Court Opinion

ID: 5118247
Source: CourtListenerOpinion
Date Created: 2021-10-14 12:02:31.986806+00
Date Added: 2024-06-11T08:22:06.300447
License: Public Domain

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                KELLY SERVICES, INC. v. THE
                  SENIOR NETWORK, INC.
                        (SC 20548)
             Robinson, C. J., and McDonald, D’Auria, Mullins,
                       Kahn, Ecker and Keller, Js.

                                  Syllabus

Pursuant to statute (§ 52-192a (c)), if ‘‘[a] plaintiff has recovered an amount
   equal to or greater than the sum certain specified in the plaintiff’s offer
   of compromise, the court shall add to the amount so recovered eight
   per cent annual interest on said amount . . . .’’
The plaintiff, an employment staffing agency, sought to recover damages
   for, inter alia, breach of contract from the defendant in connection with
   the defendant’s failure to pay for certain services. Prior to trial, the
   plaintiff filed an offer of compromise, which the defendant did not
   accept, even though it previously had agreed to pay an invoice in the
   amount of the offer. Following a bench trial, the trial court found the
   defendant liable and awarded the plaintiff compensatory damages in
   the exact amount of the offer of compromise. The trial court determined
   that the defendant had wrongfully withheld payment and that it was
   equitable to award the plaintiff double interest in light of the defendant’s
   prior agreement and failure to pay. Accordingly, the court awarded the
   plaintiff both prejudgment interest and postjudgment interest at the
   annual rate of 8 percent pursuant to the statute (§ 37-3a) governing
   interest in civil actions generally, as well as both prejudgment and
   postjudgment offer of compromise interest pursuant to § 52-192a (c),
   at an annual rate of an additional 8 percent. The defendant moved for
   reargument, claiming, inter alia, that the trial court’s award of postjudg-
   ment interest under § 52-192a was improper under Gionfriddo v. Avis
   Rent A Car System, Inc. (192 Conn. 301), in which this court concluded
   that offer of compromise interest under § 52-192a runs only from the
   date the offer was filed to the date of judgment. The trial court denied the
   motion for reargument without explanation, and the defendant appealed.
   Held that the trial court improperly ordered that the offer of compromise
   interest continue to accrue until the date the judgment is satisfied, and,
   accordingly, this court reversed the trial court’s judgment only as to
   the award of postjudgment interest under § 52-192a and remanded the
   case with direction to vacate that award; the trial court’s award of
   postjudgment interest under § 52-192a was improper, as this court’s
   conclusion in Gionfriddo that offer of compromise interest terminates
   as of the date of judgment and may not be awarded postjudgment under
   § 52-192a controlled, that conclusion was not, contrary to the plaintiff’s
   argument, dictum, and the plaintiff did not argue that Gionfriddo should
   be overruled or limited.
           Argued February 26—officially released May 4, 2021*

                             Procedural History

   Action to recover damages for, inter alia, breach of
contract, and for other relief, brought to the Superior
Court in the judicial district of Stamford-Norwalk,
where the defendant filed a counterclaim; thereafter
the case was tried to the court, Hon. Edward R. Kara-
zin, Jr., judge trial referee, who, exercising the powers
of the Superior Court, rendered judgment for the plain-
tiff, from which the defendant appealed. Reversed in
part; judgment directed.
   James E. Nealon, for the appellant (defendant).
  Robert C. Clark, pro hac vice, with whom was Abra-
ham M. Hoffman, for the appellee (plaintiff).
                          Opinion

   ECKER, J. The sole issue in this appeal is whether
the trial court properly awarded postjudgment, offer of
compromise interest to the plaintiff, Kelly Services, Inc.,
under General Statutes § 52-192a1 and Practice Book
§ 17-18.2 We conclude that the trial court’s award of
postjudgment, offer of compromise interest was
improper under our holding in Gionfriddo v. Avis Rent
A Car System, Inc., 192 Conn. 301, 307–308, 472 A.2d
316 (1984), and therefore reverse in part the judgment
of the trial court.
