Opinion
No. WWMCV 09 6000991S
July 16, 2010
MEMORANDUM OF DECISION RE MOTION FOR SUMMARY JUDGMENT AND MOTION FOR DEFAULT FOR FAILURE TO DISCLOSE A DEFENSE
The plaintiff, the town of Canterbury, commenced this action by service of process upon the defendants on November 19 and 23, 2009. The defendants are the Church of the Good Word (the Church); Joseph Lagana; Henry Graff, the executor of Joseph Lagana's estate (Graff); Stella Lagana; Michael Lagana; the heirs of Joseph Lagana; Hospice, Inc.; the town of Scotland; the state of Connecticut; and Home and Bank Trust Company. The only defendant against whom the plaintiff directs the present motions for summary judgment and default is Hospice, Inc.
The plaintiff filed motions for default for failure to appear against the town of Scotland, the state of Connecticut, Home Bank Trust Company and the Church of the Good Word on February 1, 2010. All of these motions were granted by the court on February 2, 2010.
The eighteen-count complaint alleges the following facts. On October 1, 2006, October 1, 2007 and October 1, 2008, Joseph Lagana, individually, under the auspice of the Church or both, was the record owner/s of six properties in Canterbury. The plaintiff assessed taxes on each of the properties that became due and payable on July 1, 2007, July 1, 2008 and July 1, 2009. These taxes remain unpaid. The plaintiff recorded certificates of lien for the taxes with interest, fees and charges thereof in its land records in June 2008 and June 2009. The plaintiff now seeks to foreclose on its tax liens and possess the properties, which are currently owned and possessed by Graff. In seeking foreclosure, the plaintiff claims that its rights are prior and senior to any rights that any of the defendants may have in the properties. Hospice, Inc. (hereinafter the defendant), for example, has or may have rights in the properties because it is or may be a beneficiary under Joseph Lagana's will. The answers filed by Michael Lagana, Joseph Lagana's brother, and Stella Lagana, Joseph Lagana's mother, on December 28, 2009 and January 6, 2010, respectively, state that the defendant is the sole beneficiary under Joseph Lagana's will.
On February 2, 2010, the plaintiff filed a demand for a disclosure of defenses by the defendant. The defendant in turn filed a notice of defenses on February 9, 2010. In its proposed defenses, the defendant pleaded, inter alia, that it is the beneficial owner of Joseph Lagana's estate by virtue of his will, currently in probate in the Probate Court for the District of Plainfield. The plaintiff filed the present motions for summary judgment on the issue of liability only and default for failure to disclose a defense, along with accompanying memoranda of law and four exhibits on April 22, 2010. The plaintiff's exhibits include a copy of the defendant's notice of defenses, certified copies of the plaintiff's tax lien certificates and affidavits given by the plaintiff's tax collector and tax assessor, respectively. The defendant filed its answer and special defenses on the same day. The special defenses are identical to the defenses disclosed in the February 9, 2010 notice. The defendant has not filed an opposition to either of the present motions. The court heard oral argument for the motions at short calendar on June 1, 2010.
The grounds upon which the plaintiff moves for summary judgment and default for failure to disclose a defense are identical. In both its notice of defense and its answer and special defenses, the defendant argues, inter alia: "As Hospice is a non-profit as recognized by the Internal Revenue Service and State of Connecticut, Hospice would have no liability for taxes to the Plaintiff incurred after the date on which Hospice became the beneficial owner of the said real property, and Hospice had no notice with which to request an exemption from the Grand List of the Town of Canterbury." The plaintiff argues that this defense is legally insufficient to overcome the validity of the tax liens and the plaintiff's ability to foreclose on them and is therefore not bona fide for two reasons. First, an argument that a property is tax-exempt is a challenge to a tax assessment that cannot be made as a special defense in a collection action brought under General Statutes § 12-161. Second, the plaintiff has met its notice requirements of posting an annual grand list of property value assessments and tax exemptions, publishing notice of when and where taxes will be collected and making demands upon delinquent taxpayers either personally or by mail.
General Statutes § 12-161 provides: "All taxes properly assessed shall become a debt due from the person, persons or corporation against whom they are respectively assessed to the town, city, district or community in whose favor they are assessed, and may be, in addition to the other remedies provided by law, recovered by any proper action in the name of the community in whose favor they are assessed."
The court will first address the motion for default. Practice Book § 13-19 provides in relevant part: "In any action to foreclose . . . any . . . lien . . . in which there is an appearance by an attorney for any defendant, the plaintiff may at any time file and serve . . . a written demand that such attorney present to the court, to become a part of the file in such case, a writing signed by the attorney stating whether he or she has reason to believe and does believe that there exists a bona fide defense to the plaintiff's action and whether such defense will be made, together with a general statement of the nature or substance of such defense. If the defendant fails to disclose a defense within five days of the filing of such demand . . . the plaintiff may file a written motion that a default be entered against the defendant by reason of the failure of the defendant to disclose a defense."
