FSB v. Carlos Reinoso et al. (2012)

MEMORANDUM OF DECISION ON DEFENDANTS' MOTION FOR SUMMARY JUDGMENT

FACTUAL BACKGROUND

On January 20, 2012, the original plaintiff, OneWest Bank, FSB,¹ commenced this foreclosure action by service of process on the defendants, Carlos Reinoso and Engracia M. Reinoso.²  In its complaint, the plaintiff alleges the following facts.   On May 30, 2006, the defendants executed a $375,920 promissory note payable to the order of IndyMac Bank, FSB. In order to secure the indebtedness owed under the note, the defendants mortgaged property located at 6 Meadow Road in Trumbull to Mortgage Electronic Registration Systems, Inc. (MERS), as nominee for IndyMac Bank. This mortgage was recorded on the Trumbull land records on June 2, 2006.   The mortgage was eventually assigned to the plaintiff, and the plaintiff is now the holder of the note and mortgage.   The defendants are currently in default on the payments owed pursuant to the note.   As a result, the plaintiff elected to accelerate the total amount due under the terms of the note and commence foreclosure proceedings.

In response to the plaintiff's complaint, the defendants, who are acting as self-represented parties, filed an answer, along with five special defenses, on August 23, 2011.   The five special defenses alleged by the defendants are:  (1) unconscionability;  (2) breach of the covenant of good faith and fair dealing;  (3) unclean hands;  (4) predatory lending and (5) violations of the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42–110a et seq.   The crux of the defendants' special defenses are that they were misled by the lender, in that “[u]nbeknowst to the [d]efendants, the lender has offered and convinced the [d]efendants to accept a negative amortization loan, whereby the [d]efendants in the beginning would pay less than the interest, with the extra amount added to the principal.”   According to the defendants, the negative amortization aspect of their mortgage loan caused the principal owed on the loan to increase considerably.   The defendants further allege that the lender knew or should have known that they had significant savings and investments, and despite this fact, the lender “made [an] unaffordable loan based on the assets of the [d]efendants rather than on their ability to repay the obligation.”   Additionally, the defendants allege that the true nature of the loan was never explained to them.

On February 10, 2012, the plaintiff filed a motion for summary judgment, as well as a supporting memorandum of law.   The plaintiff argues that it is entitled to summary judgment, as to liability only, because it has presented a prima facie case for mortgage foreclosure and all of the defendants' special defenses are legally invalid.   In support of its motion, the plaintiff offers the sworn affidavit of John Cook, a title searcher employed by the law firm of the plaintiff's counsel, Bendett & McHugh, P.C. Attached to this affidavit are:  (1) a copy of the mortgage deed for the subject premises;  (2) a copy of the assignment of mortgage from MERS to the original plaintiff, One West Bank, FSB, dated January 20, 2010;  and (3) a copy of the assignment of mortgage from the original plaintiff to the substitute plaintiff, U.S. Bank National Association, dated August 2, 2011.   Additionally, the plaintiff offers the notarized affidavit of Dari Romero, an assistant secretary with OneWest Bank, FSB. This affidavit attaches:  (1) a copy of the subject mortgage note;  (2) a copy of a document titled “Adjustable Rate Mortgage Loan Program Disclosure”;  (3) a copy of the defendants' uniform residential loan application;  and (4) a copy of the loan underwriting and transmittal summary that was completed at the closing for the 6 Meadow Road property.   Although the defendant Carlos Reinoso did appear at the March 26, 2012 short calendar to oppose the plaintiff's motion for summary judgment, the defendants have not filed any written opposition or opposing documentary evidence.³  Additionally, none of the arguments made by Carlos Reinoso at the short calendar hearing were substantive in nature.   Accordingly, the plaintiff's summary judgment motion is essentially unopposed.