   The relevant facts, which the trial court found follow-
ing a bench trial, are not contested on appeal. The
plaintiff is an employment staffing agency that provides
workers for temporary assignments. In September,
2014, the plaintiff entered into a contract with the defen-
dant, The Senior Network, Inc., to provide temporary
workers for a ten week period to distribute marketing
brochures encouraging Walmart customers to enroll in
a program for Medicare supplemental benefits. After
the work was completed, the plaintiff submitted
invoices for payment. A dispute ensued regarding the
value of the services rendered, and, following a series
of communications, the defendant asked the plaintiff
to ‘‘ ‘prepare an invoice for the $114,180.56 final pay-
ment and we will consider the assignment closed.’ ’’
The plaintiff responded shortly thereafter by submitting
an invoice for $113,955.56, slightly less than the defen-
dant had agreed to pay. On May 19, 2015, the defendant
advised the plaintiff that it would pay the invoice within
thirty to forty-five days. Notwithstanding this agree-
ment, the defendant did not pay any portion of the
final invoice.
   The plaintiff commenced this action against the
defendant to recover the $113,995.56 debt by filing a
two count complaint for breach of contract and unjust
enrichment. The defendant filed an answer and special
defenses, as well as a counterclaim for breach of con-
tract. More than two years later, on March 15, 2018, the
plaintiff filed an offer of compromise ‘‘to settle this
action and [to] stipulate to judgment in the amount of
$113,955.56 in [its] favor . . . .’’ The defendant did not
accept the offer of compromise. A five day bench trial
took place in June, 2019.
   On December 2, 2019, the trial court issued a memo-
randum of decision, finding that the defendant had
breached its contractual payment obligations to the
plaintiff and awarding compensatory damages in the
amount of $113,955.56, the exact amount of the plain-
tiff’s offer of compromise.3 The court also awarded
interest and attorney’s fees to the plaintiff.4 The interest
award contained two components.
  First, after finding that the defendant had wrongfully
withheld payment of the final invoice, the trial court
awarded the plaintiff interest under General Statutes
§ 37-3a, which permits interest to be awarded ‘‘as dam-
ages for the detention of money after it becomes pay-
able.’’ General Statutes § 37-3a (a). The trial court
ordered interest under § 37-3a ‘‘at the rate of 8 percent
per annum’’ and stated that the interest will run from
the date when it determined that payment of the final
invoice became due, ‘‘May 19, 2015, until the date [the
defendant] completely pays [the plaintiff].’’ In other
words, the § 37-3a interest award included both prejudg-
ment interest and any postjudgment interest that may
accrue until the judgment is fully satisfied. The award
of statutory interest under § 37-3a is not challenged
on appeal.
   The issue on appeal relates to the second component
of the trial court’s interest award, which was made
under § 52-192a and Practice Book § 17-18. Section 52-
192a (c) provides in relevant part that, if ‘‘the plaintiff
has recovered an amount equal to or greater than the
sum certain specified in the plaintiff’s offer of compro-
mise, the court shall add to the amount so recovered
eight per cent annual interest on said amount . . . .’’5
Similarly, Practice Book § 17-18 provides in relevant
part that, ‘‘[i]f the judicial authority ascertains from the
record that the plaintiff has recovered an amount equal
to or greater than the sum certain specified in that
plaintiff’s offer of compromise, the judicial authority
shall add to the amount so recovered 8 percent annual
interest on said amount. . . .’’ The disputed aspect of
the trial court’s interest award is the portion specifying
that the interest owed to the plaintiff under § 52-192a
and Practice Book § 17-18 shall be calculated ‘‘from
the filing of the offer of compromise until paid,’’ i.e.,
postjudgment. (Emphasis added.) The trial court deter-
mined that it would ‘‘not be inequitable’’ to award ‘‘dou-
ble interest’’ under both § 37-3a and § 52-192a and
Practice Book § 17-18 from March 15, 2018, until the
judgment is paid in full because the offer of compromise
‘‘was the second demand for the approved and agreed
on amount, the first one having been in March, 2015,
and [the offer of compromise] was a further alert to
the defendant [that] the money should be paid in March,
2018. In addition, the nature of the offer of compromise
section is to, in some respect, act as a punitive device.
If you [do not] settle the case and you lose, you pay.
Accordingly, the court is exercising its discretion in this
case and awarding the double interest . . . .’’
