Opinion
UWYCV136017507
08-31-2017
Deutsche Bank National Trust Company, as Trustee v. Regina M. Pinto et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT
Mark H. Taylor, Judge.
I
BACKGROUND AND RELEVANT FACTS
In this action to foreclose the defendants' mortgage, the plaintiff seeks summary judgment as to liability. The defendants object, asserting 1) the plaintiff's breach of a mortgage modification agreement, as set forth in their first special defense, and 2) that summary judgment is premature because discovery is incomplete. Based upon the pleadings, relevant law and facts presented by the parties, the motion for summary judgment is denied.
The defendants' second special defense states: " The Note and Mortgage the Plaintiff seeks to foreclose were entered into by fraud or mistake." As this defense was neither briefed nor argued, the court considers it to have been abandoned.
The court finds the following relevant facts in the record and as asserted by the parties in their affidavits and exhibits. Important to the court's consideration of this matter is the fact that this is the second of two actions brought by the plaintiff to foreclose the defendants' mortgage. The first action was filed with the court on March 19, 2009, bearing docket number CV 09 5012975 S. Although a judgment of foreclosure by sale was entered in the first case on October 26, 2009, the judgment was opened, vacated and subsequently withdrawn on January 28, 2010. This second action to foreclose the defendants' mortgage was filed by the plaintiff over two years later on December 14, 2012, asserting a subsequent default by the defendants on the original mortgage note and deed, as entered into on August 1, 2006 with Countrywide Home Loans, Inc., the plaintiff's predecessor in interest, encumbering 325 Patriot Road, Southbury, Connecticut.
The defendants concede that they defaulted on the mortgage in 2009 because they were no longer able to make the monthly payments on the note of approximately $2,200. The 2009 foreclosure was apparently resolved by a payment to the plaintiff by the defendant, Regina M. Pinto, in the amount of $55,852.31. Although not admitted by the plaintiff, this fact was generally conceded at the hearing on the motion for summary judgment, at which the defendants did not appear. The parties differ, however, as to the purpose and legal effect of this payment.
The defendants assert in their first special defense that the payment of $55,852.31 was consideration for an agreement with the plaintiff to modify monthly payments on the mortgage note from approximately $2,200 per month to $1,300 per month. Affidavit of Ms. Pinto, para. 5. Ms. Pinto asserts in her affidavit that the reduction in her monthly payments, as modified, would have allowed her to remain current on all her loans and obligations. Id., para. 6. Ms. Pinto further asserts that after entering into the agreement and making this substantial payment, the plaintiff failed or refused to modify the monthly payment as agreed. Id., para. 7.
The defendants also object to proceeding on the plaintiff's motion for summary judgment because the plaintiff has been evasive in answering discovery requests, particularly with regard to the payment history on the note prior to September 10, 2010, during which period the modification was alleged to have occurred. On this point and of particular note is the fact that the plaintiff does not dispute the payment of $55,852.31; however, the defendants allege neither the tender nor acceptance by the plaintiff of a modified monthly mortgage payment of $1,300.
The plaintiff counters the factual claim of a modification with two legal claims. First, that modification of the mortgage note is not a proper special defense because it does not attack the making, validity or enforcement of the lien. The second legal claim raises the application of the statute of frauds, as there is no allegation of a written agreement to modify the mortgage loan, originally in the principal amount of $365,000. This allegation of an oral modification of the mortgage note therefore violates the $50,000 limit for loan agreements, as well as a transaction involving an interest in real property. General Statutes § 52-550.
At the time of the first judgment of foreclosure by sale in 2009, the debt was $397,143.79, the approximate time of the alleged mortgage modification and unquestionably in excess of the $50,000 limit on oral loans, as set forth in the statute of frauds, below.
General Statutes § 52-550 provides, in relevant part: " (a) No civil action may be maintained in the following cases unless the agreement, or a memorandum of the agreement, is made in writing and signed by the party, or the agent of the party, to be charged: . . . (4) upon any agreement for the sale of real property or any interest in or concerning real property; . . . or (6) upon any agreement for a loan in an amount which exceeds fifty thousand dollars."
II
SUMMARY JUDGMENT
Pursuant to Practice Book § 17-49, summary judgment " shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." " In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party . . . The party seeking summary judgment has the burden of showing the absence of any genuine issue of material facts which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . and the party opposing such a motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact." J.E. Robert Co., Inc. v. Signature Properties, LLC, 309 Conn. 307, 333, 71 A.3d 492 (2013).
" In order to establish a prima facie case in a mortgage foreclosure action, the plaintiff must prove by a preponderance of the evidence that it is the owner of the note and mortgage, that the defendant mortgagor has defaulted on the note and that any conditions precedent to foreclosure, as established by the note and mortgage, have been satisfied . . . Thus, a court may properly grant summary judgment as to liability in a foreclosure action if the complaint and supporting affidavits establish an undisputed prima facie case and the defendant fails to assert any legally sufficient special defense.
