HSBC Bank USA, National Assn. v. Nathan

***********************************************
The “officially released” date that appears near the be-
ginning of each opinion is the date the opinion will be pub-
lished in the Connecticut Law Journal or the date it was
released as a slip opinion. The operative date for the be-
ginning of all time periods for filing postopinion motions
and petitions for certification is the “officially released”
date appearing in the opinion.
All opinions are subject to modification and technical
correction prior to official publication in the Connecticut
Reports and Connecticut Appellate Reports. In the event of
discrepancies between the advance release version of an
opinion and the latest version appearing in the Connecticut
Law Journal and subsequently in the Connecticut Reports
or Connecticut Appellate Reports, the latest version is to
be considered authoritative.
The syllabus and procedural history accompanying the
opinion as it appears in the Connecticut Law Journal and
bound volumes of official reports are copyrighted by the
Secretary of the State, State of Connecticut, and may not
be reproduced and distributed without the express written
permission of the Commission on Official Legal Publica-
tions, Judicial Branch, State of Connecticut.
***********************************************
HSBC BANK USA, NATIONAL ASSOCIATION,
TRUSTEE v. LESLIE I. NATHAN
ET AL.
(AC 40222)
Bright, Moll and Harper, Js.
Syllabus
The plaintiff bank, H Co., sought to foreclose a mortgage on certain real
property owned by the defendants L and W and the defendant trust,
who filed special defenses and a counterclaim. Specifically, they alleged,
inter alia, that the equitable doctrine of laches applied to the plaintiff’s
conduct and that the plaintiff had violated the Connecticut Unfair Trade
Practices Act (CUTPA) (§ 42-110a et seq.). The trial court granted the
plaintiff’s motion to strike the first amended laches defense and the
counterclaim in its entirety. L and W and the trust then filed a second
amended counterclaim and special defenses, in which, inter alia, they
repleaded four counts of their first amended counterclaim and repleaded
laches as a special defense. The trial court granted the plaintiff’s motion
to strike the second amended laches defense and the counterclaim in
its entirety and, subsequently, rendered judgment of strict foreclosure,
from which L and W and the trust appealed to this court. On appeal,
they claimed that the trial court improperly granted the plaintiff’s first
motion to strike as to the nonrepleaded counts and the second motion
to strike the second amended laches defense and second amended
counterclaim. The plaintiff claimed that certain nonrepleaded counts of
their first amended counterclaim as well as a special defense of unclean
hands had been abandoned. Held:
1. Contrary to the plaintiff’s claim, L and W and the trust preserved their
right to appeal the nonrepleaded counts of their first amended counter-
claim: the correct course of action for a litigant to take in order to
preserve appellate rights as to a stricken pleading is to forgo pleading
over, await the rendering of a final judgment and appeal therefrom, and
the defendants’ statement in their objection to the plaintiff’s second
motion to strike that they were not reasserting counts involving only
postdefault conduct was a decision by the defendants, in an effort to
preserve their appellate rights, not to replead those counts with modified
allegations in an effort to cure the purported deficiencies therein, rather
than an abandonment of the counts; nevertheless, the defendants having
expressly stated in their objection that the first amended unclean hands
defense had been abandoned, that statement was an unequivocal relin-
quishment of the first amended unclean hands defense, and the defen-
dants, having abandoned that defense, could not now ask this court to
consider whether the trial court’s striking thereof constituted error.
2. The trial court erred in striking the nonrepleaded counts, the second
amended laches defense and the second amended counterclaim on the
ground that they did not satisfy the making, validity or enforcement
test; the allegations in the pleadings of L and W and the trust related
to the enforcement of the note or mortgage in that those defendants
raised allegations of postorigination misconduct by the plaintiff that,
inter alia, increased their debt and hindered their ability to cure their
default.
Argued January 15, 2019—officially released January 14, 2020
Procedural History
Action to foreclose a mortgage on certain real prop-
erty owned by the named defendant et al., brought to
the Superior Court in the judicial district of Middlesex,
where the defendant Gerri N. Russo was defaulted for
failure to appear; thereafter, the defendant Webster
Bank, National Association was defaulted for failure to
plead; subsequently, the named defendant et al. filed
an amended counterclaim; subsequently, the court,
Aurigemma, J., granted the plaintiff’s motion to strike
the amended special defenses and counterclaim in part;
thereafter, the named defendant et al. filed a second
amended counterclaim; subsequently, the court granted
the plaintiff’s motion to strike the second amended
special defenses and counterclaim; thereafter, the
court, Domnarski, J., concluded that the plaintiff was
entitled to enforce the note by foreclosing on the mort-
gage; subsequently, the court, Aurigemma, J., granted
the plaintiff’s motion for a judgment of strict foreclosure
and rendered judgment thereon, from which the named
defendant et al. appealed to this court; subsequently,
this court dismissed, for lack of a final judgment, the
portion of the appeal challenging the trial court’s strik-
ing of the counterclaim as amended; thereafter, the
court, Frechette, J., granted the plaintiff’s motion for
judgment on the stricken counterclaim as amended and
the named defendant et al. filed an amended appeal;
subsequently, this court, sua sponte, issued an order
staying the appeal pending the final disposition by the
Supreme Court in U.S. Bank National Assn. v. Blowers,
332 Conn. 656, 212 A.3d 226 (2019); thereafter, following
the release of the opinion in Blowers, the Appellate
Court lifted the stay and, sua sponte, ordered the parties
to submit supplemental briefing, and the parties there-
after filed supplemental briefs. Reversed; further pro-
ceedings.