  The defendant moved for reargument in the trial court
on numerous grounds, only one of which is relevant to
this appeal, namely, its claim that the trial court’s award
of postjudgment interest under § 52-192a and Practice
Book § 17-18 was improper. In support of this claim,
the defendant relied on Gionfriddo v. Avis Rent A Car
System, Inc., supra, 192 Conn. 301, in which we rejected
the contention that an award of interest under § 52-
192a ‘‘continues to accrue until final payment of the
principal debt has been tendered’’ and, instead, con-
cluded that interest awarded under § 52-192a runs only
until ‘‘the date of the judgment.’’ Id., 307, 308. The plain-
tiff opposed reargument, claiming that the language
in Gionfriddo was dictum. The trial court denied the
motion for reargument without explanation. The defen-
dant appealed from the judgment of the trial court to
the Appellate Court, and we transferred the appeal to
this court pursuant to General Statutes § 51-199 (c) and
Practice Book § 65-1.
   ‘‘The question of whether the trial court properly
awarded interest pursuant to § 52-192a is one of law
subject to de novo review.’’6 Willow Springs Condomin-
ium Assn., Inc. v. Seventh BRT Development Corp.,
245 Conn. 1, 55, 717 A.2d 77 (1998). In Gionfriddo, we
addressed ‘‘the availability of statutory interest [under
§ 52-192a] when a plaintiff’s offer of judgment has been
rejected.’’ Gionfriddo v. Avis Rent A Car System, Inc.,
supra, 192 Conn. 302. After concluding ‘‘that § 52-192a,
read as a statutory totality, encompasses recoveries in
court cases as well as in jury cases’’; id., 306; we pro-
ceeded to address ‘‘a number of subsidiary issues about
the calculation of § 52-192a interest.’’ Id., 307. One sub-
sidiary issue was ‘‘the relationship between [offer of
compromise] interest under § 52-192a and the postjudg-
ment interest statute, [that is] § 37-3a . . . .’’ Id. We
observed that § 52-192a ‘‘says nothing about when [offer
of compromise] interest terminates’’ but held that § 37-
3a definitively resolved the issue by explicitly limiting
the amount of postjudgment interest that may be
awarded. Id., 308. ‘‘Reading these two statutes in con-
junction with each other, as we must,’’ we held that
‘‘the rules of § 52-192a determine prejudgment interest,
while the rules of § 37-3a determine postjudgment inter-
est.’’7 Id. Accordingly, we held that offer of compromise
interest under § 52-192a terminates as of ‘‘the date of
the judgment.’’ Id.; see also Camp, Dresser & McKee,
Inc. v. Technical Design Associates, Inc., 937 F.2d 840,
844 (2d Cir. 1991) (‘‘Connecticut case law . . . makes
it clear that interest under § 52-192a (b) terminates as
of the date of the final judgment’’), citing Gionfriddo
v. Avis Rent A Car System, Inc., supra, 308.
   We agree with the defendant that our analysis of
the issue presented on appeal begins and ends with
Gionfriddo, which held that postjudgment, offer of
compromise interest may not be awarded under § 52-
192a. This aspect of our decision in Gionfriddo was
not dictum but, instead, was necessary to our holding
and, therefore, binding precedent.8 See, e.g., Cruz v.
Montanez, 294 Conn. 357, 376, 984 A.2d 705 (2009) (‘‘a
court’s discussion of matters necessary to its holding
is not mere dictum’’); see also Voris v. Molinaro, 302
Conn. 791, 797 n.6, 31 A.3d 363 (2011) (‘‘[Dictum]
includes those discussions that are merely passing com-
mentary . . . those that go beyond the facts at issue
. . . and those that are unnecessary to the holding in
the case. . . . [I]t is not [dictum] [however] when a
court . . . intentionally takes up, discusses, and
decides a question germane to, though not necessarily
decisive of, the controversy . . . . Rather, such action
constitutes an act of the court [that] it will thereafter
recognize as a binding decision.’’ (Internal quotation
marks omitted.)). The plaintiff has not asked us to over-
rule or to limit our holding in Gionfriddo, and we see
no reason to do so in this case.9 We therefore conclude
that the trial court improperly awarded the plaintiff
postjudgment interest under § 52-192a.
  The judgment is reversed only as to the award of
postjudgment interest under § 52-192a and the case is
remanded with direction to vacate that award of inter-
est; the judgment is affirmed in all other respects.
   In this opinion the other justices concurred.
   * May 4, 2021, the date that this decision was released as a slip opinion,
is the operative date for all substantive and procedural purposes.
