Opinion
FBTCV136035841S
10-31-2019
JP Morgan Chase Bank, National Association v. Betty Lawrence et al.
UNPUBLISHED OPINION
Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Spader, Walter M., J.
MEMORANDUM OF DECISION ON DEFENDANT’S MOTION TO DISMISS (#178.00)
Walter Michael Spader, Jr. Judge.
At the onset, the Court will note that the defendant did not appear for the hearing on her motion to dismiss. A continuance was filed and denied on the morning of the Court hearing. Plaintiff’s counsel indicated that the defendant also failed to appear for oral argument at the Appellate Court on October 21, 2019. The Court conducted the hearing with only the plaintiff present. The plaintiff highlighted various points in its written arguments and again brought the original note and mortgage to the hearing for the Court’s review. The Court is relying on the history of pleadings and the defendant’s written arguments in support of her motion. The Court orally denied the motion to dismiss, sustained the objection thereto, ordered the plaintiff to file an amended complaint and set new law days. This written Memorandum of Decision provides the reasoning behind the Court’s oral Orders.
The Court denied the continuance request with the following Order (See Docket Entry #196):
At 1:10 a.m. this morning, the Defendant filed a motion for continuance indicating "Counsel not ready" and stating "Subsequent to court order 178.50 scheduling hearing 10-30 Plaintiff filed another motion on 10-25 Pursuant to PB rules Def has 14 days to respond."
The Court is denying the motion for continuance for multiple reasons:
1) The defendant has been a self-represented litigant for over six years. In that time, there have been no appearances by any counsel on her behalf. That "Counsel not ready" is claimed as a cause for continuance is inconsistent with the history of the file;
2) The filing by the plaintiff on October 25, 2019 is an affidavit with attachments that have been already been presented to the Court in earlier hearings and pleadings and is an argument consistent with their objection on file for nearly two years. It is not a "motion" as alleged by the defendant in need of a written response, but an appropriate collection of the exhibits the plaintiff will be presenting at the hearing; and
3) The Appellate Court has charged this Court with a strict timeline on adjudicating this outstanding motion.
THE MOTION TO DISMISS
The defendant moves to dismiss the plaintiff’s cause of action alleging that the plaintiff has committed fraud in the recitation of facts in its complaint where it alleged that Washington Mutual Loans, Inc. merged with Chase Home Financial, LLC. The defendant claims that, in fact, Washington Mutual Loans, Inc. merged with Washington Mutual Bank, FA as evidenced by the 2003 loan modification between the parties wherein the lender was noted as "Washington Mutual Bank, FA, Successor by Corporate Merger to Fleet Mortgage Corporation."
Consequently, the defendant claims, based solely upon the drafting of the complaint, no subsequent assignment is valid and the plaintiff is engaged in a master scheme of fraud against her, is apparently a thief, and recorded a false lis pendens against her property. The defendant believes the recitation of facts was not an error, but rather an attempt by the plaintiff to withhold exculpatory information from her while defrauding the Court.
Ultimately, the defendant asks the Court to find that the plaintiff has no standing and urges it to dismiss the case.
The Court will not be doing so.
PROCEDURAL POSTURE OF THE CASE
This matter was commenced by writ, summons and complaint returnable to this Court on June 25, 2013. After a year of mediation, the matter returned to the active docket when the defendant was unable to obtain cooperation from her co-borrower to participate in a loan modification. The Court’s mediators noted that both sides had acted appropriately in mediation and the mediator’s final report noted that an extended law day would be appropriate as the defendant was seeking a new residence for relocation (See mediation reports up to and including May 21, 2014 as part of the Court record).
Following procedural matters and cite ins, this case first went to Judgment on January 19, 2016 (J. Jennings) with findings that the plaintiff was due $238,239.28 on a premises valued at $72,000.00. This Judgment was not appealed.
After the 2016 Judgment was entered, the defendant filed two motions to open and four bankruptcies (it should be noted that the plaintiff also filed one motion to extend law days, which was for the purposes of loss mitigation review to benefit the defendant).
