for the Second Circuit, which asked this court to decide whether the plaintiffs allegations, if proven, would entitle him to relief under CUTPA. Abrahams v. Young & Rubicam, Inc., 79 F.3d 234, 239 (2d Cir. 1996). Pursuant to the applicable certification procedures; General Statutes § 51-199a; we agreed to decide the issue. We agree with the District Court that, even if we were to assume without deciding that Young & Rubicam’s scheme, as alleged by the plaintiff, constituted “unfair trade practices” within the meaning of CUTPA, that scheme was not the proximate cause of the plaintiffs injuries. Accordingly, we conclude that the facts in the plaintiffs complaint, even if true, cannot provide the basis for a CUTPA claim against Young & Rubicam and, therefore, we answer the certified questions in the negative.

The Court of Appeals’ certification order included the following relevant facts from the plaintiffs complaint. “[The p]laintiff . . . is a citizen and subject of Jamaica. From October 1980 to February 1989, [he] was an elected member of the Jamaican Parliament. In October 1980, [he] was also appointed Jamaican Minister of Tourism and Information and served in that post until about August 1984. In addition, [the plaintiff] has served as the Jamaican Director of Tourism and as a consultant on international tourism and marketing with the Organization of American States. Following his service as Minister of Tourism, [the plaintiff] acted as a consultant to various international businesses in Jamaica.

“Unbeknownst to [the plaintiff], a scheme was concocted by Robin Moore, a writer, and Arnold Foote, Jr., a Jamaican advertising executive. Many activities in furtherance of this scheme took place within the state of Connecticut.

“[Moore and Foote] persuaded [Young & Rubicam] that bribes and kickbacks would have to be paid to Foote and to [the plaintiff] to influence the decisions of the Jamaican Tourist Board ... to ensure that [Young & Rubicam] would receive the lucrative [Jamaican Tourist Board] advertising account. During the course of the scheme, [Young & Rubicam] paid close to one million dollars ... in bribes to Moore and Foote. However, no money was ever paid to [the plaintiff], who neither demanded money nor was in a position to influence the award of the . . . contract.

“In October 1989, the scheme was publicly exposed by a federal indictment . . . returned by a grand jury in Hartford, Connecticut. On February 9,1990, [Young & Rubicam] pled guilty to knowingly and intentionally conspiring to pay bribes to influence the decision of the [Jamaican Tourist Board] in awarding its advertising account. Because [Young & Rubicam] and other defendants falsely implicated [the plaintiff] in their scheme, [the plaintiff] was also indicted. However, this indictment was later dismissed.

“News regarding the criminal indictment of [Young & Rubicam], including false statements by a number of defendants that depicted [the plaintiff] as a criminal, was widely published. As a result, [the plaintiffs] professional reputation was damaged, and his consulting business destroyed. His personal reputation was also severely impaired, and he suffered severe emotional distress, humiliation, and depression.”

In order to address whether these facts, if proven, would form the basis for a CUTPA claim, we first set forth the basic elements of such an action. CUTPA provides that “[n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.” General Statutes § 42-110b (a). In order to enforce this prohibition, CUTPA provides a private cause of action to “ [a]ny person who suffers any ascertainable loss of money or property, real or personal, as a result of the use or employment of a [prohibited] method, act or practice . . . .” General Statutes § 42-110g (a); see generally Fink v. Golenbock, 238 Conn. 183, 212-13, 680 A.2d 1243 (1996).

Thus, in order to prevail in a CUTPA action, a plaintiff must establish both that the defendant has engaged in a prohibited act and that, “as a result of’ this act, the plaintiff suffered an injuiy. The language “as a result of’ requires a showing that the prohibited act was the proximate cause of a harm to the plaintiff. See generally Haesche v. Kissner, 229 Conn. 213, 223-24, 640 A.2d 89 (1994). With regard to the requisite causal element, it is axiomatic that proximate cause is “[a]n actual cause that is a substantial factor in the resulting harm . . . .” Stewart v. Federated Dept. Stores, Inc., 234 Conn. 597, 606, 662 A.2d 753 (1995). The question to be asked in ascertaining whether proximate cause exists is “whether the harm which occurred was of the same general nature as the foreseeable risk” created by the defendant’s act. (Internal quotation marks omitted.) Doe v. Manheimer, 212 Conn. 748, 758, 563 A.2d 699 (1989). Proximate cause does not exist merely because there is cause in fact. “Philosophically, cause in fact is limitless; but for the creation of this world, no crime or injury would ever have occurred. . . . Lines must be drawn determining how far down the causal continuum individuals will be held liable for the consequences of their actions.” (Citations omitted; internal quotation marks omitted.) Stewart v. Federated Dept. Stores, Inc., supra, 605-606, citing W. Prosser & W. Keeton, Torts (5th Ed. 1984) § 41, p. 264, and § 42, p. 273. “This line is labeled ‘proximate cause.’ ” Suarez v. Sordo, 43 Conn. App. 756, 769, 685 A.2d 1144 (1996).

