The Connecticut appeal in Adler v. Rosenthal involved two lawyers who talked about starting a…
Strict Compliance with Home Improvement Act Unnecessary
A Connecticut appeal confirms that contractors do not have to strictly comply with the Home Improvement Act. The advance release opinion becomes official on March 1, 2016.
The homeowners in Ippolito v. Olympic Construction, LLC hired a contractor to repair some water damage to his home. They terminated the contract before the contractor completed the work. Contractor commenced an arbitration to recover its lost profit. Homeowners claimed that contractor could not enforce the contract because it did not comply with the Home Improvement Act. Specifically, homeowners asserted that the contract did not comply with the notice of the right to cancel provision of CGS § 20-429(a)(6) or specify starting and completion dates as required by § 20-429(a)(7).
Arbitrator found for contractor. Homeowners moved to vacate the award in Superior Court. Contractor moved to confirm the award. “[Homeowners] claimed that the award violated the clear public policy of this state because it contravened the previously described provisions of the [Home Improvement Act], and that the arbitrator, by not strictly enforcing those statutory provisions, had manifestly disregarded the law.” The trial court rejected homeowners claims, denied their motion to vacate the award, and granted contractor’s motion to confirm it.
Homeowners appealed. The Connecticut Appellate Court affirmed.
Homeowners’ Main Arguments on Appeal
“[Homeowners] argue[d] … that the location of the cancellation notice within the contract does not comply with § 20-429(a)(6), and that the contract does not contain a starting date and completion date, as required by § 20-429 (a)(7).”
Appellate Court Confirms Strict Compliance with Home Improvement Act is Unnecessary
Quoting Supreme Court authority, the Appellate Court noted that “‘[t]o determine whether an arbitration award must be vacated for violating public policy, we employ a two- pronged analysis. . . . First, we must determine whether the award implicates any explicit, well-defined, and dominant public policy. . . . To identify the existence of a public policy, we look to statutes, regulations, administrative decisions, and case law. . . . Second, if the decision of the arbitrator does implicate a clearly defined public policy, we then determine whether the contract, as construed by the arbitration award, violates that policy.'”
The court “first turn[ed] to the [homeowners’] claim that the contract violates public policy because it does not comply with the notice of cancellation requirements of § 20-429(a)(6), which requires that a home improvement contract include notice of the homeowner’s cancellation rights in accordance with the provisions of the [Home Solicitation Sales Act. The [homeowners] do not dispute that the parties’ contract contains a notice of their cancellation rights, nor do they argue that the language or typeface of that cancellation notice is in any way deficient. Instead, they argue that the location of the notice within the contract documents does not comply with General Statutes § 42- 135a (1) … of the [Home Solicitation Sales Act].”
“Section 42-135a (1) of the [Home Solicitation Sales Act] requires, inter alia, that the seller include a cancellation notice ‘in immediate proximity to the space reserved in the contract for the signature of the buyer . . . .'” The contract in this case incorporated by reference another document [AIA document A201–2007, General Conditions of the Contract for Construction] directly above one of the homeowner’s signature lines. That other document consisted of thirty-nine pages. The notice of cancellation provision was on pages thirty-eight to thirty-nine.
“Although our Supreme Court has recognized that compliance with § 20-429 (a) is mandatory, it has not required perfect compliance.” “The arbitrator in this case found that the cancellation notice complied in substance with the requirements of the [Home Improvement Act], because, even though it was set forth on pages thirty-eight and thirty-nine of a separate document that had been incorporated into the contract by reference, the incorporated document itself was referenced in close proximity to the signature line on the contract. Here, then, because the [homeowners] have not demonstrated that the cancellation notice was missing from the contract, or that the language or typeface or any other aspect of the cancellation notice was deficient in such a way as to deprive them of notice of their cancellation rights under the [Home Improvement Act], we cannot conclude that enforcement of the contract against the homeowners violated an explicit, well-defined and dominant public policy of this state.”
The Court “turn[ed] next to the [homeowners’] claim regarding § 20-429 (a) (7), which provides that: ‘No home improvement contract shall be valid or enforceable against an owner unless it . . . (7) contains a starting date and completion date . . . . ‘ The plaintiffs claim that the contract does not comply with that provision because it does not contain specific calendar dates for starting and completing work under the contract.”
The arbitrator found that the contract defined the starting and completion dates by references to events rather than actual dates and that this was sufficient. “In this matter, the start dates and the completion date can be readily adduced by looking at the entire contract . . . .” “[T]he [trial] court expressly noted that the plaintiffs could not provide any case law that held that ‘the starting date and/or completion date need to be fixed calendar dates rather than dates to be determined upon the occurrence of certain events. (E.g., the completion of plans; issuance of a building permit; notification of closing on construction financing.)'”
The Appellate Court concluded that, for these reasons, “the [homeowners’ ] claim on appeal fails, for even if strict enforcement of the starting date and completion date requirement of the statute were an explicit, well-defined, and dominant public policy of this state, the contract here at issue does not violate that requirement or the public policy it is designed to promote.”
Other Things to Note
Homeowners also claimed on appeal that “the arbitrator’s enforcement of a contract that is noncompliant with § 20-429 (a) (6) and (7) of the [Home Improvement Act] demonstrates a manifest disregard of the law, and thus that the award should be set aside pursuant to § 52-418 (a) (4).” The Appellate Court rejected this argument because the deviation from the Home Improvement Act in respect of the notice of cancellation was “minor and technical” and the contract did provide start and completion dates.
Homeowners also claimed on appeal that contractor failed to comply with the Home Improvement Act, via § 42-135a(2) of the Home Solicitation Sales Act, because the contractor did not attach two blank notices of cancellation to the contract. “Although the [homeowners] argued in the trial court that the contract violated § 42-135a (2), the trial court’s decision did not reference that claim and … [t]he [homeowners] never filed a request for articulation to receive a ruling on their claim under § 42-135a (2). Moreover, the [homeowners] have failed to adequately brief their claim as to § 42-135a (2) by failing to set forth how the contract here at issue violates that subdivision. Thus, we decline to review the plaintiffs’ claim to the extent that it asserts a violation of that subdivision.”
The court footnoted its “decline to review” discussion, as follows: “We are aware that Practice Book § 61-10 was recently amended to include subsection (b), which provides in relevant part that ‘[t]he failure of any party on appeal to seek articulation pursuant to Section 66-5 shall not be the sole ground upon which the court declines to review any issue or claim on appeal. . . . ‘ The commentary for § 61-10 provides, however, that ‘[t]he adoption of subsection (b) is not intended to preclude the court from declining to review an issue where the record is inadequate for reasons other than solely the failure to seek an articulation . . . .'”
The lesson is that, if you don’t seek articulation, you better brief the tar out of the issue.