LEGAL DISCUSSION

“Practice Book § 17–49 provides that summary judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.   In deciding a motion for summary judgment, the trial court must view the evidence in the light most favorable to the nonmoving party.”  (Internal quotation marks omitted.)  Provencher v. Enfield, 284 Conn. 772, 790–91, 936 A.2d 625 (2007).  “[S]ummary judgment is appropriate only if a fair and reasonable person could conclude only one way ․ [A] summary disposition ․ should be on evidence which a jury would not be at liberty to disbelieve and which would require a directed verdict for the moving party.”  (Citations omitted;  internal quotation marks omitted.)   Dugan v. Mobile Medical Testing Services, Inc., 265 Conn. 791, 815, 830 A.2d 752 (2003).   The burden is on the moving party to demonstrate an absence of any triable issue of material fact and “[t]o satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact ․ Once the moving party has met its burden, however, the opposing party must present evidence that demonstrates the existence of some disputed factual issue ․ It is not enough, however, for the opposing party merely to assert the existence of such a disputed issue.   Mere assertions of fact ․ are insufficient to establish the existence of a material fact and, therefore, cannot refute evidence properly presented to the court under Practice Book § [17–45].”  (Internal quotation marks omitted.)  Zielinski v. Kotsoris, 279 Conn. 312, 318–19, 901 A.2d 1207 (2006).

First, the court will address whether the plaintiff has presented a sufficient prima facie case in order to support its belief that it is entitled to judgment as a matter of law in this foreclosure action.  “In a mortgage foreclosure action, [t]o make out its prima facie case, [the foreclosing party] ha[s] to prove by a preponderance of the evidence that it was the owner of the note and mortgage and that [the mortgagee] had defaulted on the note.”  (Internal quotation marks omitted.)  Franklin Credit Management Corp. v. Nicholas, 73 Conn.App. 830, 838, 812 A.2d 51 (2002), cert. denied, 262 Conn. 937, 815 A.2d 163 (2003).  “Furthermore, the foreclosing party must demonstrate that all conditions precedent to foreclosure, as mandated by the note and mortgage, have been satisfied.”  Bank of New York v. Conway, 50 Conn.Sup. 189, 194, 916 A.2d 130 (2006), citing Bank of America, FSB v. Hanlon, 65 Conn.App. 577, 581, 783 A.2d 88 (2001).  “When a complaint and supporting affidavits establish an undisputed prima facie case for a foreclosure action, a court must only determine whether [a] special defense is legally sufficient before granting summary judgment.”   LaSalle National Bank v. Shook, Superior Court, judicial district of New London, Docket No. 549266 (July 13, 2000, Martin, J.), aff'd, 67 Conn.App. 93, 787 A.2d 32 (2001).  “Nevertheless, the opposing party only needs to demonstrate the applicability of one legally sufficient special defense in order to defeat a motion for summary judgment.”   Deutsche Bank National Trust Co. v. Segarra, Superior Court, judicial district of Fairfield, Docket No. CV 08 5018505 (March 12, 2010, Tyma, J.) (49 Conn. L. Rptr. 534, 536);  see also Union Trust Co. v. Jackson, 42 Conn.App. 413, 417, 679 A.2d 421 (1996) (same).

According to the evidence attached to the plaintiff's motion for summary judgment, the defendants executed a note on May 30, 2006, in favor of MERS, as nominee for IndyMac Bank, in order to secure a mortgage for the subject property.   Following two assignments that are evidenced in the attachments offered in support of the summary judgment motion, the substitute plaintiff is the current holder of this note and mortgage.   The plaintiff also alleges that the defendants are currently in default on the money owed pursuant to the terms of the note.   This allegation is supported by an attestation in Romero's affidavit.   Although the defendants' answer states that the defendants leave the plaintiff to its proof regarding their default, the defendants offer no evidence to dispute that they are currently in default.   Accordingly, the plaintiff has demonstrated a prima facie case for a mortgage foreclosure.   Therefore, the court will determine whether any of the defendants' special defenses preclude the court from rendering summary judgment in favor of the plaintiff.

