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Salisbury Bank & Trust Co. v. Christophersen

Appellate Court of Connecticut

March 1, 2016

SALISBURY BANK AND TRUST COMPANY
v.
ERLING C. CHRISTOPHERSEN ET AL

         Argued January 7, 2016.

          Action to foreclose a mortgage on certain real property, and for other relief, brought to the Superior Court in the judicial district of Stamford-Norwalk, where the matter was transferred to the Complex Litigation Docket; thereafter, the plaintiff withdrew the complaint as to the defendant John R. Christophersen; subsequently, the court, Brazzel-Massaro, J., denied the motion for stay filed by the named defendant et al., and the named defendant et al. appealed to this court, which dismissed the appeal for lack of a final judgment; thereafter, the matter was tried to the court, Genuario, J.; subsequently, following a hearing on attorney's fees, the court, Genuario, J., rendered judgment of strict foreclosure; thereafter, the court, Genuario, J., denied the motion to open filed by the named defendant et al., and the named defendant et al. appealed to this court; subsequently, the court, Genuario, J., issued an articulation of its decision.

          SYLLABUS

         The plaintiff bank sought to foreclose a mortgage on certain real property of the defendant C, who had an ownership interest in two adjacent parcels of land. The trial court rendered judgment of strict foreclosure, from which C appealed to this court. He claimed that because there was uncertainty as to the value of the property and, as a result, as to whether the debt owed the plaintiff was greater than the value of the property, the trial court abused its discretion in ordering a judgment of strict foreclosure, rather than a foreclosure by sale. Specifically, he claimed that the trial court improperly valued the parcels as a one two-acre lot, rather than as two separate buildable lots, which he claimed would have resulted in a value in excess of the debt owed the plaintiff. Held that the trial court did not abuse its discretion in ordering a judgment of strict foreclosure; on the basis of a review of the record and the trial court's detailed and well reasoned memorandum of decision, this court concluded that the trial court correctly applied the law and reasonably could have reached the conclusion that it did.

         Andrew M. McPherson, with whom, on the brief, was William J. Kupinse, Jr., for the appellants (named defendant et al.).

         Patrick M. Fahey, for the appellee (plaintiff).

         Lavine, Alvord and Wilson, Js.

          OPINION

Page 33

          [163 Conn.App. 430] PER CURIAM.

          The defendant Erling C. Christophersen, individually and as trustee,[1] appeals from the judgment of strict foreclosure rendered by the trial court. On appeal, the defendant claims that the court abused its discretion by ordering a judgment of strict foreclosure rather than a foreclosure by sale. We affirm the judgment of the trial court.

         In its memorandum of decision issued on June 2, 2014, the trial court made the following findings of fact that are relevant to the defendant's appeal. Prior to December, 2006, the defendant in his individual capacity had an ownership interest in two adjacent parcels of real property in Westport known as 1 Chalmers Landing (Chalmers parcel) and 259 Saugatuck Avenue (Saugatuck parcel), (collectively the property). The defendant acquired his interest in the property by conveyances [163 Conn.App. 431] from members of his family or family trusts. In 2006, the defendant was in need of cash to pay off encumbrances on the property, back taxes, and personal expenses. To secure a loan, he met with a representative of the plaintiff, Salisbury Bank and Trust Company, on November 24, 2006, and represented that the property was being offered for sale for $9 million. He suggested that the plaintiff serve as a cotrustee of the property and eventually as cotrustee of the net proceeds from the sale

Page 34

of the property. At all times relevant, both parties understood that the only way that the defendant could repay the loan was with the proceeds from the sale of the property. The plaintiff was interested in the defendant's proposal given the potential for funds to accrue to its trust department.

         The plaintiff commissioned a summary appraisal of the property that valued the Saugatuck parcel at $4.675 million and the Chalmers parcel at $4.725 million. The defendant's lawyer drafted a document entitled " The Erling C. Christophersen Revocable Trust" (trust),[2] which the defendant signed as both grantor and trustee on November 21, 2006, and the plaintiff signed on December 4, 2006. Thereafter, the plaintiff issued a loan commitment letter in the amount the defendant requested, $740,000. The loan was conditioned on the plaintiff's remaining a cotrustee " `so long as there is debt owed to [it].'"

         By February, 2007, the parties realized that the defendant's original plan was insufficient. The defendant, therefore, prepared a second business plan, which revealed that the property was subject to certain family interests. In particular, the defendant represented that his mother, Lorna B. Christophersen, who previously [163 Conn.App. 432] had a 25 percent interest in the property, had conveyed her interest to the defendant. As a result of the conveyance, the defendant had a 75 percent interest in the property. The remaining 25 percent interest was owned by the defendant's aunt, Elena B. Dreiske. The defendant represented in his second business plan that Dreiske had agreed to accept $1.5 million for her interest in the property. The ...


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