Opinion
HHBCV185024637S
09-09-2019
The Bank of New York Mellon fka The Bank of New York, as Trustee for the Certificateholders CWALT, Inc. Alternative Loan Trust 2006-18-CB, Mortgage Pass-Through Certificates, Series 2006-18CB v. Alison L. Hatheway fka Alison T. Edwards aka Alison Hatheway aka Alison Lorraine Hatheway aka Alison-Lorraine Hatheway aka Alison-Lorraine Hatheway et al.
UNPUBLISHED OPINION
Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Huddleston, Sheila A., J.
MEMORANDUM OF DECISION
Sheila A. Huddleston, Judge.
This is the first petition brought pursuant to two statutory provisions recently enacted to address the growing problem of false filings on land records and false filings of Uniform Commercial Code (UCC) financing statements. The new provisions, codified in General Statutes § § 42a-9-518(f) and 47-31a, are intended to allow the victims of such false filings to obtain prompt judicial invalidation of those filings.
In this case, the petitioner, The Bank of New York Mellon, formerly known as The Bank of New York, as Trustee for the Certificateholders CWALT, Inc., Alternative Loan Trust, 2006-18CB, Mortgage Pass-Through Certificates, Series 2006-18CB (bank), petitioned this court to invalidate certain filings on the land records of the town of Deep River, Connecticut (town). The bank alleges that the respondents, Alison Hatheway (Hatheway) and Daniel Droste Hatheway (Daniel Hatheway), have filed thirteen false records on the town’s land records, all relating to a parcel of real property at 112 Cedar Swamp Road in Deep River (the property). The respondents owned the property before the bank obtained title to it early in 2018 pursuant to a judgment of strict foreclosure. The bank alleges that since judgment entered in the foreclosure action, Hatheway has engaged in conduct that interferes with the bank’s ability to sell the property. The bank seeks the invalidation of the records at issue and injunctive relief under § § 42a-9-518(f) and 47-31a. Pending before the court are Hatheway’s second motion to dismiss the petition and the merits of the petition itself.
Unless otherwise stated, all references to the "bank" in this decision are to the Bank of New York Mellon in its capacity as trustee of the named trust. "Bank" is used merely as a short form for convenience.
For the reasons discussed herein, the court denies Hatheway’s motion to dismiss. The court concludes that § 42a-9-518(f) does not apply to the UCC financing statements at issue because the bank is not named in those statements. The court further concludes that § 47-31a does apply to the challenged notices, affidavits, and notices of lis pendens, which the court finds were falsely filed within the meaning of § 47-31a. The bank is entitled to injunctive relief, and the respondents are ordered to cease all interference with the bank’s right to sell the property.
I
The bank filed its petition on December 17, 2018, naming as respondents Hatheway, Daniel Hatheway, and Richard Ranno, a private investigator hired by Hatheway. In its original petition, the bank alleged that it is the owner of the property, as described in a certificate of foreclosure recorded on February 8, 2018, in Volume 240, Page 423 on the town’s land records. The bank alleged that Hatheway or Daniel Hatheway had filed twelve false filings concerning the property over the period from July 30, 2009, through November 27, 2018. It further alleged that Hatheway had hired Ranno to station himself near the property, set up "game cameras" to record movement at the property, report on such movement to Hatheway, and inform third parties that they were trespassing on the property. The bank alleged that Hatheway’s conduct has interfered with the bank’s ability to sell the property.
Under both § 42a-9-518(f) and § 47-31a, the court is required to hold a hearing within sixty days of the filing of the petition if it finds cause to doubt the validity of the challenged record. Upon review of the challenged records filed with the bank’s petition, the court found such cause, scheduled a hearing for February 7, 2019, and ordered that notice of the hearing be served on the respondents. On February 6, 2019, the bank withdrew its claim against Ranno. On February 7, 2019, an attorney filed an appearance on behalf of Hatheway and Daniel Hatheway and requested a continuance of the hearing. The court opened the hearing on that date and continued it at the request of the respondents’ attorney. Hatheway and Daniel Hatheway subsequently entered appearances on their own behalf. They also continued to be represented by the attorney, who represented to the court that the respondents now live in Arizona.
On March 7, 2019, Hatheway filed a motion to dismiss, alleging that the bank was not the owner of the property and therefore lacked standing to file the petition. In that motion, Hatheway alleged that the property is owned by "Sonlight," a "constitutional contract trust" of which she is the trustee.
The court held a hearing on the motion to dismiss on March 19, 2019, and denied the motion. The court ordered the respondents to file an answer by April 1, 2019, and scheduled the continued hearing for April 12, 2019. On March 20, 2019, the bank filed a second amended petition. The second amended petition omitted Ranno as a respondent but otherwise incorporated the allegations of the original petition, including the allegations concerning Hatheway’s hiring of Ranno to surveil the property, and additionally sought to invalidate a notice of lis pendens filed by Hatheway after the original petition in this case was filed. Neither respondent filed an answer by April 1, 2019.
On April 10, 2019, Hatheway filed a document captioned "Notice to the court for the hearing 12 April 2019 to be admitted as evidence." Although purportedly "verified," the document was not executed under oath before a notary public or any other competent authority. It contested the allegations of the bank’s petition. Despite Hatheway’s characterization of the document as "evidence," the court construed it as, in effect, Hatheway’s answer to the petition.
On April 12, 2019, the court held a hearing on the merits of the petition. Neither respondent appeared for the hearing. The bank presented testimony by two witnesses, Raymond Ranno and Michael Sirochman, III, both of whom appeared under subpoena. At the bank’s request, the court took judicial notice of the court’s file in the foreclosure action, captioned- in shortened form - The Bank of New York Mellon as Trustee v. Hatheway, Superior Court, judicial district of Middlesex, Docket No. MMX-CV-16-6015267-S (2016 foreclosure). The bank submitted as exhibits certified copies of its certificate of foreclosure and the land records at issue, as well as copies of complaints in two actions filed by Hatheway in the federal district court in Arizona. The respondents’ attorney cross examined the bank’s witnesses, but did not proffer any evidence on the respondents’ behalf The court ordered the parties to submit post-trial briefs to address three issues: (1) whether the provisions in § § 42a-9-518(f) and 47-31a, each of which had an effective date of January 1, 2018, were intended to be retroactive, so as to apply to records filed before that date; (2) whether § 47-31a applies to a lis pendens filed on the land records; and (3) whether there is any significance to the fact that some of the land records were purportedly filed by Hatheway as trustee of Sonlight. On April 25, 2019, Hatheway filed her second motion to dismiss. On May 2019, both Hatheway and the bank filed briefs in response to the court’s order; Hatheway’s counsel did not file a brief. The bank’s brief also addressed and opposed Hatheway’s second motion to dismiss. On May 13, 2019, Hatheway filed a reply to the bank’s brief. On June 11, 2019, the bank filed a memorandum of supplemental authority, stating that Hatheway’s Arizona district court action against the bank- the subject of one of the lis pendens at issue- has been dismissed for lack of personal jurisdiction over the bank. The bank attached a copy of the district court’s decision to its motion. On June 12, 2019, Hatheway filed a statement alleging that she would file a motion for reconsideration of the dismissal, and if that motion is denied, will appeal the dismissal. The court deems the record before it to have been completed with the filing of Hatheway’s response, filed on June 12, 2019, to the bank’s supplemental memorandum of June 11, 2019.
The 2016 foreclosure complaint was captioned The Bank of New York Mellon f/k/a The Bank of New York, as Trustee for the Certificateholders CWALT, Inc., Alternative Loan Trust 2006-18CB, Mortgage Pass-Through Certificates, Series 2006-18CB v. Alison Hatheway a/k/a Alison L. Hatheway a/k/a Alison-Lorraine Hatheway a/k/a Alison T. Edwards et al. Additional named defendants included Daniel Droste Hatheway, State of Connecticut Judicial Branch, Bank of America, N.A., Webster Bank, N.A., and Rbeate.
