167 Conn. App. 183
Conn. App. Ct.2016Background
- Astoria filed foreclosure against Genesis and Professional Services Group, Inc. (PSG) over two mortgages on Derby property; PSG claimed a mechanic’s lien recorded Sept. 8, 2009 for work it performed.
- PSG assigned its mechanic’s lien to Viking (Aug. 13, 2011; recorded Sept. 30, 2011) and Viking assigned it back to PSG (Oct. 12, 2012) but PSG did not record that reassignment until June 26, 2014.
- Genesis filed Chapter 11; the bankruptcy court granted limited relief from the automatic stay to permit state-court proceedings on the lien’s validity and priority.
- After bankruptcy dismissal, PSG filed a cross claim (Apr. 16, 2014) to foreclose its mechanic’s lien; plaintiff (successor to Astoria) moved to dismiss arguing PSG lacked standing because the reassignment had not been recorded when PSG filed the cross claim.
- The trial court granted the motion to dismiss, relying on Conn. Gen. Stat. § 47-10 (recording statute) and concluding an unrecorded assignment was ineffective against third parties; PSG appealed.
- The Appellate Court reversed, holding that the mechanic’s-lien and foreclosure statutes (§§ 49-33 and 49-17) — which govern standing to foreclose — control over the general land-recordation statute (§ 47-10), so failure to record the assignment did not automatically deprive PSG of standing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 47-10’s recording requirement bars an assignee of a mechanic’s lien from bringing a foreclosure action if the assignment was not recorded before suit | Assignment must be recorded to be effectual against other parties; PSG lacked standing because Viking was the record holder when PSG sued | The reassignment to PSG was valid despite delayed recording; §§ 49-33 and 49-17 (mechanic’s-lien and foreclosure statutes) govern standing and trump § 47-10 | Reversed: failure to record the assignment prior to filing did not automatically deprive PSG of standing to foreclose under §§ 49-33 and 49-17 |
Key Cases Cited
- Conboy v. State, 292 Conn. 642 (Conn. 2009) (standard of review and jurisdictional rules on motions to dismiss)
- Groton v. Mardie Lane Homes, LLC, 286 Conn. 280 (Conn. 2008) (definition and scope of "conveyance" under recording statute)
- Farmers & Mechanics Sav. Bank v. Garofalo, 219 Conn. 810 (Conn. 1991) (mortgage is a conveyance for recording purposes)
- Seaman v. Climate Control Corp., 181 Conn. 592 (Conn. 1980) (who may claim mechanic’s lien; categories of lienors and notice requirements)
- New England Savings Bank v. Meadow Lakes Realty Co., 243 Conn. 601 (Conn. 1998) (liberal construction and remedial purpose of mechanic’s lien statute)
- First Constitution Bank v. Harbor Village Ltd. Partnership, 230 Conn. 807 (Conn. 1994) (mechanic’s liens validated despite recording errors when no prejudice shown)
- RMS Residential Properties, LLC v. Miller, 303 Conn. 224 (Conn. 2011) (§ 49-17 gives rightful note owner statutory right to foreclose irrespective of assignment recording)
- Connecticut Carpenters Benefit Funds v. Burkhard Hotel Partners II, LLC, 83 Conn. App. 352 (Conn. App. 2004) (standing to foreclose can be satisfied by statutory relationship placing plaintiff within zone of interests protected by mechanic’s-lien law)
- Handsome, Inc. v. Planning & Zoning Commission, 317 Conn. 515 (Conn. 2015) (applicability of mortgage foreclosure principles to mechanic’s lien foreclosures)