As a threshold matter, this memorandum will consider whether it is appropriate for the plaintiff to use a motion for summary judgment to attack the validity of the defendants' special defenses, as opposed to a motion to strike.   Our Supreme Court has determined that “the use of a motion for summary judgment to challenge the legal sufficiency of a complaint is appropriate when the complaint fails to set forth a cause of action and the defendant can establish that the defect could not be cured by repleading.”  Larobina v. McDonald, 274 Conn. 394, 401, 876 A.2d 522 (2005).   This same principle has been applied by our Supreme Court in the context of a motion for summary judgment that attacked the legal sufficiency of a counterclaim.  American Progressive Life & Health Ins. Co. of New York v. Better Benefits, LLC, 292 Conn. 111, 124–25, 971 A.2d 17 (2009).   This court has previously held that “[a] plaintiff in a foreclosure action can challenge a special defense by summary judgment in three ways.   The first way to challenge a special defense is to argue that the special defense does not address the making, validity and enforcement of the mortgage ․ The second way to challenge a special defense is to challenge its legal sufficiency ․ The third way to challenge a special defense is to show that there is no genuine issue of material fact based on the evidence ․ Even if a special defense is a valid defense to a foreclosure action, and even if such a defense is sufficiently pled, the defendant still must produce sufficient evidence to support the defense in order to survive summary judgment.”  (Internal quotation marks omitted.)   IndyMac Bank, F.S.B. v. Khan, Superior Court, judicial district of Fairfield, Docket No. CV 08 5016789 (April 16, 2010, Hartmere, J.);   see also Deutsche Bank National Trust Co. v. Casas, Superior Court, judicial district of Fairfield, Docket No. CV 09 5026100 (April 19, 2012, Hartmere, J.) (same).  Consequently, in order to survive a summary judgment motion, the defendants still need to provide some evidentiary basis to support their special defenses.   Furthermore, Connecticut law allows for a court to render summary judgment as to a special defense if the defect cannot be cured by repleading.   Consequently, the court will address the validity of each of the defendants' special defenses within the context of this motion for summary judgment.

I

UNCONSCIONABILITY

The court initially will address the defendants' first special defense, sounding in unconscionability.   In their first special defense, the defendants allege that this loan transaction is unconscionable because “the lender has offered and convinced the [d]efendants to accept a negative amortization loan, whereby the [d]efendants in the beginning would pay less than the interest, with the extra amount added to the principal.”   The defendants allege that the lender's actions caused them unfair surprise and oppression because their “principal debt went up considerably.”   The plaintiff argues that this special defense does not preclude the court from rendering a judgment of liability against the defendants because:  (1) the defendants have failed to assert sufficient facts to support this special defense;  (2) the mere assertion of unconscionability without any factual support of same is insufficient to maintain this special defense because the defendants bear the burden of proof and (3) as an assignee of the mortgage, it is not legally responsible for the conduct of the assignor.

“The purpose of the doctrine of unconscionability is to prevent oppression and unfair surprise ․ As applied to real estate mortgages, the doctrine of unconscionability draws heavily on its counterpart in the Uniform Commercial Code which, although formally limited to transactions involving personal property, furnishes a useful guide for real property transactions ․ As Official Comment 1 to § 2–302 of the Uniform Commercial Code suggests, [t]he basic test is whether, in the light of the general commercial background and the commercial needs of the particular trade or case, the clauses involved are so one-sided as to be unconscionable under the circumstances existing at the time of the making of the contract ․ Unconscionability is determined on a case-by-case basis, taking into account all of the relevant facts and circumstances.”  (Emphasis in original;  internal quotation marks omitted.)   LaSalle National Bank v. Freshfield Meadows, LLC, 69 Conn.App. 824, 837, 798 A.2d 445 (2002).   Consequently, the law is clear that an unconscionability special defense is only legally cognizable if it alleges conduct that occurred at the time of the making of the mortgage contract.   Additionally, when discussing the legal viability of unconscionability and unclean hands special defenses in the context of a foreclosure case, this court has previously stated that “[w]hile Connecticut's appellate courts do not appear to have had an occasion to consider precisely the issue of the liability of an assignee for pre-assignment breaches by the assignor, numerous other courts have ruled that to be liable for the assignor's nonperformance of duties under a contract, the assignee must have expressly assumed liability for the prior breaches.”   (Internal quotation marks omitted.)  IndyMac Bank, F.S.B. v. Khan, supra, Superior Court, Docket No. CV 08 5016789.   In IndyMac Bank, this court held that “the defendants have not alleged that [the substitute plaintiff] assumed liability for prior breaches or the nonperformance of duties by [initial plaintiff], its predecessor in interest, and accordingly have failed to support the defense of unconscionability ․ Nor have the defendants offered any evidence to support their equitable defenses, as is required after the plaintiff meets its initial summary judgment burden.”  Id.

In the present case, the defendants do allege conduct that occurred at the time of the formation of the mortgage contract.   Nevertheless, the defendants negotiated their loan with IndyMac Bank, F.S.B., and this loan has been assigned twice since then.   The defendants do not allege that the substitute plaintiff assumed any liability for the acts of IndyMac Bank, F.S.B. Additionally, the defendants have provided absolutely no documentary evidence in support of this special defense.   Therefore, for these reasons, the defendants' first special defense does not prevent the court from rendering summary judgment in favor of the plaintiff.