As required by General Statutes § § 42a-9-518(f) and 47-31a, the bank filed certified copies of the challenged records with its original petition, and the court reviewed them in determining whether there was cause to doubt the validity of the records. Those copies were regrettably destroyed after they were scanned in to the court’s electronic file. The bank submitted new certified copies at the hearing.
II
As evidence of the invalidity of the filings and records at issue, the bank relies primarily on the documents it seeks to invalidate, the record of the 2016 foreclosure, and evidence of Hatheway’s interference with the bank’s efforts to sell the property since the foreclosure. The evidence may be summarized as follows.
This summary of the evidence is by no means intended to be an exhaustive account, especially with respect to the contents of the various documents, styled as affidavits, filed by Hatheway on the town’s land records. These documents are lengthy, discursive, and repetitious. The court has carefully reviewed and considered all of the evidence and arguments presented. In this summary, the court addresses only the principal assertions set out in the documents.
Hatheway and Daniel Hatheway are prior owners of real property at 112 Cedar Swamp Road, Deep River, Connecticut. On May 3, 2006, Hatheway executed a mortgage deed, securing a promissory note for $300,000 that listed Countrywide Home Loans, Inc., as the lender. The mortgage was recorded on the town’s land records on May 8, 2006, and was assigned to the bank on August 15, 2008. The assignment was recorded in Volume 209, Page 0997 of the town’s land records on August 25, 2008.
In August 2008, the bank commenced a foreclosure action against Hatheway and Daniel Hatheway with respect to the property (2008 foreclosure). It withdrew the 2008 foreclosure action in 2014.
The 2008 foreclosure was docketed as The Bank of New York v. Hatheway, Superior Court, judicial district of Middlesex, Docket No. MMX-CV-08-5005096-S, and is referenced in several of the records filed by Hatheway and introduced as exhibits by the bank. See, e.g., Exhibit 1C, p. 11 (copy of pleading from 2008 foreclosure action), Exhibit 1J, p. 11 (reference to withdrawal of 2008 foreclosure on February 6, 2014).
While the 2008 foreclosure was pending, on July 30, 2009, Hatheway filed a UCC-1 financing statement on the town’s land records, where it was recorded in Volume 212, Page 1061. (Exhibit 1B.) The statement identified the "debtor" both as an organization ("Hatheway, Alison Lorraine: Common-Law Trade Name/Trademark") and as an individual (Alison Lorraine Hatheway). The statement named the secured party as "Alison-Lorraine: Hatheway" and identified the collateral as follows: "All property belonging to the debtor belongs to the secured party. Debtor is a transmitting utility. Debtor is a trust ‘accepted for value exempt from levy without the United States Corporatism.’ "
On November 20, 2009, while the 2008 foreclosure was pending, Hatheway filed four additional documents on the town’s land records. The first, recorded in Volume 213, Pages 824-45, consisted of a six-part set of documents. (Exhibit 1C.) The cover sheet identified the parts as follows:
Part 1. Three-Page Notice of Superior Entitlement Right by Entitlement Holder, or Controlling Creditor, or Drawer, or Maker, Alison Lorraine Hatheway.
Part 2. Request for Debt Validation Pursuant to Fair Debt Collection Practices Act 15 U.S.C. § 1601 et seq.
Part 3. Two-Page Entitlement Holder’s Private International Administrative Remedy Demand No. ALH0003 and Notice of Reservation of Right of Initiating Adverse Claim or Counterclaim and Claim Official Oath, or Bond, or Surety.
Part 4. One-Page Verification of Notice of Reservation of Right of Initiating Adverse Claim, or Counterclaim, and Claim Oath, or Bond, or Surety.
Part 5. Two-Page Entitlement Holders Conditional Acceptance, and Bank of New York Trustee for the Certificateholders CWALT, Inc., Alternative Loan Trust 2006-18CB of Performance.
Part 6. Four-Page Alleged Creditor’s Good Faith Disclosure Statement.
Hatheway used upper case letters for virtually all captions in her filings and often for emphasis within the text of the filings as well. Because there is no legal significance to her use of upper case letters, and in the interest of conserving space in this memorandum, the court does not follow Hatheway’s capitalization style except where expressly noted.
The six documents asserted a number of legal claims in conclusory fashion and asserted those claims as if they were established facts. Part 1 gave notice that Hatheway had received the bank’s adverse claim, denied Hatheway’s knowledge of the bank’s interest in the note, and claimed that "[a]bsent a certified rebuttal of any points herein in this Six-Part ‘Notice’ by the [bank] or any agents or assigns, the [bank] accepts all possible liability for the below acts and deeds, not limited by, claims and damages unto Alison Lorraine Hatheway ..." There followed a list of some twenty-nine possible claims, including, but not limited to, violations of the Securities Exchange Act, the Truth in Lending Act, the antitrust laws, the Uniform Deceptive Trade Practices Act, bank and wire fraud, money laundering, privateering, the federal Freedom of Information Act, "paper terrorism," and false advertising. Additional paragraphs asserted that the bank’s failure to respond to the notice in specified ways would constitute the bank’s consent to the removal of any liens against Hatheway’s property. Yet another paragraph asserted that the bank’s failure to rebut any part of the notice would constitute agreement that Hatheway was granted the bank’s power of attorney.
Other parts of this document purportedly sought inforiliation about the loan and alleged that failure to validate the debt would become a "security agreement" under "commercial law." Still other parts reserved Hatheway’s right to initiate a counterclaim, presumably in the then pending 2008 foreclosure.
The second set of documents that Hatheway filed on November 20, 2009, were recorded in Volume 213, Pages 0813-18 on the town’s land records. (Exhibit 1D.) This set included a "presentment" of a debt validation request, a "protest" in which Hatheway alleged the "dishonor" of liability under the mortgage loan, and an affidavit of notice of default, which claimed that Hatheway was a "secured party/creditor" pursuant to a UCC-1 financing statement and that the respondent (identified as both Countrywide Home Loans, Inc., and the bank) had failed to respond to the presentment and was therefore in default.
The third document that Hatheway filed on November 20, 2009, was a "notice of rescission," addressed to the bank, and recorded in Volume 213, Pages 0819-20 on the town’s land records. (Exhibit 1E.) This document purported to rescind the mortgage loan by Countrywide Home Loans, Inc., pursuant to the federal Truth in Lending Act. It was filed more than three years after Hatheway signed the note and mortgage.
The fourth document that Hatheway filed on November 20, 2009, was a "Notice of Fault and Opportunity to Cure and Perform," addressed to the bank. (Exhibit 1F.) It was recorded in the town’s land records at Volume 213, Pages 0821-23. It asserted that the bank had failed to respond to a request for validation of the debt and was now "in dishonor and default" and was "stopped from maintaining the original collection action ..." It also purported to be a "RESPA Qualified Written Request" and a "Non-Negotiable Dispute of Alleged Debt, Regarding Home Eq Security Loan Account No. A11223344."
On October 15, 2015, more than a year after the bank withdrew the 2008 foreclosure, two UCC financing statements were filed on the land records concerning the property. Neither financing statement made any reference to the bank or to the mortgage loan. One of the statements, recorded in Volume 233, Page 311 on the land records, identified Alison Lorraine Hatheway as the debtor and "Rbeate" as the secured party. (Exhibit 1G.) It identified the collateral as "all present and future equity" in the property and "all personal property owned by the above named Debtor ..." It stated that the purpose was to fulfill a financial obligation of $695,000. The other financing statement, recorded in Volume 233, Page 312 of the land records, identified Daniel Droste Hatheway as the debtor and "Boyne" as the secured party. (Exhibit 1H.) It stated that the collateral was "all present and future equity" in the property and all personal property of the debtor, given to fulfill a financial obligation of $2,900,000. There is no evidence in the record as to the nature or identity of "Rbeate" or "Boyne." Nor does the record disclose the identity of any person who filed the UCC financing statements on behalf of "Rbeate" or "Boyne."
On March 14, 2016, the bank filed a lis pendens, recorded in Volume 234, Pages 721-23 of the town’s land records, giving notice of the 2016 foreclosure. On March 22, 2016, the bank’s 2016 foreclosure complaint and return of service were filed with the court.
