January Connecticut Appellate Update and Wrap Up – Banking and Financial Institution Services

January, as have most months recently, saw quite a few appeals decided by the Connecticut Appellate Court that impact the banking and financial services industry that SGL serves. As a result, we are providing the below summaries relative to these decisions. Although each case is unique in its facts, application of binding authority such as set forth by Connecticut’s appellate courts is an invaluable litigation tool which is why the attorneys at SGL review Supreme and Appellate Court decisions when released on a weekly basis.

Wells Fargo Bank, N.A. v. Tarzia – After entry of a judgment of foreclosure, the defendant filed a motion to open and vacate judgment based on a claim of newly discovered evidence of fraud by the mortgagee. Specifically, defendant claimed that the Superior Court abused its discretion in denying the motion to open as filed. The Appellate Court disagreed and held that the defendant failed to present sufficient facts or evidence to warrant an evidentiary hearing on the claims asserted in the motion to vacate judgment. Similarly, the Appellate Court rejected the defendant’s second challenge to standing to foreclose based on a prior appeal which affirmed the Superior Court’s finding that the mortgagee possessed standing at the commencement of the action and declined to review a constitutional due process claim for lack of adequate briefing. The judgment denying the motion to open and vacate was affirmed and the matter remanded for imposition of new law days.

People’s United Bank, N.A. v. Purcell – The defendant moved to open a judgment of foreclosure by sale and dismiss the underlying action for lack of personal jurisdiction. The Superior Court, after holding an evidentiary hearing at which defendant and a state marshal that effected service of process testified and evidence was introduced, denied the defendant’s motion. The defendant appealed claiming that the Superior Court’s denial of the motion to open and dismiss was in error. The Appellate Court disagreed and reiterated the standard for review of mortgage foreclosure appeals as abuse of discretion before reciting the standard for review of factual findings (such as a place of abode) is subject to the clearly erroneous standard. The Court thereafter recited that Connecticut law permits a party to have more than one “usual place of abode” for purposes of service of process and service made at a location which falls within the definition of a usual place of abode is valid and conveys personal jurisdiction to the Superior Court. The denial of the defendant’s motion was affirmed and the matter remanded for imposition of a new sale date.

Bank of America, N.A. v. Gonzalez – After trial on the merits in a foreclosure action, the plaintiff prevailed and a judgment of strict foreclosure was entered. The defendant appealed claiming that the Superior Court erred in finding that the special defenses asserted, which related to a mortgage broker being an agent of the mortgagee were not established by the facts and evidence. Specifically, the Superior Court, after presentation of evidence at trial, found that the defendant had failed to sustain his burden of proof regarding issues of agency between the mortgage broker; the broker’s alleged actions; and either the originating lender or the foreclosing mortgagee. On appeal, the Appellate Court recited well-established standards of foreclosure law regarding the prima facie case requirements as well as the court’s ability to consider equitable factors in entering or denying a judgment of foreclosure before reciting additional established law regarding principal-agent requirements. After consideration of defendant’s claims, the Court discussed the implications of agency between a mortgage broker and lender previously addressed in CitiMortgage, Inc. v. Coolbeth, 147 Conn.App. 183 (2013), and found that the defendant had failed to introduce evidence sufficient to establish a principal-agent relationship as alleged in the special defenses. As such, the judgment of foreclosure was affirmed and the matter remanded to the Superior Court for imposition of new law days.


For questions relative to these matters or to discuss how SGL can assist in your business or litigation requirements, please feel free to contact any of the attorneys in the Banking and Financial Institution Services practice group:

Linda Hadley – lhadley@sgllawgroup.com; 860-760-8428

Jerry Garlick – ggarlick@sgllawgroup.com; 860-760-8427

Andrew Barsom – abarsom@sgllawgroup.com; 860-760-8423

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