II

BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING

Next, the plaintiff argues that the defendants' second special defense, breach of implied covenant of good faith and fair dealing, is legally insufficient because such a defense is not proper in a foreclosure action.  “[I]t is axiomatic that the ․ duty of good faith and fair dealing is a covenant implied into a contract or a contractual relationship ․ In other words, every contract carries an implied duty requiring that neither party do anything that will injure the right of the other to receive the benefits of the agreement ․ The covenant of good faith and fair dealing presupposes that the terms and purpose of the contract are agreed upon by the parties and that what is in dispute is a party's discretionary application or interpretation of a contract term.”  (Internal quotation marks omitted.)  Rafalko v. University of New Haven, 129 Conn.App. 44, 51, 19 A.3d 215 (2011).   Despite the general applicability of this doctrine, the Appellate Court has held on multiple occasions that “special defenses and counterclaims alleging a breach of an implied covenant of good faith and fair dealing ․ are not equitable defenses to a mortgage foreclosure ․ Accordingly, the defendants' special defense is legally insufficient and is not a valid legal or equitable defense to a foreclosure action.”  (Internal quotation marks omitted.)  Monetary Funding Group, Inc. v. Pluchino, 87 Conn.App. 401, 404 n.3, 867 A.2d 841 (2005).⁴  When faced with the allegation of such a special defense, it is appropriate for the court to grant summary judgment in favor of the plaintiff mortgagee.   Fidelity Bank v. Krenisky, 72 Conn.App. 700, 717, 807 A.2d 968, cert. denied, 262 Conn. 915, 811 A.2d 1291 (2002) (stating that “the defendants' [implied covenant of good faith and fair dealing] special defense is legally insufficient and is not a valid legal or equitable defense to a foreclosure action.   Therefore, the court's conclusion that it presented no genuine issue of material fact was legally and logically correct.”).   Accordingly, the defendants' second special defense is legally insufficient.

III

UNCLEAN HANDS

The defendants' third special defense is unclean hands.   According to the plaintiff, this special defense does not apply in this case because “as alleged [it] does not constitute a legally cognizable special defense to a foreclosure action.”   Specifically, the plaintiff contends that unclean hands is not applicable here because the defendants fail to allege that they came to the court with clean hands, as required to state an unclean hand special defense, and this special defense does not relate to the making, validity or enforcement of the note.⁵

“Because an action to foreclose a mortgage is an equitable proceeding, the doctrine of unclean hands may be applicable ․ The doctrine of unclean hands expresses the principle that where a plaintiff seeks equitable relief, he must show that his conduct has been fair, equitable and honest as to the particular controversy in issue ․ Unless the plaintiffs' conduct is of such a character as to be condemned and pronounced wrongful by honest and fair-minded people, the doctrine of unclean hands does not apply.”  (Citation omitted;  internal quotation marks omitted.)  Ulster Savings Bank v. 28 Brynwood Lane, Ltd., 134 Conn.App. 699, 710–11 (2012).  “It is a fundamental principle of equity jurisprudence that for a complainant to show that he is entitled to the benefit of equity he must establish that he comes into court with clean hands ․ The clean hands doctrine is applied not for the protection of the parties but for the protection of the court ․ It is applied not by way of punishment but on considerations that make for the advancement of right and justice.”  (Internal quotation marks omitted.)  Thompson v. Orcutt, 257 Conn. 301, 310, 777 A.2d 670 (2001).

Although the doctrine of unclean hands may be a valid special defense in a foreclosure action, it is important to note the procedural posture of this case.  “A special defense may be challenged by showing that there is no genuine issue of material fact based on the evidence ․ The presence ․ of an alleged adverse claim is not sufficient to defeat a motion for summary judgment.   A party must substantiate his adverse claim by specifically showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue ․ Even if a special defense is a valid defense to a foreclosure action, and even if such a defense is sufficiently pled, the defendant still must produce sufficient evidence to support the defense in order to survive summary judgment.”  (Internal quotation marks omitted.)   IndyMac Bank, F.S.B. v. Khan, supra, Superior Court, Docket No. CV 08 5016789.

The defendants have presented no evidence in support of their unclean hands special defense.   Consequently, the defendants have failed to meet their evidentiary burden to raise a genuine issue of material fact as to the applicability of this special defense.   Therefore, the mere existence of this special defense does not preclude the court from rendering summary judgment in favor of the plaintiff.

