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Full Opinion
MEMORANDUM AND ORDER
“As you will see, it’s not all about the money in life: it’s about health, love, respect, happiness and then at some point about the money, which is the only thing that will survive all of us.”
—Plaintiff Emel Dilek
The employee is Plaintiff Emel Dilek, who filed her complaint in this action on May 3, 2011. (Dkt. No. 1. (“Compl.”).) She alleges breaches of contract and of the duty of good faith and fair dealing by the company, her former employer, Defendant Watson Enterprises, Inc. (“Defendant” or “WEI” or the “Company”). (Id.) WEI’s two counterclaims against Dilek allege unjust enrichment and civil theft and were filed on July 29, 2011. (Defendant’s Amended Answer and Counterclaims, Dkt. No. 10 (“Ans.”).) Currently before the Court are three motions: WEI’s motion for summary judgment as to Dilek’s claims (Dkt. No. 21); Dilek’s motion for summary judgment as to her contract claim and WEI’s counterclaims (Dkt. No. 36); and Dilek’s motion for sanctions against WEI and its counsel on the ground that their counterclaims against Dilek are frivolous (Dkt. No. 41). For the reasons discussed below, WEI’s motion for summary judgment is denied; Dilek’s motion for summary judgment is denied in part and granted in part; and Dilek’s motion for sanctions is denied.
I. Background
This background statement of facts is drawn primarily from the four Rule 56.1 statements submitted by the parties.
A. Watson Enterprises, Inc.
Beginning in 1983, Defendant Watson Enterprises, Inc. operated a car dealership under the trade name Mercedes-Benz of Greenwich. (Watson’s Statement Pursuant to Local Civil Rule 56.1 in Support of Its Motion for Summary Judgment, Dkt. No. 48 (“WEI 56.1 Statement”), ¶¶ 1, 3; Plaintiffs Response to Defendant’s Statement Pursuant to Local Civil Rule 56.1, Dkt. No. 60 (“Dilek 56.1 Counterstatement”), ¶¶ 1, 3.) In 1995, the sole shareholder of WEI, Arthur “Kitt” Watson (“Watson”), sold a twenty-five percent share in the Company to Ronald Pecunies, who became WEI’s chief operating officer (“COO”). (WEI 56.1 Statement ¶¶4, 7; Dilek 56.1 Counterstatement ¶¶ 4, 7; Stock Purchase Agreement including Shareholders’ Agreement, Dkt. No. 10-1 (“Stock Purchase Agreement”), § 8.3, appended as Ex. 1 to Watson’s Amended Answer and Counterclaims, Dkt. No. 10). Their agreement provided that “except as otherwise provided herein, decisions relating to day-to-day operations of the Corporation shall be determined by the holder(s) of the majority of the shares of the Corporation” and further provided that “[i]t [is] of the essence of this Agreement that [Pecunies] be active in the day to day management of the Corporation, and that [he] use due diligence and his best efforts and make the Corporation financially successful....” (Stock Purchase Agreement §§ 7.6(e), 8.3.)
In practice, Watson’s responsibilities at WEI included speaking to his accountant, signing payroll checks, and checking the books of the Company. (Deposition Transcript of Arthur Watson (“Watson Tr.”) at 14:21-15:14, appended as Ex. 11 to Decía
B. Enter Emel Dilek
Dilek and Pecunies first met on January 28, 2004, and they began a romantic relationship shortly thereafter. (WEI 56.1 Statement ¶ 16; Dilek 56.1 Counterstatement ¶ 16.) On October 3, 2005, Plaintiff began living together with Pecunies at an apartment he leased at 220 Central Park South in New York City. (WEI 56.1 Statement ¶ 17; Dilek 56.1 Counterstatement ¶ 17.) On or about October 10, 2005, WEI hired Dilek as its Business Development Center Manager with a starting salary of $60,000. (WEI 56.1 Statement ¶ 18-19; Dilek 56.1 Counterstatement ¶ 18-19; Notice of Wages and Benefits, Dkt. No. 23-4 (“Employment Letter Agreement”), appended as Ex. 4 to Reiter Decl.) Dilek asserts that it was Pecunies who hired her. (Declaration of Emel Dilek, Dkt. No. 39 (“Dilek Deck”), ¶ 3.) Plaintiffs Employment Letter Agreement provided that WEI
adheres to a policy of employment-at-will. Either the employee or the Company is at will to terminate the employment relationship at any time, with or without cause. Upon termination for any reason the Company will not pay accrued but unearned benefits.
