Customers Bank v. Boxer

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CUSTOMERS BANK v. JODIE M. BOXER ET AL.
(AC 35465)
Gruendel, Robinson and Alvord, Js.*
Argued November 18, 2013—officially released March 4, 2014
(Appeal from Superior Court, judicial district of
Stamford-Norwalk, Housing Session, Hon. Jack L.
Grogins, judge trial referee.)
Abram J. Heisler, for the appellant (defendant Carl-
ton Tucker).
Andrew P. Barsom, with whom, on the brief, was
Alena C. Gfeller, for the appellee (plaintiff).
Opinion
ALVORD, J. The defendant Carlton Tucker appeals
from the trial court’s judgment of immediate possession
in favor of the plaintiff, Customers Bank.1 On appeal,
the defendant claims that the court erred in finding that
he was not a bona fide tenant as defined by Title VII
of the Helping Families Save Their Homes Act of 2009,
known as the Protecting Tenants at Foreclosure Act of
2009, Pub. L. No. 111-22, §§ 701–704, 123 Stat. 1660(PTFA).2 We affirm the judgment of the trial court.
The record reveals the following facts and procedural
history. The plaintiff acquired title to 426 Westover
Road, Stamford (property) from Westover Enterprise,
LLC (prior owner) on February 23, 2012, via a judgment
of strict foreclosure. The defendant was a resident of
the property when the plaintiff took possession. The
plaintiff initially exercised its right to terminate the
tenancy of the defendant by serving him with a notice
to quit on April 2, 2012, that required the defendant to
quit possession of the property on or before July 3,
2012 (first notice). Following the service of the first
notice, the defendant did not contact the plaintiff,
tender rent or use and occupancy payments to the plain-
tiff or the prior owner, and ‘‘failed, neglected, and/or
refused to provide proof of a valid lease agreement.’’
On or about May 7, 2012, the plaintiff served the defen-
dant with a supplemental notice to quit, revoking the
first notice and directing the defendant to quit posses-
sion of the property on or before May 15, 2012 (second
notice). The defendant did not quit possession of the
property at that time.
Thereafter, in late May, 2012, the plaintiff commenced
this action against the defendant. In the second count
of its operative complaint, the plaintiff alleged that the
defendant’s right or privilege to occupy the property
had terminated.3 The plaintiff asserted that the defen-
dant was not a ‘‘ ‘bona fide’ [tenant] under the ambit
of the [PTFA]’’ due to the defendant’s failure to ‘‘pro-
duce any lease which sets forth an arm’s-length transac-
tion to enter such tenancy and requires payment of rent
that is not substantially less than the fair market rent
of the subject property . . . .’’ On September 6, 2012,
the court ordered the defendant to make use and occu-
pancy payments of $4000 per month. The defendant did
not comply with that order and failed to make any of
the use and occupancy payments, and, thus, judgment
for possession was rendered in the plaintiff’s favor on
September 27, 2012. The defendant filed a motion to
open the judgment, which the court granted on October
16, 2012. The defendant subsequently filed an answer
and special defenses,4 asserting that the plaintiff failed
to provide ninety days’ notice to the defendant as
required by the PTFA.
On November 8, 2012, the defendant stipulated to the
plaintiff’s ability to prove its prima facie case under
count two of the complaint, and the trial was bifurcated
to allow the defendant to present evidence regarding
the pleaded special defenses, namely, the applicability
of the PTFA.5 The court heard evidence regarding the
defendant’s special defense on November 15, 2012. Tes-
timony revealed that there was a six month written
lease between the prior owner of the property and the
defendant for a term of tenancy beginning on January
19, 2012, and ending on June 31, 2012, that provided
for monthly rental payments of $5000. The defendant
testified that he did not make any rental payments to
the prior owner of the property, and the prior owner
testified that he never received any rent from the defen-
dant. Instead, the defendant and the prior owner both
testified that they modified the six month written lease
via an oral agreement,6 whereby ‘‘in lieu of the $5000,
being that the property needed work,’’ the defendant
‘‘would do some things there to maintain the property.’’
