Connecticut Housing Finance Authority v. John Fitch Court Associates Ltd. Partnership

Before the court in the present foreclosure action are three motions. The first is the plaintiff's motion to strike the defendants' jury claim. The second is the defendants' motion, pursuant to General Statutes § 52-218, that all issues of fact be tried to a jury. The third is the plaintiff's motion in the alternative, that if this court allows a jury trial on the defendants' counterclaim, it will be severed from the plaintiff's foreclosure trial.

The relevant facts and pleadings are as follows. The plaintiff's original complaint alleged a deed and a mortgage note executed by the defendant John Fitch Court Associates Limited Partnership (Fitch) in favor of the plaintiff, upon which Fitch defaulted. Fitch then filed an answer on April 7, 1994, denying its default and leaving the plaintiff to its proof as to other material allegations of the complaint. The defendant's answer further alleged a special defense that the plaintiff breached the implied covenant of good faith and fair dealing in regard to the administration of the loan, and a counterclaim that the plaintiff wrongfully accelerated the note, for which the defendant claimed money damages.

The plaintiff replied to the defendant's counterclaim on May 9, 1994, denying its allegation and alleging a special defense that it failed to state a claim for which relief could be granted.

The defendant did not file a jury claim on its counter claim within ten days of May 9, 1994, and, on October 18, 1994, the plaintiff claimed the case for a court trial.

On May 23, 1995, the plaintiff moved to cite in Carr Property Management, Inc., (Carr) as a defendant, and to amend its complaint to allege that Carr may claim an interest by virtue of its occupancy of specific commercial space in the mortgaged premises. These motions were granted and the defendant Carr was served on June 8, 1995.

Carr appeared on July 14, 1995, and was represented by the same law firm that had represented the defendant Fitch.

Both the defendants Fitch and Carr filed a joint answer on September 11, 1995, denying a default on the note, leaving the plaintiff to its proof as to the other material allegations of the complaint, as in the original answer of Fitch. On the same date, the defendants Fitch and Carr filed a jury claim as to their counterclaim.

In support of its motion to strike the defendants' jury claim, the plaintiff argues first that the jury claim is untimely.

General Statutes § 52-215 provides that a claim for a jury may be made "within thirty days after the return day" or "within ten days after [an] issue of fact is joined. . . ."

On the issue of timeliness, the jury claim of the defendant Carr was clearly timely since it was filed at the time the defendants' joint answer alleging the counterclaim was filed.

On the issue of timeliness as to the jury claim of the defendant Fitch, a determination depends on the significance of the plaintiff's amended complaint.

The defendants argue that any amendment, even a technical one, which requires a responsive pleading, revives the period for claiming the matter to a jury.Troiano v. Doyker, Superior Court, judicial district of Hartford-New Britain at Hartford, Docket No. 365449 (January 15, 1991, 3 Conn. L. Rptr. 133) (Corrigan, J.). The more accurate rule, however, is that "a new ten day period may be created by the filing of an amended pleading, provided that the amended pleading introducesa new issue of fact into the case." (Emphasis added.) Javit v. Marshall's, Inc., 40 Conn. App. 261,266, 670 A.2d 886 (1996).

The plaintiff's amended complaint of May 23, 1995, alleged the interest of the defendant Carr as a tenant. This introduced a new issue of fact in the case, but the question is, does Fitch have the right to file a new jury claim within ten days after the pleadings were again closed?

The court holds that it does not. The amended complaint, by adding a defendant having an interest subsequent to Fitch, does not raise a new issue of fact respecting the plaintiff's foreclosure action against Fitch. In fact, the responsive pleading of the defendants Fitch and Carr is exactly the same as the one Fitch filed in response to the original complaint, except for leaving the plaintiff to its proof as to the interest of Carr. Thus, the court concludes that Fitch's jury claim is not timely filed.

The plaintiff, secondly, argues that the counterclaim for damages, based on the plaintiff wrongfully accelerating the mortgage note, is essentially equitable in nature and, thus, does not create a right to a jury trial.

Northeast Savings, F. A. v. Plymouth CommonsRealty Corp., 229 Conn. 634, 642 A.2d 1194 (1994) put to rest the lingering dicta of Savings Bank of NewLondon v. Santaniello, 130 Conn. 206, 211, 33 A.2d 126 (1943) that by a defendant raising legal counterclaims in a plaintiff's equitable action, the defendant waived his right to a jury trial. Rather, our law is that where "separate and distinct causes of action are joined, one at law and one in equity, either party has the right to have a jury trial of the issues involved in the cause of action at law." Berry v. Hartford National Bank Trust Co., 125 Conn. 615, 618, 7 A.2d 847 (1939).

The Supreme Court held in Northeast Savings, F. A.v. Plymouth Commons Realty Corp., supra, 229 Conn. 641, that because a counterclaim is an independent action, the right to a jury trial on the counterclaim depended on whether the counterclaim was "essentially legal or essentially equitable." The analysis must be made "in the context of the pleadings when read as a whole" and the "form of the relief demanded is not dispositive." Id., 641-42.

The standard for determining whether a counterclaim is "essentially" legal or equitable is not articulated in the cases, although examples of the application of the rule are given in Berry v. Hartford National Bank Trust Co., supra, 125 Conn. 618-19, and National Bankof Commerce of New London v. Howland, 128 Conn. 307,310, 22 A.2d 773 (1941).

In the present case, the allegation of the counterclaim that the plaintiff wrongfully accelerated the note sounds in breach of contract for which the defendant seeks money damages. That is a legal cause of action as to which Carr is entitled to a jury trial.

The plaintiff argues finally, that this counterclaim cannot be raised by the defendant tenant Carr because it is not in privity with the defendant mortgagor Fitch. On a motion to strike a jury claim, however, the court must take the counterclaim as pleaded and cannot decide its legal sufficiency.

Thus, this court decides that the defendant Carr's jury claim was timely made and its counterclaim is properly triable to a jury.

Both defendants move, pursuant to § 52-218, that all issues of fact be tried to the jury. That statute provides that "[u]pon the application of either party, the court may order any issue or issues of fact in any action demanding equitable relief to be tried by a jury of six." General Statutes § 52-218.

At the outset, it may be noted that while a claim to the jury, pursuant to § 52-215, must be made within a strict time limitation, a claim for a jury in an action demanding equitable relief, pursuant to § 52-218, is not time limited and may be made any time before trial. While a jury claim under § 52-215 is a matter of right, however, a jury claim under § 52-218 is not a matter of constitutional or statutory right. Davis v. McFarland,113 Conn. 594, 608, 156 A. 52 (1931). A determination of whether to grant the motion and what issues to submit to the jury is left entirely to the discretion of the court and "this discretion should be sparingly exercised."Lombardi v. Laudati, 124 Conn. 569, 571,200 A. 1019 (1938).

In the present action, since the jury claim of the defendant Fitch was untimely, to prevent confusion at trial, the court hereby grants the joint motion of both defendants for a jury trial, pursuant to § 52-218, on the defendants' counterclaim only.

The plaintiff moves to sever the defendants' counter claim from the foreclosure action so that a court trial can proceed on the plaintiff's action. Since the court deems it unfair for the plaintiff to obtain its relief before the defendants' counterclaim is litigated, it denies the plaintiff's motion to sever.

Thus, to recapitulate, this court grants the plaintiff's motion to strike the jury claim of the defendant Fitch, denies the plaintiff's motion to strike the jury claim of the defendant Carr, grants the defendants' motion for a jury trial, pursuant to §