(Employment Letter Agreement at 2 (emphasis in original).) The letter agreement also delineated WEI’s vacation and personal time policy, which allowed Plaintiff certain limited amounts of paid time off. (Id. at 1.) The letter agreement provided that its “terms ... may be changed at any time, with or without notice, at the sole discretion of the management of Watson Enterprises Incorporated.” (Id. at 2.)
C. Dilek’s Accolades, Recognition, and Compensation
In 2006, Dilek’s salary was raised from $60,000 to $100,000 per year. (Dilek’s Statement of Material Facts Pursuant to Local Rule 56.1, Dkt. No. 38 (“Dilek 56.1 Statement”), ¶ 12; Watson’s Counterstatement of Facts Pursuant to Local Civil Rule 56.1 in Opposition to Plaintiffs Motion for Summary Judgment, Dkt. No. 53 (‘WEI 56.1 Counterstatement”), ¶ 12.) In 2007, her salary was raised again to $120,000 per year plus additional benefits. (Dilek 56.1 Statement ¶ 14; WEI 56.1 Counterstatement ¶ 14.) Dilek was informed of these raises by Pecunies and the dealership’s general manager, Russ Baird. (Declaration of Emel Dilek, Dkt. No. 39 (“Dilek Deck”), ¶¶ 5, 6; Dilek 56.1 Statement ¶¶ 13, 15; WEI 56.1 Counterstatement ¶¶ 13, 15.) Also in 2007, Dilek was promoted from Business Development Center Manager to Business Development and Marketing Manager. (Dilek 56.1 Statement ¶ 16; WEI 56.1 Counterstatement ¶ 16.) She was informed of that promotion by Pecunies. (Dilek Deck ¶ 6; Dilek 56.1 Statement ¶ 17; WEI 56.1 Counterstatement ¶ 17.)
During her tenure at WEI, Dilek received numerous certifications in the Mercedes-Benz Standards of Excellence Program. (Dilek Deck, Exs. 1-4; Dilek Deck ¶ 6; Dilek 56.1 Statement ¶¶ 18-22; WEI 56.1 Counterstatement ¶¶ 18-22.) On June 27, 2008, she received an email message from WEI’s president, Watson, telling her “[t]hank you Emel for doing a bang up job two thumbs up.” (Email from Watson to Dilek, dated June 27, 2008, appended as Ex. 6 to Dilek Deck) She received another email from Watson on November 18, 2008, which concluded, “Keep up the good work.” (Email from Watson to Dilek, dated November 18, 2008, appended as Ex. 5 to Dilek Deck; Watson
D. Dilek’s Dereliction
During her employment with the Company, Dilek and Pecunies took numerous vacations together throughout the world. (Deposition Transcript of Emel Dilek (“Dilek Tr.”) at 85:19-91:24, 94:13-99:20, appended as Ex. 2 to Reiter Decl.)
With Pecunies’s permission, Dilek used his company credit card, and then her own company credit card, from 2007 until Pecunies’s death in May 2010. (Dilek 56.1 Statement ¶¶ 54-56; WEI 56.1 Counter-statement ¶¶ 54-56.) The Company deducted from Pecunies’s earnings amounts that Pecunies or Plaintiff identified as personal charges to those cards. (Dilek 56.1 Statement ¶¶ 57-59; WEI 56.1 Counter-statement ¶ 58.) WEI asserts that Pecunies had not repaid WEI for all of Dilek’s personal credit card expenses before the time he died. (WEI 56.1 Counterstatement ¶ 61-62; Dilek 56.1 Statement ¶ 62 (partially agreeing).) Watson testified that WEI sought reimbursement for those charges in an arbitration against Pecuniés’s estate. (Watson Tr. 75:2-8, 76:3-9.) WEI and Pecunies’s estate reached a confidential settlement of that arbitration in December 2011. (Declaration of Nicholas M. Reiter in Further Support of Watson’s Motion for Summary Judgment and in Opposition to Plaintiffs Motion for Summary Judgment, Dkt. No. 50 (“2d Reiter Decl.”), ¶ 20.)