IV

PREDATORY LENDING

The fourth special defense asserted by the defendants is “predatory lending.”   In its memorandum of law, the plaintiff argues that this special defense is not valid in the present case because:  (1) as an assignee it is not responsible for the conduct of the assignor and (2) this special defense does not attack the making, validity or enforcement of the note.   For both of these reasons, the plaintiff contends that this special defense does not stop the foreclosure of the subject mortgage.

In National City Mortgage Co. v. Lederman, Superior Court, judicial district of Fairfield, Docket No. CV 09 5021617 (March 2, 2011, Hartmere, J.), this court discussed the legal validity of a predatory lending special defense.   The court stated that it was “unwilling to recognize ‘predatory lending’ as a distinct special defense because of the scant authority supporting it as an independent defense and the dearth of formal legal elements that would allow a court to test whether this defense has been sufficiently pleaded.   The definition drawn from [Monetary Funding Group, Inc. v. Pluchino, Superior Court, judicial district of Fairfield, Docket No. CV 01 0382851 (September 3, 2003, Stevens J.), aff'd., 87 Conn.App. 401, 867 A.2d 841 (2005) ] sets forth no formal elements of the defense and is more akin to a nonexhaustive list of practices that could be encompassed within the broad descriptive term ‘predatory lending.’   Nevertheless, the court will consider the allegations of the fourth special defense in order to determine whether the defendants have pleaded a valid foreclosure defense that relates to the making, validity or enforcement of the note or mortgage.”  Id. Accordingly, in accord with this court's previous decision in National City Mortgage Co., a predatory lending special defense is non-existent and such a defect could obviously not be cured by repleading.   Therefore, although the factual allegations set forth in this special defense can be considered by the court, a predatory lending special defense, by itself, cannot prevent the plaintiff from foreclosing the mortgage on the defendants' property.⁶

V

CUTPA

Finally, the court will address the applicability of the defendants' fifth special defense, CUTPA.   The plaintiff contends that this special defense is legally insufficient because the defendants fail to allege any immoral, unethical, oppressive or unscrupulous behavior that rises to the level of a CUTPA violation.   According to the plaintiff, the conduct alleged by the defendants does not satisfy the cigarette rule such that the plaintiff's behavior constitutes an unfair trade practice.

“[General Statutes § ]42–110b(a) provides that [n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce.   It is well settled that in determining whether a practice violates CUTPA we have adopted the criteria set out in the cigarette rule by the federal trade commission for determining when a practice is unfair:  (1)[W]hether the practice, without necessarily having been previously considered unlawful, offends public policy as it has been established by statutes, the common law, or otherwise—in other words, it is within at least the penumbra of some common law, statutory, or other established concept of unfairness;  (2) whether it is immoral, unethical, oppressive, or unscrupulous;  (3) whether it causes substantial injury to consumers, [competitors or other businesspersons] ․ All three criteria do not need to be satisfied to support a finding of unfairness.”  (Internal quotation marks omitted.)  Szekeres v. Szekeres, 126 Conn.App. 829, 841, 16 A.3d 713, cert. denied, 300 Conn. 939, 17 A.3d 475 (2011).  “There are instances in which violations of CUTPA have been upheld as valid counterclaims brought in foreclosure actions.”   JP Morgan Chase Bank, Trustee v. Rodrigues, 109 Conn.App. 125, 133, 952 A.2d 56 (2008).  “In foreclosure actions, the mortgagee's conduct in the making of the mortgage note has been held to constitute a violation of CUTPA.”  Id., 134.

In the present case, the defendants allege, inter alia, that the plaintiff committed a CUTPA violation when it convinced them to accept a negative amortization loan.   This conduct allegedly occurred at the time of the formation of the mortgage agreement, and it could, arguably, rise to the level of an unfair business practice.   Nevertheless, once again, the defendants have failed to provide any documentary support for these allegations.   As previously stated, “[e]ven if a special defense is a valid defense to a foreclosure action, and even if such a defense is sufficiently pled, the defendant still must produce sufficient evidence to support the defense in order to survive summary judgment.”  (Internal quotation marks omitted.)  IndyMac Bank, F.S.B. v. Khan, supra, Superior Court, Docket No. CV 08 5016789.   Because the defendants have not produced any evidence in support of this special defense, as the defendants must in order to meet their burden to raise a genuine issue of material fact, this special defense also does not preclude the court from rendering summary judgment in favor of the plaintiff mortgagee.⁷

CONCLUSION

For all of the foregoing reasons, the plaintiff's motion for summary judgment is granted.