We assume, without deciding, that the bribery scheme in which Young & Rubicam engaged is an act of the type proscribed by CUTPA. We conclude, however, that this assumed violation was not the proximate cause of the injuries to the plaintiffs reputation and business. “Although the issue of causation generally is a question reserved for the trier of fact . . . the issue becomes one of law when the mind of a fair and reasonable person could reach only one conclusion, and summary judgment may be granted based on a failure to establish causation.” 1 R. Langer, J. Morgan & D. Belt, Connecticut Unfair Trade Practices Act (1994) § 6.10, p. 231; see also Mather v. Griffin Hospital, 207 Conn. 125, 130, 540 A.2d 666 (1988).

In this case, Young & Rubicam’s bribery scheme did not, in and of itself, directly harm the plaintiff. The plaintiff has not alleged, nor can it be reasonably inferred from the plaintiffs allegations, that Young & Rubicam either intended or could have foreseen that, as a result of its attempt to bribe the plaintiff, he would be injured by an erroneous indictment for bribery or by publication of the incorrect accusations therein. In other words, Young & Rubicam’s conduct in attempting to bribe the plaintiff was not “a substantial factor reasonably foreseeable as likely to bring about [the] plaintiffs indictment [on false charges] and his resulting damages. [The p]laintiff was neither the intended target nor victim of [Young & Rubicam’s] illegal activities.” Abrahams v. Young & Rubicam, Inc., supra, 793 F. Sup. 406. It is trae that the plaintiff would not have been harmed but for the existence of the bribery scheme. As explained previously, however, mere “but for” causation is not sufficient to support a CUTPA claim.

Rather, the proximate cause of the plaintiffs injuries was the confession that Young & Rubicam gave to state and federal authorities after its scheme was discovered, in which it implicated the plaintiff as having accepted bribes. It was the confession, not the underlying bribery scheme, that directly and predictably led to the indictment against the plaintiff that damaged his reputation. As the Court of Appeals observed, the plaintiff was injured not by the bribery scheme itself, but “by the fallout from the scheme’s exposure.” Abrahams v. Young & Rubicam, Inc., supra, 79 F.3d 239.

The plaintiff has never asserted that Young & Rubi-cam’s act of confessing was itself an unfair act or practice that violated CUTPA. Thus, on the one hand, the practice that assumedly did violate CUTPA — the bribery scheme — was not the proximate cause of the plaintiffs losses. On the other hand, the act that was the proximate cause — Young & Rubicam’s statement to authorities — was not pleaded by the plaintiff as being the type of act that CUTPA was intended to prohibit. Accordingly, we conclude that the plaintiff has not stated a cause of action under CUTPA.

The answer to the certified questions is: No.

No costs will be taxed in this court to either party.

In this opinion the other justices concurred.

       In addition to Young & Rubicam, Inc., a number of its employees' and officers were named as defendants in this action, including Arthur Klein, Thomas Spangenberg, Steven McKenna, Mike Slosberg, Edward Daley, Edward Ney and Alex Kroll. We refer to all of these defendants collectively as Young & Rubicam. Two other individuals were also named as defendants in the plaintiffs complaint. All claims against one of them, Robin Moore, have been dismissed. See footnote 5. The status of the other defendant, Frederick Sturges, is unclear. No papers were submitted on his behalf, and he is not mentioned either in the certification order from the United States Court of Appeals for the Second Circuit or in the briefs of either party. See Abrahams v. Young & Rubicam, Inc., 79 F.3d 234, 235 n.1 (2d Cir. 1996).