Karen L. Dowd, with whom was Scott Garosshen,
for the appellants (defendants).
David M. Bizar, for the appellee (plaintiff).
Opinion
MOLL, J. The defendants, Leslie I. Nathan, Lynne W.
Nathan, and Lynne W. Nathan, Trustee of the Lynne W.
Nathan Trust Agreement dated November 19, 2001,1
appeal from the judgment of strict foreclosure and the
judgment on their counterclaim, as amended, rendered
by the trial court in favor of the plaintiff, HSBC Bank
USA, National Association, Trustee.2 On appeal, the
defendants claim that the court erred in striking two
of their special defenses, as amended, and their counter-
claim, as amended.3 We reverse the judgments of the
trial court.
The following facts and procedural history are rele-
vant to our disposition of this appeal. In August, 2014,
the plaintiff commenced this foreclosure action. In its
complaint, the plaintiff alleged the following relevant
facts. On or about April 12, 2007, Leslie and Lynne
executed a promissory note, in the principal amount
of $560,000, in favor of Wells Fargo Bank, N.A. (Wells
Fargo). To secure the note, the Lynne Trustee executed
a mortgage on real property located at 115 Second Ave-
nue in Westbrook. On April 17, 2007, the mortgage deed
was recorded on the Westbrook land records. The mort-
gage was to be assigned to the plaintiff by virtue of
an assignment to be recorded on the Westbrook land
records, and the plaintiff was the holder of the note.
Leslie and Lynne thereafter defaulted on the note,4 and
they failed to cure the default following receipt of writ-
ten notice of the default from the plaintiff. Thereafter,
the plaintiff elected to accelerate the balance due on
the note, to declare the note to be due in full, and to
foreclose the mortgage.
On June 8, 2015, the defendants filed a first amended
answer, special defenses, and counterclaim.5 The defen-
dants asserted three special defenses: (1) lack of stand-
ing; (2) laches; and (3) unclean hands. In the counter-
claim, the defendants asserted the following twelve
counts: (1) equitable reduction of interest on the ground
that the plaintiff failed to mitigate its damages (count
one); (2) the plaintiff was improperly pursuing attor-
ney’s fees and costs accrued in relation to a prior fore-
closure action, with docket number MMX-CV-10-
6002743-S (prior foreclosure action), which the plaintiff
had commenced against the defendants in 2010 and
which was dismissed in 2013 (count two); (3) inten-
tional infliction of emotional distress (count three); (4)
negligent infliction of emotional distress (count four);
(5) breach of the covenant of good faith and fair dealing
(count five); (6) unjust enrichment (count six); (7) viola-
tion of the Fair Debt Collection Practices Act, 15 U.S.C.
§ 1692 et seq. (count seven); (8) violation of the Credi-
tors’ Collections Practices Act, General Statutes § 36a-
645 et seq. (count eight); (9) vexatious litigation (count
nine); (10) fraud (count ten); (11) negligence (count
eleven); and (12) violation of the Connecticut Unfair
Trade Practices Act (CUTPA), General Statutes § 42-
110a et seq. (count twelve). As relief, the defendants
sought, inter alia, compensatory damages and an equita-
ble reduction in principal and interest.
On July 8, 2015, the plaintiff filed a motion to strike
the defendants’ first amended special defenses and
counterclaim, claiming, inter alia, that the defendants’
claims and defenses did not relate to the making, valid-
ity, or enforcement of the note or mortgage. The defen-
dants objected to the motion. On December 28, 2015,
the trial court, Aurigemma, J., issued a memorandum
of decision granting the motion to strike as to the first
amended laches defense, unclean hands defense, and
counterclaim in its entirety.6
On January 12, 2016, the defendants filed a second
amended counterclaim and special defenses. In the
counterclaim, the defendants repleaded counts five, six,
ten, and twelve of the first amended counterclaim. They
did not replead counts one, two, three, four, seven,
eight, nine, or eleven thereof. In addition, the defen-
dants reasserted their first amended special defense
asserting lack of standing, which had not been stricken
by the court, and repleaded laches as a special defense,
but they did not replead unclean hands as a special
defense.
On February 9, 2016, the plaintiff filed a motion to
strike the defendants’ second amended laches defense
and counterclaim, claiming, inter alia, that the defen-
dants’ claims and second amended laches defense failed
to satisfy the making, validity, or enforcement test. The
defendants objected to the motion. On March 28, 2016,
the court issued an order granting the motion to strike
the second amended laches defense and counterclaim
in its entirety.
