160 Conn.App. 138
Conn. App. Ct.2015Background
- U.S. Bank, N.A., as trustee for Wells Fargo Asset Securities Corp. Mortgage Pass-Through Certificates, Series 2005-AR6, filed a residential foreclosure against Anne Schaeffer and others in Danbury, CT.
- The note was executed January 5, 2005, payable to Wells Fargo and endorsed in blank, with Wells Fargo keeping possession as custodian for the trust.
- Wells Fargo transferred the asset to Wachovia Bank; Wachovia’s corporate trust business was later acquired by U.S. Bank on November 29, 2005.
- The action proceeded with several evidentiary hearings; the trial court eventually dismissed for lack of standing, citing failure to produce the Purchase Agreement.
- The trial court also relied on a joint affidavit about the purchase of Wachovia’s trust assets, but treated it as having limited weight and questioned its impact on standing.
- The Connecticut Supreme Court held that U.S. Bank, as bearer-note holder, had standing to foreclose and remanded for further proceedings consistent with its ruling.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether U.S. Bank has standing to foreclose as holder of bearer note | U.S. Bank is the holder of a bearer note and thus owner of the debt. | Schaeffer contends ownership of the debt is not established and that the Purchase Agreement is missing. | Yes; holder status suffices to confer standing. |
| Whether the missing Purchase Agreement defeats standing | Presumption of ownership by holder remains intact absent proof of transfer to another party. | Absence of the Purchase Agreement creates a plausible scenario that ownership passed elsewhere. | No; absence does not rebut presumption of holder ownership. |
| Whether the trial court misapplied nonholder standing standards to a holder | The court should apply holder standards, not nonholder tests, given bearer-note possession. | Proper distinction between holder and nonholder tests was not observed by the trial court. | Held status governs; misapplied nonholder test. |
| Whether the joint affidavit suffices to prove ownership/debt ownership | Affidavits + possession support ownership of the debt. | Weight of the affidavit was limited and it did not fully establish ownership. | Sufficient to dispel doubts about holder status. |
Key Cases Cited
- RMS Residential Properties, LLC v. Miller, 303 Conn. 224 (2011) (holder presumed owner of debt; production of note establishes prima facie case)
- J.E. Robert Co. v. Signature Properties, LLC, 309 Conn. 307 (2013) (nonholder transferee must show authority and rights via proper documentation)
- American Home Mortgage Servicing, Inc. v. Reilly, 157 Conn. App. 127 (2015) (bearer-note holder may foreclose if authorized to enforce debt (authority shown))
- Wells Fargo Bank, N.A. v. Strong, 149 Conn. App. 384 (2014) (standing; threshold jurisdiction; de novo review on motion to dismiss)
- U.S. Bank, N.A. v. Foote, 151 Conn. App. 620 (2014) (standing; proof of ownership and default in foreclosure)