By HOUSTON PUTNAM LOWRY (fn*) AND PETER W. SCHROTH (fn**)
This year's report is devoted to cases almost exclusively because there was no relevant Connecticut legislation during 1996. As usual, there were several decisions on the proper methods of service of process. Other cases involved enforcement of foreign judgments, claims against the United States and forum non conveniens. (fn1) There was also a minor change in the federal regulations (fn2) concerning legalization of documents not covered by the Hague Convention on the Legalization of Foreign Public Documents. (fn3)
A. Cavendish-Pell v. Howell (fn4)
Once again, a "garden variety" lawsuit went awry because the plaintiff failed to take proper steps to effect service of process. Plaintiff was a Connecticut resident who entered into a joint venture with a resident of the United Kingdom to develop a parcel of land in Stamford. Instead of serving the complaint pursuant to the Hague Convention on the Service Abroad of judicial and Extra-judicial Documents in Civil or Commercial Matters ("Hague Service Convention"), (fn5) as required by Section 52-59d of the General Statutes, (fn6) plaintiff served by mail pursuant to Section 52-59b of the General Statutes. Because plaintiff did not comply with the Hague Service Convention, the case was dismissed.
The court's opinion includes an excellent discussion of the interpretation of Article 10(a) of the Hague Service Convention, which reads in pertinent part, "provided the state of destination does not object, the present convention shall not interfere with: (a) the freedom to send judicial documents, by postal channels, directly to persons abroad . . . ." The majority rule and the better reasoned decisions hold that the word "send" is not the equivalent of "serve process." (fn7) This provision was intended to preserve a plaintiff's right to send documents overseas by postal channels after initial service is made. It cannot be used as a basis for initial service.
B. Itoba Ltd. v. LEP Group (fn8)
Defendant Grant was a resident of the United Kingdom, which is a party to the Hague Service Convention. In an action for damages under the Securities Exchange Act of 1934 and Rule lOb-5 in the United States District Court, plaintiff failed to serve defendant Grant in accordance with the Hague Service Convention but defendant Grant took three years to object to this failure.
Applying Rule 12(h) of the Federal Rules of Civil Procedure, Judge Eginton ruled that the defect in service of process was waived by being omitted from a previous mot-ion to dismiss. The fact that service was required to be made as provided in a treaty does not excuse the parties from complying with the Federal Rules of Civil Procedure.
C. DiMartino v. Eric Riebling Company (fn9)
Plaintiff brought this action in Connecticut superior court for personal injuries suffered because of an alleged design defect in a drilling machine. The drilling machine was manufactured by a German corporation, although it was leased from a New York corporation and used in Connecticut. One of the defendants was the German manufacturer, which was served pursuant to Section 33-411 (c) of the General Statutes. (fn10)
Once jurisdiction based upon constructive service is contested, the plaintiff has the burden of proof. (fn11) The plaintiff did not oppose the motion to dismiss. Under the revised Practice Book, the court must review the merits of the motion instead of granting the motion "by consent." Even though they clearly applied, the court did not discuss Section 52-59d of the General Statutes or Practice Book Section 202A. Instead of ruling on the law, which clearly required service of process under the Hague Service Convention, the court held the plaintiff failed to meet his burden of proof to sustain jurisdiction. While the court did not need to examine the facts because it could have ruled as a matter of law, it reached the right decision.
D. Lacey v. Broque (fn12)
Plaintiff and defendant are former partners in a defunct Hartford law firm. Defendant resided in Monaco at the time suit was instituted. Plaintiff filed an application, pursuant to Connecticut General Statutes Section 52-59d and Practice Book Section 202A, for an order of notice. Service of the order of notice was to be via telecopy and Federal Express to defendant in Monaco with no "in-hand" service, service by mail or service by publication.
The application for the order of notice discussed the following issues: (fn13)
1. Other methods of service specified or allowed in any applicable treaty or convention. Monaco was not a party to the Hague Service Convention or to any other treaty or convention with the United States on the service of process. Therefore, issuing an order of notice on these terms would not violate any United States treaty obligations.
2. Whether or not all applicable international treaties and conventions prohibit substituted service. No international treaty or convention prohibited service in the manner proposed because there was no treaty or convention in effect. The authors doubt that any existing treaty (including the Hague Service Convention) ever contemplated service by Federal Express or telecopy, but in this case both methods were reasonably calculated actually to notify the defendant of the pending action in time for him to appear and to defend.
3. What method of service provides the greatest likelihood the party being served will receive actual and timely notice of the suit. The methods of service proposed provided the greatest likelihood of actual and timely notice to the defendant so he could appear and defend. The defendant probably received better notice than someone who was served via abode service within the State of Connecticut. At the same time the order of notice was applied for, plaintiff also requested an ex parte prejudgment remedy to attach real property. The procedure increases the likelihood of bringing the lawsuit to the defendant's attention. The ex parte writ of attachment was approved by the court and served.