" A mortgagee that seeks summary judgment in a foreclosure action has the evidentiary burden of showing that there is no genuine issue of material fact as to any of the prima facie elements, including that it is the owner of the debt. Appellate courts in this state have held that the burden is satisfied when the mortgagee includes in its submissions to the court a sworn affidavit averring that the mortgagee is the holder of the promissory note in question at the time it commenced the action . . . The evidentiary burden of showing the existence of a disputed material fact then shifts to the defendant. It is for the maker of the note to rebut the presumption that a holder of the note is also the owner of it." (Citations omitted.) Wells Fargo Bank, N.A. v. Strong, 149 Conn.App. 384, 392, 89 A.3d 392 (2014).
There is no dispute between the parties over the plaintiff's standing in this matter to foreclose or that the defendants are in default of the original note and mortgage. The question presented is whether the defendants have presented a material factual basis, sufficient to assert the special defense of modification at trial. The court concludes that they have and that the motion for summary judgment should be denied.
III
DISCUSSION
In the present case, the defendants have asserted a legally sufficient defense to the plaintiff's claim that it is the owner of the note and that the defendants are in default. Although the plaintiff suggests that a modification fails to attack the making, validity or enforcement of the lien, the court has concluded previously that a written modification of a mortgage note is a valid special defense to an action to foreclose a mortgage deed. Wells Fargo Bank, National Association for Asset Backed Sec. Corp. Home Equity Loan Tr., Series OOMC 2005-HE6 v. Bissonnette, Superior Court, Judicial District of Waterbury, Docket No. 14 6024874 (April 28, 2017; Taylor, J.).
This conclusion is supported by the holding in TD Bank, N.A. v. M.J. Holdings, LLC, 143 Conn.App. 322, 330, 71 A.3d 541 (2013), in which an allegation of performance was sufficient to plead a mortgage modification under the law of contracts. In M.J. Holdings, the defendant agreed to sell a property based upon the promise of the lender that if it was provided with all of the net proceeds of the sale, it would modify the defendants' other loans. Upon these facts, the Appellate Court concluded that an " offer can be accepted by the rendering of a performance only if the offer invites such an acceptance . . . Further, [i]n order to accept the offer [by rendering performance], the offeree must give . . . that for which the offeror bargains. If it is in any material respect different, there is no contract . . . Such a contract where the offeror invites acceptance of his promise . . . by performance is a unilateral contract. Furthermore, [u]nder established principles of contract law, an agreement must be definite and certain as to its terms and requirements. (Citations omitted; internal quotation marks omitted.) Id., 331-32.
Although the statute of frauds was not considered by the Appellate Court in M.J. Holdings, the Supreme Court has held that " part performance is an essential element of the estoppel exception to the statute of frauds." SS-II, LLC v. Bridge St. Associates, 293 Conn. 287, 294-95, 977 A.2d 189 (2009). The court then reiterated the elements required to be shown for the exception to apply, as well as the rationale behind the rule. " [I]n sum, the elements required for part performance are: (1) statements, acts or omissions that lead a party to act to his detriment in reliance on the contract; (2) knowledge or assent to the party's actions in reliance on the contract; and (3) acts that unmistakably point to the contract . . . Under this test, two separate but related criteria are met that warrant precluding a party from asserting the statute of frauds . . . First, part performance satisfies the evidentiary function of the statute of frauds by providing proof of the contract itself . . . Second, the inducement of reliance on the oral agreement implicates the equitable principle underlying estoppel because repudiation of the contract by the other party would amount to the perpetration of a fraud." Id., pp. 295-96.
In reading the defendants' special defense broadly and realistically, TD Bank, N.A. v. M.J. Holdings, LLC, supra, 143 Conn.App. 329, as well as construing the facts presented most favorably in support of the nonmoving party, J.E. Robert Co., Inc. v. Signature Properties, LLC, supra, 309 Conn. 307, 333 (2013), the court concludes that the defendants have raised a material issue of fact sufficient to deny the motion for summary judgment.
The facts of the present case are essentially similar to those in M.J. Holdings , in that the defendants allege that the plaintiff agreed that if a substantial sum of money was paid to the lender, the monthly payments on the mortgage would be reduced. Although no monthly payments of $1,300 were tendered by the defendants or accepted by the plaintiff, the substantial payment of $55,852.31 is sufficient to raise a question of fact as to whether this sum was intended to cure the default and restore the defendants' good standing with the lender or, in addition, consideration for a new monthly mortgage payment of $1,300.
IV
CONCLUSION
The motion for summary judgment is denied. This will permit further discovery, if necessary, before trial.