Appellate Court Notes

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Welcome to our Supreme and Appellate Court summaries page.  Here, I provide abbreviated summaries of decisions from the Connecticut appellate courts which highlight important issues and developments in Connecticut law, and provide practical practice pointers to litigants.  I have been summarizing these court decisions internally for our firm for more than 10 years, and providing relevant highlights to my municipal and insurance practice clients for almost as long.  It was suggested that a wider audience might appreciate brief summaries of recent rulings that condense often long and confusing decisions down to their basic elements.  These summaries are limited to the civil litigation decisions based on my own particular field of practice, so you will not find distillations of the many criminal and matrimonial law decisions on this page.  I may from time to time add commentary, and may even criticize a decision’s reasoning. Such commentary is solely my opinion . . . and when mistakes of trial counsel are highlighted because they triggered a particular outcome, I will try to be mindful of the adage . . . “There but for the grace of God . . ..”  I hope the reader finds these summaries helpful. – Edward P. McCreery

Posted July 3, 2014

  • SC18819 - Single Source, Inc. v. Central Regional Tourism District, Inc.

As a precursor to the July 4th holiday and the resultant influx of tourists to Connecticut's attractions, the Connecticut Supreme Court through Justice McDonald ruled this week that Regional Tourist Districts are not the successors in liability to the former Local Tourist Districts.  The District Court in Massachusetts certified questions to the Connecticut Supremes over an attempt by a Massachusetts vendor to hold the Hartford Regional Tourist District liable for $700,000 in late fees when the Greater Hartford District was dissolved and 150 licensed photos were not returned and others were returned late.  This decision held that the legislature carefully spelled out the circumstances under which the new regional districts could assume local liabilities and so such assumption was not automatic unless those protocols were followed….and they weren’t here.  The District court also asked who would then be responsible for this claim.  The Connecticut Supreme Court responded that the liabilities flowed no differently than for any other corporation that is winding up its business affairs.  If the corporation had assets at the end of its existence and did not pay off all of its debts, a fraudulent conveyance claim could be asserted by the plaintiff against whomever was the recipient of those assets.  A footnote distinguishes this fact pattern from the common law rule that successor governmental units performing the same task are generally considered successors in interest to liabilities of their predecessors.  The  court noted that the tourist districts were quasi government., quasi private….and lacked taxing authority to raise funds to pay obligations.  

[Potentially running through this decision (which likely leaves the plaintiff holding an empty bag) is a bit of sticker shock at the extremely high prices being charged for late photos when it’s likely the owner had the negatives (Is that a proper term in this digital age?) and there was no claim the new tourist district was improperly using the old materials.  Nonetheless, the decision is a reminder to watch those penalty clauses in licensing agreements and consider negotiating caps at the value of the work so the late fees don’t add up indefinitely.]

The facts and holdings of any case may be redacted, paraphrased or condensed for ease of reading.  No summary can be an exact rendering of any decision, however, so interested readers are referred to the full decisions.  The docket number of each case is a hyperlink to the Connecticut Judicial Department online slip opinion.  

[View source.]

 

Topics:  Successor Liability, Successors, Tourists

Published In: Administrative Agency Updates, Civil Procedure Updates, General Business Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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