On August 25, 2016, following a one day court trial
conducted on May 19, 2016, the court, Domnarski, J.,
issued a memorandum of decision concluding that the
plaintiff was entitled to enforce the note by foreclosing
the mortgage. The court also made findings regarding
the debt and the value of the subject property. There-
after, the plaintiff filed a motion for a judgment of strict
foreclosure, which the court, Aurigemma, J., granted
on February 21, 2017. This appeal followed.7
On January 17, 2019, following oral argument held
on January 15, 2019, this court, sua sponte, issued an
order staying the appeal pending the final disposition
by our Supreme Court of U.S. Bank National Assn. v.
Blowers, 332 Conn. 656, 212 A.3d 226 (2019), in which
the court resolved the dispositive certified question of
whether special defenses and a counterclaim asserted
in a foreclosure action must ‘‘directly attack’’ the mak-
ing, validity, or enforcement of the note or mortgage. On
August 27, 2019, following the release of our Supreme
Court’s opinion in Blowers, this court lifted the appel-
late stay and, sua sponte, ordered the parties to submit
supplemental briefs to address the impact, if any, of
Blowers on the defendants’ claims on appeal.8 The par-
ties thereafter filed supplemental briefs in accordance
with this court’s order.
I
Before reaching the merits of the defendants’ claims
on appeal, we first address the plaintiff’s argument that
the defendants abandoned (1) counts one, two, three,
four, seven, eight, nine, and eleven of the first amended
counterclaim (nonrepleaded counts) and (2) their first
amended unclean hands defense, thereby forfeiting
their appellate rights to challenge the court’s decision
striking them. We conclude that the defendants (1) pre-
served their appellate rights as to the nonrepleaded
counts, but (2) abandoned their first amended unclean
hands defense and, therefore, cannot contest on appeal
the court’s striking thereof.
The following additional facts and procedural history
are relevant to this claim. In their second amended
counterclaim, the defendants repleaded counts five, six,
ten, and twelve of their first amended counterclaim,
but they did not replead the other eight counts thereof.
Additionally, the defendants reasserted their special
defense sounding in standing and repleaded laches as
a special defense, but they did not replead unclean
hands as a special defense. Thereafter, the plaintiff
moved to strike the second amended laches defense
and the second amended counterclaim. The defendants
filed a written objection, stating in relevant part: ‘‘[The
defendants’ pleading setting forth their second
amended special defenses and counterclaim] realleges
the laches special defense . . . . It abandons the
unclean hands special defense. It also realleges [counts
five, six, ten, and twelve of the first amended counter-
claim] . . . . [The nonrepleaded counts] involving
only postdefault conduct have not been reasserted.’’
The plaintiff first argues that the defendants’ failure
to replead the nonrepleaded counts and their first
amended unclean hands defense constitutes a waiver
of any alleged error in the court’s striking thereof. This
contention is unavailing, as the correct course of action
for a litigant to take in order to preserve his or her
appellate rights as to a stricken pleading is to forgo
pleading over, await the rendering of a final judgment,
and appeal therefrom. See Himmelstein v. Windsor,
116 Conn. App. 28, 32, 974 A.2d 820 (2009) (plaintiff
preserved appellate rights with respect to stricken
counts of original complaint by not repleading stricken
counts in amended complaint), aff’d, 304 Conn. 298, 39
A.3d 1065 (2012); Suffield Development Associates Ltd.
Partnership v. National Loan Investors, L.P., 64 Conn.
App. 192, 194 n.2, 779 A.2d 822 (2001) (plaintiff sought
to preserve appellate rights as to certain stricken counts
by not repleading those counts in amended complaint),
rev’d in part on other grounds, 260 Conn. 766, 802 A.2d
44 (2002).9
The plaintiff next argues that, on the basis of their
statements in their objection to its February 9, 2016
motion to strike, the defendants expressly abandoned
the nonrepleaded counts and the first amended unclean
hands defense. ‘‘[T]he interpretation of pleadings is
always a question of law for the court . . . .’’ (Internal
quotation marks omitted.) Bridgeport Harbour Place
I, LLC v. Ganim, 111 Conn. App. 197, 202 n.4, 958 A.2d
210 (2008), aff’d, 303 Conn. 205, 32 A.3d 296 (2011).
As to the nonrepleaded counts, the defendants stated
in the objection that those counts, ‘‘involving only post-
default conduct,’’ had ‘‘not been reasserted’’ in the sec-
ond amended counterclaim. We do not construe that
statement as an abandonment of the nonrepleaded
counts; rather, we interpret it to mean that the defen-
dants, in an effort to preserve their appellate rights,
decided not to replead those counts with modified alle-
gations in an effort to cure the purported deficiencies
therein. See Lund v. Milford Hospital, Inc., 326 Conn.
846, 850, 168 A.3d 479 (2017). Accordingly, we reject
the plaintiff’s argument as to the nonrepleaded counts.
In contrast, the defendants expressly stated in their
objection that the first amended unclean hands defense
had been ‘‘abandon[ed].’’ The defendants characterize
their use of the term ‘‘abandon[ed]’’ as ‘‘not ideal’’ and
‘‘unfortunate’’; however, they contend that the state-
ment at issue should be interpreted as being synony-
mous with their other statement, located within the
same paragraph of the objection, that the nonrepleaded
counts had ‘‘not been reasserted.’’ We are not per-
suaded. The defendants chose to describe their first
amended unclean hands defense as having been ‘‘aban-
don[ed],’’ as opposed to not ‘‘reasserted’’ or ‘‘realleged.’’
