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Advance Release Opinions – Appellate Court – September 28

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Reviews of Connecticut Appellate Court advance release opinions about divorce, a spite fence, and standing.

Divorce

Brochard v. Brochard – I’m not giving you much detail on this one – the second time in the Appellate Court for the Brochards – because the opinion is long and most of it is ho-hum. This quote from one of the many trial court judges gives you the idea: “[T]he enmity between the two of you has continued. . . . I mean, you’re both so adamant about who’s right about everything that you just keep, you know, wasting time and money and taking ridiculous positions.” Appellate Court affirmed, finding that (1) plaintiff was not in contempt of the non-emergency medical expenses or extracurricular activities provisions of the co-parenting agreement because defendant did not notify him of, or obtain his consent to, the proposed expenses in advance; (2) it would sua sponte invoke res judicata (prior appeal) to decline to consider defendant’s claim that plaintiff was in contempt of certain orders dealing with modification of the mortgage on the marital home (this part of the opinion was interesting because res judicata is not normally invoked sua sponte); (3) plaintiff was not in contempt of any order requiring him to reimburse defendant for mortgage payments because there was no such order; (4) plaintiff was not in contempt of an order requiring him to give defendant half of a refund on a joint income tax return because there was no such refund (plaintiff received a refund for a married-filing-separately return, but when the court ordered that corrected with amended married-filing-jointly return, there was tax owed); (5) trial court properly declined to modify the order directing the split for payment of guardian ad litem’s fees because there was no substantial change in either party’s finances since the court entered order; (6) there was no error in trial court’s orders modifying child support downward, and not modifying it upward; and (7) trial court did not miscalculate in granting defendant’s motion for contempt for failure to pay the correct amount of provisional alimony (defendant claimed that the trial court’s “correct amount” was too little).

Fredo v. Fredo – Defendant moved for modification of child support, claiming that child was living with an aunt, and asking the court to order that child support be paid directly to the aunt. Trial court granted plaintiff’s motion to dismiss for lack of subject matter jurisdiction because the motion for modification improperly asked for payment of child support to the aunt, a non-party to the action. Trial court simultaneously denied the motion for modification. Appellate Court reversed the dismissal for lack of subject matter jurisdiction because “[CGS] § 46b-1(4) vested the court with plenary and general jurisdiction over child support in the underlying matter, and § 46b-86(a) vested the court with continuing jurisdiction to modify the child support orders.” Appellate Court declined to consider the propriety of the denial of modification as moot because, by the time the parties argued the motion in the trial court, defendant had already abandoned her request that child support be paid to the aunt. Defendant’s claim for an accounting on an unrelated financial issue also was moot because plaintiff had since provided an accounting. And, since the motions to modify and for an accounting were moot, so was defendant’s claim that the trial court improperly quashed her subpoena of plaintiff related to those motions. Appellate Court reversed the award of attorney’s fees for having to deal with the motions to modify and for an accounting, and having to file a motion to quash the subpoena because trial court made no finding that any of defendant’s actions were taken in bad faith.

Peixoto v. Peixoto – Trial court granted plaintiff’s motion to increase her alimony. On appeal, defendant argued that the Supreme Court’s decision in Dan v. Dan precluded increasing alimony based on nothing more than a postdissolution increase in the payor’s income. Appellate Court affirmed, finding that Dan permits increasing alimony on an increase in the payor’s income if there are exceptional circumstances, as there were in this case: At the time of dissolution, trial court had minimum knowledge of defendant’s financial circumstances because he did not appear in the action, provide a financial affidavit, or appear at the dissolution hearing, and the parties did not present a written agreement to the court.

Spite Fence

Errichetti v. Botoff – Botoffs put up a fence through a low lying wooded/wetland area separating their property from Errichetti’s. The fence didn’t keep the Botoffs’ kids, or anyone else, in or out of the Botoffs’ yard because it didn’t connect to anything – anyone in the Botoffs’ yard could just walk around the fence into Errichetti’s yard and vice versa. The fence did not provide any privacy because it was lower than Errichetti’s house – if Errichetti was standing in his yard, he could see over the fence and into the Botoffs’ yard. The fence impaired Errichetti’s use and enjoyment of his property because, though it was not ugly as far as stockade fences go, it wasn’t as enjoyable as the natural scenery Errichetti had before. Trial court found the fence to be a “malicious erection … intended to annoy and injure any owner or lessee of adjacent land in respect to his use or disposition of the same” and granted an injunction under CGS § 52-480 requiring the Botoffs to remove it and restore the area to its previous condition. Appellate Court affirmed.