The bank filed a copy of its lis pendens as an exhibit to Docket Entry No. 128 in the 2016 foreclosure.
On September 28, 2016, more than six months after the bank filed its lis pendens, Hatheway, purportedly as trustee of "Sonlight," filed an "Affidavit of Facts Affecting Title to Real Property with Notice of Transfer of Title." (Exhibit 1L.) This affidavit, recorded on the town’s land records in Book 236, Pages 368-75, gave notice that Hatheway and Daniel Hatheway had transferred title to the property by quitclaim deed to Sonlight, on October 17, 2015. According to the affidavit, Sonlight is a "common-law, non-statutory Massachusetts Contract Trust" of which Hatheway is the trustee. Her affidavit further stated: "For privacy reasons, this private Quit Claim Deed is not recorded in the public record. The PUBLIC is hereby NOTICED of the existence of said deed." (Capitalization as in original.) In the affidavit, Hatheway averred that the property was not subject to a valid mortgage because the loan transaction had been rescinded "by operation of law" by the notice of rescission she had previously filed in Volume 213, Pages 819-20 on the land records. She further averred that the loan was not "consummated" and that the transaction did not satisfy the definition of "loan" in Black’s Law Dictionary. She also averred that the assignment of the mortgage to the bank was "fatally defective."
Hatheway filed several motions in the 2016 foreclosure in which she relied on the 2009 notice of rescission and the 2016 notice of transfer of title. In those motions, she alleged that she was "making a special visitation, sui juris, without accepting or conceding to the court’s jurisdiction." She argued that the bank lacked an interest in the property and that it had failed to bring an action against Sonlight, the purported owner of the property by virtue of the quitclaim deed. See, e.g., "Verified Motion for Summary Judgment for Want of Jurisdiction with Declaration and Memorandum in Support With Mandatory Judicial Notice of Adjudicative Facts From the Public Record," Docket Entry No. 115; "Verified Motion to Strike," Docket Entry No. 119; "Verified Opposition to Plaintiff’s Motion to Default for Failure to Plead," Docket Entry No. 125 (purportedly filed by Daniel Hatheway); "Verified Motion to Dismiss," Docket Entry No. 126; "Verified Motion for Findings of Fact and/or Conclusions of Law," Docket Entry No. 131; and "Verified Motion to Set Aside/Open Default," Docket Entry No. 135. In these voluminous filings, Hatheway repeatedly asserted that the loan had been rescinded and that title to the property resided in Sonlight.
Despite Hatheway’s prolific filings, the one thing that neither she nor Daniel Hatheway ever filed was an answer to the 2016 foreclosure complaint. The bank moved for default for failure to plead. (Docket Entries No. 124, 132.) After the motions for default were granted, Hatheway moved to open the default as to her; Daniel Hatheway did not. The court granted Hatheway’s motion, but ordered her to file an answer within fifteen days and stated that no other pre-answer pleadings would be accepted. (Docket Entry No. 135.10.) Hatheway filed a response to that order, stating that she "OBJECTS, OBJECTS, OBJECTS" and "DOES NOT CONSENT, DOES NOT CONSENT, DOES NOT CONSENT" to the court’s order. (Capitalization as in original.) She claimed that the court’s order denied her due process by denying her the opportunity to file other pleadings before filing an answer. (Docket Entry No. 138.) The bank moved again to default Hatheway for failure to plead (Docket Entry No. 140), and that motion was granted. (Docket No. 140.10.)
The bank moved for a judgment of strict foreclosure on September 14, 2017. (Docket Entry No. 143.) Hatheway filed an "Emergency Verified Motion to Dismiss Complaint Due to Misrepresentation by Alleged Plaintiff’s Counsel- Improper Party, False Plaintiff" on September 15, 2017. (Docket Entry No. 146.) This motion was based on information Hatheway allegedly obtained as a member of a "private legal membership organization," with "a lot of information being provided" by an attorney blogger. On September 20, 2017, the bank objected and provided copies of documents showing that the bank was the current holder of the note, which was endorsed in blank, and that the bank’s counsel had been in continuous possession of the note since February 2015, before commencement of the 2016 foreclosure action. (Docket Entry No. 148.) Hatheway filed a "Verified Reply" on September 22, 2017. (Docket Entry No. 151.) The motion to dismiss and the motion for strict foreclosure were scheduled for hearing on October 2, 2017. Hatheway did not attend that hearing. The court denied Hatheway’s motion and granted the bank’s motion for strict foreclosure on that date. (Docket Entry Nos. 143.10, 157.)
On October 12, 2017, Hatheway filed an "objection" to the court’s decisions, stating that she "objects," "does not consent," and "will not accept" the court’s judgment. On October 18, 2017, she filed an appeal of the judgment. The bank moved to terminate the automatic stay. The trial court granted its motion, observing that "[t]he defendant has never interposed any defense, but instead has filed a number of frivolous motions in an effort to delay the proceedings. At the time judgment entered there was negative equity of over $305,000, so the plaintiff is harmed by the delay. This appeal has only been taken for the purpose of delay and it is unlikely that the defendant will prevail on the appeal." (Docket Entry No. 161.10.) The bank moved to dismiss the appeal.
On December 12, 2017, Hatheway filed an "Affidavit of Facts Affecting Title to Real Property with Notice of Non-Abandonment of Property, Claims, and Secured Equity Interest of Property" on the town’s land records, where it is recorded in Book 239, Pages 1023-43. (Exhibit 1J.) This affidavit contains the subheading: "Real Estate Professionals and Title Companies, Please Take Particular Note of this Affidavit." The affidavit identified the property and the date of the judgment of strict foreclosure; it then provided "Notice to the World" that the loan transaction was void and had been cancelled. In this affidavit, Hatheway reiterated the claims made in previous filings, asserting that the bank lacked an interest in the property. She further stated, among other claims, that "[t]his AFFIDAVIT is made to protect the equity interests of the rightful owner of Title to the Property against the void JUDGMENT," and "[t]his AFFIDAVIT is made to show that the JUDGMENT from the COURT CASE is not in line with established, unrefuted facts, law and reality." (Capitalization as in original.) In the affidavit, she also asserted a "secured equitable interest" in excess of $2,000,000 as a result of her improvements to and maintenance of the property since she acquired it in 1997. The affidavit concluded with a notice "To All Prospective Purchasers: Beware!" Hatheway averred that her "secured, equitable interest" must be satisfied before a transfer of the property can occur.
The Appellate Court dismissed Hatheway’s appeal on December 18, 2017, and title vested in the bank on January 27, 2018. This did not end Hatheway’s efforts to derail the foreclosure, however. On March 22, 2018, after filing other pleadings in the trial court, she filed another appeal to the Appellate Court. The bank again moved to terminate the appellate stay, and the trial court granted that motion, observing that "it is clear that the instant appeal is dilatory and frivolous in nature and does not have any likelihood of success." An execution of ejectment was issued on July 9, 2018.
On September 17, 2018, Hatheway filed another affidavit on the town’s land records, where it is recorded in Book 241, Pages 998-1013. (Exhibit 1K.) It bears four headings:
LIVING TESTIMONY IN THE FORM OF AN AFFIDAVIT
AFFIDAVIT OF FACTS AFFECTING TITLE TO REAL PROPERTY WITH NOTICE OF TRUE TITLE HOLDER
REAL ESTATE PROFESSIONALS, TITLE COMPANIES AND INSURANCE COMPANIES PLEASE TAKE PARTICULAR NOTICE OF THIS AFFIDAVIT TO ANY PROSPECTIVE BUYERS- PLEASE TAKE NOTICE OF THE RULE OF "CAVEAT EMPTOR."(Capitalization and underlining as in original.)
This affidavit avers that Sonlight is a "pure contract trust" and the owner of the property by virtue of the quitclaim deed from Hatheway and Daniel Hatheway. It further avers that the foreclosure judgment entered in the 2016 foreclosure is not valid because Sonlight was not named as a defendant in that action.