Litigants routinely and unambiguously use the term
‘‘abandon’’ to convey their decision not to preserve or
otherwise pursue a claim, a defense, or a particular
position, and we perceive no ambiguity in the defen-
dants’ use of the term here. Instead, we construe the
defendants’ statement as an unequivocal relin-
quishment of the first amended unclean hands defense.
Having abandoned the first amended unclean hands
defense, the defendants cannot now ask this court to
consider whether the trial court’s striking thereof con-
stituted error.10
II
We now address the merits of the defendants’ claim
that the court improperly granted (1) the plaintiff’s July
8, 2015 motion to strike as to the nonrepleaded counts
and (2) the plaintiff’s February 9, 2016 motion to strike
the defendants’ (a) second amended laches defense and
(b) second amended counterclaim. For the reasons set
forth subsequently in this opinion, we agree.
The following additional facts and procedural history
are relevant. On June 8, 2015, the defendants filed their
first amended answer, special defenses, and counter-
claim. In support of their first amended laches defense,
the defendants alleged, in a conclusory manner, that the
‘‘[p]laintiff’s action is barred by the equitable doctrine
of laches.’’ With respect to their first amended counter-
claim, the defendants made various allegations con-
cerning misconduct that the plaintiff purportedly
engaged in following their January, 2010 default on the
note. For instance, the defendants alleged that (1) Wells
Fargo, the plaintiff’s purported servicer of the loan,
refused to accept certain payments from them, thereby
causing them to incur exacerbated interest charges, and
(2) the plaintiff and Wells Fargo repeatedly failed to
send representatives to speak with the defendants at
mediation sessions held during the course of the prior
foreclosure action and otherwise frustrated the defen-
dants’ efforts to discuss modifications of their loan,
causing them harm.
In its July 8, 2015 motion to strike, the plaintiff
claimed that the first amended laches defense (1) was
not supported by any allegations of fact, (2) did not
relate to the making, validity, or enforcement of the
note or mortgage, and (3) was not a legally cognizable
defense. With respect to the twelve counts of the first
amended counterclaim, the plaintiff asserted that they
(1) did not relate to the making, validity, or enforcement
of the note or mortgage, and (2) were not legally suffi-
cient. In its December 28, 2015 memorandum of deci-
sion granting, in part, the July 8, 2015 motion to strike,
the court struck the first amended laches defense on
the basis of its determinations that (1) the defense was
devoid of any supporting factual allegations, and (2) to
the extent that the defendants were relying on allega-
tions in the first amended counterclaim that Wells Fargo
delayed offering them a loan modification, Connecticut
law does not impose a duty on a mortgagee to provide
a loan modification. In striking the first amended coun-
terclaim in its entirety, the court construed the allega-
tions therein as concerning (1) payments remitted by
the defendants subsequent to their default, (2) the par-
ties’ failed attempts to modify the loan, (3) the plaintiff’s
debt collection activities, or (4) litigation in the prior
foreclosure action, all of which had occurred after the
execution of the note or mortgage. The court concluded
that the allegations in the first amended counterclaim
did not relate to the making, validity, or enforcement of
the note or mortgage, and, therefore, the first amended
counterclaim could not be joined with the plaintiff’s
complaint.
Thereafter, the defendants filed their second
amended laches defense and counterclaim. In support
of the second amended laches defense, the defendants
alleged that the plaintiff had engaged in dilatory behav-
ior during the course of the prior foreclosure action,
inter alia, by failing to send agents with knowledge
of the case and/or settlement authority to mediation
sessions and by initiating the prior foreclosure action
despite lacking sufficient documentation to establish its
standing to pursue that action. The defendants further
alleged that the plaintiff’s misconduct had prejudiced
them, inter alia, by depleting their equity in the subject
property. As to the second amended counterclaim, the
defendants repleaded therein counts five, six, ten, and
twelve—sounding in breach of the implied covenant of
good faith and fair dealing, unjust enrichment, fraud,
and a violation of CUTPA, respectively—of the first
amended counterclaim. In support thereof, the defen-
dants set forth allegations primarily concerning pur-
ported misconduct by the plaintiff that predated their
default on the note. For example, the defendants alleged
that (1) in early 2009, prior to their default, Wells Fargo
had represented to them that they could obtain a loan
modification within three months, but Wells Fargo
thereafter engaged in intentional dilatory conduct that
resulted in an untimely loan modification offer that
contained terms that were inconsistent with previous
representations made by Wells Fargo, and (2) Wells
Fargo made false representations to the defendants dur-
ing their discussions regarding a loan modification. The
defendants further alleged that they were harmed by
these actions.
