Lasalla v. Doctor's Associates, No. Cv00-0071161s (Jun. 7, 2002)

2002 Conn. Super. Ct. 7241
CourtConnecticut Superior Court
DecidedJune 7, 2002
DocketNos. CV00-0071161S, CV01-00745445
StatusUnpublished

This text of 2002 Conn. Super. Ct. 7241 (Lasalla v. Doctor's Associates, No. Cv00-0071161s (Jun. 7, 2002)) is published on Counsel Stack Legal Research, covering Connecticut Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lasalla v. Doctor's Associates, No. Cv00-0071161s (Jun. 7, 2002), 2002 Conn. Super. Ct. 7241 (Colo. Ct. App. 2002).

Opinion

[EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]

MEMORANDUM OF DECISION
These two actions have been ordered consolidated since they involve the same parties and the same arbitration proceeding. In the action with the docket no. CV00-007 1161S, the plaintiff has filed an application with the court to vacate portions of an arbitration award involving a contractual dispute with the defendant and the defendant has filed an application to confirm the arbitration award. In the action with the docket no. CV01-0074544S, the plaintiff has filed an application to confirm selected portions of the same arbitration award.

The defendant is the franchiser for Subway sandwich stores. On February 1, 1986, the plaintiff entered into a written contract with the defendant entitled "Development Agent Agreement." Pursuant to the agreement, the plaintiff was granted the right to develop and service Subway sandwich shops in certain specified counties in the state of Florida. On or about May 14, 1991, the parties signed an addendum to the Development Agent Agreement.

The parties dispute involves two clauses of the Development Agent Agreement: the so-called "bonus and penalty clause" and the "expense sharing clause." The plaintiff claims that the defendant took actions in contravention of each of these provisions.

The bonus and penalty clause is contained in paragraph 2c of the Development Agent Agreement. Paragraph 2c establishes a schedule for the development by the development agent of a specific number of stores in his territory. The bonus and penalty clause of that paragraph provides CT Page 7242 that "If the Development Agent is ahead in the performance of his schedule, the Company shall pay him an extra $100 per month for each store that he is ahead. If he is behind schedule, he shall pay the Company $100 per month for each store that he is behind."1

It is undisputed that at some point the defendant stopped paying bonuses to development agents who had previously reached the last date specified in their development schedules. The plaintiff claims that the defendant breached the Development Agent Agreement by ceasing the payment of bonuses to him after January 1, 1996. The plaintiff contends that the Agreement requires the payment of bonuses for the entire term of the contract. The defendant asserts that the bonus and penalty clause of the Development Agent Agreement only requires the payment of bonuses during the development phase of the agreement and that once the development schedule ends no further payment of bonuses is required.

A number of development agents who had contractual arrangements with the defendant that included bonus and penalty clauses designated a small group of development agents, which became known as the Development Agency Advisory Board ("DAAB"), to negotiate with the defendant a resolution of the dispute concerning the payment of bonuses. A "Bonuses and Penalty Rider" was eventually proposed as a way to settle the dispute over the payment of bonuses. Under the rider, a development agent could choose either of two options: (1) In consideration of the deletion of the provisions related to the payment of bonuses and penalties, the term of the Development Agent Agreement would be extended by two years; or (2) any bonus provided in the Development Agent Agreement would be payable in full only until the later of (a) October, 1994, or (b) the last month of the revised Development Schedule and thereafter the defendant would pay the development agent each month 50% of the bonus earned during October, 199 4 or during the last month of the development schedule, whichever applied.

On or about February 1996, the defendant sent the plaintiff a proposed Bonuses and Penalty Rider together with a letter which indicated that, under option two, the plaintiff would receive 50% of $2,900 or $1,450 monthly and that the plaintiff would be owed $2,900 in bonus payments through February 1996. The letter instructed the plaintiff to choose option one or option two of the rider, sign the rider and return it to the defendant. The defendant also sent the plaintiff a check in the amount of $2,900 as payment of its obligations under option two of the rider. Although the plaintiff never signed and returned the rider, the defendant subsequently sent and the plaintiff accepted payments of $1,450 monthly pursuant to option two of the rider.

