WILLIAM STUART et al. v. KENNETH STUART, JR., et al., SC 18324

Judicial District of Stamford-Norwalk


      Statutory Theft; General Statutes § 52-564; Whether Appellate Court Properly Affirmed Trial Court's Application of Clear and Convincing Standard of Proof to Claims Brought Pursuant to § 52-564.  Kenneth Stuart, Sr., executed an estate plan that included the establishment and funding of a trust and the execution of a will that, upon his death, would have distributed his assets equally among his three sons, namely, William Stuart, Jonathan Stuart and Kenneth Stuart, Jr., who was named as trustee and executor.  Following their father's death, William and Jonathan learned that their father and Kenneth had formed a partnership in 1992 and that most of their father's assets had  been transferred to that entity, leaving the trust with few or no assets.  In 1994, they brought this action, alleging that the defendant, Kenneth, exercised undue influence over their father and used his fiduciary position to misappropriate millions of dollars through numerous illegal transactions.  After the court rendered a judgment of $2,375,528.38 in their favor, the plaintiffs claimed before the Appellate Court (112 Conn. App. 160) that the award was insufficient because, among other things, the court improperly required them to prove their claims for treble damages under General Statutes § 52-564 by clear and convincing evidence.  The Appellate Court rejected this claim and, relying on Schaffer v. Lindy, 8 Conn. App. 96, 105 (1986), concluded that clear and convincing proof of the actions alleged is required under § 52-564.  In reaching this conclusion, it observed that in Freeman v. Alamo Management Co., 221 Conn. 674, 682-83 (1992), the Supreme Court disagreed with the rationale of Schaffer when it decided  that the standard of proof for a claim for punitive damages under General Statutes § 47a-46 was the preponderance of the evidence standard.  The Appellate Court noted, however, that Freeman did not overrule Schaffer and that the Supreme Court has yet to determine the proper standard of proof for statutory theft claims.  The Supreme Court will consider whether the Appellate Court properly affirmed the trial court's application of the clear and convincing standard of proof to claims brought pursuant to § 52-564.