In its February 9, 2016 motion to strike, the plaintiff
asserted that the allegations set forth in support of
the second amended laches defense and the second
amended counterclaim (1) were largely the same or
substantively identical to the allegations in the prior
versions thereof, and any new allegations provided by
the defendants were immaterial, (2) did not relate to
the making, validity, or enforcement of the note or
mortgage, and (3) were legally insufficient. In its order
striking the second amended laches defense and the
second amended counterclaim in its entirety, the court
concluded that the issues raised in the second amended
laches defense, the second amended counterclaim, and
the February 9, 2016 motion to strike ‘‘were previously
adjudicated by this court in its memorandum of decision
dated December 28, 2015.’’11
On appeal, the defendants, relying on our Supreme
Court’s decision in U.S. Bank National Assn. v. Blow-
ers, supra, 332 Conn. 656, claim that the allegations that
they pleaded in support of the nonrepleaded counts,
their second amended laches defense, and their second
amended counterclaim related to the ‘‘enforcement’’ of
the note or mortgage. Thus, the defendants contend, the
trial court erred in striking those claims and defenses
on the ground that they did not relate to the making,
validity, or enforcement of the note or mortgage. We
agree.
We first observe that, in general, ‘‘[a]ppellate review
of a trial court’s decision to grant a motion to strike is
plenary. . . . This is because a motion to strike chal-
lenges the legal sufficiency of a pleading . . . and, con-
sequently, requires no factual findings by the trial court
. . . . In ruling on a motion to strike, the court must
accept as true the facts alleged in the special defenses
and construe them in the manner most favorable to
sustaining their legal sufficiency. . . . The allegations
of the pleading involved are entitled to the same favor-
able construction a trier would be required to give in
admitting evidence under them and if the facts provable
under its allegations would support a defense or a cause
of action, the motion to strike must fail.’’ (Citations
omitted; internal quotation marks omitted.) U.S. Bank
National Assn. v. Blowers, supra, 332 Conn. 667–68. As
in Blowers, the precise issue before us is whether the
allegations set forth by the defendants in support of
the nonrepleaded counts, the second amended laches
defense, and the second amended counterclaim ‘‘bear
a sufficient connection to enforcement of the note or
mortgage,’’12 which ‘‘presents an issue of law over which
we also exercise plenary review.’’ Id., 670.
We next provide an overview of our Supreme Court’s
decision in Blowers. In Blowers, after the mortgagee
had commenced an action to foreclose the mortgage
encumbering the mortgagor’s real property, the mort-
gagor filed special defenses sounding in equitable estop-
pel and unclean hands, and a counterclaim sounding in
negligence and violations of CUTPA. Id., 659. In support
thereof, the mortgagor alleged that the mortgagee com-
mitted various acts, which occurred either after the
mortgagor’s default on the promissory note or after
the mortgagee had commenced the foreclosure action,13
that, inter alia, frustrated his ability to obtain a proper
loan modification and increased the amount of the debt,
including attorney’s fees and interest, claimed by the
mortgagee in the foreclosure action. Id., 661. Addition-
ally, in support of his negligence claim, the mortgagor
alleged that the mortgagee’s actions had ruined his
credit score, which detrimentally affected his business
and personal affairs, and caused him to incur significant
legal and other expenses. Id. The mortgagor also
asserted that the mortgagee should be estopped from
collecting the damages that it had caused by its own
alleged misconduct and barred from foreclosing the
mortgage at issue due to its unclean hands. Id., 661–62.
With respect to his counterclaim, he sought compensa-
tory and punitive damages, injunctive relief, and attor-
ney’s fees. Id., 662.
The mortgagee moved to strike the mortgagor’s spe-
cial defenses and counterclaim, claiming that they were
unrelated to the making, validity, or enforcement of the
note and failed to state a claim upon which relief may
be granted. Id. The trial court granted the motion to
strike, concluding that the alleged misconduct by the
mortgagee had occurred following the execution of the
note and, therefore, neither the counterclaim nor the
special defenses related to the making, validity, or
enforcement thereof. Id., 662–63. Additionally, the court
determined that the mortgagor had alleged sufficient
facts to support his special defenses, but the court did
not reach the issue of whether the counterclaim was
supported by adequate facts. Id., 662. Thereafter, the
court rendered a judgment of strict foreclosure. Id.,
663. The mortgagor appealed to this court, which
affirmed the judgment, with one judge dissenting. U.S.
Bank National Assn. v. Blowers, 177 Conn. App. 622,
638, 172 A.3d 837 (2017), rev’d, 332 Conn. 656, 212 A.3d
226 (2019); id., 638–51 (Prescott, J., dissenting).
On certified appeal to our Supreme Court, the mort-
gagor challenged, inter alia, the propriety of the making,
validity, or enforcement test, and, to the extent that the
test applied in foreclosure actions, the proper scope of
‘‘ ‘enforcement’ ’’ under the test. U.S. Bank National
Assn. v. Blowers, supra, 332 Conn. 664. Our Supreme
Court explained that the making, validity, or enforce-
ment test is ‘‘nothing more than a practical application
of the standard rules of practice that apply to all civil
actions to the specific context of foreclosure actions.’’14
Id., 667. Having clarified the proper standard, the court
agreed with the mortgagor that ‘‘a proper construction
of ‘enforcement’ includes allegations of harm resulting
from a mortgagee’s wrongful postorigination conduct
in negotiating loan modifications, when such conduct
is alleged to have materially added to the debt and
substantially prevented the mortgagor from curing the
default.’’ Id.