The expense sharing clause can be found in paragraph 2b of the CT Page 7243 Development Agent Agreement. It provides that the plaintiff agrees to "assist the Company in the enforcement of all of the provisions of any License or Franchise Agreement of any unit established in his Territory, including but not limited to the collection of monies due the Company. If the Company incurs expenses in order to enforce the agreements or to commence evictions of Franchisees within said Territory, the Company may charge the Development Agent one-third of its expenditures."

The plaintiff contends that the defendant charged him expenses that did not fall within the parameters of the expense sharing clause of paragraph 2b. Specifically, the plaintiff maintains that the defendant charged him for all expenses incurred in relation to the franchises in his territory and did not limit the expenses to expenses incurred to enforce franchise agreements or to commence evictions of franchisees. The plaintiff also claims that the defendant improperly charged him with expenses which were incurred by the defendant's leasing affiliates. The plaintiff contends that the defendant improperly deducted from his compensation a total of $69,585.63 for expenses in contravention of the expense sharing clause of the Development Agent Agreement.

The Development Agent Agreement provides that any claim concerning a breach of the agreement shall be settled by arbitration in accordance with the Commercial Rules of the American Arbitration Association. On or about June 15, 1998, the plaintiff filed with the American Arbitration Association a written demand for arbitration of its dispute with the defendant. In its initial demand for arbitration, the plaintiff sought a declaratory judgment ordering the defendant to honor the bonus and penalty clause for the duration of the subject contract, an order compelling the defendant to pay delinquent bonus payments under the subject contract, and punitive damages, legal fees and costs under the Connecticut Unfair Trade Practices Act ("CUTPA"), General Statutes §42-110g. The plaintiff also sought a declaratory judgment that the defendant is not authorized to set off against the plaintiffs monthly payments monies owed the defendant by franchisees for supplies and equipment and a declaratory judgment that the defendant is not authorized to set off against the plaintiffs monthly payments legal or other expenses not incurred in connection with the enforcement of the franchise agreements or with the commencement of evictions of franchisees. The plaintiff further sought an order requiring the payment of all amounts due and owing the plaintiff for unpaid bonuses and for reimbursement of unauthorized charges.

On or about November 17, 1999, the plaintiff amended its prayer for relief in the arbitration proceeding. The amended prayer for relief contained seventeen requests, all of which related to his claims that the defendant violated the agreement by failing to pay bonuses for the CT Page 7244 duration of the agreement and by deducting from his monthly payments expenses not incurred by the defendant in connection with the enforcement of the franchise agreements or with the commencement of evictions of franchisees within the plaintiffs territory.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Estate of Thornton v. Caldor, Inc.
472 U.S. 703 (Supreme Court, 1985)
Waterbury Construction Co. v. Board of Education
457 A.2d 310 (Supreme Court of Connecticut, 1983)
Caldor, Inc. v. Thornton
464 A.2d 785 (Supreme Court of Connecticut, 1983)
Local 63, Textile Workers Union of America v. Cheney Bros.
141 Conn. 606 (Supreme Court of Connecticut, 1954)
State v. Connecticut Employees Union Independent
440 A.2d 229 (Supreme Court of Connecticut, 1981)
City of Middletown v. Police Local, No. 1361
445 A.2d 322 (Supreme Court of Connecticut, 1982)
City of New Haven v. AFSCME, Council 15, Local 530
544 A.2d 186 (Supreme Court of Connecticut, 1988)
City of Hartford v. Connecticut State Board of Mediation & Arbitration
557 A.2d 1236 (Supreme Court of Connecticut, 1989)
Garrity v. McCaskey
612 A.2d 742 (Supreme Court of Connecticut, 1992)
United States Fidelity & Guaranty Co. v. Hutchinson
710 A.2d 1343 (Supreme Court of Connecticut, 1998)
Town of Stratford v. International Ass'n of Firefighters
728 A.2d 1063 (Supreme Court of Connecticut, 1999)
Perkins & Mario, P.C. v. Annunziata
694 A.2d 1388 (Connecticut Appellate Court, 1997)

Cite This Page — Counsel Stack

Bluebook (online)
2002 Conn. Super. Ct. 7241, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lasalla-v-doctors-associates-no-cv00-0071161s-jun-7-2002-connsuperct-2002.