Morequity, Inc. v. David Varisco et al. (2011)

MEMORANDUM OF DECISION RE MOTION TO REARGUE

The arguments of the parties must be considered in the context of the motion before the court, in this case Defendant, New Alliance Bank's (NAB) Motion to Strike the Amended Complaint.   The court previously denied NAB's Motion to Strike on October 5, 2009.   On March 10, 2010, the court issued an Articulation of its decision in response to a motion for articulation filed by NAB. Thereafter, NAB requested reargument stating that the court had overlooked controlling law not previously cited to the court which is contrary to its decision.   The court granted the motion and heard reargument on September 1, 2010.

In its March 9, 2010 Memorandum of Decision the court concluded, “the validity and effect of a release of mortgage ․ and which plaintiff had disavowed by affidavit ․ requires submission of evidence and factual findings in subsequent proceedings.”

Plaintiff asserts that the mortgage which it seeks to foreclose was released in error and that it sought to protect its legal rights by filing an affidavit so indicating on the land records as authorized by statute.   The subject statute Conn. Gen.Stat. § 47-12(a) affidavit of facts relating to title or interest in real estate, provides:  “(a) an affidavit which states facts relating to the matters named in subsection (b) of this section and which may affect the title to or any interest in real estate in this state ․”

Subsection (b) referenced in the foregoing statute states:  (b) the affidavits provided for in this section may relate to the following matters:  age, sex, birth, death, capacity, relationship, family history, hardship, names, identity of parties, martial status, possession or adverse use, residence, service in the armed forces, conflicts and ambiguities in description of land in recorded instruments, and the happening of any condition or event which may terminate an estate or interest.”

Defendant NAB correctly argues that Connecticut courts have held that the filing of an affidavit pursuant to § 47a-12a does not create a lien on the subject property but merely a notice analogous to a lis pendens.   See Mortgage Electronic Registration Systems, Inc. v. Venditto, Superior Court, judicial district of New London, Docket No. 4002228 (October 28, 2005, Devine, J.) 40 Conn. L. Rptr. 209, 210, 2005 Conn.Super. LEXIS 2998;  People's Bank v. Bouffard, J.D. of Fairfield at Bridgeport, CV 05-40008908 (August 19, 2005, Doherty, J.) (39 Conn. L. Rptr. 832).   However, this argument does not mandate the court to grant the motion to strike under the facts of this case.

Brief analysis of the cases cited by the defendant illustrates the rationale for this conclusion.   For example, Alaska Seaboard Partners, LP v. Legare, No. TTDCV 085002827, 2009 Conn.Super. LEXIS 2026 [48 Conn. L. Rptr. 338] (Conn.Super.Ct. July 23, 2009), concerned an affidavit in which the affiant alleged to have entered into a contract for the purchase of certain real estate which was recorded on the land records.   Both sides filed motions for summary judgment.   Defendant buyer's revised counterclaim sought specific performance of a time barred contract.   The court held that the recording of a notice of a contract for the conveyance of land cannot be construed to fall under the authorization of § 47-12a.   Thus, despite the affidavit's reference to § 47-12a, it was not authorized by that statute because it did not relate to any of the matters named in subsection (b).

Citing the analysis of the court in Peoples Bank v. Bouffard, supra, the court in Mortgage Electronic Registration Systems, Inc. v. Venditto, supra, denied the motion to strike the second special defense where a party who pled recordation of an affidavit pursuant to Conn. Gen.Stat. § 47-12a alleged sufficient additional facts in support of its defense.   Repeating the rule that the affidavit in and of itself cannot be treated as a lien against the property, the court continued, “The validity of the late mortgage deed filing and the effect of bankruptcy proceeding will be left to the trier of fact for determination at trial.”   Similarly, in this case, the recordation of the affidavit does not confer title.   Nonetheless, the plaintiff has alleged facts sufficient to entitle it to determination by a trier of fact at trial.

Neither side has cited precedent in which the court has decided the issue in this case, whether § 47-12a permits a party to record an affidavit asserting erroneous release of a mortgage.   The caselaw cited by NAB is not controlling.   Defendant NAB insists on a narrow reading of the examples to which § 47-12a applies and limits its argument to the specific examples listed in § 47-12(b), ignoring the last phrase of the statute i.e., “and which may affect the title to or any interest in real estate in this state.”   Release of a mortgage recorded in error clearly affects title to or interest in the subject real estate.   Plaintiff argues that the general provisions of the last clause or category enumerated by § 47-12(b) is a “catch-all” meant to apply to situations such as the one it faces here where its mortgage was mistakenly released.   None of the cases cited provide guidance as to the applicability of the statutory provision, “the happening of any condition or event, which may terminate an estate or interest.”

Release of a mortgage is an event which terminates one's interest in property.   Plaintiff argues that § 47-12a permits one to file an affidavit of facts relating the circumstances of an erroneous release of mortgage.   Review of case law and the arguments of both sides requires that the legal effect of that filing must be left to the trier of fact.   This is the basis upon which the court denied NAB's Motion to Strike.

In short, NAB argues that it is entitled to have the court strike the Amended Complaint as a matter of law because it has alleged that the plaintiff executed a release and the affidavit recorded by plaintiff is not valid.   As stated above, the law in Connecticut entitles a plaintiff such as the one in this case to a factual hearing.

The court confirms that its decision remains as originally filed in this case, denying the Motion to Strike.

BY THE COURT

SOMMER, J.

Sommer, Mary E., J.