WELLS FARGO BANK, N.A.
ERIC LORSON ET AL.
January 18, 2018
to foreclose a mortgage on certain of the defendants'
real property, and for other relief, brought to the Superior
Court in the judicial district of Fairfield and tried to the
court, Hon. Richard P. Gilardi, judge trial referee;
judgment of strict foreclosure, from which the defendants
appealed to this court; thereafter, the court, Hon.
Richard P. Gilardi, judge trial referee, issued an
articulation of its decision. Affirmed.
Ridgely Whitmore Brown, withwhom was Benjamin E. Gershberg,
for the appellants (defendants).
M. Bizar, for the appellee (plaintiff).
Bright and Beach, Js.
defendants, Eric Lorson and Laurin Maday, appeal from the
judgment of strict foreclosure rendered by the trial court in
favor of the plaintiff, Wells Fargo Bank, N.A. On appeal, the
defendants claim that the court improperly found that the
plaintiff met its burden of proving its prima facie case and
that the defendants failed to prove their special defenses of
equitable estoppel and unclean hands. We affirm the judgment
of the trial court.
following facts are relevant to this appeal. The defendants
and the McCue Mortgage Company (McCue) executed a promissory
note on December 1, 2008 (note). The note was secured by a
mortgage on the defendants' property at 40 McGuire Road
in Trumbull (property), in favor of Mortgage Electronic
Registration Systems, Inc., as nominee for McCue. The
mortgage was recorded on the Trumbull land records on
December 1, 2008. The mortgage was assigned to the plaintiff
on December 16, 2011, and the assignment was recorded on the
Trumbull land records on December 21, 2011. It is undisputed
that the plaintiff is the holder of both the note and the
plaintiff filed this foreclosure action on October 19, 2011.
The complaint alleged that the note and mortgage were in
default by virtue of nonpayment of the installments of
principal and interest due on November 1, 2010, and each and
every month thereafter. The complaint further alleged that
the plaintiff is entitled to collect the debt evidenced by
the note and to enforce the terms of the mortgage, that the
plaintiff had elected to accelerate the balance of the note,
and that the plaintiff requested a foreclosure of the
court referred the parties to a foreclosure mediation program
on December 1, 2011. During that program, the parties entered
into a special forbearance agreement (agreement) dated August
23, 2012, which identified twenty-two consecutive months of
nonpayment. According to the terms of the agreement, the
plaintiff agreed to ‘‘temporarily [accept]
reduced installments'' in the amount of $3009.07 per
month for a period of three months. Section 2 of the agreement
provides in relevant part: ‘‘Upon successful
completion of the [a]greement, your loan will not be
contractually current. Since the installments may be less
than the total amount due you may still have outstanding
payments and fees. Any outstanding payments and fees will be
reviewed for an option to bring the loan current. If approved
for an option, based on investor guidelines, this will
satisfy the remaining past due payments on your loan and we
will send you a plan agreement. An additional payment may be
required.'' Section 3 of the agreement provides:
‘‘The lender is under no obligation to enter into
any further agreement, and this [a]greement shall not
constitute a waiver of the lender's right to insist upon
strict performance in the future.''
defendants made the first payment of $3009.07 in accordance
with the agreement prior to September 22, 2012. On October 8,
2012, the plaintiff sent the defendants a letter requesting a
‘‘Notice of Release of Mortgage or Discharge of
Judgment/Lien'' and stating that the plaintiff is
‘‘unable to complete the final
modification'' of the loan until the title issue is
resolved. A property title report was enclosed with the
letter. The lien at issue was a judgment lien on the property
from a dispute with an insurance company about the value of a
vehicle Lorson owned that had been declared a total loss
October 19, 2012, the foreclosure mediator issued a final
report that indicated that the final mediation was held on
July 31, 2012, the mediation period expired on September 1,
2012, and the mediation was terminated.