       In his original complaint in the District Court, the plaintiff brought numerous other claims against Young & Rubicam, including a claim under the federal Racketeer Influenced and Corrupt Organizations Act and common law claims for intentional infliction of emotional distress, negligence and defamation. See Abrahams v. Young & Rubicam, Inc., 793 F. Sup. 404, 407 (D. Conn. 1992); see also Abrahams v. Young & Rubicam, Inc., 79 F.3d 234, 239 (2d Cir. 1996). These claims are outside the scope of the questions we certified for review; see footnote 3; and, therefore, we do not discuss them.

       Specifically, the Court of Appeals asked this court to answer the following questions: “[W]hethert,he [plaintiffs allegations], if proven, constitute ‘unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce’ within the meaning of [General Statutes] § 42-110b, and whether [the plaintiff] is ‘[a] person who [has] suffered] [a] . . . loss of money or property ... as a result of the use or employment of [such] a method, act, or practice’ within the meaning of [General Statutes] § 42-110g (a)?”

       General Statutes § 51-199a provides: “Uniform Certification of Questions of Law Act. (a) This section may be cited as the ‘Uniform Certification of Questions of Law Act’.
      “(b) The Supreme Court ma.y answer questions of law certified to it by the Supreme Court of the United States, a court of appeals of the United States or a United States district court when requested by the certifying court if there are involved in any proceeding before it questions of law of this state which may be determinative of the cause then pending in the certifying court and as to which it appears to the certifying court there is no controlling precedent in the decisions of the Supreme Court of this state.
      “(c) This section may be invoked by an order of any of the courts referred to in subsection (b) of this section upon the court’s own motion or upon the motion of any party to the cause.
      “(d) A certification order shall set forth: (1) The questions of law to be answered; and (2) a statement of all facts relevant to the questions certified and showing fully the nature of the controversy in which the questions arose.
      “(e) The certification order shall be prepared by the certifying court, signed by the judge presiding at the hearing, and forwarded to the Supreme Court by the clerk of the certifying court under its official seal. The Supreme Court may require the original or copies of all or of any portion of the record before the certifying court to be filed with the certification order, if, in the opinion of the Supreme Court, the record or portion thereof may be necessary in answering the questions.
      “(f) Fees and costs shall be the same as in civil appeals docketed before the Supreme Court and shall be equally divided between the parties unless otherwise ordered by the certifying court in its order of certification.
      “(g) Proceedings in the Supreme Court shall be those provided in the rules of said court.

        “(h) The written opinion of the Supreme Court stating the law governing the questions certified shall be sent by the clerk under the seal of the Supreme Court to the certifying court and to the parties.
      “(i) This section shall be so construed as to effectuate its general purpose to make uniform the law of those states which enact it.”

       Moore was named as a defendant in the plaintiffs original complaint, but all claims against him have been dismissed. See Abrahams v. Young & Rubicam, Inc., supra, 79 F.3d 236-37.

       Although the plaintiff stated in his complaint that he is innocent of all bribery charges, he did not allege that Young & Rubicam “knew that [the] plaintiff was not involved in the scheme, had no knowledge of it, and did not receive the money.” Abrahams v. Young & Rubicam, Inc., supra, 793 F. Sup. 406. Indeed, the plaintiff specifically stated in his complaint that Young & Rubicam was “convinced” by the bribery scheme. Accordingly, nothing in the record or pleadings indicate that, at the time Young & Rubicam made its confession to authorities, it believed anything but that the plaintiff had been a willing participant in the bribery scheme.

       We state no opinion as to whether Young & Rubicam’s bribery scheme did, in fact, constitute an unfair act or practice within the meaning of CUTPA.

       Indeed, on the contrary, the plaintiff alleged that Young & Rubicam was convinced of the plaintiff’s complicity. See footnote 6.

       The plaintiff argues that the question of whether his injuries were proximately caused by the bribery scheme or by Young & Rubicam’s subsequent statement to authorities is a question for the fact finder and not amenable to judgment as a matter of law. Although the plaintiff argues at some length in his brief that the bribery scheme itself was the proximate cause of his injuries, his reasoning is entirely conclusoiy and unpersuasive. We are persuaded that, as a matter of logic and of law, Young & Rubicam’s confession, and not the underlying bribery scheme, was the proximate cause of the plaintiffs injuries.

