162 Conn.App. 167
Conn. App. Ct.2015Background
- Plaintiff Seminole Realty, LLC seeks foreclosure of a mortgage on Unit 4, River Bend Condominiums, Sterling, held by defendant Sergey Sekretaev.
- On April 24, 2009, Sekretaev conveyed the unit and executed a promissory note for $136,995 secured by a mortgage recorded April 27, 2009.
- Sekretaev made only eight monthly interest payments and no principal payments; default was declared April 10, 2010.
- As of September 30, 2014, plaintiff claimed principal $136,995 and accrued interest totaling $184,934.45; condo value was $75,000.
- Plaintiff sought a judgment of foreclosure; defendant asserted numerous special defenses and three counterclaims.
- The court granted a strict foreclosure, offsetting $2,000 for building repairs and $1,680 for HOA fees; net debt stated as $181,254.45.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff proved ownership and default | Seminole showed it holds the note and mortgage and Sekretaev defaulted. | Sekretaev contested proof of ownership and default; raised defenses to bar foreclosure. | Yes; plaintiff established ownership and default by preponderance. |
| Whether the special defenses are meritorious | defenses are without merit; equitable foreclosure should proceed. | defenses interwoven with the transaction merit consideration and may preclude foreclosure. | Most defenses unfounded; only offset considerations recognized, others rejected as unfounded. |
| Whether defendant's counterclaims have merit, including the third count on acceleration | Counterclaims fail on the merits and do not defeat foreclosure. | Counterclaims allege deceptive origination/servicing, warranty violations, and acceleration failures. | Third count addressed within special defenses; counterclaims found largely unproven; some offset recognized. |
| Whether the court should grant a strict foreclosure and award offsets | Foreclosure appropriate; offsets only to the extent proven. | Equitable relief requires broader consideration of defects and damages. | Strict foreclosure granted; offsets of $2,000 and $1,680 applied; net debt fixed. |
| Whether standing or procedural defects barred foreclosure | Plaintiff is proper party; no standing defects shown. | Challenges to party status and record-keeping possible defects. | Denials sustained; motions to dismiss denied. |
Key Cases Cited
- Franklin Credit Mgmt. Corp. v. Nicholas, 73 Conn. App. 830 (2002) (foreclosure requires proof of ownership and default)
- CitiMortgage, Inc. v. Rey, 150 Conn. App. 595 (2014) (equitable consideration in foreclosure; intertwinement with transaction)
- TD Bank, N.A. v. M.J. Holdings, LLC, 143 Conn. App. 322 (2013) (equitable defenses may preclude foreclosure when plaintiff’s conduct is inequitable)
- DiFrancesco v. Kennedy, 114 Conn. 681 (1932) (de facto corporation doctrine; corporate existence defenses)
- Thompson v. Orcutt, 257 Conn. 301 (2001) (unclean hands doctrine in equitable actions)
- Ridgefield v. Eppoliti Realty Co., 71 Conn. App. 321 (2002) (burden of proving unclean hands in foreclosure)