The standard for what constitutes a "failure of the defendant to disclose a defense" was articulated by the court in Mortgage Electronic Registration Systems, Inc. v. Pressman, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV 03 0194914 (October 28, 2004, Tobin, J.T.R.). In Mortgage Electronic Registration Systems, Inc., the plaintiff moved for default for failure to disclose a defense on the ground that the defenses disclosed by the defendants were not proper. The court rejected the motion because the defenses met the standard articulated in Jennings v. Parsons, 71 Conn. 413, 42 A. 76 (1899), that defenses "not appear to be clearly untruthful, irrelevant, frivolous or asserted in bad faith." Mortgage Electronic Registration Systems, Inc., supra, Superior Court, Docket No. CV 03 0194914. The court elaborated: "It is evident from the language of the rule, that the chief thing to be determined in a proceeding under it is the real belief of the counsel and his good faith in this matter, rather than the validity or sufficiency in point of law or of fact of the defense stated . . . If the disclosed defense in a given case is clearly and unpalpably untruthful, or irrelevant, or utterly frivolous, it would indicate bad faith on the part of the counsel, and might warrant the court in holding that it was not satisfied either that the attorney believed that a bona fide defense existed, or that he intended to make it; but that is a very different thing from passing upon the legal sufficiency of an apparently good defense, believed in good faith to exist, and honestly intended to be made." (Citations omitted; internal quotation marks omitted.)
The plaintiff in the present case does not question whether the subject defense was disclosed in good faith. By signing the February 2, 2010 notice, counsel for the defendant attested that he had reason to believe and did believe that valid defenses existed to the plaintiff's action that the defendant would make (and has made by filing its answer and special defenses on April 22, 2010). There is insufficient evidence to determine that this belief was untruthful and stated in bad faith. The plaintiff instead argues for a default order only on the ground that the defense is not "proper" and therefore not bona fide. This is not a recognized ground for a motion for default for failure to disclose a defense. The court therefore denies the plaintiff's motion because the defense disclosed by the defendant appears to be based upon real belief and made in good faith, in accordance with the standard articulated in Jennings v. Parsons.
The court will now address the motion for summary judgment. "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." (Citations omitted.) Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989). "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." (Citation omitted; internal quotation marks omitted.) Kakadelis v. DeFabritis, 191 Conn. 276, 282, 464 A.2d 57 (1983).
"The courts hold the movant to a strict standard. 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 . . . As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent . . . When documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue . . . Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue." (Internal quotation marks omitted.) Zielinski v. Kotsoris, 279 Conn. 316, 318-19, 901 A.2d 1207 (2006).
"Ordinarily, `a [plaintiff's] motion for summary judgment as to a special defense is improper. Such a motion is improper because Practice Book § 17-44 does not provide for summary judgment on special defenses.' Sound Post, LLC v. New Harvest Coffee Roasters, Inc., Superior Court, housing session at Bridgeport, Docket No. BRSP 056336 (May 6, 2005, Skolnick, J.). `A court may consider, however, special defenses if the facts entitle the plaintiff to judgment on the underlying claim and the defenses have no merit.' First Union National Bank v. Rath, Superior Court, judicial district of New Haven, Docket No. CV 99 0431811 (December 29, 2000, Celotto, J.T.R.); see also Kazlon Communications, LLC v. American Golfer, Inc., 82 Conn.App. 593, 596, 847 A.2d 1012 (2004); Source One Mortgage Services Corp. v. Dziurzynski, Superior Court, judicial district of Stamford-Norwalk at Stamford, Docket No. CV 95 0145337 (May 22, 1996, Hickey, J.) ( 17 Conn. L. Rptr. 29); Mechanics Savings Bank v. Walker, Superior Court, judicial district of Hartford, Docket No. CV 91 0500701 (March 13, 1995, Corradino, J.) ( 14 Conn. L. Rptr. 129). `[T]o establish their entitlement to summary judgment, the plaintiffs must plead and prove not only that there is no genuine issue of material fact as to the defendants' special defense[s] . . . but also that there is no such genuine issue as to each contested element of its . . . [own] claim.' Knudsen v. Volpe, Superior Court, judicial district of Litchfield, Docket No. CV 94 0066028 (December 4, 1998, Sheldon, J.)." Bank of New York Trust Co., NA v. Gbeh, Superior Court, judicial district of Litchfield, Docket No. CV 07 5002495 (February 26, 2008, Marano, J.).
The plaintiff moves for summary judgment on the ground that there is no genuine issue of material fact regarding the defendant's liability in the present action but bases its argument on the legal insufficiency of the defendant's special defense. "By challenging the validity of the . . . special defense, the plaintiff appears to be moving for summary judgment on the special defense," not the complaint. Eight Fifty Five RT v. Gaynor, Superior Court, judicial district of New London, Docket No. CV 124994 (January 27, 2004, Martin, J.). The court nonetheless grants the plaintiffs motion for summary judgment. The plaintiff has pleaded and proven that there is no genuine issue of material fact with respect to both the defendant's special defense and its own cause of action, and it is entitled to a judgment as a matter of law.