The last Judgment was entered on December 4, 2017 and it does not appear as of record that this motion to dismiss was ever formally adjudicated. It was filed at 9:50pm on December 3, 2017. The defendant did not appear in Court at the December 4 short calendar to alert anyone of her pleading. The motion to dismiss raises the exact same issues that were contained in the defendant’s objection to the motion to reset law days that was heard and overruled on December 4, 2017. No appeal was timely taken from the December 4, 2017 judgment. So even if the actual motion was not formally adjudicated, it substantively was addressed in context of the filed objection the Court overruled at the hearing.
In light of the objection, plaintiff’s counsel at the hearing specifically requested the Court to re-enter judgment pursuant to Connecticut General Statute § 49-17, which the Court did.
Nearly two months after Judgment entered, the defendant filed a motion for order seeking the vacating of the law days. The motion was addressed on January 29, 2018. The Court (J. Jennings) sua sponte set new law days so that it could address the motion to dismiss before the law days ran. This Appeal was filed from the Order on that motion for order, although the defendant incorrectly alleges she was appealing the judgment of December 4, 2017 (by placing a different date in the box for date of Judgment). This motion to dismiss could not be addressed because of the associated appellate stay. The Court was assigned this matter as the Appellate Court has referred this case back to this judicial district to hear and decide the unresolved motion to dismiss from December 3, 2017 and, if it is denied, to set new law days.
SUBJECT MATTER JURISDICTION
Lack of subject matter jurisdiction can be raised at any time. Waterbury v. Washington, 260 Conn. 506, 527 (2002). Once raised, the Court must consider and decide the issue of jurisdiction before proceeding further. Schaghticoke Tribal Nation v. Harrison, 264 Conn. 829, 839 n.6 (2003); Figueroa v. C&S Ball Bearing, 237 Conn. 1, 4 (1996).
"A motion to dismiss ... attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court." (Internal quotation marks omitted.) Bacon Construction Co. v. Dept. of Public Works, 294 Conn. 695, 706 (2010). "A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) Wilcox v. Webster Insurance, Inc., 294 Conn. 206, 213 (2009).
"The grounds which may be asserted in [a motion to dismiss] are: (1) lack of jurisdiction over the subject matter; (2) lack of jurisdiction over the person ..." Zizka v. Water Pollution Control Authority, 195 Conn. 682, 687 (1985). The Court must take the allegations in the complaint in the light most favorable to the pleader. See, generally, Conboy v. State, 292 Conn. 642, 651 (2009).
The plaintiff asks this Court to disregard the motion to dismiss as procedurally deficient in that the allegation raised (fundamentally, "fraud") is more properly pled as a special defense rather than be the subject of a motion to dismiss. In the context the defendant is pleading the fraud, however, she is alleging the plaintiff’s pleadings to be fraudulent because they are not a proper holder of the mortgage. Since her actual argument does relate to the standing of the plaintiff, the Court will not disregard the pleading out of hand, but will address it in a meaningful manner.
THE SOUSA THREE-PART ANALYSIS
While it was noted, above, that a motion to dismiss can be raised at any point in a proceeding, this one was raised almost four years after the action was commenced and almost two years after a final judgment was first entered and after numerous bankruptcies and hearings to reset the law day. The defendant even engaged with the plaintiff for over a year in mediation.
"Although challenges to subject matter jurisdiction may be raised at any time, it is well settled that [f]inal judgments are ... presumptively valid ... and collateral attacks on their validity are disfavored. The reason for the rule against collateral attack is well stated in these words: The law aims to invest judicial transactions with the utmost permanency consistent with justice ... Public policy requires that a term be put to litigation and that judgments, as solemn records upon which valuable rights rest, should not lightly be disturbed or overthrown (Internal quotations and citations omitted.)" Sousa v. Sousa, 322 Conn. 757, 771 (2016).
