April 11, 2017
P. Sherlock, for the appellants (named defendant et al.).
Michael T. Grant, for the appellee (substitute plaintiff).
Sheldon, Mullins and Flynn, Js.
plaintiff bank, F Co., sought to foreclose a mortgage on
certain real property of the decedent. After the foreclosure
action was commenced, but before trial had begun, O Co., of
which F Co. was a subsidiary, was substituted as the
plaintiff. Thereafter, another bank merged into O Co., and
although O Co. was the surviving entity of the merger, as
part of the merger it changed its name to C Co., which was
never substituted as the party plaintiff. Subsequently, the
trial court granted O Co.'s motion for a judgment of
strict foreclosure and rendered judgment thereon, from which
the defendant A, individually and as the executrix of the
estate of the decedent, appealed to this court. A claimed,
inter alia, that the trial court improperly rejected her
special defense and counterclaim sounding in breach of the
implied covenant of good faith and fair dealing. In her
special defense and counterclaim, A had alleged that, in
light of a provision in the note executed by the decedent
that permitted the decedent's estate to avoid its
obligation to repay the loan upon the decedent's death if
it cooperated with F Co. in selling the subject property, F
Co. breached the covenant of good faith and fair dealing when
it initiated the foreclosure action instead of communicating
with the executrix to facilitate such a sale.
trial court properly found that A failed to meet her burden
of proof with respect to her special defense and counterclaim
sounding in breach of the implied covenant of good faith and
fair dealing; the relevant provision in the note provided
that the death of the decedent was a maturity event that made
the loan immediately due and payable, except if the parties
extended the repayment deadline by entering into a separate
written agreement within thirty days of the decedent's
death that required the decedent's estate to cooperate
fully with F Co. in selling the property, and the trial court
properly concluded that, in the absence of such a separate
written agreement extending the deadline to allow the
executrix to sell the decedent's home, the relevant
provision of the note did not provide for a contractual right
to an extension of the deadline to sell the property, and F
Co., therefore, had no obligation to undertake any action
facilitating the sale of the property by the executrix, and
did not breach the terms of the note by never agreeing to
such an extension.
to foreclose a mortgage on certain real property owned by the
named defendant et al., and for other relief, brought to the
Superior Court in the judicial district of Litchfield, where
the defendant John T. Griffin et al. were defaulted for
failure to appear; thereafter, the named defendant et al.
filed a counterclaim; subsequently, the court, Pickard,
J., granted the plaintiff's motion to substitute
OneWest Bank, N.A., as the plaintiff; thereafter, the matter
was tried to the court, Shah, J.; judgment for the
substitute plaintiff on the complaint and the counterclaim;
subsequently, the court, Pickard, J., granted the
substitute plaintiff's motion for a judgment of strict
foreclosure and rendered judgment thereon, from which the
named defendant et al. appealed to this court; thereafter,
the court, Shah, J., issued an articulation of its
action to foreclose a reverse mortgage, the defendants, Ann
T. Griffin, in her representative capacity as executrix of
the estate of Angela C. Griffin, and Ann T. Griffin, in her
individual capacity, appeal from the judgment of strict
foreclosure rendered in favor of the substitute plaintiff,
OneWest Bank, N.A.On appeal, the defendants claim that the
court erred in (1) concluding that the substitute plaintiff
established a prima facie case of foreclosure and (2)
rejecting their special defense and counterclaim sounding in
breach of the implied covenant of good faith and fair
dealing. We affirm the judgment of the trial court.
December 10, 2015 memorandum of a decision, the trial court
set forth the following facts. ‘‘[Angela C.]
Griffin [(decedent)] was the owner of the real property
located at 312 Milton Road, Litchfield, Connecticut
(property). On or about July 23, 2008, [the decedent]
executed a note and reverse annuity mortgage (mortgage) on
the [p]roperty in favor of Financial Freedom Senior Funding
Corporation, [a predecessor in interest to the substitute
plaintiff]. . . . [The note and mortgage] established an
open-ended line of credit not to exceed $692, 180
([decedent's] loan). At that time, Financial Freedom
[Senior Funding Corporation] advanced $378, 791 to [the
decedent] to pay off a loan from Deutsche Bank, which sought
to foreclose on the mortgage it held on the property.
Financial Freedom [Senior Funding Corporation] obtained an
appraisal at the time that valued the property at $612, 709.
decedent] . . . entered into the loan so that [she] could
remain in the home that she had lived in for thirty years.
The property is a private property that includes a colonial
residence located on eleven acres of land with a pond. It has
a stable and many acres of well-maintained pasture. The home
was a central part of [Ann Griffin's] and [the
the mortgage is a reverse annuity mortgage, no principal
became due until a maturity event occurred. On April 16,
2010, [the decedent] passed away, which constituted a
maturity event and rendered the balance of the loan due and
payable unless there was an agreement in writing between the
[named] plaintiff and certain legal representatives of [the
decedent] within thirty days to cooperate fully in selling
the property. The [named] plaintiff and the [executrix] had
no agreement in writing to this effect, and the [executrix]
did not pay the balance due upon [the decedent's] death.
