Opinion
HHDCV146049820S
12-31-2015
HSBC Bank USA, National Association as Trustee for Wells Fargo Home Equity Asset-Backed Securities 2005-3 Trust, Home Equity Asset-Backed Certificates, Series 2005-3 v. Thomas C. Hatcher, Jr. aka Thomas C. Hatcher aka Thomas Hatcher aka Thomas L. Hatcher et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION RE PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT AS TO LIABILITY ONLY (#136)
David M. Sheridan, J.
In this foreclosure action, the plaintiff, HSBC Bank USA, National Association as Trustee for Wells Fargo Home Equity Asset-Backed Securities 2005-3 Trust, Home Equity Asset-Backed Certificates, Series 2005-3 (the " plaintiff"), has moved this court for summary judgment on the ground that there are no genuine issues of material fact as to the plaintiff's ownership of the note and mortgage, the existence of a default under the note and mortgage by the defendants, Thomas C. Hatcher, Jr. a/k/a Thomas C. Hatcher a/k/a Thomas Hatcher a/k/a Thomas L. Hatcher and Linda M. Hatcher a/k/a Linda Hatcher a/k/a Linda Marie Hatcher a/k/a Linda M. Kennedy a/k/a Linda M. Kennedy-Hatcher a/k/a Athena Palatsoukas a/k/a A.L. Hatcher (the " defendants"), and the satisfaction of all conditions precedent to foreclosure. Therefore, plaintiff contends, summary judgment as to liability is appropriate.
In support of its motion, the plaintiff has appended the affidavit of April H. Hatfield, Vice President of Loan Documentation of Wells Fargo Bank, N.A., the loan servicer, with a photocopy of the June 16, 2005, three-page " Adjustable Rate Note" and a one-page " Addendum" (collectively referred to here as " the Note"), a Lost Note Affidavit, the Mortgage and Assignment of Mortgage, and the Notice of Default Letter attached as exhibits.
On September 21, 2015, the parties appeared at short calendar and were heard. At the time of the hearing, the defendants had not filed any pleading specifically responsive to the motion for summary judgment. However, at the argument, the defendants directed the court's attention to several previously-filed pleadings which set forth the substance of their opposition.
On March 30, 2015, the defendants filed an Answer and Special Defense (Docket Entry #130) and a " Motion to Plead" (Docket Entry #131). On April 20, 2015, the defendants filed an " Objection to Summary Judgment." (Docket Entry #133.) Although the order and style of these pleadings is not precisely according to Practice Book Sec. 17-45, the purpose of the rule has been served (see Practice Book Sec. 1-8) and therefore, according the defendants the latitude given to self-represented parties due to their lack of familiarity with court procedures and filings, the court has treated them, collectively, as opposition to the subsequent (August 26, 2015) motion for summary judgment.
I. FACTS NOT IN DISPUTE
On or about June 16, 2005, the defendant Thomas C. Hatcher, Jr. executed and delivered an " Adjustable Rate Note" in favor of Wells Fargo Bank, N.A in the original principal amount of $146, 400.00.
In order to secure the Note, both defendants executed a Mortgage Deed (the " Mortgage") in favor of Wells Fargo Bank, N.A. on property known as 75 Pond Circle, Glastonbury, Connecticut 06033 (the " Property"). The Mortgage was recorded on June 23, 2005 in Volume 2205 at Pages 274-97 of the Glastonbury Land Records.
The Note was endorsed in blank, and transferred to the plaintiff, HSBC Bank USA, National Association as Trustee for Wells Fargo Home Equity Asset-Backed Securities 2005-3 Trust, Home Equity Asset-Backed Certificates, Series 2005-32. The Mortgage was also transferred by Wells Fargo Bank, N.A. to the plaintiff by means of an assignment of mortgage dated September 8, 2014 and recorded September 12, 2014 in Volume 3208 at Page 18 of the Glastonbury Land Records.
Beginning with the monthly payment due May 1, 2007, the defendant has failed to timely make some or all of the required monthly payments under the Note.