In Sousa, the Supreme Court set a three-part analysis that a Court should consider before entertaining a collateral attack on a final judgment. 1) The Court must determine if it was "entirely obvious" that the Court was initially without jurisdiction; 2) If it was not entirely obvious, the Court has to determine if the defendant had the opportunity to litigate jurisdiction; 3) If there was an opportunity to litigate the jurisdiction prior to when judgment entered, the Court has to determine if there is a public policy reason to allow a chance to litigate the jurisdiction now.
First, it is not entirely obvious that this court lacks jurisdiction. To be entirely obvious that there was no jurisdiction, "the jurisdictional deficiency must amount to a fundamental mistake that is so plainly beyond the court’s jurisdiction that its entertaining the action was a manifest abuse of authority." Sousa at 773. To the contrary, it is plainly obvious that this was the proper Court for the plaintiff’s matter to be adjudicated. The civil session of the Judicial District of Fairfield at Bridgeport is the proper venue for foreclosure actions involving property located in Bridgeport, such as the defendant’s property, which is located at 170-174 Orchard Street in Bridgeport.
Second, it is clear that the defendant had multiple opportunities to litigate any issues with the assignments of the mortgage prior to the entry of final judgment. The Court reviewed the original note, mortgage and assignments at the Judgment hearing in open Court on January 19, 2016. Since the Judgment was not appealed, there is no transcript that was ordered from that hearing for Court review. This Court requested at this hearing that the Court Monitor play the audio recordation of the January 19, 2016 review of documents by Judge Jennings. Judge Jennings spent nearly ten minutes reviewing the note, with its original signatures, the blank endorsement thereon and the mortgage with its assignments. Judge Jennings’ findings are summarized as follows:
THE NOTE
The note is dated April 28, 1989 and was signed by Willie J Lawrence, Jr and Betty Lawrence in favor of Shawmut Mortgage Company d/b/a The Connecticut National Mortgage Company ("Shawmut"). It was endorsed to The Connecticut National Bank ("CNB") by Shawmut. It was then endorsed to State Street Boston Securities Services Corporation by CNB. State Street Boston Securities Services Corporation endorsed it back to CNB, who then endorsed it in blank making the note a "bearer instrument."
THE MORTGAGE
The mortgage is also dated April 28, 1989 and was signed by Willie J. Lawrence, Jr. and Betty Lawrence in favor of Shawmut Mortgage Company d/b/a The Connecticut National Mortgage Company It was recorded May 1, 1989 in the Bridgeport Land Records.
Judge Jennings noted that the plaintiff had provided him with affidavits, National Information Center reports, and FDIC documents and he found that Shawmut Mortgage Company was acquired by Fleet Mortgage Company. Fleet Mortgage Company merged into Washington Mutual Home Loans, Inc. and Washington Mutual Home Loans, Inc. was merged into Washington Mutual Bank, FA. Washington Mutual Bank, FA was then renamed Washington Mutual Bank. The FDIC closed Washington Mutual Bank and sold its assets to, and specifically assigned this mortgage to, JPMorgan Chase Bank, National Association.
Judge Jennings actually read most of the full FDIC affidavit into the record, which included early-in-time entities to Washington Mutual Home Loans, Inc.
JPMorgan Chase Bank, National Association assigned this loan to Bayview Loan Servicing, LLC, who was made party plaintiff in Motion #115.00.
The defendant was in Court while Judge Jennings went through each of the above papers and made findings on the record. She did not raise any objections thereto or question any document. She did not appeal the findings. This Judgment was not disturbed except for new law days being set on motions to open and post-bankruptcy proceedings. She only raised the issue with the representations in the complaint after six prior openings. She had time to raise this issue prior to the December 2017 hearing and not only failed to do so, stood silently in Court while the assignments were originally being reviewed. In this context, the timing of the motion to dismiss can only been seen as a dilatory tactic.