The court observed that ‘‘[a]n action for foreclosure
is ‘peculiarly an equitable action’ ’’; id., 670; and that
‘‘appellate case law recognizes that conduct occurring
after the origination of the loan, after default, and even
after the initiation of the foreclosure action may form
a proper basis for defenses in a foreclosure action.’’ Id.,
672. The court determined that ‘‘[t]his broader temporal
scope is consistent with the principle that, in equitable
actions, ‘the facts determinative of the rights of the
parties are those in existence at the time of final hearing’
. . . [and] is not inconsistent with a requirement that
a defense sufficiently relates to enforcement of the note
or mortgage. The various rights of the mortgagee under
the note and mortgage (or related security instruments)
are not finally or completely ‘enforced’ until the foreclo-
sure action is concluded.’’ (Citations omitted.) Id., 673.
The court further determined that ‘‘[t]he mortgagor’s
rights and liabilities . . . depend not only on the valid-
ity of the note and mortgage but also on the amount
of the debt. That debt will determine whether strict
foreclosure or foreclosure by sale is ordered, and, in
turn, whether a deficiency judgment may be recovered
and the amount of that deficiency. . . . The debt may
include principal, interest, taxes, and late charges owed.
. . . The terms of the note or mortgage may also permit
an award of reasonable attorney’s fees for expenses
arising from any controversy relating to the note or
mortgage . . . .’’ (Citations omitted.) Id., 674–75.
The court continued: ‘‘These equitable and practical
considerations inexorably lead to the conclusion that
allegations that the mortgagee has engaged in conduct
that wrongly and substantially increased the mortgag-
or’s overall indebtedness, caused the mortgagor to incur
costs that impeded the mortgagor from curing the
default, or reneged upon modifications are the types
of misconduct that are directly and inseparably con-
nected . . . to enforcement . . . . Such allegations,
therefore, provide a legally sufficient basis for special
defenses in the foreclosure action. Insofar as the coun-
terclaims rest, at this stage, upon the same allegations as
the special defenses, judicial economy would certainly
weigh in favor of their inclusion in the present action.’’15
(Citations omitted; footnote omitted; internal quotation
marks omitted.) Id., 675–76. On the basis of that ratio-
nale, the court reversed this court’s judgment and
remanded the matter to this court with direction to
reverse the judgment of strict foreclosure and remand
the matter to the trial court for further proceedings.
Id., 678.
Applying the rationale of Blowers to the present case,
we conclude that the trial court erred in striking the
nonrepleaded counts, the defendants’ second amended
laches defense, and the defendants’ second amended
counterclaim on the ground that they did not satisfy the
making, validity, or enforcement test. The defendants
raised allegations of postorigination misconduct by the
plaintiff that, inter alia, increased their debt and hin-
dered their ability to cure their default. Such alleged
misconduct is ‘‘directly and inseparably connected to
enforcement’’ of the note or mortgage and, therefore,
may form the basis of special defenses and a counter-
claim in the present action.
Like our Supreme Court in Blowers, we note that we
are not deciding whether the defendants’ allegations,
even if proven, ‘‘are sufficient to justify the remedy of
withholding foreclosure or reducing the debt. . . .
[T]he trial court would have to be mindful that [t]he
equitable powers of the court are broad, but they are
not without limit. Equitable power must be exercised
equitably.’’ (Internal quotation marks omitted.) U.S.
Bank National Assn. v. Blowers, supra, 332 Conn. 676–
77. We conclude only that the defendants’ allegations
relate to enforcement of the note or mortgage and,
as a result, the court committed error in striking the
nonrepleaded counts, the defendants’ second amended
laches defense, and the defendants’ second amended
counterclaim.16
The judgments are reversed and the case is remanded
for further proceedings in accordance with this opinion.
In this opinion the other judges concurred.
1
The complaint also named Gerri N. Russo and Webster Bank, National
Association, as defendants, but those parties were defaulted for failure to
appear and for failure to plead, respectively, and are not participating in
this appeal. For purposes of clarity, we will refer to Leslie I. Nathan as
Leslie, Lynne W. Nathan as Lynne, Lynne W. Nathan, Trustee of the Lynne
W. Nathan Trust Agreement dated November 19, 2001, as the Lynne Trustee,
and to those three parties collectively as the defendants.
2
The full name of the plaintiff is HSBC Bank USA, National Association,
as Trustee for Wells Fargo Asset Securities Corporation Mortgage Pass-
Through Certificates Series 2007-8.
