Wilmington Savings Fund Society, FSB v. Blake, WWMCV146008236S

Wilmington Savings Fund Society, FSB dba v. Julie Blake aka

No. WWMCV146008236S

Superior Court of Connecticut, Judicial District of Windham, Putnam

April 26, 2017

UNPUBLISHED OPINION

MEMORANDUM OF DECISION (MOTION TO DISMISS, #140 SHORT CALENDAR, JANUARY 30, 2017 AND APRIL 24, 2017)

Harry E. Calmar, J.

The defendant moves to dismiss on the ground that the court lacks subject matter jurisdiction over the case because the plaintiff lacks standing to commence the foreclosure action.

The original plaintiff, CitiMortgage, Inc. (CitiMortgage), filed this foreclosure action on April 22, 2014. The complaint alleges the following facts. The defendant, Julie Blake ^[1] owns real property located at 197 Dugg Hill Road in Woodstock, Connecticut (property). On December 10, 2007, the defendant executed and delivered a note (note) in favor of CitiMortgage for the original principal amount of $417, 000. On the same date, to secure the note, the defendant executed and delivered a mortgage (mortgage) on the property to Mortgage Electronic Registration Systems, Inc. (MERS) as nominee for CitiMortgage. The mortgage was later assigned to CitiMortgage on June 20, 2011 (assignment). Thereafter, the defendant defaulted on the note. As a result, CitiMortgage elected to accelerate the balance due and to foreclose the mortgage. CitiMortgage provided written notice of the foreclosure in accordance with the note and mortgage provisions. After the defendant failed to cure the default CitiMortgage caused a Lis Pendens to be recorded on the property.

On January 27, 2016, CitiMortgage assigned the mortgage, the note, and this foreclosure action to Wilmington Savings Funds Society, FSB, DBA Christiana Trust, not individually but as Trustee for Ventures Trust 2013-I-H-R (Wilmington). As a result of the assignment, CitiMortgage filed a motion to substitute the plaintiff to Wilmington. This court (Calmar J.) granted the motion to substitute the plaintiff to Wilmington on October 24, 2016.

The defendant filed a motion to dismiss with prejudice on December 12, 2016 on the ground that Wilmington lacks standing and therefore, the court is without subject matter jurisdiction. The defendant also argues that dismissal with prejudice is merited due to two previous foreclosure actions regarding this property, which were each dismissed for failure to prosecute. The defendant's motion to dismiss is accompanied by a memorandum of law.^[2]

Wilmington filed a memorandum in opposition to the motion to dismiss on January 26, 2017. On January 30, 2017, both parties argued at short calendar. After short calendar, the defendant filed a motion to file a late reply to the plaintiff's objection. In her motion, the defendant stated she needed to file a late reply because her arguments presented at short calendar were not in her filings to date. The motion was granted by this court (Calmar, J.) on February 14, 2017. The matter was scheduled to be reargued on March 20, 2017. The defendant, however, filed a motion for continuance on March 15, 2017. This court (Calmar, J.) granted the motion for continuance on March 16, 2017. The matter was then scheduled to be reargued on April 24, 2017. The defendant did not appear on April 24th, nor did she file a late reply.

DISCUSSION

" [A] motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court." (Internal quotation marks omitted.) Santorso v. Bristol Hospital, 308 Conn 338, 350, 63 A.3d 940 (2013). " A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Internal quotation marks omitted.) MacDermid, Inc. v. Leonetti, 310 Conn. 616, 626, 79 A.3d 60 (2013). " A court deciding a motion to dismiss must determine not the merits of the claim or even its legal sufficiency, but rather, whether the claim is one that the court has jurisdiction to hear and decide." (Internal quotation marks omitted.) Hinde v. Specialized Education of Connecticut, Inc., 147 Conn.App. 730, 740-41, 84 A.3d 895 (2014).

" Pursuant to the rules of practice, a motion to dismiss is the appropriate motion for raising a lack of subject matter jurisdiction." St. George v. Gordon, 264 Conn. 538, 545, 825 A.2d 90 (2003). " [T]he plaintiff bears the burden of proving subject matter jurisdiction, whenever and however raised." (Internal quotation marks omitted.) Fort Trumbull Conservancy, LLC v. New London, 265 Conn. 423, 430 n.12, 829 A.2d 801 (2003).