defendants did not provide the plaintiff with information in
response to the October 8, 2012 letter, but instead continued
to make monthly payments to the plaintiff for the amount
specified in the agreement beyond November, 2012, and through
May, 2013. On March 4, 2013, the plaintiff sent the
defendants a follow-up letter requesting documentation to
resolve the title issue regarding the judgment lien on the
property. On April 10, 2013, the plaintiff sent the
defendants another letter, stating that ‘‘[t]here
are additional liens on [the defendants'] property that
prevent [the plaintiff] from completing [the defendants']
request for mortgage assistance.'' On April 30, 2013,
the plaintiff sent yet another letter to the defendants
requesting documentation of the remaining lien balance. The
letter specified that the requested documentation must be
received by May 30, 2013. The defendants did not resolve the
defendants filed an answer on July 19, 2013, in which they
effectively denied each allegation and left the plaintiff to
its proof. The defendants also filed two special defenses
alleging unclean hands and equitable estoppel. The plaintiff
filed a motion for summary judgment on November 12, 2013. The
defendants filed an amended answer and special defenses along
with their objection to the plaintiff's summary judgment
motion on February 19, 2014. In the amended answer, the
defendants alleged a third special defense titled
‘‘Mortgage Modification Agreement, ''
claiming that the plaintiff refused to issue a permanent
modification and ‘‘breached the terms of the
agreement'' by requiring payment of the judgment
court denied the plaintiff's motion for summary judgment
on March 21, 2014, ruling that ‘‘the
counteraffidavit submitted by the defendants in opposition to
the motion raises issues of fact relating to the
defendants' special defenses of unclean hands and
equitable estoppel to be resolved at trial.'' The
plaintiff filed a reply to the defendants' special
defenses and a certificate of closed pleadings on October 22,
the plaintiff filed a certificate of closed pleadings, the
defendants moved to amend their answer on October 30, 2015.
In the proposed amended answer, the defendants added a
special defense titled ‘‘breach of contract,
'' which alleged the plaintiff's noncompliance
with various regulations of the United States Department of
Housing and Urban Development as set forth in 24 C.F.R.
§ 203.500 et. seq. (HUD regulations). The plaintiff
filed an objection to the defendants' request to amend on
November 9, 2015, and the court sustained the plaintiff's
objection on December 1, 2015, the first day of trial.
a two day bench trial, the court rendered judgment of strict
foreclosure in favor of the plaintiff on January 6, 2016. On
January 20, 2016, the defendants filed this appeal. The
defendants filed a motion for articulation on August 4, 2016,
requesting an explanation for the judgment of strict
foreclosure. On November 25, 2016, the court issued a written
response ‘‘to the allegations contained in the
defendants' motion [for] articulation and, specifically,
the defendants' misrepresentations and failure to
disclose necessary evidence within their knowledge.''
In that response, the court stated: ‘‘Based on
the factual history of this litigation, it is the finding of
this court that the plaintiff has established [its] burden of
proof with respect to the allegations of the complaint. The
court further finds that the defendants failed to submit
sufficient evidence with respect to their burden of proof
with respect to the denial of the complaint, as well as the
special defenses of unclean hands and equitable estoppel.
Accordingly, judgment is entered in favor of the plaintiff
with respect to the complaint and special defenses.''
The court denied the motion for articulation and stated as
follows: ‘‘With respect to the motion for
articulation, it is the finding of the court that the motion
is based on the misrepresentations and intentional omissions
of necessary evidence. The docket sufficiently provides the
basis for the rulings by the court. Accordingly, the motion
for articulation is denied.''
April 4, 2017, the defendants filed a motion for review of
the court's articulation with this court, which we denied
as untimely. Additional facts will be set forth as necessary.
defendants challenge the court's determination that the
plaintiff had proven its prima facie case, which was based on
their claim that the plaintiff failed to present sufficient
evidence that it had complied with all applicable HUD
regulations that are prerequisites to bringing a foreclosure
action. In response, the plaintiff contends that
noncompliance with HUD regulations must be raised as a
special defense and that the defendants failed to do so.
Alternatively, the plaintiff argues that even if it had the
burden of proving compliance with HUD regulations in the
absence of a special defense, there is sufficient evidence of
the plaintiff's compliance, and, therefore, the
court's finding that the plaintiff established its prima
facie case ...