Watson asserts that Dilek’s company credit card use was improper. His deposition testimony includes the following exchange:
Q: When did you first become aware that Ms. Dilek was, in your words, misusing the company credit card?
A: Pretty near from the start.
Q: So from around 2005?
A: Yes.
(Watson Tr. at 69:20-25.) In a declaration submitted with WEI’s motion papers, Watson has asserted that, although he “was aware during Plaintiffs employment that she, on occasion, used Mr. Pecunies’s corporate credit card,” he “did not learn until shortly before Mr. Pecunies’s death in May 2010 of the considerable number of purchases Plaintiff made using the Company’s corporate credit card.” (Declaration of Arthur K. Watson in Further Support of Watson’s Motion for Summary Judgment and in Opposition to Plaintiffs Motion for Summary Judgment, Dkt. No. 51 (“2d Watson Decl.”), ¶ 4.)
WEI asserts that the Company paid Dilek’s mobile phone bills. (Declaration of John Cox in Support of Watson’s Motion for Summary Judgment and in Opposition to Plaintiffs Motion for Summary Judgment, Dkt. No. 52 (“Cox Decl.”), ¶¶ 6-7; WEI 56.1 Counterstatement ¶ 64 (citing WEI financial documents, Dkt. No. 40-3 (“WEI Financial Documents”), appended as Ex. 13 to Fudim Decl., at WATSON 0000692-0000719).) Dilek concedes that WEI paid her mobile phone bills but avers that Pecunies charged those bills to the Company without her knowledge.
E. The 2009 Employment Agreement
On or about January 1, 2009, Pecunies (purportedly on behalf of WEI) and Dilek signed an employment agreement, which provided that Dilek would continue for a four-year term of employment as WEI’s Business Development Center and Marketing Manager. (Compl. ¶ 11; Employment Agreement, appended as Ex. 1 to Compl.; Dilek 56.1 Statement ¶¶ 28-29; WEI 56.1 Counterstatement ¶¶ 28-29.) The Employment Agreement promised Dilek “an annual (gross) salary of ONE HUNDRED TWENTY [sic ] ($120,000.00) DOLLARS,” in addition to commissions and other benefits. (Employment Agreement at 1.) The Employment Agreement called for Dilek to pay the Company consideration of one dollar. (Id.)
Dilek testified that she was aware that Watson sometimes prohibited Pecunies from firing certain employees at WEI, though Pecunies wanted to do so. (Dilek Tr. 60:4-23, 58:4-59:7; see also August 25, 2011 Dilek Email at 3-4 of 9.) Dilek did not ask Pecunies whether he had authority to enter into the Employment Agreement or whether he had discussed the Employment Agreement with Watson. (Dilek 56.1 Statement ¶¶ 35-36; WEI 56.1 Counter-statement ¶¶ 35-36.) When asked at her deposition whether Watson had said or done “anything that made you think he had authorized Mr. Pecunies to offer you an employment contract,” Dilek answered, “I don’t remember.” (Dilek Tr. at 63:3-10.)
F. The End of Dilek’s Employment
In October 2009, Pecunies was diagnosed with pancreatic cancer, and the Company granted Dilek leave as of May 7, 2010. (Dilek 56.1 Statement ¶¶ 66-67; WEI 56.1 Counterstatement ¶¶ 66-67.) During her leave, Dilek traveled to Germany and also attended the 2010 Cannes Film Festival in France. (WEI 56.1 Statement ¶ 55; Dilek 56.1 Counterstatement ¶ 55.)
Pecunies died on May 22, 2010. (WEI 56.1 Statement ¶ 51; Dilek 56.1 Counter-statement ¶ 51.) On August 26, 2010, WEI terminated Dilek’s employment. (WEI 56.1 Statement ¶56; Dilek 56.1 Counterstatement ¶ 56.) When asked at his deposition what his basis had been for terminating Dilek, Watson answered, “[t]hat I don’t want my ex-partner’s girlfriend working for me. Or fiancee, excuse me.” (Watson Tr. at 80:2-4.)