Hatheway’s second appeal was dismissed by the Appellate Court on October 22, 2018. Undeterred, on October 30, 2018, Hatheway filed still another affidavit in the town’s land records, where it is recorded in Book 242, Pages 137-75. (Exhibit 1L.) This affidavit also bears four headings:
LIVING TESTIMONY IN THE FORM OF AN AFFIDAVIT
AFFIDAVIT OF FACTS AFFECTING TITLE TO REAL PROPERTY WITH NOTICE OF TRUE TITLE HOLDER
REAL ESTATE PROFESSIONALS, TITLE COMPANIES AND INSURANCE COMPANIES PLEASE TAKE PARTICULAR NOTICE OF THIS AFFIDAVIT NOTICE OF RECLAMATION/REPOSSESSION(Capitalization and underlining as in original.)
In this affidavit, Hatheway again averred that Sonlight is the true owner of the property and has been unlawfully ejected pursuant to the allegedly void foreclosure judgment. She gave notice of Sonlight’s intent to "repossess/reclaim" the property. On November 20, 2018, Hatheway, in her individual capacity, filed an action against the bank and its chief executive officer in federal district court in Arizona, which assigned a docket number of CV-18-083320-PCT-DLR. (Exhibit 2.) She alleged that the bank had sued her in violation of the Fair Debt Collection Practices Act because it had notice of the quitclaim deed to Sonlight before it brought suit. She sought a decree from the district court that Hatheway was not the title holder to the property after October 17, 2015, and that Sonlight, a common-law trust, holds the title to the property. On November 27, 2018, Hatheway filed a notice of lis pendens concerning Arizona district court action on the town’s land records, where it is recorded in Book 242, Pages 411-13. (Exhibit 1M.)
On January 22, 2019, "Alison Lorraine Hatheway TM/SM" filed an action in federal district court in Arizona against Michael Sirochman, Nicholas Mastrangelo, Richard Greene, and John S. Bennett, docketed as CV-19-0828-PCT-DWL. (Exhibit 3.) The bank is not a defendant in that action. Hatheway alleged that the defendants Sirochman, Mastrangelo, and Greene are real estate agents who are advertising the property for sale, and that the fourth defendant "is an individual who claims to be representing the Bank of New York Mellon, as trustee for CWALT." She alleges that he filed the petition naming the bank as the owner of the property in this action. She alleges that the defendants have violated 15 U.S.C. § 1125 by advertising that the property is bank owned. She seeks orders requiring the defendants to cease from trying to sell the property, from describing the property as bank owned, among other things, and she seeks damages in the hundreds of thousands of dollars. On February 15, 2019, she filed a lis pendens relating to the action on the town’s land records, where it is recorded in Book 243, Pages 58-59.
Attorney Bennet’s name is misspelled throughout Hatheway’s complaint.
III
The court first addresses Hatheway’s second motion to dismiss, filed on April 25, 2019. Hatheway asserts that The Bank of New York Mellon lacks standing to bring the petition because the "Certificate of Foreclosure is to the Bank of New York Mellon, as trustee ... The Bank of New York Mellon did not foreclose as a Bank, rather as a trustee for a trust." Although Hatheway is correct that the 2016 foreclosure was brought on behalf of the bank in its role as trustee of a trust, her motion to dismiss is baseless because the bank expressly brought this petition in its capacity as trustee . The petition does not state, as Hatheway claims, that the Bank of New York Mellon is the owner of the property; to the contrary, the petition identifies the petitioner as "The Bank of New York Mellon, formerly known as The Bank of New York, as Trustee for the Certificateholders CWALT, Inc, Alternative Loan Trust, 2006-18CB, Mortgage Pass-Through Certificates, Series 2006-18CB." This is precisely the capacity in which the bank obtained the judgment of strict foreclosure. After identifying the petitioner as stated above, the petition thereafter uses the acronym "BONYM" to identify the petitioner throughout the rest of its petition, presumably for convenience, in the same manner that the court uses the term "bank" as a short form to refer to the petitioner in its capacity as trustee. The factual premise of Hatheway’s argument regarding standing- that the bank brought the petition in its capacity as "the Bank of New York Mellon" rather than as trustee- is simply wrong, based on the pleadings.
In addition, in response to Hatheway’s motion to dismiss the 2016 foreclosure, the bank provided a copy of the note, endorsed in blank, and established that it was the holder of the note. (Docket Entry No. 148, Exhibit 1.) The original note, endorsed in blank, was presented to the court for its inspection at the foreclosure hearing on October 2, 2017. Hatheway relies in the motion, as she did in many of the filings in the 2016 foreclosure action and in some of the filings on the land records, on the bank’s response to one of her inquiries, in which the bank allegedly stated it does not own the property. More specifically, in filings such as Exhibit 1L, Hatheway quotes a purported response by the bank to one of her inquiries as follows: "BNY Mellon is acting as a Trustee, and therefore we do not own the loan or the property. As trustee, BNY Mellon is not involved in the servicing of the loans or the foreclosure process ..." Hatheway made the same argument in a motion to dismiss the 2016 foreclosure, where she attached a purported copy of an e-mail from "BNY Mellon Property Inquiries." (Docket Entry No. 147, Exhibit B.) The attached e-mail, however, merely served to redirect Hatheway’s inquiries to the loan servicer. It confirmed that the bank was functioning solely as a trustee with respect to the property. A trustee is a proper party to bring an action on behalf of a beneficiary. See General Statutes § 52-106.
The remaining assertions in the motion to dismiss do not even remotely raise issues related to the court’s jurisdiction. Hatheway disputes the bank’s claim that the challenged filings on the land records are false, but that is a question regarding the merits of the bank’s petition, not the court’s jurisdiction to hear it. Accordingly, Hatheway’s motion to dismiss is denied.
The court next turns to a consideration of Hatheway’s frequently repeated assertions that the petition is invalid as to certain documents because the bank has failed to name her in her capacity as trustee for Sonlight, the alleged "private contract trust" to which she and Daniel Hatheway allegedly quitclaimed their interest in the property in 2015, before the 2016 foreclosure was filed. In its May 10, 2019 brief, the bank argued that there is no record evidence that Sonlight is an actual legal entity or had any interest in the property. The bank further argued that a common-law trust is not a legal entity that can sue or be sued, and that "to the extent that this Court ascribes existence to the ‘Sonlight Trust,’ it would still be legally permissible to expunge documents filed on behalf of the ‘trust’ because Alison Hatheway is the real person in interest."
In a reply filed on May 13, 2019, Hatheway argued that she could not be considered to have been served as the trustee of Sonlight. She asserted that she has no ownership interest in the assets of Sonlight and that "Sonlight has no beneficiary(ies)."
The court has carefully considered Hatheway’s claims with respect to Sonlight. In particular, it considers her representation that "Sonlight has no beneficiary(ies)." Without beneficiaries, there can be no valid private trust. See Fidelity Title & Trust Co. v. Clyde, 143 Conn. 247, 254, 121 A.2d 625 (1956) (holding that the validity of an alleged private trust could not be sustained because the alleged settlor "neglected to designate beneficiaries who would be definitely ascertainable ..."). "The requisite elements of a valid and enforceable trust are: ‘(1) a trustee, who holds the trust property and is subject to duties to deal with it for the benefit of one or more others; (2) one or more beneficiaries, to whom and for whose benefit the trustee owes the duties with respect to the trust property; and (3) trust property, which is held by the trustee for the beneficiaries.’ " Palozie v. Palozie, 283 Conn. 538, 545, 927 A.2d 903 (2007), quoting 1 Restatement (Third) Trusts § 2, comment (f), p. 21 (2003).
The court concludes that the bank’s position is correct, and Hatheway is the real party in interest with respect to Sonlight. Even if Hatheway and Daniel Hatheway intended to convey the property in trust to Sonlight, the representation that Sonlight has no beneficiaries indicates that such intention was not properly realized. Accordingly, the court turns to the merits of the bank’s petition.
