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The Bank of New York Mellon v. Ganley

Superior Court of Connecticut, Judicial District of Fairfield, Bridgeport

January 6, 2017

THE BANK OF NEW YORK MELLON
v.
GANLEY, ROBERT F Et Al

          ORDER

          ALFRED J JENNINGS, JUDGE

         ORDER REGARDING: 09/12/2016

         137.00 MOTION FOR SUMMARY JUDGMENT

         The foregoing, having been considered by the Court, is hereby:

         ORDER: DENIED

         Plaintiff's Motion for Summary Judgment as to liability is based on the September 1, 2016 affidavit of Christine Butler (" Affidavit") as a Litigation Foreclosure Specialist employed by New Penn Financial, LLC d/b/a Shellpoint Mortgage Servicing (" New Penn"), which is the mortgage servicer of the Ganley mortgage loan account at issue on behalf of the plaintiff The Bank of New York Mellon fka the Bank of New York, as Trustee for the Certificate holders of the CWMBS, Inc. CHL Mortgage Passthrough Certificates, Series 200-14 (" Plaintiff"), and the documents identified in that affidavit, copies of which are attached thereto as Exhibits as follows: The Note signed by the defendant Robert F. Ganley on May 13, 2004 (Ex A-1); and the Notice of Default sent to Mr. Ganley on June 19, 2013 (Ex A-2). The affidavit makes reference to the Mortgage Deed signed by Robert F. Ganley in favor of MERS as nominee for the lender to secure the Note, a copy of which Mortgage Deed is attached to Plaintiff's Memorandum of Law in Support of Motion for Summary Judgment as Exhibit B.

         Plaintiff's initial burden as the party moving for summary judgment is to make a showing of the absence of any genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Bartha v. Waterbury House Wrecking Company, 190 Conn. 8, 11 (1983). A material fact is a fact that will make a difference in the outcome of the case. Reynolds v. Chrysler First Commercial Corporation, 40 Conn.App. 725, 729 (1996), citing Hammer v. Lumberman's Mutual Casualty Co. 214, 573, 578 (1990). To satisfy its burden, the party moving for summary judgment 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. Plouff v. New York, New Haven and Hartford Railroad Company, 160 Conn. 482, 488 (1971). As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent. D.H.R. Construction Company v. Donnelly, 180 Conn. 430, 434 (1980). 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. Allstate Insurance Co. v. Barron, 269 Conn. 394, 405 (2004).In order to establish a prima facie case in a mortgage foreclosure action, the plaintiff must prove that it is the owner of the note and mortgage, that the defendant mortgagor has defaulted on the note, and that any conditions precedent to foreclosure, as established by the note and mortgage, have been satisfied. A mortgagee that seeks summary judgment in a foreclosure action has the evidentiary burden of showing that there is no genuine issue of material fact as to any of the prima facie elements. Wells Fargo Bank, N.A. v. Strong, 194 Conn.App. 384, 392 (2014).In this case the plaintiff is claiming that defendant has defaulted on the Note by virtue of nonpayment of installments of principal and interest due on May 1, 2013 and each and every month thereafter. (Affidavit, para. 5) It is further claimed that Notice of Default was sent to defendant Robert Ganley by First Class Mail on June 19, 2013, specifying the default, the action required to cure the default, and a date by which the default had to be cured (Affidavit, para. 6) and a copy of that Notice is attached as Exhibit A-2. It is further claimed that the default was not cured as specified in the Notice and plaintiff.