Summary judgment is appropriate where “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). The “mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) (internal quotation marks and citation omitted). “A fact is ‘material’ when it might affect the outcome of the suit under governing law,” and “[a]n issue of fact is ‘genuine’ if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 202 (2d Cir.2007) (internal quotation marks and citation omitted).
When determining whether a genuine dispute of material fact exists, a court must view the facts in the light most favorable to the non-moving party and draw all reasonable inferences in that party’s favor. See Fincher v. Depository Trust & Clearing Corp., 604 F.3d 712, 720 (2d Cir.2010).
“A court faced with cross-motions for summary judgment need not ‘grant judgment as a matter of law for one side or the other,’ but ‘must evaluate each party’s motion on its own merits, taking care in each instance to draw all reasonable inferences against the party whose motion is under consideration.’ ” Cariou v. Prince, 784 F.Supp.2d 337, 345 (S.D.N.Y. 2011) (quoting Heublein, Inc. v. United States, 996 F.2d 1455, 1461 (2d Cir.1993)) (internal quotation marks not referring to quotation from Heublein omitted).
III. Discussion
The parties agree that Connecticut law governs this action. Accordingly, the Court may apply Connecticut law without engaging in a choice-of-law analysis. See Motorola Credit Corp. v. Uzan, 388 F.3d 39, 61 (2d Cir.2004) (Even “implied consent is sufficient to establish choice of law.” (internal quotation marks and ellipses omitted)).
This discussion addresses in turn (1) Dilek’s motion and WEI’s cross-motion for summary judgment as to Dilek’s claims; (2) Dilek’s motion for summary judgment as to WEI’s counterclaims; and (3) Dilek’s motion for sanctions.
A. Breach of Contract and of the Duty of Good Faith and Fair Dealing
Under Connecticut law, “[t]he elements of a breach of contract action are the formation of an agreement, performance by one party, breach of the agreement by the other party and damages.” Rosato v. Mascardo, 82 Conn.App. 396, 411, 844 A.2d 893 (2004) (internal quotation marks omitted). Plaintiffs claim for breach of the duty of good faith and fair dealing (addressed by WEI’s summary judgment motion but not Dilek’s) is considered together with her contract claim because both of these claims depend upon the existence of an enforceable contract between the parties. See Macomber v. Travelers Property & Cas. Corp., 261 Conn. 620, 638, 804 A.2d 180 (2002) (“As our case law makes clear, no claim for breach of the duty of good faith and fair dealing will lie for conduct occurring prior to, or during, the formation of a contract.”).
Here, the parties’ dispute centers on whether Pecunies had authority sufficient to bind WEI to the Employment Agreement and, as a result, whether the
1. Burden of Proof Concerning Pecunies’s Authority
Plaintiff correctly notes that, under New York choice-of-law rules, the parties’ choice of law governs substantive but not procedural issues. See Phillips v. Audio Active Ltd., 494 F.3d 378, 384-85 (2d Cir. 2007) (citing Woodling v. Garrett Corp., 813 F.2d 543, 551-52 (2d Cir.1987)). “The question of burden of proof ... is regarded by New York law as a question of procedure to which the law of the forum applies.” Woodling, 813 F.2d at 552; see also Bensen v. American Ultramar, 1997 WL 66780, at *14 n. 26, 1997 U.S. Dist. LEXIS 1608, at *47 n. 26 (S.D.N.Y. Feb. 13,1997).