The defendant stated that he undertook certain
expenses in connection with his occupancy of the prop-
erty, including repairing a fence on the property, paint-
ing the interior and exterior of the premises, and filling
the oil tank.7 On the basis of this oral agreement with
the prior owner, the defendant argued that he is a bona
fide tenant under the PTFA, and that the plaintiff should
have provided him with a ninety day notice to quit.
At the conclusion of evidence, the trial court ordered
the parties to file simultaneous briefs on January 3,
2013, regarding the applicability of the PTFA. In a writ-
ten memorandum of decision released on February 28,
2013, the trial court rendered judgment for immediate
possession in favor of the plaintiff. In its decision, the
court concluded that the defendant ‘‘ha[s] failed to
maintain [his] burden of proof with respect to the
alleged defenses by, most notably, failing to prove the
third prong of the test for establishing [his] status as a
bona fide [tenant] under the [PTFA],’’ and therefore the
PTFA was inapplicable. This appeal followed.
On appeal, the defendant argues that the court ‘‘erred
in stating that the defendant did not assert sufficient
facts to trigger the ninety day notice required by the
[PTFA].’’ The defendant specifically challenges the
court’s ruling that the defendant’s ‘‘expenditures in
improving the property could not constitute proof of a
bona fide lease pursuant to the [PTFA]’’ and urges us
to interpret the act broadly. We disagree and affirm the
judgment of the trial court.
Our review of the defendant’s claim of error first
requires us to determine what constitutes a bona fide
tenant and lease pursuant to the PTFA. Accordingly,
we begin with a statutory analysis of the PTFA. ‘‘Issues
of statutory construction raise questions of law, over
which we exercise plenary review. . . . The process
of statutory interpretation involves the determination
of the meaning of the statutory language as applied to
the facts of the case, including the question of whether
the language does so apply. . . . In seeking to deter-
mine that meaning, General Statutes § 1–2z directs us
first to consider the text of the statute itself and its
relationship to other statutes. If, after examining such
text and considering such relationship, the meaning of
such text is plain and unambiguous and does not yield
absurd or unworkable results, extratextual evidence of
the meaning of the statute shall not be considered.’’
(Internal quotation marks omitted.) Doctor’s Associ-
ates, Inc. v. Windham, 146 Conn. App. 768, 783–84, 81
A.3d 230 (2013).
‘‘Moreover, [t]his court will not reverse the factual
findings of the trial court unless they are clearly errone-
ous. . . . A finding of fact is clearly erroneous when
there is no evidence in the record to support it . . .
or when although there is evidence to support it, the
reviewing court on the entire evidence is left with the
definite and firm conviction that a mistake has been
committed. . . . In making this determination, every
reasonable presumption must be given in favor of the
trial court’s ruling.’’ (Internal quotation marks omitted.)
Petrucelli v. Travelers Property Casualty Ins. Co., 146
Conn. App. 631, 636, 79 A.3d 895 (2013).
The PTFA provides in relevant part that ‘‘[i]n the case
of any foreclosure on a federally-related mortgage loan
or on any dwelling or residential real property after the
date of enactment of this title, any immediate successor
in interest in such property pursuant to the foreclosure
shall assume such interest subject to . . . the provi-
sion, by such successor in interest of a notice to vacate
to any bona fide tenant at least [ninety] days before
the effective date of such notice . . . .’’ (Emphasis
added.) Pub. L. No. 111-22, § 702 (a). The PTFA estab-
lishes a tripartite conjunctive test for establishing a
bona fide lease or tenancy: ‘‘(1) the mortgagor or the
child, spouse, or parent of the mortgagor under the
contract is not the tenant; (2) the lease or tenancy was
the result of an arms-length transaction; and (3) the
lease or tenancy requires the receipt of rent that is
not substantially less than fair market rent for the
property or the unit’s rent is reduced or subsidized due
to a Federal, State or local subsidy.’’ (Emphasis added.)
