Harty v. Cantor Fitzgerald and Co.

881 A.2d 139, 275 Conn. 72, 2005 Conn. LEXIS 324
CourtSupreme Court of Connecticut
DecidedAugust 16, 2005
DocketSC 17201
StatusPublished
Cited by75 cases

This text of 881 A.2d 139 (Harty v. Cantor Fitzgerald and Co.) is published on Counsel Stack Legal Research, covering Supreme Court of Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harty v. Cantor Fitzgerald and Co., 881 A.2d 139, 275 Conn. 72, 2005 Conn. LEXIS 324 (Colo. 2005).

Opinion

Opinion

KATZ, J.

The defendant, Cantor Fitzgerald and Company, appeals from the judgment of the trial court denying the defendant’s application to vacate in part an arbitration award rendered in favor of the defendant’s former employee, the plaintiff, Emmett J. Harty, and granting the plaintiffs application to confirm the award. The trial court concluded that the arbitration panel had not manifestly disregarded the law in awarding to the *75 plaintiff compensatory damages for the defendant’s failure to pay the plaintiff a 1999 annual bonus and, pursuant to the wage collection statute, General Statutes § 31-72, 1 double damages, attorney’s fees and costs for the defendant’s failure to pay his 1998 and 1999 annual bonuses. With respect to the award under § 31-72, the defendant’s principal contention is that the trial court improperly failed to apply de novo review to its claim that the arbitrators had exceeded their authority by awarding double damages, attorney’s fees and costs and that, under that standard, the award must be vacated because the submission expressly barred an award of punitive damages, exemplary damages or damages in the nature of punitive or exemplary damages. With respect to the award of compensatory damages for the 1999 bonus, the defendant claims that the trial court improperly determined that the arbitrators had not manifestly disregarded the law in determining that the bonus was a “wage” within the meaning of § 31-72 and that *76 the plaintiff was entitled to the bonus. We conclude that the trial court improperly failed to vacate the award with respect to attorney’s fees and costs only. Accordingly, we affirm in part and reverse in part the judgment of the trial court.

The record reveals the following undisputed facts and procedural history. The defendant is a New York corporation doing business in Connecticut. The parties executed an employment agreement (agreement) under which the plaintiff was to serve as a managing director of one of the defendant’s divisions for a term beginning on June 28, 1996, and ending on December 31, 1999. The agreement thereafter automatically would extend for successive one year periods unless either party notified the other of its intention not to renew the agreement within a prescribed time period, at which point the plaintiff would become an employee at will. Under the terms of the agreement, the plaintiff was to receive annual bonuses in addition to a base salary. The agreement also contained an arbitration provision providing in relevant part that, “any disputes, differences or controversies arising under this [agreement shall be settled and finally determined by arbitration .... However, it is understood and agreed that the arbitrators are not authorized or entitled to include as part of any award rendered by them, special, exemplary or punitive damages or amounts in the nature of special, exemplary or punitive damages regardless of the nature or form of the claim or grievance that has been submitted to arbitration . . . .”

During the plaintiffs term of employment, certain disputes arose between the parties. One of these disputes concerned the plaintiffs 1996 and 1997 bonuses. The parties ultimately executed an agreement under which the defendant would pay the plaintiff approximately $150,000 as bonus compensation in exchange *77 for his release of claims, including any claim under § 31-72, against the defendant arising from the dispute.

As a result of a subsequent dispute, in December, 1998, the parties exchanged letters notifying the other of their intention not to renew the agreement and that, as a result, the agreement would terminate on December 31, 1999. By letter dated December 31, 1998, the defendant ordered the plaintiff to remain on home leave until further notice and not to have any contact with the defendant’s employees or clients. One year later, by letter dated December 31, 1999, the defendant notified the plaintiff that it had terminated his employment. The defendant paid the plaintiff his salary during the year he remained on home leave, but did not pay him annual bonuses for 1998 and 1999.

Thereafter, the plaintiff filed a claim for arbitration asserting that the defendant had breached the employment agreement and seeking, inter alia, compensatory damages for his 1998 and 1999 bonuses and, pursuant to § 31-72, additional damages, attorney’s fees and costs. After seventeen days of hearings, a panel of three arbitrators rendered an award in favor of the plaintiff of compensatory damages in the amount of $1,157,393.22, plus interest, and pursuant to § 31-72, additional damages in the amount of $1,157,393.22, attorney’s fees of $382,556 and costs of $39,107.88. The arbitrators did not issue a memorandum of decision setting forth factual findings and legal conclusions supporting the award.

The plaintiff filed an application in the trial court to confirm the award pursuant to General Statutes § 52-417. The defendant filed an application to vacate the award in part pursuant to General Statutes § 52-418 (a) (4), 2 claiming that the arbitrators had manifestly *78 disregarded the law and evidence by awarding to the plaintiff: (1) compensatory damages for the 1999 bonus; and (2) double damages, attorney’s fees and costs pursuant to § 31-72 for both the 1998 and 1999 bonuses.* * 3 At a hearing on the application to vacate, the defendant also argued that the submission was restricted because, under the terms of the employment agreement, the arbitrators could not award punitive, exemplary or special damages. Accordingly, the defendant contended that the arbitrators had exceeded their authority by awarding such damages.

The trial court first determined that, in the absence of clear authority to the contrary, the arbitrators properly had determined that the submission was unrestricted, despite its prohibition on an award of punitive damages, because the parties had agreed to submit to arbitration “any disputes” arising under their agreement. The court then concluded that the contested portions of the award must be reviewed under the manifest disregard of the law standard. Turning to the defendant’s claim regarding the damages awarded under § 31-72, the trial court determined that neither the plain language of the statute, the statute’s legislative history nor our case law supported the defendant’s contention that the law was well-defined that double damages, fees and costs under the wage collection statute were punitive and, therefore, barred under the parties’ *79 agreement. Turning to the defendant’s claim regarding the award of compensatory damages for its failure to pay the plaintiff his 1999 bonus, the court concluded that the arbitrators had not manifestly disregarded the law either as to whether the plaintiffs bonus was a “wage” under the statute or as to whether the plaintiff was entitled to receive the bonus under the terms of the employment agreement. Accordingly, the trial court denied the defendant’s application to vacate part of the award and granted the plaintiffs application to confirm the award in its entirety.

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Cite This Page — Counsel Stack

Bluebook (online)
881 A.2d 139, 275 Conn. 72, 2005 Conn. LEXIS 324, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harty-v-cantor-fitzgerald-and-co-conn-2005.