By a letter dated January 4, 2012, the plaintiff advised the defendants that the Note and Mortgage were in default due to the defendant's failure to make the required monthly payments. The letter was sent via First Class mail to the defendants at the 75 Pond Circle, Glastonbury, Connecticut property address. The letter clearly stated that the defendants must pay all amounts required to constitute payment in full of the outstanding payments owed under the Note, and if such payments were not made, that the plaintiff reserved the right to commence immediate foreclosure proceedings. The defendants failed to cure the default, and the plaintiff elected to accelerate the sums due and owing under the Note.
This foreclosure action was commenced by writ summons and complaint dated March 27, 2014. On March 30, 2015 the defendants filed an Answer and Special Defense. In their Answer, the defendants admit that they are the owners of the Property and the equity of redemption of the Property, deny any default of payment or that they were provided notice of the default, and leave the plaintiff to its proof on all other allegations in the Complaint. In the nature of a special defense, the defendants allege that the plaintiff is not the holder of the Note and thus lacks standing to bring this action, and that they have made all necessary payments under the Note.
II. STANDARD OF REVIEW
A. Summary Judgment--Generally
The court begins by recognizing the well-known concept that " summary judgment is a method of resolving litigation when 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 . . . The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried. However, since litigants ordinarily have a constitutional right to have issues of fact decided by a jury . . . the moving party for summary judgment is held to a strict standard . . . of demonstrating his entitlement to summary judgment." (Citations omitted; internal quotation marks omitted.) Grenier v. Commissioner of Transportation, 306 Conn. 523, 534-35, 51 A.3d 367 (2012).
" The party moving for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law . . . To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact." Ramirez v. Health Net of the Northeast, Inc., 285 Conn. 1, 11, 938 A.2d 576 (2008). In reviewing the evidence offered, the court must " view the evidence in the light most favorable to the nonmoving party." (Internal quotation marks omitted.) Johnson v. Atkinson, 283 Conn. 243, 253, 926 A.2d 656 (2007).
" In ruling on a motion for summary judgment, the court's function is not to decide issues of material fact . . . but rather to determine whether any such issues exist." RMS Residential Properties, LLC v. Miller, 303 Conn. 224, 233, 32 A.3d 307 (2011). A material fact is one that would alter the outcome of the case. Southbridge Associates, LLC v. Garofalo, 53 Conn.App. 11, 14, 728 A.2d 1114 (1999) (citing Hammer v. Lumberman's Mutual Casualty Co., 214 Conn. 573, 578, 573 A.2d 699 (1990)).
B. Foreclosure
" 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." (Internal quotation marks omitted.) Wells Fargo Bank, N.A. v. Strong, 149 Conn.App. 384, 392, 89 A.3d 392, cert. denied, 312 Conn. 923, 94 A.3d 1202 (2014). See also, New England Savings Bank v. Bedford Realty Corp., 246 Conn. 594, 717 A.2d 713 (1998) (when the plaintiff establishes its ownership of the note and satisfies the court of a defendant's failure to make payments according to the note, the plaintiff establishes its right to avail itself of such security as the mortgage affords).
Thus, the plaintiff has the burden of establishing the absence of a genuine issue of material fact as to the existence of the underlying note and mortgage, ownership of the note and mortgage, the defendant's default in payment, and that all conditions precedent to foreclosure, as established by the note and mortgage, have been satisfied. Upon such a showing, the burden shifts to the defendant to produce evidence in admissible form--as to either the elements of the foreclosure cause of action or any legally sufficient special defense--sufficient to raise a material issue of fact requiring a trial.
III. ANALYSIS
For the reasons that follow, the court finds that the plaintiff has established a prima facie entitlement to foreclose its mortgage under applicable law. See Wells Fargo Bank, N.A. v. Strong, 149 Conn.App. 384, 392, 89 A.3d 392, cert. denied, 312 Conn. 923, 94 A.3d 1202 (2014). See also, GMAC Mortgage, LLC v. Ford, 144 Conn.App. 165, 176, 73 A.3d 742 (2013).
A. Ownership of the Note
The affidavits submitted by the plaintiff sufficiently demonstrate that the plaintiff was the holder of the note at the time that it instituted this action. (See July 24, 2015 Affidavit of April H. Hatfield, ¶ 5; August 14, 2014 Affidavit of Virginia Holloway, ¶ 5.) The affidavits also sufficiently demonstrate that Wells Fargo Bank assigned the mortgage to the plaintiff by a written assignment of mortgage dated September 8, 2014 and recorded September 12, 2014 in Volume 3208 at Page 18 of the Glastonbury Land Records. It is thus clear that the plaintiff has presented satisfactory evidence that it is the holder of the Note by virtue of an endorsement in blank and is the assignee of record for the Mortgage by virtue of the assignment of mortgage.