Hartmere, J.

FOOTNOTES

FN1. On August 17, 2011, the plaintiff filed a motion to substitute U.S. Bank National Association, as trustee for the LXS 2006–14N, as the plaintiff in this matter.   The motion indicated that this entity is now the proper plaintiff because it has acquired the right to collect the debt owed by the defendants under the promissory note.   This motion to substitute was granted by the court, Hartmere, J., on September 6, 2011.   Consequently, U.S. Bank National Association, as trustee for the LXS 2006–14N, is now the party plaintiff in the present case..  FN1. On August 17, 2011, the plaintiff filed a motion to substitute U.S. Bank National Association, as trustee for the LXS 2006–14N, as the plaintiff in this matter.   The motion indicated that this entity is now the proper plaintiff because it has acquired the right to collect the debt owed by the defendants under the promissory note.   This motion to substitute was granted by the court, Hartmere, J., on September 6, 2011.   Consequently, U.S. Bank National Association, as trustee for the LXS 2006–14N, is now the party plaintiff in the present case.

FN2. Fairfield County Pathology is also named as defendant in this case.   The plaintiff alleges that it may claim an interest in the subject premises by virtue of a $495.40 judgment lien.   Fairfield County Pathology is non-appearing.   Accordingly, all references to “the defendants” in this memorandum will only refer to Carlos Reinoso and Engracia M. Reinoso..  FN2. Fairfield County Pathology is also named as defendant in this case.   The plaintiff alleges that it may claim an interest in the subject premises by virtue of a $495.40 judgment lien.   Fairfield County Pathology is non-appearing.   Accordingly, all references to “the defendants” in this memorandum will only refer to Carlos Reinoso and Engracia M. Reinoso.

FN3. Four days after the plaintiff filed its motion for summary judgment, on February 14, 2012, the defendants filed a motion for an extension of time to respond to the motion for summary judgment.   In this motion, the defendants indicated that they were requesting this extension of time in order to “formulate a response and to consult an attorney.”   No action was taken by the court with respect to the motion for extension of time prior to the March 26, 2012 hearing (see P.B. 17–45).   At the short calendar proceeding, Carlos Reinoso appeared without counsel and did not attempt to file any written opposition.   The court inquired as to the defendants' attempts at obtaining legal representation, and Carlos Reinoso did not request a further extension of time in order to find legal counsel.   Accordingly, the court stated that “the motion to extend time is granted, but it's moot.   That's the defendant's motion.   And the motion for summary judgment I'll take under advisement then, and I'll look at everything that's been submitted and render an opinion on it.”   To date, the defendants have made no further attempt to file any written opposition to the plaintiff's motion for summary judgment..  FN3. Four days after the plaintiff filed its motion for summary judgment, on February 14, 2012, the defendants filed a motion for an extension of time to respond to the motion for summary judgment.   In this motion, the defendants indicated that they were requesting this extension of time in order to “formulate a response and to consult an attorney.”   No action was taken by the court with respect to the motion for extension of time prior to the March 26, 2012 hearing (see P.B. 17–45).   At the short calendar proceeding, Carlos Reinoso appeared without counsel and did not attempt to file any written opposition.   The court inquired as to the defendants' attempts at obtaining legal representation, and Carlos Reinoso did not request a further extension of time in order to find legal counsel.   Accordingly, the court stated that “the motion to extend time is granted, but it's moot.   That's the defendant's motion.   And the motion for summary judgment I'll take under advisement then, and I'll look at everything that's been submitted and render an opinion on it.”   To date, the defendants have made no further attempt to file any written opposition to the plaintiff's motion for summary judgment.