Third, there is no strong policy reasons for giving the defendant further opportunity to litigate the alleged lack of standing of the plaintiff. The loan has gone unpaid for nearly a decade, all while the plaintiff has been paying taxes and insurance on the defendant’s property with no chance of ever recovering its debt which is exponentially "under water." The Court’s stated judicial policy is to have foreclosure cases move as swiftly as possible through the court system. See Suffield Bank v. Berman, 25 Conn.App. 369, 373 (1991). Further, the policy of finality of judgments would be undermined if this late challenge was entertained. Accordingly, applying a Sousa analysis to this case, the Court concludes that the defendant’s motion to dismiss is an impermissible substitute for the appeals which were not filed on prior final judgments and the motion to dismiss must be denied.
ADDITIONAL FACTORS LEADING TO DENIAL OF THE MOTION TO DISMISS
There are yet other reasons the motion to dismiss must be denied, however.
The blank endorsed note reviewed on the record by Judge Jennings as recited above, alone, is enough to confer standing to its holder to maintain this action. The plaintiff clearly was in possession of the note at the commencement of this action and at the judgment hearing and subsequent judgment hearings. Even if they did not have a proper assignment, pursuant to Connecticut General Statute § 49-17, the possession of the endorsed-in-blank note confers standing to its holder to maintain a foreclosure action. See also Connecticut General Statute § § 42a-3-301, 42a-3-201(b) and RMS Residential Props. v. Miller, 303 Conn. 224, 230 (2011). The defendant does not allege the existence of any other entity making a claim against her on the mortgage nor did she claim that any other entity paying the taxes or insurance on her property.
Here, however, the plaintiff also has proper assignment documentation. The mortgage documents reviewed by Judge Jennings further established a chain of title to the assignment and properly led to a finding that the plaintiff had standing and was entitled to Judgment.
The defendant points to the complaint and alleges that the error of indicating that Washington Mutual Home Loans, Inc. merged into Chase Home Financial, LLC instead of Washington Mutual Bank, FA was "fraud" and some attempt by the plaintiff to hide information from the defendant and the Court.
What it really is was a typo
A typo. A minor circumstantial error, not substantive, that did not prejudice the defendant in her defense of this action or her attempts to negotiate loss mitigation with the plaintiff. See Bayer v. Showmotion, Inc., 292 Conn. 381, 391 (2009). "It is axiomatic the courts have the power and duty to correct judgments that contain clerical errors." Bank of Stamford v. Schlesinger, 160 Conn.App. 32, 34 (2015). So, too, must the Court allow for the corrections of inconsequential errors in pleadings.
Connecticut Practice Book § 10-62 allows for the amendments of complaints to conform to the evidence provided at a trial or a hearing. The amendment can be done at any time in the prosecution of the action. The plaintiff had a typo of the wrong mortgage company listed in paragraph 5 of its complaint. Based on the evidence before the Court, the Court finds that the error was not prejudicial to any parties and Orders an amended complaint be filed within seven days of this Order conforming paragraph 5 to the assignment chain of title up to an including the present assignment to U.S. Bank. As the substitution of party plaintiff to U.S. Bank Trust, N.A., as Trustee for LSF9 Master Participation Trust was granted in 2017 without objection (Motion #154) or appeal, the amended complaint can reflect the substituted plaintiff in appropriate areas.
The Court notes that the plaintiff did so shortly after this hearing adjourned. See Docket Entry #197.00.
Bayview Loan Servicing, LLC assigned the mortgage to U.S. Bank Trust, N.A., as Trustee for LSF9 Master Participation Trust after the initial Judgment entered, and this Court has reviewed that assignment as the plaintiff brought it to the hearing on this motion.
CONCLUSION
In addition to denying the motion to dismiss, sustaining the objection thereto and Ordering that an amended Complaint be filed, this Court was tasked by the Appellate Court to set new law days in the event it denied the motion to dismiss.
It will do so by ordering that the new first law day be Set for JANUARY 28, 2020. While law days are not usually set out three months from the date of judgment, the Court is setting an extended law day in this matter to give time for the Appellate Court to effectuate any Orders it needs to issue upon review of this ruling.
Given the procedural posture of the case, any motions by the defendant to open or extend the law days must be filed AND heard by the Court on or before JANUARY 7, 2020.