In opposition to the plaintiff's proof of ownership of the Note, the defendants have offered only inadmissible hearsay statements such as " Wells Fargo now calls daily and insists the mortgage belongs to them and not HSBC as trustee . . ." (April 20, 2015 Objection to Summary Judgment, [#133], p. 1) or " HSBC does not own this loan." (Transcript of November 21, 2011 court proceedings in HSBC Bank USA v. Thomas Hatcher Jr., CV-07-5013519 [attached to Objection to Summary Judgment], p. 5). Only admissible evidence may be considered by the court in ruling upon a motion for summary judgment. Practice Book § 17-46. No admissible evidence has been offered by the defendants that creates a genuine issue of material fact as to the plaintiff's status as holder of the Note.
The defendants also suggest that the plaintiff cannot " substantiate" its claims of ownership because the original note has been lost and cannot be presented to the court. The plaintiff has submitted a lost note affidavit attesting that, at some point after the commencement of this action, the original note was misplaced or misfiled at the offices of plaintiff's counsel. The defendants have offered no evidence to contradict these facts, and have offered no evidence to suggest that they did not, on June 16, 2005, sign and deliver the Note. As a matter of fact, their proffered evidence of " payments" made to Wells Fargo would permit a reasonable inference as to the existence of a debt, if not existence of the Note.
" A bill or note is not a debt; it is only primary evidence of a debt; and where this is lost, impaired or destroyed bona fide, it may be supplied by secondary evidence . . . The loss of a bill or note alters not the rights of the owner, but merely renders secondary evidence necessary and proper." Silicon Valley Bank v. Miracle Faith World Outreach, Inc., 140 Conn.App. 827, 833-34, 60 A.3d 343, cert. denied, 308 Conn. 930, 64 A.3d 119 (2013).
The defendants have failed to submit evidence that would create a genuine issue as to the fact that the plaintiff is the holder of the Note and Mortgage.
B. Default on the Note
The plaintiffs have offered testimony by means of affidavit that, beginning with the monthly payment due May 1, 2007 and continuing to the present date, the defendant Thomas C. Hatcher, Jr. has failed, refused, and neglected to make payments under the Note. (See Affidavit of April H. Hatfield, ¶ 8.) The defendant Thomas C. Hatcher, Jr.'s failure to make the required monthly payments when due is a breach of the covenants contained in the Note and Mortgage. Accordingly, the defendant Thomas C. Hatcher, Jr. is in default under the Note and both the defendants are therefore in default under the Mortgage.
To controvert this evidence, the defendants have offered only a cryptic claim that the lender has " received all payments . . . Every payment they asked for we had the check to prove it was not only paid, but overpaid and deposited by Wells Fargo." (Motion to Plead [Docket Entry #133], pp. 2-3.) The defendants' opposition also makes obscure references to tendering these checks for payments during a mediation process; whether that was in reference to this foreclosure or other, prior foreclosures is unclear. Nonetheless, the handful of checks that have been produced--which are dated in 2006 and 2007--are insufficient to create a genuine issue of material fact as to the plaintiff's evidence--as stated in the notice of default letter--of $83, 937.36 in past due payments as of January 2012. A party opposing summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact " together with the evidence disclosing the existence of such an issue." Squeo v. Norwalk Hospital Ass'n, 316 Conn. 558, 593-94, 113 A.3d 932 (2015).
The defendants have failed to submit evidence that would create a genuine issue as to the fact as to their claim that all monthly payments have been timely made under the terms of the Note and Mortgage.
C. All Conditions Precedent to Foreclosure Have Been Fulfilled
Paragraph 8 of the Note and Paragraph 15 of the Mortgage requires that notice of default be provided to the property owners in writing, mailed via First Class Mail to the property address. Paragraph 22 of the Mortgage requires that the notice letter specify the default, the action required to cure the default, the date by which the default must be cured, and that failure to timely cure the default might result in acceleration, and certain other rights of the borrower. By a letter dated January 4, 2012, the plaintiff notified the defendants that the Note and Mortgage were in default due to the defendant's failure to make the required monthly payments. The notice was sent, via First Class mail, to the defendant at the property address. See Affidavit of April H. Hatfield, ¶ 9 and Exhibit E to Affidavit.