IV
The bank seeks relief under two statutory provisions enacted in No. 17-99 of the 2017 Public Acts (P.A. 17-99). The first provision, codified in § 42a-9-518(f), allows the filing of a petition in Superior Court to invalidate a false or fraudulent record filed pursuant to certain provisions of the UCC. The second, codified in § 47-31a, allows the filing of a petition to invalidate a falsely filed or amended filing pursuant to chapters 821 to 822 of the General Statutes. To determine whether the bank is entitled to the relief it seeks, the court must construe the new provisions and consider their applicability to the records at issue.
"When construing a statute, [the court’s] fundamental objective is to ascertain and give effect to the apparent intent of the legislature ... In other words, [the court] seek[s] to determine, in a reasoned manner, the meaning of the statutory language as applied to the facts of [the] case, including the question of whether the language actually does apply ... In seeking to determine that meaning, General Statutes § 1-2z directs [the court] first to consider the text of the statute itself and its relationship to other statutes. If, after examining such text and considering such relationship, the meaning of such text is plain and unambiguous and does not yield absurd or unworkable results, extratextual evidence of the meaning of the statute shall not be considered." (Internal quotation marks omitted.) Price v. Independent Party of CT-State Central, 323 Conn. 529, 539, 147 A.3d 1032 (2016). "The test to determine ambiguity is whether the statute, when read in context, is susceptible to more than one reasonable interpretation." (Internal quotation marks omitted.) Id., 539-40. "Only if we determine that the statute is not plain and unambiguous or yields absurd or unworkable results may we consider extratextual evidence of its meaning such as the legislative history and circumstances surrounding its enactment ... the legislative policy it was designed to implement ... its relationship to existing legislation and common-law principles governing the same general subject matter ..." (Internal quotation marks omitted.) Tine v. Zoning Board of Appeals, 308 Conn. 300, 305-06, 63 A.3d 910 (2013).
A preliminary question is whether the new provisions are intended to be retroactive, so that they may be used to invalidate records filed in the land records before their effective date. The new provisions were enacted in P.A. 17-99, and their effective date was January 1, 2018. The records reproduced in Exhibit 1B through 1J were all filed on the town’s land records before January 1, 2018. The records reproduced in Exhibits 1K, 1L, 1M, and 1N were all filed after January 1, 2018.
Nothing in the text of either § 42a-9-518(f) or § 47-31a expressly states that the provision was intended to authorize invalidation of records filed before its effective date. The court notes that these provisions were originally proposed in Senate Raised Bill No. 931, titled "An Act Concerning the Fraudulent Filing of Records" (S.B. 931), in the 2017 legislative session. The first section of S.B. 931 established a new criminal offense of filing a false record, a class D felony, now codified as General Statutes § 53a-142a; the second section amended § 42a-9-518 to include a new subsection (f); the third section created the procedure now codified in § 47-31a; and a fourth section amended General Statutes § 52-259 to permit the filing of petitions without payment of a court fee. The four sections of S.B. 931 were later transferred to Substitute House Bill No. 7198, which was enacted as P.A. 17-99. Public Act 17-99 contained fifty-two sections. Thirty-nine of those sections were given the standard effective date of October 1, 2017; nine were effective upon passage; and only four- the sections transferred from S.B. 931- were effective as of January 1, 2018. There is no explanation in the statutory text or the legislative history for the short delay in the effective date of the provisions relating to false filings. The court therefore turns to the general principles that are applied to determine whether the provisions should be given retroactive effect.
General Statutes § 55-3 provides that "[n]o provision of the general statutes, not previously contained in the statutes of the state, which imposes any new obligation on any person or corporation, shall be construed to have a retrospective effect." Courts have interpreted § 55-3 "as a rule of presumed legislative intent that statutes affecting substantive rights shall apply prospectively only ... The Legislature only rebuts this presumption when it clearly and unequivocally expresses its intent that the legislation shall apply retrospectively." (Internal quotation marks omitted.) State v. Skakel, 276 Conn. 633, 680, 888 A.2d 985, cert. denied, 549 U.S. 1030, 127 S.Ct. 578 (2006). "As a corollary to this principle, we also have presumed that procedural or remedial statutes are intended to apply retroactively absent a clear expression of legislative intent to the contrary ..." Id. "The rule is rooted in the notion that it would be unfair to impose a substantive amendment that changes the grounds upon which an action may be maintained on parties who have already transacted or who are already committed to litigation ... In civil cases, however, unless considerations of good sense and justice dictate otherwise, it is presumed that procedural statutes will be applied retrospectively ..." (Internal quotation marks omitted.) Carr v. Planning & Zoning Commission, 273 Conn. 573, 592, 872 A.2d 385 (2005).
"While there is no precise definition of either [substantive or procedural law], it is generally agreed that a substantive law creates, defines and regulates rights while a procedural law prescribes the methods of enforcing such rights or obtaining redress." (Internal quotation marks omitted.) State v. Skakel, supra, 276 Conn. 680-81. In general, courts "will not give retrospective effect to a criminal statute absent a clear legislative expression of such intent." State v. Jackson, 153 Conn.App. 639, 643, 103 A.3d 166 (2014). On the other hand, "[p]rocedural statutes have been traditionally viewed as affecting remedies, not substantive rights, and therefore leave the preexisting scheme intact." (Internal quotation marks omitted.) Carr v. Planning & Zoning Commission, supra, 273 Conn. 592. Courts have also held that "[a]bsent a contrary legislative directive, it is presumed that if any part of an act applies retroactively, all of it is retroactive." (Internal quotation marks omitted.) Id., 595. However, in appropriate cases, the court may conclude that the various statutory subsections "are not so inextricably intertwined or interrelated that it would be illogical or infeasible to apply the procedural and clarifying portions of the act retroactively and the substantive portions prospectively." Id.
The court now turns to applying these principles to § § 42a-9-518(f) and 47-31a. These provisions are clearly remedial in character. They are intended to provide an expeditious means of invalidating records that have been falsely filed. Other statutory procedures, existing before these provisions were enacted, also afford judicial procedures for resolving claims about disputed records. With respect to land records, these include, but are not limited to, General Statutes § 47-31, which provides a cause of action to quiet title to land; General Statutes § 47-33j, which prohibits the filing of notices on the land records for the purpose of slandering title; General Statutes § 49-13, which provides for a petition for discharge of a mortgage, ineffective attachment, lis pendens, or lien; General Statutes § 49-51, which provides an action to discharge an invalid lien on real or personal property; and General Statutes § § 52-325a and 52-325d, which provide for petitions to discharge invalid notices of lis pendens. With respect to UCC filings, General Statutes § 42a-9-625 provides a remedy for a secured party’s failure to comply with the requirements of the UCC, including filing a record that the secured party was not entitled to file. See State v. Brightly, Superior Court, judicial district of Hartford, Docket No. CV 16-6069518-S (March 13, 2017, Shapiro, J.) (64 Conn.L.Rptr. 120, 121) (invalidating a false and unauthorized UCC filing).
General Statutes § § 42a-9-518(f) and 47-31a differ from the statutes cited above primarily in affording an expedited procedure for invalidating a falsely filed record. If the court finds cause to doubt the validity of the record at issue, it is required to hold a hearing within sixty days to determine the validity of the record. The legislative history of this provision provides an explanation as to why an expedited procedure was needed. As Judge Patrick L. Carroll, the Chief Court Administrator, explained in written testimony to the Judiciary Committee, false liens had been filed against public officials as a means of harassment or intimidation and "[r]emoving a false lien can be a costly and time-consuming process. The legal expenses that are involved can run into the thousands of dollars, and the process can take months, or even years to resolve. Restoring damaged credit histories can take even longer ... Currently, the process for removing a false filing is very cumbersome and lengthy; this bill will expedite the proceedings, give judges the authority to invalidate the false filing and designate one court with expertise to hear these matters." Conn. Joint Standing Committee Hearings, Judiciary, Senate Bill No. 931 (March 6, 2017).
In this case, the hearing was scheduled and opened within sixty days, but was continued at the request of respondents’ counsel and was further delayed by Hatheway’s filing of a motion to dismiss.