       Moreover, as noted previously; see footnote 6; the plaintiff nowhere alleged that Young & Rubicam intentionally misled investigators, or that it lacked an honest belief that the plaintiff had, in fact, accepted bribes. We state no opinion as to whether, if such allegations had been made, the plaintiff could have sufficiently pleaded a CUTPA claim based upon Young & Rubicam’s statement to authorities.


author: MCDONALD, J.

text:
    VIRGINIA REMINGTON, ADMINISTRATRIX (ESTATE OF WILLIAM K. REMINGTON) v. AETNA CASUALTY AND SURETY COMPANY
    (15477)
    Berdon, Norcott, Katz, Palmer and McDonald, Js.
    Argued January 16
    officially released April 8, 1997

      Christopher Carrozzella, for the appellant (plaintiff).

      Michael P. Del Sole, for the appellee (defendant).
   Opinion

MCDONALD, J.

The dispositive issue presented in this appeal is whether the trial court properly instructed the jury regarding the factors to be considered in determining whether an individual was a resident of an insured’s household and, therefore, covered by an underinsured motorist automobile policy. The plaintiff, the administratrix of the estate of William K. Remington (William), brought an action to recover underinsured motorist benefits under an automobile liability policy (policy) issued to Virginia Remington by the defendant, Aetna Casualty and Surety Company.

After a trial to a jury on the issue of liability, a verdict was returned in favor of the defendant. The jury determined that William was not a resident of Virginia Remington’s household and, therefore, not covered by the policy. The trial court denied the plaintiffs motion to set aside the verdict and rendered judgment for the defendant. The plaintiff appealed from the judgment of the trial court to the Appellate Court and we transferred the appeal to this court pursuant to Practice Book § 4023 and General Statutes § 51-199 (c). On appeal, the plaintiff claims that the trial court improperly instructed the jury on the factors to be considered when determining whether William was a resident of Virginia Remington’s household. We agree.

The following evidence was before the jury. William was the stepson of Virginia Remington. He had lived with Virginia Remington during her marriage to his father and at times after his father’s death in 1987. In May, 1990, William sustained fatal injuries in a motor vehicle accident caused by an underinsured motorist. At the time of the accident, William had a bedroom available to him at the house in Cheshire where Virginia Remington was living. He also stayed at an apartment at 1308 Dixwell Avenue in Hamden that Virginia Remington had found and leased in her name. She paid the rent and furnished the apartment, and maintained a telephone there in her name. Although William listed his Hamden address as his residence on his 1989 tax returns, he used Virginia Remington’s Cheshire address for his mail and bills, including his unemployment checks.

Virginia Remington handled all of William’s financial affairs throughout his life. Although he was thirty-eight years old at the time of his death, William was unable to live on his own. William’s inability to live apart from Virginia Remington was attributed to a 1965 motor vehicle accident in which he suffered head injuries and temporary blindness. In 1988, following his father’s death, William lived with his brother for a year. He then moved into his own apartment for two months. At both locations, Virginia Remington leased the apartment and paid the rent for William. Thereafter, he lived with Virginia Remington in Cheshire, except for one week during which he lived in a motel, until he moved to Hamden in February, 1990.

The policy was introduced as an exhibit. The policy listed Virginia Remington as the named insured and defined covered persons to include her or “any family member.” Family member was defined as “a person related to [Virginia Remington] by blood, marriage or adoption who is a resident of [Virginia Remington’s] household. This includes a ward or foster child.”

The plaintiff requested that the trial court instruct the jury to consider a conglomeration of factors in determining household residency. The trial court refused to give the plaintiffs requested charge, and instead, instructed the jury that it could take into consideration where William was living, where he kept his belongings, the frequency of his contact with Virginia Remington, where his mail was sent, the address he used for formal purposes such as voting and filing tax returns, whether he had his own room in Virginia Remington’s household, and his intentions insofar as they indicated where he was actually living. This instruction failed to inform the jury that Wilham’s emotional or financial ability to establish a household separate from Virginia Remington was a factor to be considered. The plaintiff also requested an instruction that an individuai could have more than one residence. That instruction also was not given.