   1
     General Statutes § 52-192a provides in relevant part: ‘‘(a) Except as
provided in subsection (b) of this section, after commencement of any civil
action based upon contract or seeking the recovery of money damages,
whether or not other relief is sought, the plaintiff may, not earlier than one
hundred eighty days after service of process is made upon the defendant
in such action but not later than thirty days before trial, file with the clerk
of the court a written offer of compromise signed by the plaintiff or the
plaintiff’s attorney, directed to the defendant or the defendant’s attorney,
offering to settle the claim underlying the action for a sum certain. . . . If
the offer of compromise is not accepted within thirty days and prior to the
rendering of a verdict by the jury or an award by the court, the offer of
compromise shall be considered rejected and not subject to acceptance
unless refiled. Any such offer of compromise and any acceptance of the
offer of compromise shall be included by the clerk in the record of the case.
                                       ***
   ‘‘(c) After trial the court shall examine the record to determine whether
the plaintiff made an offer of compromise which the defendant failed to
accept. If the court ascertains from the record that the plaintiff has recovered
an amount equal to or greater than the sum certain specified in the plaintiff’s
offer of compromise, the court shall add to the amount so recovered eight
per cent annual interest on said amount . . . the court shall add to the
amount so recovered eight per cent annual interest on the difference between
the amount so recovered and the sum certain specified in the counterclaim
plaintiff’s offer of compromise. The interest shall be computed from the
date the complaint in the civil action . . . was filed with the court if the
offer of compromise was filed not later than eighteen months from the filing
of such complaint . . . . If such offer was filed later than eighteen months
from the date of filing of the complaint . . . the interest shall be computed
from the date the offer of compromise was filed. The court may award
reasonable attorney’s fees in an amount not to exceed three hundred fifty
dollars, and shall render judgment accordingly. This section shall not be
interpreted to abrogate the contractual rights of any party concerning the
recovery of attorney’s fees in accordance with the provisions of any written
contract between the parties to the action.’’
   2
     Practice Book § 17-18 provides: ‘‘After trial the judicial authority shall
examine the record to determine whether the plaintiff made an offer of
compromise which the defendant failed to accept. If the judicial authority
ascertains from the record that the plaintiff has recovered an amount equal
to or greater than the sum certain specified in that plaintiff’s offer of compro-
mise, the judicial authority shall add to the amount so recovered 8 percent
annual interest on said amount. In the case of a counterclaim plaintiff under
General Statutes § 8-132, the judicial authority shall add to the amount so
recovered 8 percent annual interest on the difference between the amount
so recovered and the sum certain specified in the counterclaim plaintiff’s
offer of compromise. Any such interest shall be computed as provided in
General Statutes § 52-192a. The judicial authority may award reasonable
attorney’s fees in an amount not to exceed $350 and shall render judgment
accordingly. Nothing in this section shall be interpreted to abrogate the
contractual rights of any party concerning the recovery of attorney’s fees
in accordance with the provisions of any written contract between the
parties to the action.’’
    3
      The trial court concluded that the defendant had failed to prove its
special defenses and its counterclaim.
    4
      The trial court awarded the plaintiff reasonable attorney’s fees in the
amount of $350. See General Statutes § 52-192a (c) (‘‘[t]he court may award
reasonable attorney’s fees in an amount not to exceed three hundred fifty
dollars, and shall render judgment accordingly’’); Practice Book § 17-18
(‘‘[t]he judicial authority may award reasonable attorney’s fees in an amount
not to exceed $350 and shall render judgment accordingly’’). The trial court’s
award of attorney’s fees is not at issue in this appeal.
    5
      The trial court determined that the plaintiff was entitled to interest
under § 52-192a because it had recovered an amount ‘‘equal to’’ the offer
of compromise. In fact, the plaintiff’s recovery substantially exceeded the
offer of compromise because the amount it ‘‘ha[d] recovered’’ under § 52-
192a (c) included the trial court’s award of prejudgment interest under § 37-
3a. See Blakeslee Arpaia Chapman, Inc. v. EI Constructors, Inc., 239 Conn.