New York law on the burden of proof as to a corporate official’s contracting authority today remains largely as it was explained by Judge Learned Hand in 1934: “whatever powers are usual in the business may be assumed to have been granted; but the presumption stops there, as much in the case of a president as of any other officer, though naturally in degree they may greatly differ.” Schwartz v. United Merchants & Mfrs., Inc., 72 F.2d 256, 258 (2d Cir.1934). Thus, a corporate official’s authority to bind a corporation without express say-so “exists only as to matters which are ‘usual’ or ‘ordinary,’ and ... the burden rests upon the party challenging the [official’s] authority to show that the transaction was ‘unusual’ or ‘extraordinary.’ ” Pettit v. Doeskin Products, Inc., 270 F.2d 95, 99 (2d Cir.1959). The Second Circuit has more recently elaborated that
[u]nder New York law it is settled that, in order to bind a corporation to an “extraordinary” or “unusual” contract entered into between a corporate official and another party, it is necessary to show that the official had express authority to enter into the contract. Pettit v. Doeskin Prods., Inc., 270 F.2d 95, 99 (2d Cir.1959), cert. denied, 362 U.S. 910, 80 S.Ct. 660, 4 L.Ed.2d 618 (1960); see also Scientific Holding Co. v. Plessey Inc., 510 F.2d 15, 23-24 (2d Cir.1974); Schwartz, 72 F.2d at 258. In Pettit, we noted that “what is usual or ordinary necessarily depends on the circumstances of the particular case.” 270 F.2d at 99.
Burke v. Bevona, 931 F.2d 998, 1001 (2d Cir.1991) (citation omitted in part).
Thus, WEI bears the burden to show that the contract is unusual. Only if WEI carries that burden, Dilek then bears the burden to show that Pecunies had authority to bind WEI in the Employment Agreement. If WEI does not show that the contract is legally unusual, then WEI bears the burden to prove its affirmative defense that Pecunies lacked the relevant authority. See Barton Group, Inc. v. NCR Corp., 796 F.Supp.2d 473, 498 (S.D.N.Y. 2011) (“[A] defendant asserting an affirmative defense bears the burden of proof with respect to that defense.” (citation omitted)).
Cases discerning whether contracts are ordinary focus chiefly on the terms of the agreements and on industry practices. In the Second Circuit’s Burke case, cited
Most decisions ignore the particular principal’s practices in determining whether an agreement is unusual, but some decisions do consider those practices. See, e.g., Sequa Corp. v. Gelmin, No. 91 Civ. 8675(DAB), 1996 WL 745448, 1996 U.S. Dist. LEXIS 19802 (S.D.N.Y. Dec. 31, 1996) (corporation challenging agreement’s validity had “failed to establish as a factual or legal matter that [the agreement] was ‘extraordinary’, ‘unusual’, or outside of the ordinary course of [the corporation’s] business”).
As Plaintiff argues, the Employment Agreement here was “a facially enforceable urritten contract for a term of years, signed by Defendant’s COO, which promised reasonable, not extraordinary compensation. There is nothing unusual about the contract on its face.” (Pl.’s Reply Br., Dkt. No. 61, at 2.) Certainly, in a general sense, there is nothing extraordinary about a corporate executive concluding an employment agreement with an employee. However, beyond the innocuous face of the contract, there are two ways in which the Employment Agreement could be called unusual. First, it contravened or changed WEI’s policy of at-will employment, and second, it was executed by Pecunies and Dilek, who were lovers.
To the extent that the corporate practices of WEI in particular are relevant, Watson asserts that the Company had never before offered any employee a guaranteed term of employment. (Declaration of Arthur K. Watson in Support of Watson’s Motion for Summary Judgment, Dkt. No. 23-1 (‘Watson Decl.”), appended as Ex. 1 to Reiter Decl., ¶ 15.) And indeed, Plaintiffs original Employment Letter Agreement provided that WEI “adheres to a policy of employment-at-will.” (Employment Letter Agreement at 2 (emphasis in original).) But the Employment Letter Agreement also provided that its “terms ... may be changed at any time, with or without notice, at the sole discretion of the management of Watson Enterprises Incorporated.” (Id.) Thus, as embodied in the Employment Agreement Letter, WEI’s policy was employment-at-will unless and until management chose a different policy. Pecunies was clearly “management of Watson Enterprises Incorporated.” As stated in the Employment Letter Agreement, the Company’s malleable policy does not, on its own, make the contract legally extraordinary.
Then there are the noteworthy circumstances of Dilek’s relationship with Pecunies. Ultimately, however, these special circumstances make it appear more obvious, not less, that WEI allowed Pecunies a free hand in setting the terms of Dilek’s employment. Not only had Pecunies in
Q: You agree with the statement that in the five years that Ms. Dilek was employed by Watson Enterprises she provided no benefit whatsoever to Watson Enterprises?