Standing

Bongiorno v. Capone – Bongiorno and Capone each owned 50% of an LLC. After they agreed that Bongiorno would buy Capone’s interest, Capone withdrew $17,000 from the LLC’s bank account. Bongiorno sued for breach of contract and statutory theft. Trial court found for Bongiorno on both claims and awarded him $17,000 for breach of contract and treble that for statutory theft (less $17,000 to avoid double recovery for breach of contract). Appellate Court affirmed as to the breach of contract claim, but only for $8,500, finding that since Bongiorno was buying only a 50% interest in the LLC, he was buying only a 50% interest in the $17,000 Capone withdrew. Appellate Court reversed as to the statutory theft claim because that injury was to the LLC, not Bongiorno, so Bongiorno lacked standing to bring the claim in his individual capacity. Appellate Court declined to consider Capone’s claim that waiver-of-suit provisions in the buy-sell documents protected him from Bongiorno’s claims because Capone did not raise it at trial.

CT Appeals: AC Reverses Foreclosure for Standing Issue

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In this Connecticut appeal, Deutsche Bank National Trust Company, Trustee v. Thompson, the Appellate Court reversed the judgment of foreclosure because the trial court did not make any factual findings as to plaintiff’s standing.

Plaintiff alleged in the complaint that it was the holder of the note. Defendant was defaulted for failure to plead. The trial court entered a judgment of foreclosure but made no factual findings as to whether plaintiff was the holder or owner of the note at the time it commenced the action. The Appellate Court reversed, concluding that, absent such factual findings, it could not answer “[t]he key question … [of] when the note came into the plaintiff’s possession.”

Plaintiff argued on appeal that if it had not presented the note to the trial court, the trial court could not have entered the foreclosure judgment. Plaintiff claimed, in other words, that it’s implicit from the judgment that the trial court had the note before it at the time of entry. The Appellate Court rejected this contention because there was no evidence that plaintiff ever presented the original note to the trial court. Plus, the copy of the note in the record was payable to the original lender, not plaintiff, and was not endorsed. Without an endorsement, plaintiff could not be the holder.

Plaintiff also argued that it had established holder status because it alleged that status in the complaint and defendant was defaulted for failure to plead. The Appellate Court rejected this argument.  Finding standing by a default in pleading would be akin to finding standing by waiver or consent, which the law expressly precludes.

The Appellate Court also “reject[ed] the plaintiff’s argument that an inadequate record precludes our review of its standing.” Though the appellant has the burden of presenting a record adequate for review, plaintiff has the burden of proving standing whenever the issue is raised, including on appeal. Because it is not the Appellate Court’s function to find facts, “[t]he judgment [was] reversed and the case [was] remanded for a determination of the jurisdictional issue and for further proceedings according to law.”

Two Part Test for Admitting Computerized Business Records

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In this Connecticut Appeal (Midland Funding, LLC v. Mitchell-James), the Appellate Court confirmed that there’s a two part test for admitting computerized business records into evidence.

Plaintiff claimed to have purchased defendant’s credit card account from the card issuer, JPMorgan Chase Bank, N.A. Plaintiff moved for summary judgment and submitted an affidavit that it claimed laid the foundation for the admission of two documents into evidence: a bill of sale for unspecified loans and a “field data sheet” reflecting, among other things, defendant’s name and the amount she owed.

Defendant opposed, claiming that the two documents were inadmissible hearsay and plaintiff had not demonstrated that it was the “bona fide owner of the account in question.” Plaintiff replied with another affidavit. This second affidavit “averred that Chase sold a ‘pool of charged-off accounts’ to the plaintiff, and, as part of the sale, ‘electronic records and other records on individual accounts included in the [pool of charged-off accounts] were transferred to [the plaintiff].’ [The affiant] affirmed that he was ‘aware of the process of the sale and assignment of electronically stored business records,’ and averred, without elaborating as to the basis for his averment, that he was ‘not aware of any errors in the [pool of charged-off accounts].'”

The trial court granted plaintiff summary judgment. Defendant appealed. The Appellate Court reversed.

Defendant’s Main Argument on Appeal

“On appeal, … the defendant argue[d] that Stayton’s affidavit failed to provide the ‘evidentiary foundation for the documents submitted [by the plaintiff] as business records.’ Consequently, the defendant argue[d], the plaintiff ‘never established that it was the successor in interest to the account in question’; thus, the court erred in rendering summary judgment because a genuine issue of material fact existed as to whether the plaintiff owned the defendant’s charged-off account.”