3
In their principal appellate brief, the defendants also claimed that the
trial court erred in concluding that the plaintiff had standing to pursue this
foreclosure action. More specifically, the defendants asserted that the court
erroneously presumed, upon the plaintiff’s production of the note demonstra-
ting that it was the valid holder thereof, that the plaintiff was the rightful
owner of the debt and shifted the burden to the defendants to rebut that
presumption. In their principal reply brief, however, the defendants concede
that they cannot prevail on this claim because this court is bound by our
Supreme Court’s decision in RMS Residential Properties, LLC v. Miller,
303 Conn. 224, 231–32, 32 A.3d 307 (2011), overruled in part by J.E. Robert
Co. v. Signature Properties, LLC, 309 Conn. 307, 325 n.18, 71 A.3d 492 (2013),
wherein our Supreme Court stated that ‘‘a holder of a note is presumed to
be the owner of the debt, and unless the presumption is rebutted, may
foreclose the mortgage under [General Statutes] § 49-17.’’ The defendants
represent that they have raised this claim solely to preserve it for review
by our Supreme Court. Accordingly, we need not address the merits of
this claim.
4
In their second amended counterclaim, the defendants pleaded that the
default occurred in January, 2010.
5
The defendants filed an original answer, special defenses, and counter-
claim on May 20, 2015.
6
The court denied the motion to strike as to the defendants’ first amended
special defense asserting lack of standing.
7
Prior to oral argument in this matter, this court ordered the parties to
be prepared to address whether the portion of the appeal challenging the
trial court’s striking of the defendants’ counterclaim, as amended, was taken
from a final judgment where no judgment had been rendered thereon. See
Practice Book §§ 10-44 and 61-2; Pellecchia v. Connecticut Light & Power
Co., 139 Conn. App. 88, 90–91, 54 A.3d 658 (2012), cert. denied, 307 Conn.
950, 60 A.3d 740 (2013); Homecomings Financial Network, Inc. v. Starbala,
85 Conn. App. 284, 285 n.1, 857 A.2d 366 (2004). On January 17, 2019, after
having heard argument from the parties on January 15, 2019, with respect
to, inter alia, the final judgment issue, this court issued an order dismissing,
for lack of a final judgment, the portion of the appeal challenging the trial
court’s striking of the counterclaim, as amended. Thereafter, the plaintiff
filed with the trial court a motion for judgment on the stricken counterclaim,
as amended, which the court, Frechette, J., granted. The defendants then
filed an amended appeal to encompass the judgment rendered on the coun-
terclaim, as amended.
8
This court also ordered the parties to address the claims raised in the
defendants’ amended appeal. See footnote 7 of this opinion.
9
Conversely, the defendants waived their right to challenge the court’s
striking of their first amended laches defense and counts five, six, ten, and
twelve of their first amended counterclaim by repleading them. See Lund
v. Milford Hospital, Inc., 326 Conn. 846, 850, 168 A.3d 479 (2017) (‘‘[A]fter
a court has granted a motion to strike, [a party] may either amend his [or
her] pleading [pursuant to Practice Book § 10-44] or, on the rendering of
judgment, file an appeal. . . . The choices are mutually exclusive [as the]
filing of an amended pleading operates as a waiver of the right to claim
that there was error in the sustaining of the [motion to strike] the original
pleading.’’ [Internal quotation marks omitted.]).
We further observe that ‘‘[i]f the [pleading party] elects to replead follow-
ing the granting of a motion to strike, the [opposing party] may take advan-
tage of this waiver rule by challenging the amended [pleading] as not materi-
ally different than the [stricken] . . . pleading that the court had determined
to be legally insufficient. That is, the issue [on appeal becomes] whether
the court properly determined that the [pleading party] had failed to remedy
the pleading deficiencies that gave rise to the granting of the motions to
strike or, in the alternative, set forth an entirely new cause of action. It is
proper for a court to dispose of the substance of a [pleading] merely repeti-
tive of one to which a demurrer had earlier been sustained. . . . Further-
more, if the allegations in a [pleading] filed subsequent to one that has
been stricken are not materially different than those in the earlier, stricken
[pleading], the party bringing the subsequent [pleading] cannot be heard to
appeal from the action of the trial court striking the subsequent [pleading].’’
(Internal quotation marks omitted.) Sempey v. Stamford Hospital, 194 Conn.
App. 505, 512, A.3d (2019). The plaintiff does not argue on appeal
that the second amended laches defense and the second amended counter-
claim were not materially different from the stricken iterations thereof.
Therefore, we do not consider that issue. Id., 512 n.4.
10
On January 12, 2016, in addition to filing their second amended counter-
claim and special defenses, the defendants filed a notice of intent to appeal
(notice) from the court’s December 28, 2015 decision granting, in part, the
plaintiff’s July 8, 2015 motion to strike. The defendants contend that the
notice preserved their appellate rights as to the December 28, 2015 decision.
We are not persuaded.