4. Whether or not a particular method of service violates the law, particularly the criminal law, of the foreign country involved. Counsel researched the point and represented to the court that the method proposed did not violate the criminal law of Monaco or the United States. The subtle differences between an order of notice and a summons under Connecticut law do not seem to appear in the law of any other country. While a summons might violate some foreign country's criminal law, an order of notice probably is not specifically forbidden by any country's criminal law.
5. Whether or not an actual agent of the party can be served within the United States. No actual agent could be served in the United States. Therefore, the court authorized the order of notice and a copy of the complaint to be served by Federal Express and telecopy on the defendant. The court later found the defendant had actual notice of the pending lawsuit and issued default judgment.
A. Bayne v. Zajchonski (fn14)
Plaintiff obtained a judgment for $3,611.57 against two defendants, Kwiatkowski and Zajchonski. Pursuant to the comparative negligence statute, Section 52-572h of the General Statutes, the judgment was apportioned equally between the two defendants. When plaintiff could not locate defendant Zajchonski, who was said to have returned to Poland, he moved to reapportion the debt pursuant to Section 52572h(g) of the General Statutes. The reapportionment would allow plaintiff to collect the entire debt from only one defendant.
Defendant Kwiatkowski argued that a debtor's mere residence in a foreign country is not enough to render the judgment "uncollectable" within the meaning of the statute. However, plaintiff would have to start a new suit in Poland rather than simply applying for enforcement of the Connecticut judgment because the United States and Poland are not parties to any multilateral or bilateral convention on the enforcement of judgments. It was not clear whether Poland would require the entire case to be relitigated on the merits. Judge Karazin held that a strict showing of impossibility was not required as a condition to reapportioning the judgment, particularly in light of the modest amount involved, and ordered the reapportionment.
B. Bird v. United States of America (fn15)
Plaintiff, the civilian wife of a member of the United States Navy stationed at Guantanamo Bay, Cuba, was examined by a physician at the base medical facility there, who allegedly failed to diagnose a brain tumor. After her husband was transferred to Groton, she sued in the United States District Court for the District of Connecticut under the Federal Tort Claims Act. (fn16)
The key question was whether the United States Naval Station at Guantanamo Bay is in a foreign country, because if so, then no action was possible under the Federal Tort Claims Act. (fn17) This led the court to examine the 1903 agreement between the United States and Cuba on Lease of Lands for Coaling and Naval Stations. (fn18) That agreement provides for a perpetual lease, terminable only by mutual agreement of the two countries or by abandonment of Guantanamo by the United States. The agreement specifies that, while the lease continues, the United States has "complete jurisdiction and control" over the leased premises, but Cuba has "sovereignty." After careful examination of prior cases, Judge Arterton found the latter controlling: "Because the 1903 Lease of Lands Agreement clearly establishes Cuba as the de jure sovereign over Guantanamo Bay, this Court need not speculate whether the United States is the de facto sovereign over the area." (fn19) Thus the case was dismissed for lack of subject matter jurisdiction, probably leaving plaintiff with no remedy at all.
C. Nazarici v. 0.J. Thrall Inc. (fn20)
Defendant is a Connecticut shade tobacco company, which hired Puerto Rican workers, including the plaintiffs, through the Connecticut and federal Departments of Labor. (fn21) The plaintiffs were discharged after one month instead of the contractual three months. Upon their return to Puerto Rico, they sued for breach of contract. Defendant was properly served but did not appear and a default judgment was entered by the Puerto Rican court. Plaintiffs applied to the Connecticut Superior Court for enforcement pursuant to the full faith and credit clause of the United States Constitution. (fn22)
Defendant argued that it did not itself extend offers to the plaintiffs, either directly or through the Department of Labor in Puerto Rico as its agent, and did not otherwise transact business in Puerto Rico, but the court found defendant's activities sufficient to satisfy the "minimum contacts" standard of International Shoe. (fn23) Most interesting for present purposes, however, is this additional argument, quoted from defendant's trial brief:
It is certainly inconvenient for Defendants to be hauled into a court some 2,000 miles away from their domicile, for a proceeding which is convened in a foreign language, and in a small town in what may appropriately be considered by them to be a foreign country. Moreover, this inconvenience applies equally to every single witness that could be called by Defendants to support [sic] the notion that Plaintiffs were wrongfully terminated, since every such witness would be a Thrall employee from Connecticut. (fn24)
Judge Freed's response was short and pointed:
As both parties must suffer the same inconveniences, as between the two, the Thrall corporation, rather than the migrant workers, is in the better position to bear this burden. (fn25)
As the world becomes smaller and Connecticut residents engage in more and more international transactions, garden variety matters acquire an international component. This is seen most often because plaintiffs do not properly arrange for service of process to countries that are parties to the Hague Service Convention. This unnecessarily subjects their lawsuits to dismissal and a risk of the claim becoming barred by the statute of limitations.
