Ulster Savings Bank v. 28 Brynwood Lane, Ltd.
134 Conn. App. 699
Conn. App. Ct.2012Background
- On October 4, 2002, 28 Brynwood Lane, Ltd. and Chipley obtained a $3,000,000 construction loan; Ulster Home Mortgage, Inc. lent the funds and secured with a mortgage on the Greenwich property.
- Ulster Home Mortgage, Inc. assigned the mortgage and note to Ulster Savings Bank on the same day; the assignment was recorded.
- In October 2005 Ulster Savings Bank filed for foreclosure, alleging the note had matured and was due in full.
- January 2010, 28 Brynwood Lane, Ltd. filed a third amended answer with three special defenses and a CUTPA counterclaim.
- January 2004, plaintiff sent a letter describing loan maturity and possible refinancing; defendant allegedly interpreted it as a modification.
- May 27, 2010, the court granted summary judgment for plaintiff on liability and on the defendant’s counterclaim; July 19, 2010, strict foreclosure entered.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standing to foreclose | Plaintiff possessed the note and mortgage via valid assignment and possession of the original note. | Assignment defects and unendorsed note create standing issues. | Plaintiff had standing; assignment and note transfer were valid. |
| Unclean hands as a defense | Letter did not modify the loan terms; no inequitable conduct. | Letter operated as a modification; bank acted unfairly. | Unclean hands defense rejected; no triable issue. |
| Breach of covenant of good faith and fair dealing | Foreclosing on existing terms did not breach the covenant. | Letter promised a modification, implying good faith not to foreclose. | No reasonable expectation of modification; no breach. |
| CUTPA counterclaim viability | CNT: CUTPA not satisfied by unsupported modification claim. | Letter and conduct constitute unfair trade practices. | CUTPA claim fails as a matter of law; summary judgment appropriate. |
Key Cases Cited
- Mortgage Electronic Registration Systems, Inc. v. Goduto, 110 Conn.App. 367 (Conn. App. 2008) (standard for reviewing summary judgment on foreclosure)
- Union Trust Co. v. Jackson, 42 Conn.App. 413 (Conn. App. 1996) (special defenses and triable issues affect summary judgment)
- Boone v. William W. Backus Hospital, 102 Conn.App. 305 (Conn. App. 2007) (test for granting summary judgment when triable issues exist)
- Navin v. Essex Savings Bank, 82 Conn.App. 255 (Conn. App. 2004) (plenary review of summary judgment decisions in foreclosure)
- Thompson v. Orcutt, 257 Conn. 301 (Conn. 2001) (unclean hands doctrine in equitable proceedings)
- Monetary Funding Group, Inc. v. Pluchino, 87 Conn.App. 401 (Conn. App. 2005) (criteria for CUTPA unfairness and damages in actions)
- A. Secondino & Son, Inc. v. LoRicco, 215 Conn. 336 (Conn. 1990) (CUTPA threshold and damages considerations)
- Renaissance Management Co. v. Connecticut Housing Finance Authority, 281 Conn. 227 (Conn. 2007) (duty of good faith and fair dealing in contracts)