Vossbrinck v. Accredited Home Lenders, Inc.

Karl Paul Vossbrinck v. Accredited Home Lenders, Inc. [Deutsche Bank National Trust, Company as Indenture Trustee on Behalf of the Holders of the Accredited Mortgage Loan Trust 1005-4 Asset Backed Notes, Substituted Plaintiff]

No. CV125016343S

Superior Court of Connecticut, Judicial District of Waterbury, Waterbury

December 1, 2015

UNPUBLISHED OPINION

MEMORANDUM OF DECISION RE MOTION TO STRIKE

Mark H. Taylor, J.

I BACKGROUND

The defendant has filed a motion to strike the plaintiff's revised complaint, ^[1] stated in four counts.^[2] At the hearing held on November 9, 2015, the plaintiff stipulated that the motion should be granted on counts two through four conceding that the defendant is not a state actor for purposes of the constitutional claims asserted in those counts. Therefore, the motion is granted by agreement regarding counts two, three and four. The remaining dispute between the parties is over the legal sufficiency of the first count, alleging fraud.

The essence of the plaintiff's claim in count one is that Accredited Home Lenders, Inc. (Accredited Home Lenders) fraudulently misrepresented that it was the holder of the plaintiff's note and mortgage at the time it initiated the action to foreclose the mortgage on his home. The plaintiff further asserts that Accredited Home Lenders' successor, Deutsche Bank, repeated this fraudulent misrepresentation on multiple occasions in its pleadings through and until the conclusion of the foreclosure case on March 27, 2012.

The defendant states three reasons in support of its motion to strike the first count of the complaint. The first is collateral estoppel, the second is the statute of limitations and the third is the plaintiff's failure to adequately allege a cause of action for fraud. For reasons set forth below, the motion to strike is granted.

II Motion to Strike

The court will begin by setting forth the legal standard applicable to a motion to strike. Practice Book § 10-39 provides in relevant part: " (a) Whenever any party wishes to contest (1) the legal sufficiency of the allegations of any complaint, counterclaim or cross claim, or of any one or more counts thereof, to state a claim upon which relief can be granted . . . that party may do so by filing a motion to strike the contested pleading or part thereof." Simply stated, " [t]he purpose of a motion to strike is to contest . . . the legal sufficiency of the allegations of any complaint . . . to state a claim upon which relief can be granted." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. Alves 262 Conn. 480, 498, 815 A.2d 1188 (2003).

When deciding a motion to strike, the court must " take the facts to be those alleged in the complaint . . . [and] construe the complaint in the manner most favorable to sustaining its legal sufficiency . . . Thus, [i]f facts provable in the complaint would support a cause of action the motion to strike must be denied . . . Moreover . . . [w]hat is necessarily implied [in an allegation] need not be expressly alleged . . . It is fundamental that in determining the sufficiency of a complaint challenged by a defendant's motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted . . . Indeed, pleadings must be construed broadly and realistically, rather than narrowly and technically." (Internal quotation marks omitted.) Connecticut Coalition for Justice in Education Funding, Inc. v. Rell, 295 Conn. 240, 252-53, 990 A.2d 206 (2010).

" A motion to strike challenges the legal sufficiency of a pleading . . . and, consequently, requires no factual findings by the trial court." (Internal quotation marks omitted.) Batte-Holmgren v. Commissioner of Public Health, 281 Conn. 277, 294, 914 A.2d 996 (2007). " Annexation of an agreement to [the motion to strike] . . . makes it the equivalent of a 'speaking motion to strike, ' which is not proper." Connecticut State Oil Co. v. Carbone, 36 Conn.Supp. 181, 183, 415 A.2d 771 (1979). " A speaking motion to strike is one improperly importing facts from outside the pleadings . . . Speaking motions have long been forbidden by our practice . . ." (Citations omitted.) Mercer v. Cosley, 110 Conn.App. 283, 292 n.7, 955 A.2d 550 (2008). " It is well established that a motion to strike must be considered within the confines of the pleadings and not external documents . . . We are limited . . . to a consideration of the facts alleged in the complaint." (Internal quotation marks omitted.) Zirinsky v. Zirinsky, 87 Conn.App. 257, 268 n.9, 865 A.2d 488, cert. denied, 273 Conn. 916, 871 A.2d 372 (2005).