Appellate Court Confirms Two Part Test for Admitting Computerized Business Records

“When the proffered business records are computer generated, … the proffering party must satisfy a two part test. First, the proponent must satisfy … the three conditions set forth in General Statutes § 52-180. The court must determine, before concluding that it is admissible, that the record was made in the regular course of business, that it was in the regular course of such business to make such a record, and that it was made at the time of the act described in the report, or within a reasonable time thereafter…. Second, the proponent of the computer generated business records must establish that the basic elements of the computer system are reliable…. The genesis of the second part of the test dates back to American Oil Co. v. Valenti, 179 Conn. 349, 358–59, 426 A.2d 305 (1979), in which our Supreme Court noted that ‘[b]usiness records that are generated by computers present structural questions of reliability that transcend the reliability of the underlying information that is entered into the computer. Computer machinery may make errors because of malfunctioning of the hardware, the computer’s mechanical apparatus. Computers may also, and more frequently, make errors that arise out of defects in the software, the input procedures, the data base, and the processing program…. In view of the complex nature of the operation of computers and general lay unfamiliarity with their operation, courts have been cautioned to take special care to be certain that the foundation is sufficient to warrant a finding of trustworthiness and that the opposing party has full opportunity to inquire into the process by which information is fed into the computer.'”

Plaintiff’s Field Data Sheet Inadmissible because Plaintiff Failed to Demonstrate Computer System Reliability

The Appellate Court concluded that plaintiff’s “affidavit did not establish that the basic elements of the computer system [were] reliable…. Heeding our Supreme Court’s caveat that [c]omputers may … make errors that arise out of defects in the ‘software,’ the input procedures, the data base, and the processing program[,] … we conclude that it was incumbent on the plaintiff to produce an affidavit from a person who is familiar with computerized records not only as a user but also as someone with some working acquaintance with the methods by which such records are made … to
establish the reliability of the plaintiff’s computer system.”

Appellate Court Concludes Plaintiff Failed to Establish Standing

The field data sheet was inadmissible hearsay and thus did not support plaintiff’s claimed ownership of the account. The problem with the bill of sale seems to have been that it did not specifically identify defendant’s account as one of the accounts Chase sold to plaintiff. In other words, there was no evidence that the sale to plaintiff actually included defendant’s account.

Other Things to Note

In footnote 8, the court addressed plaintiff’s argument “that because the ‘defendant failed to produce any evidence to controvert the plaintiff’s motion or . . . [submit a counteraffidavit],’ there was no genuine issue of material fact, thereby affording the court ‘little choice but to grant’ its motion for summary judgment. To be sure, when the moving party seeking summary judgment meets its burden, ‘the opposing party must present evidence that demonstrates the existence of  some disputed factual issue.’ (Internal quotation marks omitted.) Marinos v. Poirot, 308 Conn. 706, 712, 66 A.3d 860 (2013). However, ‘[w]hen documents submitted in support of a motion for summary judgment fail to establish that there is no genuine issue of material fact, the nonmoving party has no obligation to submit documents establishing the existence of such an issue.’ (Emphasis added; internal quotation marks omitted.) Id.”

Ho-Hum, Another Foreclosure Plaintiff has Standing

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Some Connecticut appeals seem doomed to fail from the outset. The challenge to plaintiff’s standing to foreclose in Property Asset Management, Inc. v. Lazarte is one of those.

Plaintiff’s motion for summary judgment included an affidavit asserting that plaintiff received delivery of the note, endorsed in blank, on a specific date that was prior to commencement of the action. The trial court didn’t have to rule on the summary judgment motion because it later defaulted defendant for failing to comply with court-ordered discovery. The trial court ultimately entered a judgment of strict foreclosure and set a law date.

After a couple of dismissed bankruptcies later, the parties were back in court to reset the law date. Defendant filed a motion to dismiss, arguing that plaintiff lacked standing to foreclose. The trial court denied the motion to dismiss and reset the law date. Defendant appealed. The Appellate Court affirmed.

Defendant’s Main Arguments on Appeal

“[D]efendant first argue[d] that the court improperly denied her motion to dismiss on the basis of its finding that she had failed to counter the rebuttable presumption that the original plaintiff had standing to initiate this action.”

“[D]efendant also claim[ed] that the trial court improperly failed to conduct an evidentiary hearing on the motion to dismiss.”