The remedial purpose of the statutes supports the conclusion that § § 42a-9-518(f) and 47-31a were intended to be available to invalidate records that were falsely filed before the effective date of these provisions. Although the criminal prohibition on filing false records in P.A. 17-99 is presumed to operate prospectively only, there is no reason that the remedial provisions cannot be given retroactive effect. See Carr v. Planning & Zoning Commission, supra, 273 Conn. 595. The criminal provision serves to deter and punish future false filings, while the remedial provisions serve to provide prompt relief to a victim of such false filings, regardless of the date of the false filing. Because the remedial provisions merely give victims of false filings an additional method of enforcing their preexisting right to petition the court to remove a false filing from the land records, the statutes may be applied retroactively. See State v. Skakel, supra, 276 Conn. 680. The court will therefore apply the provisions to all of the challenged filings.
V
The court first addresses the bank’s challenge to three UCC financing statements, reproduced in Exhibits 1B, 1G, and 1H. The first record at issue is Exhibit 1B, a UCC-1 financing statement that identifies Hatheway as both the debtor and the secured party and as a transmitting utility, two indicia of a false filing under § 42a-9-518(f)(3). The second record at issue is Exhibit 1G, which names Hatheway as the debtor and "Rbeate" as the secured party. The third record at issue is Exhibit 1H, which names Daniel Hatheway as the debtor and "Boyne" as the secured party. The question is whether § 42a-9-518(f) may be used to invalidate these financing statements.
Section 42a-9-518(f) provides in relevant part: "A person identified in any record filed pursuant to sections 42a-9-501 to 42a-9-526, inclusive, may petition the Tax and Administrative Appeals Session of the Superior Court to invalidate a record, when such record was falsely filed or amended." This language is more restrictive than the language used in certain other remedial statutes. For instance, § 47-31(a) provides that "[a]n action may be brought by any person claiming title to, or any interest in, real or personal property, or both, against any person who may claim to own the property, or any part of it ... or to have any interest in the property, or any lien or encumbrance on it, adverse to the plaintiff ..." (Emphasis added.) Thus, while § 47-31 can be used by anyone claiming any interest in property, § 42a-9-518(f)’s restrictive language indicates the legislature’s intent that its expedited remedies can be used only by "[a] person identified in any record filed pursuant to sections 42a-9-501 to 42a-9-526." (Emphasis added.) See also Morales v. Pentec, Inc., 57 Conn.App. 419, 432, 749 A.2d 47 (2000) (noting that there "is no question that the legislature may, by the language it uses in a statute or a section of a statute, demonstrate its intent that it be limited or restricted").
The UCC financing statements at issue do not identify the bank or contain any references to the bank. By its express terms, § 42a-9-518(f) does not apply to these financing statements even though they constitute a cloud on the bank’s title. The language is plain and unequivocal; a petitioner under § 42a-9-518(f) must be named in a statement filed under the relevant provisions of the UCC.
As discussed above, the provision codified in § 42a-9-518(f) was intended to address, in expedited fashion, the increasingly frequent problems caused by the filing of false UCC liens. "It is evident that the filing of false and fraudulent UCC financing statement notices is occurring in various jurisdictions." State v. Brightly, supra, 64 Conn.L.Rptr. 121. Such statements are easy to file but burdensome to remove. "For example, in a New Jersey incident, criminal defendants registered ... a $3.5 million lien against a federal judge for using their ‘copyrighted’ names in court papers and hearings; it took a federal court order to remove them. In addition to the substantial effort and expense required to expunge the liens, the fraudulent filings ruined the victims’ credit reports." Monroe v. Beard, 536 F.3d 198, 203 (3rd Cir. 2008), cert. denied, 556 U.S. 1135, 129 S.Ct. 1647, 173 L.Ed.2d 1008 (2009).
The growing problem of false UCC filings has been recognized for at least fifteen years. See National Association of Secretaries of State, "State Strategies to Subvert Fraudulent Uniform Commercial Code Filings" (last modified June 2019), p. 4, available at https://www.nass.org/sites/default/files/bogus%20filing/final-nass-report-bogus-filingsjune19.pdf (last accessed September 2, 2019).
States have taken varying statutory approaches to address such false UCC filings. Some states have responded by enacting laws that provide an avenue for relief specifically for public employees. For instance, New York law provides a special proceeding to redact or expunge a falsely filed or amended financing statement, but it is available only to "a person identified as a debtor in a financing statement" who is either "an employee of the state or a political subdivision thereof" or "an attorney who ... represents or has represented the respondent therein in a criminal court." See N.Y. U.C.C. Law § 9-518(d) (McKinney). Other states have provided an avenue for relief to anyone whose real or personal property is affected by a false lien. For instance, Colorado law provides that "[a]ny person whose real or personal property is affected by a recorded or filed lien or document that the person believes is a spurious lien or spurious document may petition the district court ... for an order to show cause why the lien or document should not be declared invalid." Colo. Rev. Stat. § 38-35-204(1). Colorado’s statute has been used in disputes entirely between private parties. See, e.g., Battle North, LLC v. Sensible Housing Co., 370 P.3d 238, 247 (Colo.App. 2015).
In § 42a-9-518(f), Connecticut’s legislature took an approach between that of New York and Colorado. Unlike New York’s statute, § 42a-9-518(f) is not limited to public officials and employees; it is available to anyone "identified in any record" filed under the specified UCC provisions. But unlike Colorado’s statute, § 42a-9-518(f)’s plain language indicates that it applies only to a person identified in a UCC filing, presumably as the debtor. That does not mean the bank is without a remedy; the quiet title statute, § 47-31(a), is available to "any person claiming title to ... real or personal property" and can be brought against "any person who may claim to ... have any interest in the property, or any lien or encumbrance on it ..." Section 42a-9-518(f)’s unambiguous and restrictive language, however, does indicate that its expedited procedure for removing falsely filed records is not available to a party that is not named in the UCC filing at issue. See Morales v. Pentec, Inc., supra, 57 Conn.App. 432.
The court notes, in addition, that § 42a-9-518(f)(1) requires the petitioner to send a copy of a petition to invalidate a record "to all parties named in such record." Nothing in the record before the court indicates that the bank sent a copy of the petition to "Rbeate," or to "Boyne," the parties named as the secured parties in the UCC financing statements reproduced in Exhibits 1F and 1G, respectively. Rbeate was a named defendant in the 2016 foreclosure and was defaulted for failure to appear; its interest in the property was accordingly extinguished by the foreclosure judgment in that action. Boyne, however, was not named in the 2016 foreclosure, and the court has no information about it. Given the absence of notice to Rbeate and Boyne in this action, the bank has not shown that it has met the prerequisites for application of § 42a-9-518(f) as to the UCC financing statements purportedly filed on behalf of those entities as secured parties.
Accordingly, the court denies relief with respect to the three records reproduced in Exhibits 1B, 1G, and 1H.
VI
The bank relies on § 47-31a to invalidate certain notices, affidavits, and notices of lis pendens filed on the town’s land records. Section 47-31a provides as follows:
(a) A person, as defined in section 42a-1-201, who has been identified in a filing pursuant to chapters 821 to 822, inclusive, may petition the Tax and Administrative Appeals Session of the Superior Court to invalidate such filing, or any amendment thereof, when such filing was falsely filed or amended. The court shall review such petition and determine whether cause exists to doubt the validity of such filing or amendment. Upon a determination that such cause exists, the court shall, not later than sixty days after the date of such determination, hold a hearing to determine whether to invalidate such filing or amendment or grant any other relief deemed appropriate by the court. There shall be no fee to petition for a hearing under this section. The person petitioning the court to invalidate a filing shall send a copy of such petition to all parties named in such filing.
(b) A person who files a petition under subsection (a) of this section shall include, as part of such petition, a certified copy of the filing, and any amendment thereof, that such person seeks to invalidate.