Thus, the nonpayment constituted a default under the
mortgage. . . . The [named] plaintiff initiated the present
foreclosure action in May of 2011.
April 30, 2010, prior to the notice of intent to foreclose,
[Ann Griffin] contacted the [named plaintiff] to inform it
that she intended to sell the property. The [named
plaintiff's] electronic system notes indicate that [Ann
Griffin] spoke with . . . a maturities administrator . . . .
They discussed repayment of the [decedent's] loan, and
[Ann Griffin] indicated she planned to sell the property and
use the proceeds of the sale to repay the debt. Subsequent to
the conversation, [the maturities administrator] sent a cash
account reverse mortgage repayment notice to [Ann Griffin].
The repayment notice informed [Ann Griffin] that the death of
[the decedent] constituted a maturity event, that upon the
occurrence of a maturity event the loan became due, and that
[Ann Griffin] needed to discuss plans with [the named
plaintiff] concerning repayment of the loan by sending in the
enclosed repayment questionnaire. ...
May 6, 2010, the defendant[s'] counsel faxed a
correspondence, attaching the death certificate and will of
[the decedent], and informing [the maturities administrator]
that he was representing the defendant[s]. [Ann Griffin] was
appointed executrix of [the decedent's] estate on May 17,
2010. [Ann Griffin] lacked legal authority to enter into
contractual agreements on behalf of the estate until such
time as she was appointed executrix.
or about June 17, 2010, the [executrix] entered into a
listing agreement with [a realty company] for the sale of the
property, with a listing price of $614, 900 (listing
agreement). On June 23, 2010, the defendant[s'] counsel
sent a second correspondence to [the maturities
administrator], which included the probate decree admitting
the [decedent's] will to probate; a certified copy of the
death certificate; a copy of the [decedent's] will; a
certified probate certificate reflecting the appointment of
[Ann Griffin] as executrix; and a signed copy of the listing
agreement. The [named] plaintiff admitted to having received
both written communications and attachments. The [named]
plaintiff still had not received the repayment questionnaire
. . . . There was no agreement in writing or any other
communication that demonstrated a mutual understanding to
extend the repayment date.''
addition to those facts expressly found by the trial court,
the following supplemental facts, which also reasonably could
have been found by the court, are relevant. Through a series
of assignments and corporate restructurings, ownership of the
decedent's loan changed several times. As previously
explained, on July 23, 2008, the decedent executed a note and
mortgage in favor of Financial Freedom Senior Funding
Corporation, making it the original mortgagee and holder of
the note. At the time the decedent executed the note in July,
2008, Financial Freedom Senior Funding Corporation was a
subsidiary of IndyMac Bank, F.S.B. (Indy-Mac). The Federal
Deposit Insurance Corporation (FDIC) had been appointed as
receiver for IndyMac prior to the decedent's execution of
the note and mortgage.
March, 2009, OneWest Bank, F.S.B, through its parent company,
IMB HoldCo, LLC, purchased from the FDIC certain IndyMac
assets, including the decedent's loan. As part of that
transaction, Financial Freedom Senior Funding Corporation
executed an allonge to the note, specially endorsing it to
‘‘OneWest Bank, F.S.B.'' The named
plaintiff in this action was formed during this transaction
as a subsidiary of OneWest Bank, F.S.B.
point after it was assigned the note, OneWest Bank, F.S.B.,
executed an allonge to the note, endorsing it in blank.
OneWest Bank, F.S.B., then transferred the note to the named
plaintiff, which held it until transferring it back to
OneWest Bank, F.S.B., around July, 2011.
February, 2014, OneWest Bank, F.S.B., converted from a
federal savings bank into a national banking association and,
thus, became OneWest Bank, N.A., the substitute plaintiff.
August 3, 2015, which was slightly more than four years after
this action was commenced, but before trial had begun, IMB
Hold Co, LLC, the holding company of OneWest Bank, N.A.,
merged with CIT Group, the holding company of a bank called
CIT Bank. As part of their holding companies' merger,
OneWest Bank, N.A., and CIT Bank also merged. Specifically,
‘‘CIT Bank . . . merged into OneWest
Bank, N.A.'' (Emphasis added.) Although OneWest Bank,
N.A., was the surviving entity of the merger with CIT Bank,
OneWest Bank, N.A., as part of the merger, changed its name
to ‘‘CIT Bank, N.A.'' ‘‘CIT
Bank, N.A., '' was never substituted for OneWest
Bank, N.A., as the party plaintiff in this action.
outlined the relevant substantive facts, we now review the
pertinent procedural history. The named plaintiff commenced
this action in May, 2011. As previously explained, the named
plaintiff was a subsidiary of OneWest Bank, N.A., which was
substituted as the plaintiff in this action on September 22,
to the substitution of OneWest Bank, N.A., for the named
plaintiff, the defendants pleaded several special defenses.
Relevant to this appeal is the defendants' special
defense that the named plaintiff breached the implied
covenant of good faith and fair dealing. The defendants also
filed a counterclaim against the named plaintiff sounding in
breach of the implied covenant of good faith and fair
dealing. Although the named plaintiff was ...