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Wells Fargo Bank, N.A. v. Owen

Court of Appeals of Connecticut

June 20, 2017

WELLS FARGO BANK, N.A.
v.
MARLENE E. OWEN ET AL.

          Argued March 21, 2017.

         (Appeal from Superior Court, judicial district of New London, Cosgrove, J.)

          Kenneth A. Leary, for the appellants (named defendant et al.).

          Jonathan A. Adamec, with whom, on the brief, was Christopher S. Groleau, for the appellee (plaintiff).

          Lavine, Prescott and Flynn, Js.

          LAVINE, J.

         The defendants Marlene E. Owen and William S. Owen[1] appeal from the denial of their motion to open the judgment of strict foreclosure rendered by the trial court in favor of the plaintiff, Wells Fargo Bank, N.A. The defendants claim that the court abused its discretion in denying their motion because they showed good cause to warrant opening the judgment pursuant to General Statutes § 49-15. We affirm the judgment of the trial court.

         The following facts and procedural history are relevant to our resolution of the defendants' claim. On April 23, 2013, the plaintiff, as trustee for the holders of the Merrill Lynch Mortgage Investors Trust, served a complaint on the defendants, a married couple, seeking to foreclose on their property at 22-24 Bayberry Hill Road in Norwich.[2] The defendants, self-represented, entered their appearances but never filed an answer or any special defenses to the plaintiff's complaint. For more than one year, from May 14, 2013, to June 3, 2014, the parties engaged in at least six mediation sessions to resolve the case but were ultimately unsuccessful. None of the mediator reports stated that the defendants claimed that the loan application contained inaccurate information regarding Marlene Owen's income or that the plaintiff's predecessor in interest, WMC Mortgage Corporation, misled the defendants when they applied for and executed the mortgage.[3] Instead, the defendants sought to modify the loan because ‘‘[t]he mortgagor was laid off from his job.''

         On March 20, 2015, approximately nine months after the mediation period ended, the plaintiff filed a motion to default the defendants for failure to plead, which was granted on April 1, 2015. On April 1, 2015, the plaintiff filed a motion for a judgment of strict foreclosure. On April 13, 2015, counsel for the defendants entered his appearance but failed to file an answer or any special defenses to the plaintiff's complaint or to contest the entry of the default in any way. See Practice Book §§ 10-46 and 10-50. The defendants also failed to file a motion for a continuance to obtain additional time to collect evidence to support a claim of fraud. On May 18, 2015, the court heard the plaintiff's motion for a judgment of strict foreclosure, but neither the defendants nor counsel for the defendants appeared at the hearing to contest the motion or to ask for a continuance. The court granted the plaintiff's unopposed motion for a judgment of strict foreclosure and set the law days to begin July 21, 2015.

         On July 8, 2015, the defendants filed a motion to open the judgment of strict foreclosure pursuant to § 49-15.[4]In the motion, they requested oral argument but specifically indicated that ‘‘testimony is not required.'' The court heard oral argument on the motion during a short calendar hearing on July 20, 2015.[5] The defendants asserted that they had good cause to open the judgment because they had proof that an agent of the plaintiff's predecessor in interest knowingly misled them into applying for and executing the mortgage by assuring them that they could afford the mortgage. They also claimed that the plaintiff's predecessor in interest altered the income information on the loan application without the defendants' knowledge. The evidence the defendants submitted in support of their argument included a sworn affidavit from William Owen, who attested that he had applied for and executed the mortgage ‘‘based on false representations . . . by [the] [p]laintiff's predecessor's agent that [he] could afford the mortgage in question'' and that Marlene Owen's ‘‘income was fraudulently put down by [the] [p]laintiff's predecessor's said agent as $5000 per month without [her] knowledge or [his], when it was in fact $2100 per month.'' They also provided a copy of Marlene Owen's 2004 tax returns and the loan application, which showed that the income listed in the tax returns did not match the income listed in the loan application. Thus, they argued that they should be given an opportunity to assert the special defenses of unclean hands and fraud in the inducement in the foreclosure action.

         The plaintiff argued that the defendants failed to show good cause to open the judgment of strict foreclosure. Contrary to the defendants' assertion, the plaintiff contended that if any party was defrauded or misled, it was the plaintiff because it unknowingly relied on the loan application that contained incorrect information. It also argued that the defendants could not claim that their income was altered without their knowledge because they had an opportunity to review the loan application and correct any inaccurate information before they had signed it.

         The same day, the court denied the defendants' motion to open the judgment of strict foreclosure.[6] The defendants filed a motion for articulation, and the court granted the motion and referred the parties to the transcript of the July 20, 2015 hearing. The defendants filed another motion for articulation, which the court denied. The defendants appealed to this court on August 7, 2015. Thereafter, the defendants never sought an articulation in accordance with Practice Book § 66-5.

         On appeal, the defendants claim that the court abused its discretion in denying their motion to open the judgment of strict foreclosure. They argue that, pursuant to § 49-15, they showed good cause to open the judgment by providing proof that the plaintiff engaged in fraud. They contend that they did not assert their defenses prior to the court's rendering its decision on the plaintiff's motion for ajudgmentofstrict foreclosure because they were not aware of any relevant defenses to foreclosure until after they had hired an attorney, and, thus, ‘‘[i]t would be unjust to bar their defenses under these circumstances . . . .'' We disagree.[7]

         ‘‘Generally, an appeal must be filed within twenty days of the date notice of the judgment or decision is given. . . . In the context of an appeal from the denial of a motion to open judgment, [i]t is well established in our jurisprudence that [w]here an appeal has been taken from the denial of a motion to open, but the appeal period has run with respect to the underlying judgment, [this court] ha[s] refused to entertain issues relating to the merits of the underlying case and ha[s] limited our consideration to whether the denial of the motion to open was proper. . . . When a motion to open is filed more than twenty days after the judgment, the appeal from the denial of that motion can test only whether the trial court abused its discretion in failing to open the judgment and not the propriety of the merits of the underlying judgment.'' (Citation omitted; internal quotation marks omitted.) Wells Fargo Bank, N.A. v. Ruggiri, 164 Conn.App. 479, 484, 137 A.3d 878 (2016).

         In the present case, there is no dispute that the defendants did not file their motion to open within twenty days of the court's rendering the judgment of strict foreclosure. Therefore, we will review the defendants' claim under an abuse of discretion ...


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