The plaintiff has pleaded and proven that there is no genuine issue of material fact with respect to its cause of action because it has made a prima facie case for a municipal tax lien foreclosure action under Practice Book § 10-70. Section 10-70(a) provides: "In any action to foreclose a municipal tax or assessment lien the plaintiff need only allege and prove: (1) the ownership of the liened premises on the date when the same went into the tax list, or when said assessment was made; (2) that thereafter a tax in the amount specified in the list, or such assessment in the amount made, was duly and properly assessed upon the property and became due and payable; (3) (to be used only in cases where the lien has been continued by certificate) that thereafter a certificate of lien for the amount thereof was duly and properly filed and recorded in the land records of the said town on the date stated; (4) that no part of the same has been paid; and (5) other encumbrances as required by the preceding section." Section 10-70(b) further provides in relevant part: "When the lien has been continued by certificate, the production in court of the certificate of lien, or a certified copy thereof, shall be prima facie evidence that all requirements of law for the assessment and collection of the tax or assessment secured by it, and for the making and filing of the certificate, have been duly and properly complied with." The exhibits submitted by the plaintiff, which include certified copies of the tax lien certificates, accordingly provide sufficient evidentiary support for the allegations contained in the complaint. Furthermore, the parties do not dispute the fact that the defendant is the beneficial owner of the six properties upon which the plaintiff assessed the unpaid taxes.
The plaintiff has also properly pleaded and proven that the special defense proffered by the defendant is without merit. First, as the plaintiff notes in its memorandum in support of its motion for summary judgment, a claim of unlawful assessment can be addressed through an appeal from the board of assessors under General Statutes § 12-111 or an application to the court under General Statutes § 12-119 and therefore cannot be raised as a special defense in an action to collect taxes under § 12-161. Hartford v. Faith Center, Inc., 196 Conn. 487, 491-92, 493 A.2d 883 (1985). "[A] taxpayer who has failed to utilize the available statutory remedies [may not] assert, in an action to collect a tax . . . that the tax has not been properly assessed." (Internal quotation marks omitted.) Redding v. Elfire, LLC, 98 Conn.App. 808, 821, 911 A.2d 1141 (2006). The defendant in the present case has sought neither of the available statutory remedies and therefore may not now assert in the present action that the taxes were improperly assessed because the properties were subject to charitable exemptions.
Section 12-111(a) provides in relevant part: "Any person, including . . . [ inter alia] any person to whom title to such property has been transferred since the assessment date, claiming to be aggrieved by the doings of the assessors of such town may appeal therefrom to the board of assessment appeals." Section 12-119 in turn provides in relevant part: "When it is claimed that a tax has been laid on property not taxable in the town or city in whose tax list such property was set, or that a tax laid on property was computed on an assessment which, under all the circumstances, was manifestly excessive and could not have been arrived at except by disregarding the provisions of the statutes for determining the valuation of such property, the owner thereof . . . prior to the payment of such tax, may, in addition to the other remedies provided by law, make application for relief to the superior court for the judicial district in which such town or city is situated. Such application may be made within one year from the date as of which the property was last evaluated for purposes of taxation and shall be served and returned in the same manner as is required in the case of a summons in a civil action, and the pendency of such application shall not suspend action upon the tax against the applicant."
Second, the Supreme Court has held that a defendant who argues lack of notice as a special defense in a municipal tax lien foreclosure action must provide supporting evidence in order to overcome the validity of the subject tax lien, which is presumed when, pursuant to Practice Book § 10-70(b), the plaintiff produces a certified copy of the certificate that continues the lien. Wallingford v. Glen Valley Associates, Inc., 190 Conn. 158, 163, 459 A.2d 525 (1983). The plaintiff in the present case has provided certified copies of its tax lien certificates, but the defendant has not in turn provided "evidence showing that [it] failed to receive notice of the . . . assessment." Id. Its special defense instead consists only of its argument that it "had no notice with which to request an exemption from the Grand List . . ."Since [the defendant] did not sustain its burden of proof, the . . . lien[s] [are] presumed to be valid" and compliant with any notice requirements that may underlie them. Id. The defendant thus may not avoid liability by arguing that it did not receive notice of the taxes that would have prompted it to seek charitable exemptions for the properties.
Because the plaintiff has pleaded and proven that there is no genuine issue of material fact with respect to both its cause of action and the defendant's special defense, it is entitled to a judgment as a matter of law. The court therefore grants its motion for summary judgment.
For the foregoing reasons, the court denies the plaintiff's motion for default for failure to disclose a defense and grants the plaintiff's motion for summary judgment.