A: I don’t believe she did.
Q: You continued to pay her during that time period?
A: It was Ron’s girlfriend.
Q: Is that a yes?
A: Yes.
(Watson Tr. at 66:20-67:5.)
Q: Did you ever put Ms. Dilek on written notice of her abuse of fringe benefits?
A: No. She was going out with Ron.
{Id. at 61:5-7.)
Q: Do you know how much money Ms. Dilek was earning when she was hired by Watson Enterprises?
A: I don’t know. Once again, Ron’s girlfriend.
{Id. at 67:9-12.)
Q: Do you know how much money she was earning at any point during her employment?
A: No. Ron’s girlfriend.
{Id. at 68:7-9.)
Q: You have no knowledge of whether she received a raise?
A: No. Ron’s girlfriend.
{Id. at 68:18-15.)
Q: Did you ever notify Ms. Dilek of the problems you were experiencing with her management style?
A: I wasn’t going to touch that with a ten-foot pole.
Q: That’s a no?
A: That’s a no.
{Id. at 47:6-12.)
Thus, while the circumstances surrounding this contract are unusual in a theatrical sense — indeed, they are worthy of a made-for-television movie — the contract itself is not unusual in the relevant legal sense. Accordingly, Plaintiff does not bear the burden to prove Pecunies’s authority to bind WEI. Rather, in raising an affirmative defense that Pecunies lacked such authority, Defendant bears the burden to prove as much. See Barton Group, Inc., 796 F.Supp.2d at 498.
2. Pecunies’s Authority
The Connecticut Supreme Court has held that “[a]n agent’s authority may be actual or apparent.” Ackerman, 298 Conn, at 508 (internal quotation marks, alterations, and citation omitted). As discussed below, genuine disputes of material fact exist as to both Pecunies’s actual authority and his apparent authority with regard to Dilek’s Employment Agreement.
i. Actual Authority
“Actual authority may be express or implied.” Maharishi Sch. of Vedic Scis., Inc. (Conn.) v. Conn. Constitution Assocs. Ltd. P’shp, 260 Conn. 598, 607, 799 A.2d 1027 (Conn.2002) (citation omitted). “Implied authority is actual authority circumstantially proved. It is the authority which the principal intended his agent to possess.” Id. (internal quotation marks and citation omitted). “Implied authority is a fact to be proven by deductions or inferences from the manifestations of consent of the principal and from the acts of the principal and [the] agent.” Id. (internal quotation marks and citation omitted).
WEI asserts that Pecunies lacked actual authority to bind WEI in an employment agreement for a term of years.
The evidence behind these assertions is sufficient to create genuine issues of material fact as to whether authority to offer the Employment Agreement was “authority which the principal [WEI] intended [its] agent [Pecunies] to possess.” Maharishi Sch. of Vedic Scis., Inc., 260 Conn, at 607, 799 A.2d 1027 (citation omitted). Accordingly, neither party is entitled to summary judgment as to Pecunies’s actual authority,
ii. Apparent Authority
Under Connecticut law,
apparent authority is that semblance of authority which a principal, through his own acts or inadvertences, causes or allows third persons to believe his agent possesses. Consequently, apparent authority is to be determined, not by the agent’s own acts, but by the acts of the agent’s principal. The issue of apparent authority is one of fact to be determined based on two criteria. First, it must appear from the principal’s conduct that the principal held the agent out as possessing sufficient authority to embrace the act in question, or knowingly permitted the agent to act as having such authority. Second, the party dealing with the agent must have, acting in good faith, reasonably believed, under all the circumstances, that the agent had the necessary authority to bind the principal to the agent’s action.
Ackerman, 298 Conn, at 508-09 (internal quotation marks, alterations, and citation omitted).