(c) In determining whether cause exists to doubt the validity of a filing or amendment under subsection (a) of this section, the court may consider factors that include, but are not limited to, whether (1) the filing or amendment is related to a valid existing commercial, financial or real estate transaction, or a potential commercial, financial or real estate transaction, or a judgment of a court of competent jurisdiction; (2) the same individual is named as both debtor and creditor; (3) an individual is named as a transmitting utility; and (4) the filing or amendment has been filed with the intent to defraud, deceive, injure or harass a person, business or governmental entity.
(d) If the court determines after a hearing that a filing identified in a petition filed pursuant to subsection (a) of this section is not valid, the court shall render a judgment that such filing is void in its entirety and shall direct the custodian of such filing, when feasible, to note that such filing is not valid. The court may grant such other relief as it deems appropriate. The petitioner under subsection (a) of this section shall provide a copy of the petition and the judgment of the court granting such petition to the custodian of the filing adjudged invalid by the court.
The bank is a "person" under General Statutes § 42a-1-201. The challenged filings on the land records constitute filings under either General Statutes § 47-12a or General Statutes § 47-33f, both of which are found in chapter 821 of the General Statutes.
General Statutes § 42a-1-201(27) defines "person" as "an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency or instrumentality, public corporation or any other legal or commercial entity."
General Statutes § 47-12a(a) provides, in relevant part: "An affidavit, which states facts relating to the matters named in subsection (b) of this section and which may affect the title to or any interest in real estate in this state, and which is made by any person having knowledge of the facts or competent to testify concerning them in open court, may be recorded in the land records of the town in which the real estate is situated." Subsection (b) of § 47-12a authorizes the filing of affidavits relating, in relevant part, to "the happening of any condition or event which may terminate an estate or interest and any other state of facts affecting title to real property."
General Statutes § 47-33f(a) provides in relevant part: "Any person claiming an interest of any kind in land may preserve and keep effective that interest by recording ... a notice in writing, duly verified by oath, setting forth the nature of the claim." General Statutes § 47-33g(b) provides in relevant part: "Each notice shall be recorded in the land records of the town where the land described therein is located." Although notices of lis pendens are governed procedurally by General Statutes § 52-325 in chapter 904 of the General Statutes, courts have recognized that they are also records affecting land titles under Title 47 in Chapter 821 of the General Statutes. See, e.g, Fountain Pointe, LLC v. Calpitano, 144 Conn.App. 624, 653-54, 76 A.3d 636 (2013) (affirming finding that mortgages and lis pendens slandered title under § 47-33j); Forgione v. Commercial Credit Corp., Superior Court, Docket No. X06CV 98-0153101-S (December 16, 1999, Aurigemma, J.) (finding that lis pendens was "maliciously placed on the premises" in violation of § 47-33j following foreclosure of the filer’s interest in the property).
The court now considers what the phrase "falsely filed" means. The statute does not define "false filing," but it does provide guidance to the court for determining whether a record is likely to be false in subsection (c). Subsection (c)’s non-exclusive list indicates that a record may be "falsely filed" for purposes of § 47-31a if it is patently invalid, such as a filing that names the same person as both debtor and creditor, or a filing that names an individual as a "transmitting utility." It also indicates that a record may be "falsely filed" if the evidence establishes that it was filed for the purpose of defrauding, deceiving, injuring or harassing a person or business. Because the considerations in § 47-31a(c) are non-exclusive, the court may also consider other indicia of invalidity, such as a pattern of conduct establishing a respondent’s intention to interfere unjustifiably with the legal rights of another person.
In this case, Hatheway argues that the bank presented no evidence that the records are false. The bank argues that it presented the following evidence: the records themselves, the complaints in the two Arizona federal court actions, the record of the 2016 foreclosure action, of which the court took judicial notice, and the testimony of two witnesses. The court concludes that, in the circumstances presented here, the bank’s evidence is sufficient to prove the invalidity of the notices and affidavits reproduced in Exhibits 1C, 1D, 1E, 1F, 1I, 1J, 1K, 1L, 1M, and 1N.
In reaching this conclusion, the court considers the context in which Hatheway filed these records. The first record filed in the land records by Hatheway was the UCC financing statement filed on July 30, 2009. (Exhibit 1B.) It was filed while the 2008 foreclosure was pending, and it was patently false. It named Hatheway as the debtor and the secured party; it claimed that Hatheway was a "transmitting utility"; and it claimed that as debtor, Hatheway was a "trust accepted for value exempt from levy without the United States corporatism." These facts all indicate that the document was "falsely filed" within the meaning of the statute. Although the court has held that § 42a-9-518(f) cannot be used to invalidate this financing statement because the bank is not named in it, the court can nevertheless consider the record as evidence of Hatheway’s intent. Filed in the context of the 2008 foreclosure, the filing evinces an intent to cloud title to the property and thereby impair the bank’s interest in it.
The records reproduced in Exhibits 1C, 1D, 1E, and 1F were all filed on November 20, 2009, while the bank’s 2008 foreclosure action was pending. It is apparent that these documents were also filed with the intent of clouding the bank’s title if it obtained a judgment of foreclosure. It is also obvious, from the entire record before the court, that Hatheway had no intention of submitting to the court’s jurisdiction or accepting its judgment. Her strategy instead was to put as many obstacles as possible in the bank’s path to foreclosure and, after the foreclosure judgment became final, to hinder the bank’s efforts to sell the property. This can be seen in Hatheway’s numerous efforts to create a "contract" or "agreement" out of the bank’s silence. For instance, in the record reproduced in Exhibit 1C, Hatheway acknowledged the bank’s "adverse claim," requested "certified confirmation" of the bank’s interest, and denied knowledge of any documents granting the bank an interest in the loan. She went further, then, to assert that if the bank failed to provide a "certified rebuttal of any points herein this six-part ‘Notice,’ " the bank thereby "accepts all possible liability for the below acts and deeds ..." The "below acts and deeds" include a lengthy list of possible violations of law, some of which as a matter of law could not be committed by the bank. Rather than asserting such claims in pleadings in litigation where she would be required to offer evidence in support of her claims, Hatheway simply asserted her claims on the land records and then tried to use the land records as "evidence" in the litigation, as if merely saying something is true would make it a "fact."
For instance, Hatheway alleges that the bank’s failure to respond would establish a violation of the federal Freedom of Information Act. That act, however, applies to federal agencies, not to private parties acting in their private capacities. Other alleged violations appear not to relate to any law at all.
The document reproduced in Exhibit 1E also demonstrates Hatheway’s pattern of filing documents for the purpose of clouding or otherwise impairing the bank’s title to the property. This document purported to be a notice of rescission under the federal Truth in Lending Act, 15 U.S.C. § 1635(a). However, § 1635(f) of that act provides a three-year limitation period for rescission. Hatheway filed her notice of rescission on November 20, 2009, more than three years after the May 3, 2006 transaction it purported to rescind. See Beach v. Ocwen Federal Bank, 523 U.S. 410, 412, 118 S.Ct. 1408, 140 L.Ed.2d 566 (1998) ("§ 1635(f) completely extinguishes the right of rescission at the end of the 3-year period"). Although the notice of rescission was not valid, Hatheway claimed throughout the 2016 foreclosure that there was no debt because she had rescinded the transaction. The court, therefore, finds that each of the documents filed on November 20, 2009, were falsely filed because they were filed with the intent to injure or harass the bank and to impede its effort to foreclose.
The court next turns to Exhibit 1I, captioned "Affidavit of Facts Affecting Title to Real Property with Notice of Transfer of Title." Hatheway filed this document in the town’s land records on September 28, 2016, some six months after the bank commenced the 2016 foreclosure and filed its notice of lis pendens regarding that action in the land records. The affidavit alleges that on October 17, 2015, Hatheway and Daniel Hatheway transferred their interest in the property by quitclaim deed to "Sonlight." The affidavit asserted that the bank’s mortgage on the property "no longer has any legal force or effect" because Hatheway had rescinded the transaction. In virtually every filing since this affidavit was filed, Hatheway has challenged the bank’s interest in the property on the grounds that the loan was rescinded and that the alleged transfer to Sonlight took place before the bank filed the 2016 foreclosure.