This court has recognized that a trier of fact must determine where an individual resides by analyzing the facts unique to each case. Griffith v. Security Ins. Co., 167 Conn. 450, 458, 356 A.2d 94 (1975); Rathbun v. Aetna Casualty & Surety Co., 144 Conn. 165, 168, 128 A.2d 327 (1956). In undertaking this analysis, the trier of fact must consider a conglomeration of factors. Mid-dlesex Mutual Assurance Co. v. Walsh, 218 Conn. 681, 686, 590 A.2d 957 (1991). These factors include: the intent of the individual; the frequency of contact between the individual and other household inhabitants; the frequency with which the individual spends time at the household; the maintenance of a separate residence for the individual; whether the individual is emotionally and financially capable of establishing and maintaining a residence independent of the household; the location of personal belongings; the location of and address used for personnel and business records; the address at which mail is received; and the address used for formal purposes such as voting, licenses, and income tax filings. Id., 686-87, 690.

The trial court here omitted some of these factors when it instructed the jury what factors should be considered in determining William’s household residency. The omitted factors included the frequency with which the individual spends time at the household, whether the individual is emotionally and financially capable of establishing and maintaining a residence independent of the household, and the location of and address used for personnel and business records. The court indicated that the decisive factor was whether William and Virginia Remington shared the same roof or dwelling. In essence, the trial court instructed the jury that William and Virginia Remington must share the “same roof’ and that the “same roof’ meant one roof. This was improper, as the description of a household and the determination of who resides in that household are decisions to be made upon consideration of the factual circumstances involved in each case. The jury reasonably might have concluded that wherever he stayed, William always returned to be with Virginia Remington, and that the apartment in Hamden was nothing more than a home away from home. William’s inability to live apart from Virginia Remington, therefore, was a circumstance to be considered. Furthermore, the focus of the charge was too narrow because a person may have more than one residence. Taylor v. Taylor, 168 Conn. 619, 621, 362 A.2d 795 (1975); see also Griffith v. Security Ins. Co., supra, 167 Conn. 461 (Bogdanski, J., dissenting), and cases cited therein.

“[A] jury charge is to be considered from the standpoint of its effect on the jury in guiding them to a correct verdict. ... A jury charge must be correct in law, adapted to the issues and sufficient for the guidance of the jury. . . .A charge is not to be critically dissected for purposes of discovering possible inaccuracies . . . but rather, the initial charge and any supplemental charge are to be read as a whole. . . . The ultimate test of a court’s instructions is whether, taken as a whole, they fairly and adequately present the case to a jury in such a way that injustice is not done to either party under the established rules of law.” (Citations omitted; internal quotation marks omitted.) Ellice v. INA Life Ins. Co. of New York, 208 Conn. 218, 226, 544 A.2d 623 (1988).

The trial court’s instruction did not meet the requirement established in Middlesex Mutual Assurance Co. that many factors under the particular circumstances must be included in the determination of household residency. Accordingly, we conclude that the trial court’s charge was improper.

We must next determine whether that improper instruction was harmful because it would have been likely to affect the jury’s verdict. See Anonymous v. Norton, 168 Conn. 421, 430, 362 A.2d 532, cert. denied, 423 U.S. 935, 96 S. Ct. 294, 46 L. Ed. 2d 268 (1975); Blancato v. Randino, 33 Conn. App. 44, 49, 632 A.2d 1144, cert. denied, 228 Conn. 916, 636 A.2d 846 (1993). We conclude that this improper instruction was harmful as it went to the central issue before the juiy, namely, whether William was a resident of Virginia Remington’s household. Accordingly, a new trial is required.

The judgment is reversed, and the case is remanded for a new trial.

In this opinion the other justices concurred.

       Virginia Remington has brought this case solely in her capacity as the administratrix of William’s estate. The fact that she is the named insured on the policy is entirely coincidental to the fact that she has brought this claim on behalf of William’s estate. In order to avoid confusion between her role as named insured and her role as administratrix, we will use Virginia Remington when referring to her as the named insured and the plaintiff when discussing the claims she raises as administratrix.

       The jury trial that forms the basis of this appeal was ordered on remand from the Appellate Court. Remington v. Aetna Casualty & Surety Co., 35 Conn. App. 581, 646 A.2d 266 (1994). Initially, the trial court, Hadden, J., granted the defendant’s motion for summary judgment after determining, as a matter of law, that William was not a resident of Virginia Remington’s household and, therefore, was not covered by the policy. The plaintiff appealed to the Appellate Court, which reversed the trial court’s judgment and remanded the case for further proceedings after holding that summary judgment was inappropriate because genuine issues of material fact, had yet 1o be resolved. Id. On remand, the trial court, Corradino, J., bifurcated the issues of damages and liability.

