Domestic Bank v. George Aubee et al. (2010)

MEMORANDUM OF DECISION RE [# 126] MOTION FOR DEFICIENCY JUDGMENT FOLLOWING STRICT FORECLOSURE

On October 29, 2009, the plaintiff, Domestic Bank, filed a foreclosure action against the defendants, George Aubee, Kevin Aubee, and Coventry Lumber, Inc. Therein, the plaintiff alleges that by a promissory note, dated May 22, 2006, defendant George Aubee promised to pay the principal sum of $315,000.00 to the plaintiff.   The plaintiff also contends that to secure the note, defendants George Aubee and Kevin Aubee executed an open end mortgage in favor of the plaintiff on a certain parcel of land known as 728 Plainfield Pike, Sterling, Connecticut, and that defendants George Aubee and Kevin Aubee have defaulted under the terms of the note.   Accordingly, the plaintiff, as a result of George and Kevin Aubee's failure to pay the balance due on the note, seeks to foreclose the mortgaged property.   The plaintiff also avers that defendant Coventry Lumber, Inc. may have an interest in the mortgaged premises by virtue of a mechanic's lien in the sum of $15,863.93 that is subsequent and subordinate in right to the plaintiff's claim.

On January 25, 2010, following a hearing on the short calendar, the court (Riley, J.) entered a judgment of strict foreclosure against the defendants in the amount of $331,380.70.   The law day was set for March 8, 2010 for the owners of the equity of redemption, and a subsequent day for the subsequent encumbrancer.   Thereafter, on January 29, 2010, the court sent a notice correcting the judgment of strict foreclosure to state the debt in the amount of $329,466.70 and reaffirming the fair market value of the property to be $155,000.00.   Defendants George Aubee and Kevin Aubee remained nonappearing in the matter.   The law day passed, and title to the subject property thereby vested in the foreclosing plaintiff on March 10, 2010.   On March 30, 2010, the plaintiff filed the present motion for a deficiency judgment to satisfy the mortgage debt.   Therein, the plaintiff avers that, as of the date of the filing of the motion, the debt including costs is $340,355.84, and that, as of the date that title to the property vested in the plaintiff, the fair market value of the property is $155,000.00.   On April 14, 2010, the plaintiff filed a revised deficiency worksheet stating the debt, including costs, to be $340,458.84, and a certified copy of the appraisal report which appraised the house to have a fair market value of $150,000.00 as of March 10, 2010.   Accordingly, the plaintiff seeks a deficiency judgment in the amount of $190,458.84.   The matter was heard on the short calendar on April 26, 2010.

“Because the entry of judgment of foreclosure precluded any further common law proceedings upon the note, the legislature, in Public Acts 1833, c. 18, 1, 2, created the remedy of the deficiency judgment as the only available means of satisfying a mortgage debt when the security is inadequate to make the plaintiff whole.”  (Internal quotation marks omitted.)  New England Savings Bank v. Lopez, 227 Conn. 270, 278 n.10, 630 A.2d 1010 (1993).  “While foreclosure by sale automatically establishes the value of the property, a strict foreclosure does not have this secondary consequence.   Only a proceeding for a deficiency judgment following a strict foreclosure establishes the amount of remaining indebtedness.”  (Internal quotation marks omitted.)  Id.

“Today deficiency judgments are calculated pursuant to § 49-14(a).”  (Internal quotation marks omitted.)  Linden Condominium Association, Inc. v. McKenna, 247 Conn. 575, 587, 726 A.2d 502 (1999).  “General Statutes [§ 49-14(a) ] provides ․ [a]t any time within thirty days after the time limited for redemption has expired, any party to a mortgage foreclosure may file a motion seeking a deficiency judgment.   Such motion shall be placed on the short calendar for an evidentiary hearing.   Such hearing shall be held not less than fifteen days following the filing of the motion, except as the court may otherwise order.   At such hearing the court shall hear the evidence, establish a valuation for the mortgaged property and shall render judgment for the plaintiff for the difference, if any, between such valuation and the plaintiff's claim.   The plaintiff in any further action upon the debt, note or obligation, shall recover only the amount of such judgment ․” (Internal quotation marks omitted.)  Winchester v. Northwest Assoc., 255 Conn. 379, 381 n.2, 767 A.2d 687 (2001).¹

“[A] deficiency proceeding has a very limited purpose ․ [T]he court, after hearing the party's appraisers, determines the value of the property and calculates any deficiency.   This deficiency judgment procedure presumes the amount of the debt as established by the foreclosure judgment and merely provides for a hearing on the value of the property ․ The deficiency hearing concerns the fair market value of the subject property as of the date title vests in the foreclosing plaintiff under [General Statutes] § 49-14 ․ [T]he value placed on the property by the court for the purposes of rendering judgment of strict foreclosure and setting law days [is] irrelevant to a subsequent deficiency judgment proceeding ․ “[I]mplicit in ․ § 49-14 is the requirement that the party seeking a deficiency judgment satisfy her burden of proof regarding the fair market value of the property ․ in particular, the requirement that the plaintiff provide the court with sufficient evidence to demonstrate that she is entitled to a deficiency judgment ․ When considering a motion for a deficiency judgment, the trial court may make an independent determination as to the valuation of the property ․ Our Supreme Court has held that, in a deficiency judgment proceeding, [t]he determination of [a property's] value by a court is the expression of the court's opinion aided ordinarily by the opinions of expert witnesses, and reached by weighing those opinions in light of all the circumstances in evidence bearing upon value and its own general knowledge of the elements going to establish it ․ [T]he determination of the credibility of expert witnesses and the weight to be accorded their testimony is within the province of the trier of facts, who is privileged to adopt whatever testimony he reasonably believes to be credible ․ Thus, “[i]n determining valuation pursuant to ․ § 49-14, the trier, as in other areas of the law, is not bound by the opinion of the expert witnesses ․ The evaluation of testimony is the sole province of the trier of fact ․” (Citations omitted;  internal quotation marks omitted.)   Brownstein v. Spilke, 117 Conn.App. 761, 765-67, 982 A.2d 198 (2009).   In the present matter, the court, on January 25, 2010, entered a judgment of strict foreclosure on the Sterling property.   The law day passed and title to the property vested in the foreclosing plaintiff on March 10, 2010.   Accordingly, within the thirty-day time limit established by General Statutes § 49-14, the plaintiff filed the present motion for a deficiency judgment, and the matter was heard before this court on the short calendar.   The court has reviewed the most recent appraisal report submitted by the plaintiff, and finds that as of March 10, 2010, the date title vested in the foreclosing plaintiff, the fair market value of the subject property was $150,000.00.   The court also finds, based on the revised deficiency worksheet filed by the plaintiff, that the current debt owed to the plaintiff is $340,458.84, including costs.

Based on the foregoing, the court hereby renders a deficiency judgment for the plaintiff in the amount of $190,458.84.

THE COURT:

RILEY, J.

FOOTNOTES

FN1. Practice Book § 23-19 substantially follows subsection (a) of General Statutes § 49-14.   Although the Practice Book also requires that the motion “[set] forth the facts relied on as the basis for the judgment.”.  FN1. Practice Book § 23-19 substantially follows subsection (a) of General Statutes § 49-14.   Although the Practice Book also requires that the motion “[set] forth the facts relied on as the basis for the judgment.”

Riley, Michael E., J.