" Because the issue of standing implicates subject matter jurisdiction, it may be a proper basis for granting a motion to dismiss." (Internal quotation marks omitted.) Electrical Contractors, Inc. v. Dept. of Education, 303 Conn. 402, 413, 35 A.3d 188 (2012). " When a . . . court decides a jurisdictional question raised by a pretrial motion to dismiss, it must consider the allegations of the complaint in their most favorable light . . ." Id. " In this regard, a court must take the facts to be those alleged in the complaint, including those facts necessarily implied from the allegations, construing them in a manner most favorable to the pleader . . ." Id. " The motion to dismiss . . . admits all facts which are well pleaded, invokes the existing record and must be decided upon that alone." Id. " If . . . the plaintiff's standing does not adequately appear from all materials of record, the complaint must be dismissed." (Footnote omitted; internal quotation marks omitted.) Burton v. Dominion Nuclear Connecticut, Inc., 300 Conn. 542, 550, 23 A.3d 1176 (2011).

In the present case, the defendant moves to dismiss the complaint with prejudice on the ground Wilmington lacks standing; therefore the court is without subject matter jurisdiction. The defendant asserts that Wilmington lacks standing because its assignment is invalid. Specifically, the defendant contends that CitiMortgage assigned the mortgage to Citibank, N.A. (Citibank) before it assigned it to Wilmington. The defendant further asserts that Wilmington does not possess the note because its predecessor, CitiMortgage, lost the note before it assigned it to Wilmington. Accordingly, the defendant concludes that Wilmington does not possess the note or the mortgage, and therefore it does not have standing. The defendant further argues that even if the assignment was valid, it only transfers the mortgage, not the note. Last, the defendant contends that the motion to dismiss should be granted with prejudice because it is the third attempt by Wilmington and its predecessor, CitiMortgage, to foreclose.

Wilmington counters that CitiMortgage and Wilmington have always maintained standing. First, Wilmington states that CitiMortgage was the holder of the original note, endorsed in blank, prior to the commencement of this action. Wilmington explains that CitiMortgage, in possession of the original note, delivered the note to its counsel, Hunt Leibert Jacobson, P.C. (counsel), on or about June 18, 2013, for the sole purpose of beginning foreclosure proceedings.^[3] Wilmington states that note has remained with its counsel since June 18, 2013, well before this foreclosure action commenced on April 22, 2014. Wilmington further asserts that it thereafter became the holder of the note and was substituted into this case on October 24, 2016. Additionally, Wilmington counters that even if the assignment of the mortgage is invalid, as holder of the note, endorsed in blank; it has the right to enforce the mortgage. Last, Wilmington states that while it is true that a lost note affidavit was utilized in a prior foreclosure action, it is immaterial that in the past the note was misplaced because it was located well before the present foreclosure action commenced.

I

Subject Matter Jurisdiction

" Standing is the legal right to set judicial machinery in motion. One cannot rightfully invoke the jurisdiction of the court unless he [or she] has, in an individual or representative capacity, some real interest in the cause of action, or a legal or equitable right, title or interest in the subject matter of the controversy . . ." Property Asset Management, Inc. v. Lazarte, 163 Conn.App. 737, 745, 138 A.3d 290 (2016). " When a party is found to lack standing, the court is consequently without subject matter jurisdiction to determine the cause ." (Internal quotation marks omitted.) Id.

" Generally, in order to have standing to bring a foreclosure action the plaintiff must, at the time the action is commenced, be entitled to enforce the promissory note that is secured by the property . . ." (Emphasis in original.) Id., 746. " Whether a party is entitled to enforce a promissory note is determined by the provisions of the Uniform Commercial Code, as codified in General Statutes § 42a-1-101 et seq. . . ." Id.

" Under the Uniform Commercial Code, only a holder of an instrument or someone who has the rights of a holder is entitled to enforce the instrument." (Internal quotation marks omitted.) Equity One, Inc. v. Shivers, 310 Conn. 119, 126, 74 A.3d 1225 (2013); see also General Statutes § 42a-3-301.^[4] " The holder is the person or entity in possession of the instrument if the instrument is payable to bearer." (Internal quotation marks omitted.) Equity One, Inc. v. Shivers, supra, 126; see also General Statutes § 42a-1-201(b)(21)(A).^[5] " When a note is endorsed in blank . . . the note becomes payable to the 'bearer' of the note." U.S. Bank, National Assn. v. Schaeffer, 160 Conn.App. 138, 146, 125 A.3d 262 (2015); see also General Statutes § 42a-3-205(b).^[6]

" The plaintiff's possession of a note endorsed in blank is prima facie evidence that it is a holder and is entitled to enforce the note,...