III SALIENT FACTS BASED UPON THE RECORD

A motion to strike is generally limited to an examination of the language of the challenged pleading, without consideration of extratextual evidence. However, a limited review of the long and complicated procedural history of this ongoing dispute between these parties, involving several thousand pages, will elucidate the basis for the court's decision. From the record, the court gleans the following, salient facts.

This case is based upon the foreclosure of the plaintiff's home, filed by Accredited Home Lenders. See Accredited Home Lenders, Inc. v. Vossbrinck, Superior Court, Judicial District of Waterbury, Docket No. CV-08-5007144-S. Critical to the plaintiff's claim in this case is the allegedly fraudulent assertion by Accredited Home Lenders that it " held the mortgage and note" at the time the foreclosure was initiated. There is no dispute between the parties that this claim has been made in pleadings and other court filings.

The plaintiff signed the original mortgage note and granted the mortgage deed to Accredited Home Lenders, with MERS as its nominee, on or about October 19, 2005. Accredited Home Lenders' successor to the underlying note and mortgage was Deutsche Bank National Trust Company, As Indenture Trustee, On Behalf of the Holders of the Accredited Mortgage Loan Trust 2005-4 Asset Backed Notes (Deutsche Bank), the substituted plaintiff in the foreclosure case. Although both Accredited Home Lenders and Deutsche Bank were separately served in this civil action, the plaintiff states in his complaint that Deutsche Bank is " the sole Defendant" in the present case.

Accredited Home Lenders originally filed the foreclosure with the court on December 21, 2007, asserting in the complaint that it was the holder of the plaintiff's note and mortgage. However, it was revealed by the date of its assignment that, at the time the foreclosure was initiated, MERS was the assignee of the mortgage. The original mortgage deed, dated October 19, 2005, identifies Accredited Home Lenders as the mortgage lender and MERS as the lender's nominee.^[3] Two months after the foreclosure was filed, MERS as nominee for Accredited Home Lenders assigned the mortgage to Accredited Home Lenders, thereby removing itself from the chain of title to the mortgage. The assignment was signed on February 21, 2008 by Jeffrey M. Knickerbocker as Assistant Secretary and Vice President of MERS. The assignment was recorded in the Southbury land records on April 7, 2008.

In view of the fact that the complaint was filed with the court on December 21, 2007, the plaintiff concludes that Accredited Home Lenders committed fraud because the assignment disproves its statement in the complaint that it was the holder of both the plaintiff's mortgage and note at the time the foreclosure was initiated. However, the court highlights the fact that the assignment of the mortgage deed to Accredited Home Lenders does not include the mortgage note. The note itself is signed by the plaintiff to the original lender, Accredited Home Lenders. Attached to the note is an undated allonge, endorsed in blank by Yanira Febres, Assistant Secretary of Accredited Home Lenders. Therefore, the note appears to be a bearer instrument pursuant to General Statutes § 42a-3-205(b).

During the foreclosure proceedings, Accredited Home Lenders assigned its rights to both the mortgage and note to Deutsche Bank on January 6, 2010. The assignment states that the original mortgage was executed by the plaintiff and was granted to MERS as nominee for Accredited Home Lenders. It also specifically states that the assignment includes the original note, which was for the principal sum of $575, 000.00, and that it was purchased for $10.00 and " other good and valuable consideration." The assignment was signed by Bill Koch on January 6, 2010 in his capacity as a document control officer for Accredited Home Lender's attorney in fact, Select Portfolio Servicing, Inc.

From this record, it appears that legal title to the note and mortgage were initially separated and later joined several months after the action to foreclose the plaintiff's home was filed on December 21, 2007. Importantly, there is no record of a transfer or endorsement of mortgage note to any entity at that time, other than Accredited Home Lenders. In addition, there is no record of the transfer of possession of the mortgage deed.^[4]

As the substituted plaintiff in the foreclosure, Deutsche Bank reiterated the assertion that Accredited Home Lenders was the holder of the mortgage and note at the time the foreclosure was filed with the court.

IV DISCUSSION

A Collateral Estoppel

This is a civil action for fraud, based upon the question of the defendant's standing in a previous action to foreclose the plaintiff's mortgage. In reviewing the judgment of foreclosure, the question presented is whether the issue of standing previously has been fully and fairly litigated between these parties.

Collateral estoppel precludes an action based upon an issue that has been previously litigated. It is similar to the broader doctrine of res...