       The jury’s verdict form, dated November 3, 1995, stated: “We the Jury find for the Defendant, Aetna Casualty and Surety Company, and hereby conclude that William K. Remington was not a resident of the household of Virginia Remington at the time of his death.”

       The plaintiff also claims that the trial court improperly: (1) failed to charge the jury that the policy was ambiguous and should be resolved in favor of coverage; and (2) refused to admit into evidence mail addressed to William that had been forwarded to Virginia Remington. In light of our resolution of the jury instruction issue, we need not reach the plaintiff’s additional claims. Further, the plaintiffs argument that these issues should be considered because they are likely to surface on remand is not persuasive. We will not engage in speculation as to what evidence may be offered or instructions may be given at a future trial.

       The plaintiff requested in part the following instruction: “The definition of a household reveals two primary characteristics: a close familial relationship and joint occupation of a dwelling. ... A conglomeration of factors, including the intent of the decedent, William Remington, must be considered by you to determine whether Virginia Remington and [William] shared a dwelling. . . . Intent is clearly a question of fact that is ordinarily inferred from one’s conduct or acts under the circumstances of the particular case. . . . Besides intent, the conglomeration of factors which you should consider in this case as indicia of household residency include the following:
      “1. Whether [William] suffered from any physical or emotional disability;
      “2. His familial relationship with his stepmother and other family members;
      “3. The amount of time [William] spent living with his stepmother during the years prior to his death;
      “'4. The circumstances surrounding his absences from Virginia Remington;
      “5. His sleeping arrangements at 155 Nob Hill Road;
      “6. The location of [William’s] clothes, paperwork and other personal belongings;
      “7. The location where [William] received his mail and bills;
      “8. The address where he was registered to vote;
      “9. [William’s] source of income;
      “10. The person in charge of the management of [William’s] financial affairs;
      “11. The ability of [William] to maintain an independent living situation and the permanent measures [William] took to achieve this;
      “12. Whether [William] was financially or emotionally capable of establishing and maintaining a household separate from his stepmother. . . .
      “As you can see from this list, your focus in determining whether William Remington was a resident of Virginia Remington’s household on May 21, 1990, should not only consider physical presence but also amultitude of other factors which focus upon whether [William] was capable of establishing and maintaining a household on his own.”

       The trial court instructed the jury in relevant part: “In defining ‘resident of [Virginia Remington’s] household,’ you use the ordinary dictionary meaning of the term ‘household.’ A household is a domicile. A household is a domestic establishment, including the members of a family who live under the same roof.
      “Thus, there must be, one, a close familial relationship; and, two, joint occupancy of a dwelling. A dwelling must be shared. Another one of our cases says that a household is a social unit comprised of those living together in the same dwelling place. . . .
      “Now, what is the second element? The second element is, did . . . William and Virginia Remington live in the same dwelling place? Was William a resident of Virginia Remington’s dwelling place?
      “You must determine if William can be said to have actually lived in the household of Virginia Remington or jointly occupied the same dwelling. How do you determine these matters? You would consider where William was actually living at the time of his death. How long had he lived there? When was the last time he lived with Virginia Remington, and for how long?
      “You will remember that there was testimony that William stayed with Virginia Remington on two occasions in early 1990, perhaps right at the end of 1989 in December. And that he lived in an apartment for a few months prior to his death.
      “You will also consider the contacts he had with Virginia Remington at her Cheshire address through visits. For example, the fact that his mail was sent to . . . Virginia Remington’s Cheshire home. You will consider what belongings of his were kept at the home of Virginia Remington prior to his death.
      “Was there any evidence he had an assigned room or bedroom at the Cheshire household of Virginia Remington? You will consider where he received his mail, including unemployment checks, where he was registered to vote, and where he listed his address, for example, on income tax returns.
      “Factors of intent do have a bearing, but only as to how they relate to the question of where William was actually living.”

       That request asked for the following instruction: “In this particular case you have heard evidence that William Remington lived at 155 Nob Hill Road, Cheshire, from approximately January, 1990, until the middle of February, 1990, when he began living at 1308 Dixwell Avenue, Hamden. Each address constitutes a residence. Connecticut law recognizes that individuals may have multiple residences at one time.”