Summary
holding that the facts alleged must include: the existence of an underlying obligation which is owed by the defendant to the plaintiff; that the note is secured by a mortgage and the defendant borrower is in default of the obligations under the note or mortgage; that, because of the default, the plaintiff has exercised its option to accelerate the debt and declare all sums owing under the mortgage to be due and payable; and the defendant is in possession of the mortgaged property
Summary of this case from LoanCare, a Division of FNF Servicing, Inc. v. ChannerOpinion
No. DBD CV09-5008016 S
June 23, 2011
MEMORANDUM OF DECISION RE MOTION TO STRIKE #186
I FACTS AND PROCEDURAL HISTORY FACTS
On July 28, 2009, the plaintiff, TD Bank, N.A. filed a complaint for foreclosure and a deficiency judgment against the defendant, Georgetown Land Development Company, LLC (land company), and a number of other defendants. A third amended revised complaint was filed on August 12, 2010, in which the plaintiff alleged the following facts. In a note and mortgage executed on April 26, 2006, the land company promised to pay the plaintiff $7.4 million for a parcel of land located at 20 North Main Street and 50 Bennett Street in Redding. The note and mortgage have matured and the plaintiff, holder in due course of both, has exercised its option to declare the entire balance due on the note. Despite demand for payment, the land company has refused and neglected to pay the balance. There are a number of encumbrances of record upon the premises. Encumbrances subsequent in right and subject to the plaintiff's mortgage as listed in count one include the defendant, Geogetown Special Taxing District (taxing district). Count two is against the defendant guarantors, "who unconditionally guaranteed payment of principal and interest and any other charges provided for in the loan to Georgetown Land Development Company (`Borrower') in the principal sum of Seven Million Four Hundred Thousand and no/100 ($7,400,000.00) Dollars, payable with interest thereon as provided in said Note." Despite demand for payment, they have failed, refused and neglected to pay the balance due.
Until May 31, 2008, TD Bank, N.A. was known as TD BankNorth, N.A.
On June 18, 2010, the plaintiff filed a motion to cite in additional parties that included the taxing district. A writ of summons and complaint was served on the taxing district on July 14, 2010.
On August 12, 2010, the taxing district filed a motion to strike a portion of count one of the plaintiff's third revised amended complaint on the ground that its tax lien is prior, not subsequent, in right to the plaintiff's mortgage. The taxing district submitted a memorandum of law in support of the motion. In response, the plaintiff filed an objection and memorandum of law in opposition. The taxing district filed a reply memorandum.
LEGAL DISCUSSION
"The purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any complaint to state a claim upon which relief can be granted." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alvers, 262 Conn. 480, 498, 815 A.2d 1188 (2003). "[A] motion to strike challenges the legal sufficiency of a pleading and, consequently, requires no factual findings by the trial court . . . Thus, [i]f facts provable in the complaint would support a cause of action, the motion to strike must be denied . . . It is fundamental that in determining the sufficiency of a complaint challenged by a defendant's motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted . . . Indeed, pleadings must be construed broadly and realistically, rather than narrowly and technically." (Internal quotation marks omitted.) Connecticut Coalition for Justice in Education Funding, Inc. v. Rell, 295 Conn. 240, 252, 990 A.2d 206 (2010). "A motion to strike [however] . . . does not admit legal conclusions or the truth or accuracy of opinions stated in the pleadings." (Emphasis in original; internal quotation marks omitted.) Faulkner v. United Technologies Corp., 240 Conn. 576, 588, 693 A.2d 293 (1997).
The taxing district moves to strike a portion of count one as it pertains to the taxing district on the ground that the allegations are legally insufficient. The taxing district is included as a defendant in paragraphs 7(c) and (f) and is referred to in paragraph 7(g). In count one, paragraph 7, the plaintiff alleges: "The following encumbrances of record upon the [premises] sought to be foreclosed are subsequent in right and subject to the Plaintiff's [mortgage] . . . (c) Defendant [Georgetown Special Taxing District] claims or may claim an interest in said premises by virtue of a Declaration of Covenants and Restrictions dated August 30, 2006 and recorded on August 31, 2006 in Volume 335 at Page 402 of the Redding Land Records . . . (f) Defendant [Georgetown Special Taxing District] claims or may claim an interest in said premises by virtue of a Notice recorded in Volume 349 at Page 1067 of the Redding Land Records and by virtue of any and all unpaid Special District Taxes recorded or assessed against the property." In paragraph 7(g) of count one, the plaintiff refers to a series of claims in favor of the taxing district recorded and subsequently assigned to a limited liability company. These subparagraphs attempt to allege a priority in right of the plaintiff's note vis-a-vis the taxing district.
The taxing district argues in its memorandum of law in support of the motion to strike that a municipality, as that term is used in General Statutes § 12-141 and § 12-171, includes a taxing district and "under the clear and explicit language of the [s]tatutes, [it] [has] a statutory priority over a subsequent encumbrance like [the plaintiff's] mortgage." In response, the plaintiff counters that the complaint sets forth a properly pleaded foreclosure action and priority of encumbrances with respect to the taxing district. The plaintiff argues that the taxing district should have filed either a request to revise for a more particular statement of the facts underlying the basis for the plaintiff's claimed priority, or a general denial with respect to those allegations. Further, the plaintiff asserts that if the court examines the motion on the grounds of the taxing district's claimed priority, it has not satisfied the requirements set forth in General Statutes § 7-325 to create such a special taxing district which would entitle it to a claimed priority.
A complaint seeking a foreclosure of a mortgage as in any civil action must set out facts establishing that the plaintiff has a cause of action. See Practice Book § 10-1. The facts alleged must include: the existence of an underlying obligation which is owed by the defendant to the plaintiff; that the note is secured by a mortgage and the defendant borrower is in default of the obligations under the note or mortgage; that, because of the default, the plaintiff has exercised its option to accelerate the debt and declare all sums owing under the mortgage to be due and payable; and the defendant is in possession of the mortgaged property. D. Caron G. Milne, Connecticut Foreclosures: An Attorney's Manual of Practice and Procedure (4th Ed. 2004) § 4.09, p. 93; see New England Savings Bank v. Bedford Realty Corp., 246 Conn. 594, 610, 717 A.2d 713 (1998) (setting forth allegations to be included in complaint); see also Webster Bank v. Flanagan, 51 Conn.App. 733, 750-51, 725 A.2d 975 (1999) (plaintiff must plead it is the owner of the note and defendant has defaulted on the note). "[A] foreclosure complaint must contain certain allegations regarding the nature of the interest being foreclosed. These should include allegations relating to the parties and terms of the operative instruments, the nature of the default giving rise to the right to foreclosure, the amount currently due and owing, the name of the record owner and of the party in possession, and appropriate prayers for relief." Cliffside Condominium Assn. v. Cushman, 100 Conn.App. 803, 804, 921 A.2d 609 (2007). See Practice Book 10-69. Section "10-69 is designed to require the plaintiff to draft a complaint from which a determination of priorities may be made." D. Caron G. Milne, supra, § 4.09.
The taxing district's motion to strike the subparagraphs of count one allege that the "complaint [is] legally insufficient" because the plaintiff claims "that its mortgage is prior in right to [the taxing district's] tax lien." This claim, however, is not properly addressed by a motion to strike but should have been addressed as a request to revise for a more particular statement or alleged in an answer as a general denial. See Rowe v. Godou, 209 Conn. 273, 279, 550 A.2d 1073 (1988). Accordingly, the taxing district's motion to strike is denied.