Citimortgage, Inc. v. Tanasi
171 A.3d 516
| Conn. App. Ct. | 2017Background
- Defs Richard Tanasi and Athanasula Casberg Tanasi executed a 2007 note and mortgage; CitiMortgage (plaintiff) possessed the original note endorsed in blank and later merged with the original lender.
- CitiMortgage entered a 2007 Master Mortgage Loan Purchase and Servicing Agreement with Hudson City Savings Bank (Hudson) selling the loan to Hudson and serving as servicer; the agreement allegedly authorizes CitiMortgage to institute foreclosures on Hudson’s behalf.
- Defs defaulted; CitiMortgage filed foreclosure in 2011 alleging it was the holder of the note; note endorsed in blank established a presumption of ownership for the holder.
- Defs moved to strike and later moved to dismiss, arguing CitiMortgage lacked standing because it did not own the debt and had no authority from Hudson to foreclose; court denied motion to strike and granted summary judgment on liability based on holder status.
- At the motion to dismiss hearing, CitiMortgage produced the unredacted agreement (previously provided in mediation), read §10.01 into the record, and the court gave defs time to review; court denied the motion to dismiss and later entered judgment of strict foreclosure.
- Defs appealed, arguing lack of standing, prejudicial surprise/judicial estoppel from CitiMortgage’s prior reliance on the holder presumption, and fraud warranting dismissal with prejudice; appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to foreclose | CitiMortgage was the holder of the note (endorsed in blank) and the agreement vested it with authority to foreclose on Hudson’s behalf | Defs rebutted presumption of ownership; holder lacked authority from Hudson so no standing | Affirmed — agreement §10.01 plainly authorized CitiMortgage; production/read into record sufficed to show authority, so standing existed |
| Timeliness / adequacy of introducing agreement | Introduction of agreement at motion to dismiss was responsive to defendants’ challenge and permissible; defs had prior access via mediation and an hour to review | Late "eleventh hour" production prejudiced defs; plaintiff should be estopped from changing theory after relying on holder presumption | Affirmed — introduction was timely and nonprejudicial; defs had prior copy and recess to review; no estoppel |
| Adequacy of the record / reliance on the agreement | The agreement was placed before the court, relevant provision read into the record, and the court considered it | The record was inadequate at time of denial; agreement not part of record earlier so denial was improper | Affirmed — transcript and filed sealed agreement provided an adequate record; court considered the agreement when denying dismissal |
| Fraud / dismissal with prejudice | Plaintiff was presumed owner until challenged; when challenged it permissibly produced evidence (the agreement) showing authority — not fraudulent | Plaintiff acted as an "imposter" and misled the court by allowing owner presumption to apply, so fraud warrants dismissal with prejudice | Affirmed — no record support for fraud; burden-shifting framework allowed plaintiff to rebut challenge by producing authority from owner |
Key Cases Cited
- RMS Residential Properties, LLC v. Miller, 303 Conn. 224 (clarifies holder presumption and burden to rebut)
- J.E. Robert Co. v. Signature Properties, LLC, 309 Conn. 307 (explains burden-shifting when ownership presumption is challenged)
- U.S. Bank, Nat. Assn. v. Schaeffer, 160 Conn. App. 138 (discusses holder presumption and prima facie case by producing note)
- JPMorgan Chase Bank, Nat. Assn. v. Simoulidis, 161 Conn. App. 133 (holder must show authority to collect after presumption is rebutted)
- Cruz v. Visual Perceptions, LLC, 311 Conn. 93 (contract interpretation: plain and unambiguous language reviewed plenarily)
- GMAC Mortgage, LLC v. Ford, 144 Conn. App. 165 (standing and subject matter jurisdiction principles in foreclosure context)
- Hoskins v. Titan Value Equities Group, Inc., 252 Conn. 789 (appellate affirmation on alternative grounds is permissible)