         Elected to exercise its right to accelerate the indebtedness by commencing this foreclosure action. (Affidavit, para. 7). The sending of such notice of default is a condition precedent to foreclosure pursuant to Paragraph 22 and Paragraph 15 of the Mortgage and Paragraph 7(c) and Paragraph 8 of the Note. Plaintiff as the party moving for summary judgment is therefore obligated to show compliance therewith by affidavit made on personal knowledge setting forth such facts as would be admissible in evidence and showing affirmatively that the affiant is competent to testify to the matters stated therein. Practice Book, Section 17-46. Plaintiff has purported to show that the Notice of Default was mailed to Mr. Ganley, and the contents of the Notice, by the statements in the Christine Butler affidavit, referenced above, and the attached copy of the Notice, not on the personal knowledge of Ms. Butler, but under the business entry statute exception to the hearsay rule embodied in Conn. Gen. Stat. § 52-180. Section 52-180(a) provides that " any writing or record or record ... made as a memorandum or record of any act, transaction, occurrence or event shall be admissible as evidence of the act, transaction, occurrence or event if the trial judge finds that it was made in the regular course of any business, and that it was the regular course of the business to make the writing or record at the time of the act, transaction, occurrence or event or within a reasonable time thereafter." In this case the Affidavit of Ms. Butler states that her employer New Penn is a business, which is the loan servicer of this mortgage for the plaintiff; that she is familiar with and has personal knowledge of the record keeping practices and procedures of New Penn with regard to mortgage loan servicing; that New Penn services mortgage loan accounts in the regular course of its business and makes in the regular course of its business records of the acts, transactions, events, and occurrences regarding and pertaining to the mortgage loan accounts it services.; and that the record of each act, transaction event or occurrence is made at the time of the act, transaction, occurrence or event or within a reasonable time thereafter. (Affidavit, para.1) She further states that she has personally reviewed New Penn's business records that relate to the Note and Mortgage and the servicing of the loan evidenced by the Note, and that in this capacity and by reason of the foregoing she has personal knowledge of the facts stated in her affidavit.

         The witness introducing the document need not have made the entry himself or herself, nor have been employed by the organization during the relevant time period. New England Savings Bank v. Bedford Realty Corp., 246 Conn. 594, 603 (1998).The evidence of the prima facie element of this foreclosure case that Mr. Ganley was given Notice of Default as required by the Note and Mortgage consists of the copy of a letter dated June 19, 2013 addressed to Mr. Ganley at the property address entitled " Notice of Intent to Accelerate" . The letter makes reference to this mortgage loan and advises Mr. Ganley that the Note was in default for failure to make payments due on May 1, 2013 and June 1, 2013; that the total amount in default was $4, 849.24, and that if the default was not cured by July 29, 2013 the full balance of the Note would be accelerated and foreclosure proceedings would be initiated. The letter, however, is on the letterhead of Bank of America Home Loans and opens by saying that " Bank of America N.A. services the home loan described above on behalf of the holder." The letter directs that payments to cure be made to Bank of America, N.A. and is signed by Bank of America, N.A. Home Loan Team. It is clearly a letter created and sent by Bank of America during a time when Bank of America - and not New Penn - was the loan servicer. It is a contemporaneous record of an occurrence or event between Bank of America and Mr. Ganley, but there is no evidence authenticating the letter as made in the regular course of the business of Bank of America or that it was the regular course of business of Bank of America to send such a letter. As such it is inadmissible hearsay.

         There is no requirement in § 52-180 that the document must be prepared by the organization itself to be admissible as that organization's business records. New England Savings Bank v. Bedford Realty Corp., supra, 246 Conn. At 703. In that case, the qualifying witness had been director of operations of the predecessor organization and was able to testify that the records in question appeared to be those kept by the predecessor organization in the regular course of its business, which was found by the Supreme Court sufficient to satisfy the " modest requirements" of admissibility under § 42-180. See, also First Union National Bank v. Woermer, 92 Conn.App. 696, 710-11 (2005) where there was testimony that a loan history record generated by the preceding bank owner of the loan was utilized in the master record of the bank acquiring the loan in setting up on its own computer system, and reliance on such a document in purchasing a loan and utilization of the document in creating its own business records was in accordance with the ordinary course of business of the acquiring bank. Admissibility of the document as a business record of the acquiring bank was affirmed by the Appellate Court.

         The plaintiff is this case has presented no evidence that the Default Notice to Mr. Ganley was prepared and sent in the ordinary course of business of Bank of America, and no evidence that the Default Notice was relied upon or utilized by New Penn in setting up its own records regarding the Ganley mortgage transaction. Ms. Butler's affidavit addresses only records created by New Penn in the ordinary course of its business in servicing mortgage loans, and states that those records are the sole source of the factual statements made in her affidavit. But the default Notice to Mr. Ganley is outside the scope of her qualifying statement and her record review and is therefore not admissible as a business record under Section 52-180.Since the sending of a Default Notice is a prima facie element of this foreclosure case, and the plaintiff has not ...


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