The defendants have offered no evidence to suggest that notice of default was not properly given, nor do they make any claim that any other condition precedent to foreclosure was not fulfilled.
D. Special Defenses
Where a complaint and supporting affidavits establish an undisputed prima facie case in a foreclosure action, the court must then determine whether any special defense is legally sufficient before granting summary judgment. " A valid special defense at law to a foreclosure proceeding must be legally sufficient and address the making, validity or enforcement of the mortgage, the note or both . . . Where the plaintiff's conduct is inequitable, a court may withhold foreclosure on equitable considerations and principles . . . [O]ur courts have permitted several equitable defenses to a foreclosure action." (Internal quotation marks omitted.) Fidelity Bank v. Krenisky, 72 Conn.App. 700, 705-06, 807 A.2d 968, cert. denied, 262 Conn. 915, 811 A.2d 1291 (2002). " If a plaintiff in a foreclosure action has shown that it is entitled to foreclose, then the burden is on the defendant to produce evidence supporting its special defenses in order to create a genuine issue of material fact; valid, legally sufficient special defenses alone do not." WM Specialty Mortgage, LLC v Brandt, Superior Court, judicial district of Ansonia-Milford, Docket No. CV 09 5001157, (February 10, 2009, Moran, J.).
1. Standing
The defendants make the claim--which the court will treat as a special defense--that the plaintiff is not the holder of the Note and mortgagee of record, and therefore lacks standing to bring this action. The defendants' claims are unsupported by any facts or evidence that raise a genuine question as to the plaintiff's possession of the note, signed by the defendants, and endorsed in blank, at the time of commencement of this action. This court has previously found that the plaintiff has standing to bring the present action and to invoke the court's subject matter jurisdiction. (See Orders, Docket Entries #107.87, #113.86, #118.86.) The defendants have not presented any new evidence or issues of law that would justify revisiting this well-settled question.
The first special defense therefore raises no genuine issue of material fact that could defeat the present motion for summary judgment.
2. Payment
The defendants make the claim--which the court will treat as a special defense--that they have made all payments under the Note. Once again, the defendants' claims are all but unsupported by any facts or evidence that raise a genuine question as to the plaintiff's assertion that, as of January 4, 2012, the plaintiff was owed $83, 937.36 in past due payments under the Note.
Generally, " [p]ayment is a valid special defense in a foreclosure action." Homecomings Financial Network, Inc. v. Starbala, 85 Conn.App. 284, 289, 857 A.2d 366 (2004). The burden of pleading and proving the special defense of payment rests on the defendant. Atlantic National Trust v. Van Eck, 89 Conn.App. 200, 873 A.2d 179 (2005). There is little if any law on the substantive elements of the defense of payment in a foreclosure action. Logic dictates that in order for the defense to preclude a remedy of foreclosure, the defendant must allege and prove either; 1) that payments were timely and properly made; 2) that the debt has been paid in full; or 3) that the lender has agreed to accept some amount less than the full amount of the debt in complete satisfaction of the debt, and that amount has been paid. If any one of those three circumstances were proven, there is no default of payment or the underlying debt has been satisfied and discharged, and the remedy of foreclosure no longer pertains.
The defendants have offered no evidence that would demonstrate timely payment of monthly installments, payment of the debt in full or an agreement to accept a lesser amount in satisfaction of the debt. The second Special Defense therefore raises no genuine issue of material fact that could defeat the present motion for summary judgment.
IV. CONCLUSION
The court has examined the affidavits and documentary evidence appended to the plaintiff's motion and the written opposition and oral argument offered by the defendants, and finds there is no genuine issue of material fact as to the plaintiff's status as the owner of the note and mortgage and that the mortgagee/defendant has defaulted on the note. The plaintiff has also demonstrated that all conditions precedent to foreclosure, as mandated by the note and mortgage, have been satisfied. Therefore, there is no genuine issue of material fact as to liability, but there is a genuine issue as to damages. Partial summary judgment as to liability only is therefore GRANTED.