Generally, “[e]ven where a party is an actual agent, another party dealing with that agent has an affirmative duty to inquire as.to the scope of the agent’s authority. A party must display that degree of common sense which distinguishes good faith from blind faith.” Hartford Whalers Hockey Club v. Uniroyal Goodrich Tire Co., No. CV89-0363496S, 1993 WL 301011, at *3 (Conn.Super.Ct. July 28, 1993), aff'd, 231 Conn. 276, 649 A.2d 518 (1994) (internal quotation marks, alterations, and citation omitted); see also Hollywyle Ass’n, Inc. v. Hollister, 164 Conn. 389, 397, 324 A.2d 247, 252 (1973). However, “[apparent authority may be derived from a course of dealing,” Edart Truck Rental Corp. v. B. Swirsky & Co., 23 Conn.App. 137, 140, 579 A.2d 133 (Conn.App.Ct.1990) (citing 3 Am.Jur.2d, Agency § 79), apparently such that- the duty to inquire evapo
WEI argues that Peeunies had no apparent authority. The Company notes that (1) WEI had communicated its at-will employment policy to Dilek in the Employment Letter Agreement; (2) Dilek knew of limitations on Pecunies’s authority in matters of employment and human resources; and (3) Watson had done nothing to suggest that Peeunies had authority to guarantee an employee a set term of employment. Supporting Plaintiffs argument for apparent authority is evidence showing (1) that WEI paid her increased salaries after Peeunies informed Dilek of her promotion and, with Baird, of her raises and (2) Watson’s substantial delegation to Peeunies in matters relating to Dilek’s employment. The evidence behind the parties’ arguments is sufficient to create genuine issues of material fact as to whether WEI “cause[d] or allow[ed] third persons [Dilek] to believe [its] agent [Peeunies] possessed]” authority to offer the Employment Agreement. Ackerman, 298 Conn. at 508.
Further, genuine issues of material fact exist as to whether Dilek’s prior course of dealings with WEI, particularly Watson’s delegation of her employment matters to Peeunies, excused her failure to inquire into the Company COO’s authority to offer her an employment contract for a term of years.
Because genuine issues of material fact exist as to whether Peeunies had apparent authority to bind WEI with Dilek’s Employment Agreement, neither party is entitled to summary judgment on this point.
3. Agent Actions Adverse to Principal
Under Connecticut law, “when a corporate officer or agent engages in fraudulent conduct for the distinctly private purpose of lining his own pockets at his corporation’s expense, it is unlawful, as well as illogical, to impute the agent’s guilty knowledge or disloyal, predatory conduct to his corporate principal.” Reid-er v. Arthur Andersen, LLP, 47 Conn. Supp. 202, 211, 784 A.2d 464, 470 (Super.Ct.2001). “Unless the agent’s activity in pursuit of that scheme somehow benefits the corporation, the corporation cannot be made responsible for the agent’s fraud.” Id.
Defendant argues that, in concluding the Employment Agreement with a derelict employee, Peeunies was acting in a manner adverse to the interests of WEI. But Dilek has adduced evidence that she received numerous certifications in the Mercedes-Benz Standards of Excellence Program; received email messages from Watson lauding her job performance; and never received notice of any deficiency in her job performance. This evidence is enough to raise a genuine issue of material fact as to whether Peeunies was acting in WEI’s interests to retain a valuable employee or against WEI’s interests and in his own or Dilek’s interests to do well by his fiancée. The Court cannot conclude as a matter of law either that Dilek was a worthless employee whose retention would necessarily be adverse to WEI’s interests or that Peeunies was, in fact, acting in the Company’s interests. Accordingly, no party is entitled to summary judgment on this point.
4. Consideration
Under Connecticut law, “the general rule [is] that in the absence of consideration an executory promise is unenforceable. Consideration consists of a benefit
This hedging is appropriate because the reason continued employment is generally insufficient for consideration is that “[a] modification of an agreement must be supported by valid consideration and requires a party to do, or promise to do, something further than, or different from, that which he is already bound to do.” Thermoglaze, Inc. v. Morningside Gardens Co., 23 Conn.App. 741, 745, 583 A.2d 1331, 1333 (1991) (citation omitted). “It is an accepted principle of law in [Connecticut] that when a party agrees to perform an obligation for another to whom that obligation is already owed, although for lesser remuneration, the second agreement does not constitute a