First, the notice did not operate to preserve the defendants’ appellate
rights. Subsection (b) of Practice Book § 61-5, which governs the filing of
notices of intent to appeal, provides in relevant part: ‘‘The use of the notice
of intent to appeal is abolished in all instances except as provided in subsec-
tion (a) of this section, which sets forth the two instances in which a notice
of intent must be filed. Except as provided in subsection (a), the filing of
a notice of intent to appeal will preserve no appeal rights.’’ Subsection (a)
of § 61-5 provides in relevant part that a notice of intent to appeal must be
filed in the following two instances only: ‘‘(1) [W]hen the deferred appeal
is to be filed from a judgment that not only disposes of an entire complaint,
counterclaim or cross complaint but also disposes of all the causes of action
brought by or against a party or parties so that that party or parties are not
parties to any remaining complaint, counterclaim or cross complaint; or (2)
when the deferred appeal is to be filed from a judgment that disposes of
only part of a complaint, counterclaim, or cross complaint but nevertheless
disposes of all causes of action in that pleading brought by or against a
particular party or parties.’’ Section 61-5 (a) further provides in relevant
part: ‘‘In the event that the party aggrieved by a judgment described in (1)
or (2) above elects to defer the taking of the appeal until the disposition
of the entire case, the aggrieved party must, [within the applicable appeal
period], file in the trial court a notice of intent to appeal the judgment
. . . .’’ Here, the December 28, 2015 decision, which itself is not a final
judgment; see Sempey v. Stamford Hospital, 180 Conn. App. 605, 618, 184
A.3d 761 (2018) (‘‘[t]he granting of a motion to strike . . . ordinarily is not
a final judgment’’); Practice Book § 10-44; and footnote 7 of this opinion; is
outside of the ambit of § 61-5 (a). Accordingly, the defendants did not
preserve their appellate rights by filing the notice.
Second, the notice did nothing to counteract the defendants’ simultaneous
express abandonment of their first amended unclean hands defense in their
objection. In the notice, the defendants represented in relevant part that
they were ‘‘exercis[ing] their option to appeal from the [December 28, 2015
decision when] a final judgment is rendered which disposes of the cause
of action for all purposes.’’ The defendants made no representations in the
notice contradicting their explicit abandonment of the first amended unclean
hands defense.
11
In their briefs, the parties interpret this decision as the court concluding
that the allegations set forth in support of the second amended laches
defense and the second amended counterclaim did not relate to the making,
validity, or enforcement of the note or mortgage. We do as well.
12
We do not address whether all of the allegations that the defendants
set forth in support of their claims and defenses have a sufficient nexus to
enforcement of the note or mortgage. The parties and the trial court have
generally addressed the allegations in toto, as will we. See U.S. Bank
National Assn. v. Blowers, supra, 332 Conn. 676.
13
The mortgagor alleged, inter alia, that the mortgagee had (1) offered
rate reductions lowering the mortgagor’s monthly mortgage payments, only
to later renege on the modifications following the mortgagor’s successful
completion of trial payment periods, (2) increased the mortgagor’s monthly
payment amount of modified payments that had been agreed to following
the intervention of the state’s Department of Banking, (3) erroneously
informed the mortgagor’s insurance company that the mortgagor’s real prop-
erty was no longer being used as the mortgagor’s residence, resulting in the
cancelation of the mortgagor’s insurance policy and requiring the mortgagor
to replace the coverage at higher premium costs, and (4) engaged in dilatory
conduct during the course of approximately ten months of mediation ses-
sions held after the commencement of the foreclosure action. U.S. Bank
National Assn. v. Blowers, supra, 332 Conn. 659–61.
14
In their principal appellate brief in this appeal, the defendants claim
that the pleading standards set forth in Practice Book §§ 10-10 (concerning
counterclaims) and 10-50 (concerning special defenses) that apply in other
civil actions should also be applicable in foreclosure actions in lieu of the
making, validity, or enforcement test. As our Supreme Court established in
Blowers, the making, validity, or enforcement test is not a separate pleading
standard, but rather a ‘‘practical application’’ of the existing pleading stan-
dards set forth in our rules of practice. U.S. Bank National Assn. v. Blowers,
supra, 332 Conn. 667.
15
In striking the mortgagor’s special defenses and counterclaim, the trial
court also ‘‘acknowledged that a foreclosure sought after a modification
had been reached during mediation could have the requisite nexus to
enforcement of the note, but found that there had been no such modification
. . . .’’ U.S. Bank National Assn. v. Blowers, supra, 332 Conn. 662. On
appeal, the mortgagor also challenged ‘‘the sufficiency of the allegations to
establish that the parties had entered into a binding modification if such
allegations are necessary to seek equitable relief on the basis of postorigina-
tion conduct.’’ Id., 664. Our Supreme Court determined that ‘‘[t]o the extent
that the pleadings reasonably may be construed to allege that the April,
2012 intervention by the Department of Banking resulted in a binding modifi-
cation, there can be no doubt that the breach of such an agreement would
bear the requisite nexus [to enforcement of the note or mortgage].’’ Id., 675.
16
In its principal and supplemental appellate briefs, the plaintiff, as an
alternative ground for affirmance, asserts that the nonrepleaded counts, the
defendants’ second amended laches defense, and the defendants’ second
amended counterclaim fail to state legally cognizable claims or defenses.
Although the plaintiff raised that argument in each of its motions to strike,
the trial court did not address it in its decisions adjudicating the motions.
The defendants argue that the trial court should adjudicate that issue in the
first instance and that, pursuant to Practice Book § 10-44, they are entitled
to an opportunity to replead if the trial court, upon motion by the plaintiff,
strikes their claims or defenses as otherwise legally insufficient. We agree
with the defendants. Accordingly, we do not address the plaintiff’s claim and
leave it to the trial court to decide should the plaintiff choose to reassert it.