COLUMBIA AIR SERVICES, INC. v. STATE OF CONNECTICUT, DEPARTMENT OF TRANSPORTATION et al., SC 18142

Judicial District of New London

 Sovereign Immunity; Breach of Contract; Whether Allegations of Complaint were Sufficient to Show Contractual Relationship Between Plaintiff and State; Whether Allegations were Sufficient to Show Due Process and Equal Protection Violations. The plaintiff leases land from the state at Groton-New London Airport for purposes of providing services to general aviation users.  In 2003, in response to the plaintiff's request to lease and develop a 2.6 acre abutting lot, the state held the prospective leasehold and development rights out for public bid.  By letter dated February 6, 2004, the state informed the plaintiff that its proposal was successful and that it would be contacted soon to begin the agreement negotiation process.  By March, 2006, neither a temporary agreement nor a formal lease and operating rights agreement had been negotiated and executed.  Subsequently, the state denied the plaintiff's request for an extension of time to secure funding to cover cost increases that had occurred over the two year period.  As the plaintiff was unable to meet the state's construction schedule, the state rescinded its decision awarding the plaintiff the leasehold and development rights.  Thereafter, seeking injunctive and declaratory relief and money damages, the plaintiff filed this action, claiming, among other things, that the state breached its contract by putting the project on hold and by failing, over the course of a twenty-five month period,  to issue a temporary agreement or sign a lease and operating rights agreement.  The plaintiff also alleged that the state had fraudulently represented that it would honor its agreement and that the state deprived it of its rights to due process and equal protection by arbitrarily terminating the contract and by engaging in collusive contacts with the plaintiff's competitors.  The state filed a motion to dismiss the complaint, which the trial court granted on the basis of sovereign immunity.  In reaching this decision, it found that the allegations were insufficient to show the existence of a contractual relationship between the parties or that the plaintiff reasonably relied on the state's alleged promises.  With respect to the contractual claims seeking injunctive relief, it found, among other things, that because there was no contractual relationship, the allegations failed to show that the state had acted in excess of its statutory authority and, hence, these claims were insufficient to overcome the presumption of immunity.  It also found that the fraud allegations were insufficient to overcome a sovereign immunity bar.  As to the due process claim, the court ruled that because no contractual relationship existed, the plaintiff had no constitutionally protected property or liberty interest that was at risk.  The plaintiff's equal protection claim, it found, was also precluded because there was no factual basis for the plaintiff's assertion that the state had treated differently a similarly situated competitor.  On appeal, the Supreme Court will decide if the trial court's decisions were correct.