Pub. L. No. 111-22, § 702 (b). At trial and now on appeal,
the parties dispute whether the defendant’s tenancy
satisfies the third prong of the test and whether ‘‘rent’’
within the PTFA can include funds spent improving the
premises in lieu of rental payments.8 This issue is one
of first impression for this court.
The PTFA does not define the term ‘‘receipt of rent.’’
Nevertheless, we turn to our General Statutes for guid-
ance as the PTFA does not preempt state law with
respect to the requirements of eviction proceedings. See
Federal National Mortgage Assn. v. Williams, United
States District Court, Docket No. CIV. S-11-3067 (KJM)
(E.D. Cal. January 4, 2012) (‘‘federal courts have held
that the [PTFA] does not create a federal private right of
action, but indeed provides directives to state courts’’);
Federal National Mortgage Assn. v. Hammond, United
States District Court, Docket No. 11-00867 GAF (OPX)
(C.D. Cal. June 22, 2011) (‘‘[t]he PTFA is not a recog-
nized area of complete preemption’’); Nativi v.
Deutsche Bank National Trust Co., United States Dis-
trict Court, Docket No. 09-06096 (PVT) (N.D. Cal. May
24, 2010) (‘‘[t]he PTFA was intended to allow tenants
who are victims of the foreclosing crisis a protection
that can be used in the state courts to combat unlaw-
ful evictions’’).
General Statutes § 47a-1 (h) defines ‘‘rent’’ as ‘‘all
periodic payments to be made to the landlord under
the rental agreement.’’9 Black’s Law Dictionary defines
‘‘payment’’ as ‘‘[t]he money or other valuable thing so
delivered in satisfaction of an obligation.’’ Black’s Law
Dictionary (9th Ed. 2009); see also Commissioner on
Human Rights & Opportunities ex rel. Arnold v. Forvil,
302 Conn. 263, 274, 25 A.3d 632 (2011) (citing to defini-
tion of payment in Black’s Law Dictionary in order to
reach conclusion that ‘‘to constitute income, something
does not need to be money; rather, it can be something
else of value’’). Accordingly, we consider a bona fide
lease or tenancy for purposes of applying the PTFA in
Connecticut to be a lease or tenancy that requires the
receipt of periodic monetary payments or periodic pay-
ments of something of value, to the landlord in satisfac-
tion of the tenant’s obligation, ‘‘that [are] not
substantially less than fair market rent for the prop-
erty or the unit’s rent is reduced or subsidized due to
a Federal, State or local subsidy.’’ (Emphasis added.)
Pub. L. No. 111-22, § 702 (b). Applying the law to these
facts, the defendant must establish that the oral
agreement for repairs and improvements in lieu of rent
required the receipt of periodic payments of something
of value delivered to the prior owner in satisfaction
of the defendant’s obligation and that the value was
reasonably commensurate with the fair market rent of
the property. Failure to establish either of these ele-
ments renders the PTFA inapplicable.
On the basis of the testimony of the defendant and
the prior owner, as well as the other evidence before
it, the trial court found that ‘‘the [defendant] ha[s] not
established [that] the value of the repairs or improve-
ments was commensurate with the fair market value’’10
rent of the property. ‘‘[I]t is well established that [i]t is
within the province of the trial court, when sitting as
the fact finder, to weigh the evidence presented and
determine the credibility and effect to be given the
evidence.’’ (Internal quotation marks omitted.) Rutka
v. Meriden, 145 Conn. App. 202, 211–12, 75 A.3d 722(2013). Our review of the record reveals that there was
sufficient evidence to support the trial court’s conclu-
sion. Accordingly, the defendant failed to establish that
his lease or tenancy required the receipt of rent that
was not substantially less than fair market rent for the
property, and the court properly concluded that he did
not qualify for the protections of the PTFA.
The judgment is affirmed.
In this opinion the other judges concurred.
* The listing of judges reflects their seniority status on this court as of
the date of oral argument.