708, 740 n.35, 687 A.2d 506 (1997) (‘‘[t]he offer of judgment is to be compared
to the amount that the plaintiff ‘has recovered,’ which includes compensatory
interest’’); see also Gionfriddo v. Avis Rent A Car System, Inc., supra, 192
Conn. 304–305 (‘‘it is the total judgment that is the relevant [basis] for
comparison’’); Gillis v. Gillis, 21 Conn. App. 549, 556, 575 A.2d 230 (conclud-
ing that trial court improperly denied offer of judgment interest on § 37-3a
interest portion of verdict), cert. denied, 215 Conn. 815, 576 A.2d 544
(1990).’’).
    6
      Practice Book § 17-18 provides for an ‘‘identical computation method’’
as § 52-192a for offer of compromise interest. Georges v. OB-GYN Services,
P.C., 335 Conn. 669, 674 n.3, 240 A.3d 249 (2020); see also footnotes 1 and
2 of this opinion. For the sake of simplicity, and consistent with the parties’
arguments on appeal, we limit our analysis to § 52-192a.
    7
      Gionfriddo was a personal injury action and, therefore, did not involve
a claim for prejudgment interest under § 37-3a. See Gionfriddo v. Avis Rent
A Car System, Inc., supra, 192 Conn. 308 (recognizing that ‘‘a personal injury
claim would not ordinarily constitute a claim for the wrongful detention of
money’’ under § 37-3a ‘‘before the rendering of a judgment’’), citing Cecio
Bros., Inc. v. Feldmann, 161 Conn. 265, 274–75, 287 A.2d 374 (1971)). In a
breach of contract action, however, prejudgment interest under § 37-3a may
be awarded upon a finding that the defendant withheld money from the
plaintiff after it became payable. See White Oak Corp. v. Dept. of Transporta-
tion, 217 Conn. 281, 302, 585 A.2d 1199 (1991) (holding that trial court
improperly failed to award prejudgment interest under § 37-3a after finding
that payment owed by defendant was wrongfully withheld under contract);
see also DiLieto v. County Obstetrics & Gynecology Group, P.C., 310 Conn.
38, 49–50 n.11, 74 A.3d 1212 (2013) (identifying types of claims that would,
and would not, permit award of prejudgment interest under § 37-3a). As we
previously noted, the trial court in the present case awarded the plaintiff
prejudgment and postjudgment interest under § 37-3a, and that award is not
challenged on appeal.
    8
      To support its contention to the contrary, the plaintiff relies on DiLieto
v. County Obstetrics & Gynecology Group, P.C., 310 Conn. 38, 56–57, 74
A.3d 1212 (2013), in which we held that an award of postjudgment interest
under § 37-3a was discretionary, rather than mandatory. The plaintiff points
out that, in DiLieto, we observed that ‘‘the issue of postjudgment interest was
not a contested issue in Gionfriddo,’’ and, thus, ‘‘the discussion regarding
the award of postjudgment interest pursuant to § 52-192a in Gionfriddo was
dict[um].’’ This claim lacks merit. In DiLieto, we clarified that our language
in Gionfriddo ‘‘purporting to recognize the plaintiff’s ‘entitlement’ to post-
judgment interest under § 37-3a’’ was not conclusive as to whether the award
of such interest was mandatory in every case in which prejudgment interest
was awarded under § 52-192a, reasoning that ‘‘the issue of whether postjudg-
ment interest is automatic under § 37-3a in cases in which the plaintiff is
entitled to prejudgment interest under § 52-192a was not before this court
because the defendant in [Gionfriddo] did not challenge the plaintiff’s enti-
tlement to postjudgment interest. The defendant simply argued that such
interest should be calculated at the annual rate of 8 percent pursuant to
§ 37-3a, rather than at the higher annual rate of 12 percent pursuant to § 52-
192a. Thus, although we agreed with the defendant that § 37-3a governed
an award of postjudgment interest in [Gionfriddo], we were not required
to decide whether such an award was mandatory.’’ DiLieto v. County Obstet-
rics & Gynecology Group, P.C., supra, 58. Nothing in DiLieto suggests that
we may consider as dictum the court’s determination in Gionfriddo that
controls the outcome in the present case, which is Gionfriddo’s conclusion
that interest under § 52-192a terminates as of the date of judgment.
   9
     Indeed, counsel for both the plaintiff and the defendant informed this
court during oral argument that they were unaware of any other case in
which postjudgment, offer of compromise interest had been awarded under
§ 52-192a.