Appellate Court Concludes Plaintiff had Standing to Foreclose

A “holder” is a person in possession of a note (assuming it’s a negotiable instrument) endorsed in blank. Under Supreme Court precedent, in a mortgage foreclosure action, the holder is rebuttably presumed also to be the owner of the debt. Since the owner of the debt on the date the action is commenced has standing to foreclose, so too does a person rebuttably presumed to be the owner of the debt, like the holder of the note, on the date the action is commenced.

“[A]lthough the court did not state the basis for its finding that the original plaintiff was in possession of the note when it initiated the foreclosure action, that finding is supported by the record, namely, the affidavit submitted with the motion for summary judgment indicating that the note [endorsed in blank] was delivered to the original plaintiff on or before October 6, 2008. The defendant presented no evidence that the original plaintiff transferred or lost possession of the note prior to commencing the foreclosure action on October 14, 2008.”

“Because the defendant presented the court with nothing to rebut the evidence in the record that the original plaintiff possessed the mortgage note endorsed in blank at the time that it commenced this action, and thus that it had standing, we conclude that the court properly denied the motion to dismiss.”

Appellate Court Concludes No Evidentiary Hearing Required

“A court is required to hold an evidentiary hearing before adjudicating a motion to dismiss only if there is a genuine dispute as to some pertinent jurisdictional fact…. In the present case, there was no jurisdictional fact in dispute necessary to determine whether the original plaintiff had standing to bring the present action. The record before the court revealed that the original plaintiff was in possession of the note, endorsed in blank, at the time it commenced the action, and, thus, there was a rebuttable presumption of standing. Because the defendant failed to demonstrate the existence of any relevant jurisdictional fact that was in dispute, the court was not required to hold an evidentiary hearing before ruling on the defendant’s motion to dismiss.”

Other Things to Note

In footnote 5, the Appellate Court rejected plaintiff’s arguments that defendant had waived standing and public policy militated against raising the standing argument at such a late stage in the proceedings. “As we have indicated, … a party may raise a lack of subject matter jurisdiction at any time, and subject matter jurisdiction cannot be conferred on the court by waiver or consent of the parties…. The defendant’s claim that the original plaintiff lacked standing implicates subject matter jurisdiction and, therefore, is not waivable and is properly before this court.”

Non-party Lacks Standing to Appeal

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The Connecticut Appellate Court dismissed an appeal because the appellant, who was not a party to the underlying judgment, lacked standing.  The appellant in M.U.N. Capital, LLC v. National Hall Properties, LLC, an advance release opinion to be officially released March 1, 2016, was a lessee of the property plaintiff was foreclosing in the underlying action. Appellant was a named defendant, along with the property owner.  Appellant “claimed, however, that it was not a proper party to the foreclosure action, and, before the judgment of strict foreclosure was rendered … the plaintiff withdrew the action as to [appellant] and proceeded only against the [property owner].”

Subsequently, appellant was defaulted in a summary process action, which terminated its leasehold interest in the property. Appellant apparently believed that it could not undo the summary process default judgment unless it first undid the foreclosure judgment. So, appellant filed, in the foreclosure action, a motion to open and vacate the foreclosure judgment on the ground that plaintiff lacked standing to foreclose.

The trial court dismissed appellant’s motion to open and vacate the foreclosure judgment. Appellant appealed. The Appellate Court dismissed the appeal.

Out of the Ordinary

Normally, this is where I would describe the appellant’s main arguments on appeal. This appeal is different. As the court explained:

Following oral argument in this appeal, we asked the parties to submit simultaneous supplemental briefs addressed to the following: ‘‘1. Whether [appellant], a nonparty to the underlying foreclosure action, had standing to file a motion to open the foreclosure judgment? 2. Whether a nonparty can appeal the dismissal of a motion to open a judgment in a case in which it was not a party? 3. What practical relief can this court provide to [appellant], in this appeal?’’

Appellate Court Concludes Non-party Lacks Standing to Appeal

The court noted that under CGS § 52-263 and Practice Book § 61-1 only a “party” may appeal. ‘‘Ordinarily, the word party has a technical legal meaning, referring to those by or against whom a legal suit is brought . . . the party plaintiff or defendant, whether composed of one or more individuals and whether natural or legal persons. . . . This definition of party . . . includes only those
who are parties to the underlying action’’ (emphasis original).

“Consequently, because the [appellant] is not a party to the underlying foreclosure judgment in this case, it does not have standing to appeal, and we do not have subject matter jurisdiction over the appeal.”