*. Of the Meriden Bar.
**. Of the Hartford Bar.
1. Several international cases with Connecticut aspects, but litigated elsewhere, were decided by the United States Court of Appeals for the Second Circuit. In International Minerals and Resources, S.A. v. Pappas, 96 F.3d 586 (1996), Liberian and Panamanian corporations sued, in the Southern District of New York, two Connecticut residents and several corporations based in New Jersey and Texas over the rights to a vessel that ran aground in Venezuela. Among other points, the Second Circuit upheld a contractual choice of English law. The case is discussed in a student note in 10 NY INT'L L. Rev. 227 (1997). United States v. Harris, 79 F.3d 223 (1996), was Will Harris's mostly unsuccessful appeal of his 188-month sentence and $200 million restitution order, after trial in the Southern District of New York, for wire and bank fraud, money laundering and conducting a financial crimes enterprise. (The matter was remanded for further proceedings on the restitution issue only.) Many of the criminal acts took place in Connecticut, where Arochem Corporation, of which Harris was president, chief executive officer and majority shareholder, had its principal offices. In Banque Franco-Hellenique de Commerce International et Maritime, S.A. v. Christophides, 106 F.3d 22 (1997), a Greek bank sued, in the Southern District of New York, the Connecticut guarantor of a loan for the purchase of a ship. The Second Circuit's January 1997 decision is concerned primarily with misrepresentation and who knew when that the loan was secured through a bribe.
2. 22 C.F.R. Part 131. When these regulations were first issued, in 1957, they provided for only a single Department of State Authentication Officer. The volume of such requests is so high today that it is no longer possible for a single person to perform this function. Therefore, the new regulations, 61 Fed. Reg. 39584 (July 30, 1996, effective immediately), provide for Assistant Authentication Officers, which should speed up the process of legalizing documents.
3. 0ct. 5, 1961; 527 U.N.T.S. 189, 33 U.S.T. 883, TIAS No. 10072, 90 I.L.M. 1405, U.S.C.S. International Agreements 465 (1996); entered into force for the United States, Oct. 15, 1981.
4. 95 Conn. Super. LEXIS 3575 (Dec. 16, 1995).
5. Nov. 15, 1965, 658 U.N.T.S.., 20 U.S.T. 361, TIAS No. 6638, entered into force for the United States, Feb. 10, 1969; reprinted as a note at 28 U.S.C.A., Fed.R.Civ.P., Rule 4, and in the MARTINDALE-HUBBELL Law DIRECTORY.
6. See Lowry & Schroth, Survey of 1991 Developments in International Law in Connecticut, 66 CONN. B.J. 65-68 (1992).
7. See, e.g., Robillard v. Asahi Chemical Industry, 1995 Conn. Super LEXIS 3109 (Nov. 7, 1995), and discussion in Lowry & Schroth, Survey of 1995 Developments in International Law in Connecticut, 70 CONN. B.J. 68, 79-81 (1996).
8. 30 F.Supp. 36 (D.Conn. 1996).
9. 95 Conn. Super. LEXIS 3607 (Dec. 22, 1995).
10. This section was repealed effective January 1, 1997.
11. Standard Tallow Corp. v. Jowdy, 190 Conn. 48, 54 (1983).
12. Super. Ct. Docket No. CV-96-0472229-S (Holzberg, J.) U. 0. Hartford-New Britain at New Britain).
13. Compare Lowry & Schroth, Survey of 1994 Developments in International Law in Connecticut, 68 CONN. B.J. 143, 147-149 (1995).
14. 996 Conn. Super. LEXIS 787 (Mar. 21, 1996).
15. 923 F.Supp. 338 (D.Conn. 1996).
16. 28 U.S.C. §§ 1346, 2671 et seq.
17. This is because the Federal Tort Claims Act expressly excludes waiver of the sovereign immunity of the United States for "any claim arising in a foreign country." 28 U.S.C. § 2680(k).
18. Feb. 16-23, 1903, T.S. No. 418; reaffirmed, Relations with Cuba, May 29, 1934, T.S * No. 866. The current government of Cuba does not recognize these treaties, but the United States government considers them still in force.
19. 23 F.Supp. at 343.
20. 1996 Conn. Super. LEXIS 1210 (May 13, 1996).
21. Using the United States Employment Service established pursuant to the Wagner-Peyser Act, 29 U.S.C. § 1738.
22. U.S. Const. art IV, § 1; 28 U.S.C. § 1738. The Uniform Enforcement of Foreign Judgments Act, CONN. GEN. STAT, § 52-604 et seq., did not apply, because the judgment was obtained by default.
23. International Shoe Co. v. State of Washington, 326 U.S. 310 (1945).
24. 1996 Conn. Super. LEXIS 1210 at *46.
25. Id. at *46-47.