1
Jodie M. Boxer and Rose Tucker were also named as defendants in the
action brought by the plaintiff. On September 27, 2012, a motion for default
for failure to appear was granted as to Boxer and the case was withdrawn
by the plaintiff as to Rose Tucker. Neither defendant is a party to this appeal.
We therefore refer in this opinion to Carlton Tucker as the defendant.
2
Initially set to expire on December 31, 2012, the PTFA was extended to
December 31, 2014, by the Dodd-Frank Wall Street Reform and Consumer
Protection Act, Pub. L. No. 111–203, § 1484, 124 Stat. 2204 (2010).
3
The plaintiff initially brought a three count complaint against the defen-
dant. In its first count, the plaintiff alleged nonpayment, and in its third
count, the plaintiff alleged that the defendant’s tenancy had expired by lapse
of time. The plaintiff subsequently withdrew these counts.
4
The defendant raised four special defenses in total. When agreeing to
stipulate to the provisions of the plaintiff’s second count, however, he stated
that the ‘‘crux of [his] defense’’ was the PTFA and whether the required
ninety days’ notice was given.
5
The defendant has raised his claim under the PTFA in a special defense,
and ‘‘the general rule is that a defendant who pleads a special defense bears
the burden on that issue . . . .’’ National Publishing Co. v. Hartford Fire
Ins. Co., 287 Conn. 664, 673, 949 A.2d 1203 (2008). Furthermore, he has
stipulated to the plaintiff’s ability to prove its prima facie case that ‘‘[t]o
the extent the [defendant] once had a right or privilege to occupy [the
property], [that] right or privilege has since terminated by virtue of the
judgment of strict foreclosure and absolute vesting of the title [to the prop-
erty] in the plaintiff . . . and the plaintiff’s service of [the second notice].’’
6
The defendant could not provide the exact date of this oral agreement
with the prior owner, other than stating that it ‘‘was around the time that
we signed the lease.’’ He also testified that he thought that they might have
‘‘entered into the agreement prior to the signing of the lease.’’ Similarly, the
prior owner testified that he and the defendant entered into their oral
agreement ‘‘[a]round the same—same week or two’’ when the written lease
was signed.
7
The defendant testified that he spent $7150 to repair the fence and
$11,750 to paint the interior and exterior of the premises. The defendant
submitted an ‘‘invoice’’ for the repair of the fence, which listed a ‘‘shipped
to’’ date of March 1, 2012, and an ‘‘estimate’’ for the painting of the premises,
which was dated August 2, 2012. Both the invoice and the estimate included
the notation that they were paid in cash. The defendant also submitted an
invoice dated June 1, 2012, for $3709.38 for oil, which consisted of a ‘‘[b]al-
ance [b]rought [f]orward’’ of $3655.55 and ‘‘[f]inance [c]harges’’ totaling
$53.83. There was no evidence as to whether the defendant paid this invoice.
8
We note that although the written lease states that any modifications to
the agreement must be in writing signed by the defendant and the prior
owner, the record reveals that both the defendant and the prior owner
agreed that the written lease was modified by their oral agreement to allow
the defendant to spend funds improving the property in lieu of rental pay-
ments, and that the defendant was occupying the property pursuant to the
oral agreement. ‘‘Under the general rules applicable to oral modification of
written contracts, in the absence of statutory restrictions a written lease
may be subsequently modified as to the amount of rent, by oral agreement.’’
Baier v. Smith, 120 Conn. 568, 571, 181 A. 618 (1935); see also Taft Realty
Corp. v. Yorkhaven Enterprises, Inc., 146 Conn. 338, 342, 150 A.2d 597(1959) (‘‘[t]he rent provided in a written lease may even be changed by a
subsequent parol agreement’’).
9
General Statutes § 47a-1 (i) defines ‘‘rental agreement’’ in relevant part
as ‘‘all agreements, written or oral, and valid rules and regulations . . .
embodying the terms and conditions concerning the use and occupancy of
a dwelling unit or premises.’’
10
The trial court considered the fair market rent of the property to be ‘‘at
least $4500 on a monthly basis,’’ but did not make an explicit finding of the
exact amount.