The claim in that affidavit is false in two respects: first, it relies on an ineffective rescission, and second, it ignores the effect of the bank’s lis pendens. Even if, as the affidavit averred, the Hatheways quitclaimed the property to a trust before the bank’s lis pendens was filed, it is undisputed that no notice of the alleged transfer was recorded in the land records until September 28, 2016, after the bank’s lis pendens was filed. The effect of the bank’s lis pendens is set out in General Statutes § 52-325(a), which provides, in relevant part, that a notice of lis pendens "shall, from the time of the recording only, be notice to any person thereafter acquiring any interest in such property of the pendency of the action; and each person whose conveyance or encumbrance is subsequently executed or subsequently recorded ... shall be deemed to be a subsequent purchaser or encumbrancer, and shall be bound by all proceedings taken after the recording of such notice, to the same extent as if he were made a party to the action." (Emphasis added.) In other words, it does not matter when an alleged conveyance or encumbrance took place; what matters is when notice of such conveyance or encumbrance is recorded on the land records. As explained in the Connecticut Standards of Title, "[a] person whose conveyance or encumbrance is executed or recorded after the notice of lis pendens shall forfeit his rights thereunder, unless he seeks to be made a party defendant before the judgment or decree is rendered." (Emphasis added.) Connecticut Bar Association, Connecticut Standards of Title, Standard 19.1(A). Although Hatheway contended that the bank had acted improperly in bringing the foreclosure action against her rather than against Sonlight, she misunderstood the effect of the lis pendens statute in Connecticut, which is a record title state. As the Standards of Title state, "Actual knowledge of the plaintiff that a party is in the actual and visible possession of such property, pursuant to an unrecorded deed, does not create an obligation to make that party a defendant." Id. The burden was on Hatheway, as trustee of Sonlight, to move to make Sonlight a defendant in the 2016 foreclosure. Because she never made that motion, any rights Sonlight might have possessed by virtue of the quitclaim deed were forfeited when the foreclosure judgment was rendered.
Each of the records filed after September 28, 2016, rely on the same premises as the affidavit filed on that date- namely, that the notice of rescission extinguished the loan and that the transfer to Sonlight made Sonlight the true owner of the property. As the 2016 foreclosure progressed, moreover, Hatheway’s intent to reject the court’s authority and to interfere with the bank’s right to foreclose and take title to the property became more explicit. For example, in the affidavit filed on December 12, 2017 (reproduced in Exhibit 1J), Hatheway asserted that the court’s judgment was "void"; in the affidavit filed on October 30, 2018, she asserted her intention to "reclaim" or "repossess" title to the property on behalf of Sonlight. Consequently, the court finds that each of these records was "falsely filed" within the meaning of § 47-31a because each was intended to injure and harass the bank and to interfere with its legal interest in the property.
The two notices of lis pendens filed by Hatheway with respect to the actions she commenced in federal district court in Arizona are similarly "falsely filed" within the meaning of § 47-31a. Hatheway argues that the notices of lis pendens are not false because they refer to actions actually pending in the courts. The fact that the notices refer to actual lawsuits, however, is not dispositive. In Fountain Pointe, LLC v. Calpitano, 144 Conn.App. 624, 656 n.14, 76 A.3d 636, cert. denied, 310 Conn. 928, 78 A.3d 147 (2013), the Appellate Court pointed out that the existence of litigation does not establish that a lis pendens was filed in good faith. In that case, a trial court had invalidated a notice of lis pendens despite the fact that the notice referred to actual litigation. The Appellate Court affirmed, noting that the litigation itself had been brought with reckless disregard of the falsity of the documents on which it was based. Id.
In this case, Hatheway’s actions in Arizona are improper collateral attacks on the validity of the foreclosure. The action referenced in Exhibit 1M, Hatheway v. Bank of New York Mellon, names as defendants the bank and its chief executive officer. Hatheway claims that the bank "sued Alison Hatheway for relief of debt by vestment of title to property which she did not own as she had quit claimed the title to the property prior to the commencement of the case and advised Bank of New York Mellon of the new title holder." Hatheway brought this action in Arizona, even though the dispute entirely concerns real property in Connecticut and had already been adjudicated in the 2016 foreclosure. The Arizona district court has dismissed the action for lack of personal jurisdiction. Although Hatheway asserts that she will seek reconsideration and will appeal, the Arizona district court’s dismissal supports the bank’s argument that the lis pendens was filed only to injure and harass the bank and hinder its efforts to sell the property.
The Arizona district court action referenced in Exhibit 1N, Hatheway v. Sirochman, is an even more improper use of the lis pendens, as that action does not name the bank as a defendant and therefore could not affect the title to the property. This action names as defendants three Connecticut realtors and the bank’s attorney in this petition. The lis pendens states that the action is brought "to show defendants advertising an MLS listing for the property known as 112 Cedar Swamp Road, Deep River CT as Bank owned, and claiming bank ownership in public documents in violation of 15 U.S. Code § 1125." The complaint to which the lis pendens refers seeks to enjoin these four individual defendants "from creating any references that the property is bank owned, remove the for sale listing, not offer the property for sale, have their real estate licenses suspended for life, pay retribution for expenses and other costs of the criminal activity, and cease from interfering with the title holder’s use, enjoyment and alienation of the property." (Exhibit 3.) A lis pendens is to be used for actions "intended to affect real property." General Statutes § 52-325(a). Because this action does not name the record owner of the property as a defendant, it is plain that it was filed only to harass and injure individual agents of the bank.
Invalidating the two notices of lis pendens through the procedures in § 47-31a is consistent with the legislative purpose underlying the statute. As discussed above, P.A. 17-99 provides an expedited procedure for removing documents from the land records in order to combat the rising number of records that are falsely filed for the purpose of harassing or intimidating the intended victim. A notice of lis pendens is a cloud on title that may make it difficult, if not impossible, for an owner to sell property. In this case, Hatheway’s post-foreclosure affidavits make clear that she refuses to accept the foreclosure judgment, even though she failed to perfect an appeal from that judgment. Because she is using the notices of lis pendens to harass the bank and prevent it from selling the property, her actions fall squarely within the type of conduct that the legislature was seeking to remedy by enacting § 47-31a.
Hatheway’s intention to interfere with the bank’s legal rights is further demonstrated by her hiring of a private investigator, who admitted that he had set up cameras at the property to observe and report to her on the people who entered the property. Sirochman, one of the real estate agents whom Hatheway has sued, testified credibly that Hatheway’s filings on the land records and stationing of the investigator at the property has caused the bank to lose at least two potential sales of the property. Such conduct confirms that Hatheway has simply refused to accept the judgment of the court in the 2016 foreclosure. It also demonstrates that her purpose in her various filings on the land records is to injure and harass the bank and interfere with its right to sell the property. Such improper purpose is one of the factors that the court may consider when determining whether to invalidate a record pursuant to § 47-31a. See General Statutes § 47-31a(c)(4). In these circumstances, the bank is entitled to relief to invalidate the respondents’ filings and to enjoin their efforts to cloud the bank’s title.
VII
The court finds that the notices, affidavits, and notices of lis pendens reproduced in Exhibits 1C, 1D, 1E, 1F, 11, 1J, 1K, 1L, 1M, and 1N were falsely filed, and the same are hereby declared invalid, void, and of no effect. An order authorizing the custodian of the land records of the town of Deep River, Connecticut, to note the invalidity of these records is filed contemporaneously with this memorandum of decision and specifies the invalid records by volume and page number of their recording.
The court finds that the petitioner is entitled to permanent injunctive relief pursuant to General Statutes § 47-31a. Such relief is ordered in the Permanent Injunction Order filed contemporaneously with this memorandum of decision.
The court finds that the petitioner is not a person named within the UCC financing statements alleged to have been falsely filed, as required for the invalidation of those filings pursuant to General Statutes § 42a-9-518(f), and the petition is denied with respect to the filings reproduced in Exhibits 1B, 1G, and 1H.
So ordered.