FN4. See also Bank of New York v. Saquinaula, Superior Court, judicial district of Fairfield, Docket No. CV 08 5017454 (July 14, 2011, Hartmere, J.), and TD Bank, NA. v. SM Phoenix Merritt 8, LLC, Superior Court, judicial district of Fairfield, Docket No. CV 10 6011034 (January 19, 2011, Hartmere, J.), where this court stated that “[a]lthough [s]ome recent decisions of the Superior Court ․ have ․ concluded that the special defense of a breach of the implied covenant of good faith and fair dealing is not automatically barred in a foreclosure action ․ absent further appellate review ․ the rule appears to remain that ․ a breach of the implied covenant of good faith and fair dealing ․ [is] not an equitable [defense] to mortgage foreclosure.”  (Internal quotation marks omitted.)   Id.;  but see Bayview Loan Servicing, LLC v. Yoney Realty Corp., Superior Court, judicial district of Fairfield, Docket No. CV 11 6016983 (April 4, 2012, Hartmere, J.) (where the court allowed this defense to survive a motion to strike because it related to the making, validity and enforcement of the note)..  FN4. See also Bank of New York v. Saquinaula, Superior Court, judicial district of Fairfield, Docket No. CV 08 5017454 (July 14, 2011, Hartmere, J.), and TD Bank, NA. v. SM Phoenix Merritt 8, LLC, Superior Court, judicial district of Fairfield, Docket No. CV 10 6011034 (January 19, 2011, Hartmere, J.), where this court stated that “[a]lthough [s]ome recent decisions of the Superior Court ․ have ․ concluded that the special defense of a breach of the implied covenant of good faith and fair dealing is not automatically barred in a foreclosure action ․ absent further appellate review ․ the rule appears to remain that ․ a breach of the implied covenant of good faith and fair dealing ․ [is] not an equitable [defense] to mortgage foreclosure.”  (Internal quotation marks omitted.)   Id.;  but see Bayview Loan Servicing, LLC v. Yoney Realty Corp., Superior Court, judicial district of Fairfield, Docket No. CV 11 6016983 (April 4, 2012, Hartmere, J.) (where the court allowed this defense to survive a motion to strike because it related to the making, validity and enforcement of the note).

FN5. The plaintiff fails to argue that the defendants' unclean hands special defense does not apply to the facts of this case because the plaintiff, as an assignee, cannot be held responsible for the conduct of the assignor..  FN5. The plaintiff fails to argue that the defendants' unclean hands special defense does not apply to the facts of this case because the plaintiff, as an assignee, cannot be held responsible for the conduct of the assignor.

FN6. Additionally, this special defense is also legally insufficient because as an assignee, the plaintiff is not liable, absent an express assumption of liability, for the conduct of its assignor.   Moreover, as the defendants have not opposed the summary judgment motion with any documentary evidence, they have failed to meet their evidentiary burden to raise a genuine issue of material fact with respect to this special defense..  FN6. Additionally, this special defense is also legally insufficient because as an assignee, the plaintiff is not liable, absent an express assumption of liability, for the conduct of its assignor.   Moreover, as the defendants have not opposed the summary judgment motion with any documentary evidence, they have failed to meet their evidentiary burden to raise a genuine issue of material fact with respect to this special defense.

FN7. Additionally, although this argument is not raised by plaintiff, it should be noted that “[s]ince CUTPA claims by their very nature constitute claims for damages, they are properly brought as counterclaims rather than special defenses ․ CUTPA is a sword rather than a shield.”  (Internal quotation marks omitted.)   Discovery Bank v. Kollars, Superior Court, judicial district of Tolland, Docket No. CV 09 5005293 (October 15, 2010, Bright, J.).   Accordingly, although there is some dissenting Superior Court authority, the majority rule appears to be that “an alleged violation of CUTPA is properly brought as a counterclaim to foreclosure actions, rather than as a special defense ․” (Internal quotation marks omitted.)   Deutsche Bank National Trust Co. v. Medina, Superior Court, judicial district of Stamford–Norwalk at Stamford, Docket No. CV 08 5006907 (January 10, 2011, Mintz, J.) (51 Conn. L. Rptr. 270, 277)..  FN7. Additionally, although this argument is not raised by plaintiff, it should be noted that “[s]ince CUTPA claims by their very nature constitute claims for damages, they are properly brought as counterclaims rather than special defenses ․ CUTPA is a sword rather than a shield.”  (Internal quotation marks omitted.)   Discovery Bank v. Kollars, Superior Court, judicial district of Tolland, Docket No. CV 09 5005293 (October 15, 2010, Bright, J.).   Accordingly, although there is some dissenting Superior Court authority, the majority rule appears to be that “an alleged violation of CUTPA is properly brought as a counterclaim to foreclosure actions, rather than as a special defense ․” (Internal quotation marks omitted.)   Deutsche Bank National Trust Co. v. Medina, Superior Court, judicial district of Stamford–Norwalk at Stamford, Docket No. CV 08 5006907 (January 10, 2011, Mintz, J.) (51 Conn. L. Rptr. 270, 277).

Hartmere, Michael, J.