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Macomber v. Travelers Property and Casualty Corp.9/3/2002
me stream than they in fact did. Thus, the plaintiffs have alleged two harms: a reduced value to their annuity; and a reduced income stream resulting therefrom. Furthermore, in the event that the plaintiffs prove these allegations at trial, we cannot rule out, at this stage, that the trial court, in its discretion, would impose a constructive trust, for the benefit of the plaintiffs, for the difference between the two amounts--namely, the represented cost of the annuity, and the actual cost thereof, or some other type of compensatory relief.
Second, the plaintiffs alleged that they calculated their attorneys' fees based on the total settlement amount. If Travelers Casualty allegedly spent a lesser amount on the annuity than it had agreed to spend, and if we accept as true, as we must, the plaintiffs' assertion that the value of the annuity was represented to equal its cost, then the attorneys' fees were calculated incorrectly, depriving the plaintiffs of a portion of their settlement. For example, in the case of Huaman, assuming that the plaintiffs can prove their short-changing allegation, Travelers Casualty, although agreeing to spend $6667 on an annuity, actually purchased an annuity costing $6569.51. Thus, instead of spending $10,000 on Huaman's settlement as was promised, Travelers Casualty actually spent $9902.51. Based on this sum, Huaman's attorneys' fees would have been $3300, rather than the $3333 that was paid. In addition, under the plaintiffs' rebating allegations, Huaman overpaid her attorneys by an even greater amount.
The defendants contend, nonetheless, as the trial court determined, that the plaintiffs cannot ''allege any legally cognizable injury '' because, first, with respect to the rebating allegations, the plaintiffs do not, and cannot, allege how or why they are entitled to any portion of the annuity commission paid by the insurance brokers to Travelers Casualty. The defendants argue that the plaintiffs have received exactly what they bargained for, namely, an annuity that provided the plaintiffs with an agreed upon income stream. The defendants further argue that, because the commission paid by the life insurance company to the broker was both legal and not part of the payments promised to the plaintiffs, it was the ''brokers money to do with as it pleased.... Thefact that the broker later used a portion of that commission allegedly to pay others who provided it with services--whether its lawyers, its accountants or the insurance company whose claims representatives did the leg work in arranging the structure and securing the annuity--does not suddenly make the plaintiffs' decade-old structured settlements the products of a fraud.'' (Emphasis in original.) We disagree.
The plaintiffs alleged that Travelers Casualty promised to spend a certain amount to purchase an annuity. The plaintiffs further alleged that, by ultimately receiving a portion of the broker's commission in the form of a rebate, Travelers Casualty failed to do as promised. The key to the plaintiffs' argument is that, once Travelers Casualty made a representation as to how much the annuity would cost for it to purchase, Travelers Casualty had a duty to disclose any rebates or other schemes that would reduce the final cost of the annuity to Travelers Casualty.
We have held that '' failure to disclose can be deceptive only if, in light of all the circumstances, there is a duty to disclose.'' (Internal quotation marks omitted.) Olson v. Accessory Controls & Equipment Corp., 254 Conn. 145, 180, 757 A.2d 14 (2000). ''Regarding the duty to disclose, the general rule is that . . . silence . . . cannot give rise to an action ... tosetaside the transaction as fraudulent. Certainly this
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