Opinion
KNLCV146021747S
07-21-2017
Bank of America, N.A. v. Philip A. Schonberger et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION IN RE MOTION TO CITE, #138
Hon. John J. Nazzaro, J.
The issues presented are whether: (1) the court should grant the defendant's motion to make the estate of Philip A. Schonberger, by and through his fiduciaries, a defendant in this action; (2) or alternatively, grant the defendant permission to file a third-party complaint against the estate. For reasons set forth below, the defendant's motion to cite the estate as an additional party and the defendant's request to file a third-party complaint are each denied.
FACTS
The plaintiff, Bank of America, National Association, a National Banking Association, as successor in interest to Merrill Lynch Credit Corporation (Merrill Lynch), commenced this action by way of amended complaint (#120) on January 11, 2016. The plaintiff alleges the following facts. On September 17, 2002, Mr. Schonberger executed and delivered, to Merrill Lynch, a note for a loan in the original principal amount of $1,628,000 and to secure that note, Mr. Schonberger executed and delivered to Merrill Lynch a mortgage on the property at 12 Sill Lane, Old Lyme, Connecticut 06371 (property). On March 17, 2006, Koerner became the owner of the property by virtue of a quit claim deed from Mr. Schonberger. The note went into default and the plaintiff chose to accelerate the balance due on the note, declaring the note to be due in full. The plaintiff provided written notice to the defendants, Mr. Schonberger and Koerner, of the default. The defendants failed to cure the default. The plaintiff elected to accelerate the balance due on the note and foreclose on the mortgage securing the note.
The plaintiff alleges Merrill Lynch merged with the plaintiff, effective on July 1, 2001. The plaintiff alleges that, as a successor in interest to Merrill Lynch, it is the holder of the note.
On April 20, 2015, Mr. Schonberger passed away. After Mr. Schonberger's death, Robin Schonberger (Mrs. Schonberger) filed an application to be made a party defendant in this action (#119), on the ground that her rights were being affected as a beneficiary of Mr. Schonberger's trust. In support of her motion, Mrs. Schonberger submitted a " Declaration of Trust" with her application to be made a party defendant. The declaration of trust provided that: " I [Koerner] am not the equitable owner of the [p]remises [12-1 Sill Lane, Old Lyme, Connecticut], but rather am holding the [p]remises as a trustee for the benefit of the persons listed below: Philip A. Schonberger and Robin Schonberger as joint tenants with rights of survivorship." The declaration was signed by Koerner and a notary public on April 13, 2006. This court granted Mrs. Schonberger's application (#119.01) on January 6, 2016, thereby making her a defendant in this action.
On July 6, 2015, counsel for Mr. Schonberger filed a suggestion of death upon the record (#112) informing the court that Mr. Schonberger had died on April 20, 2015.
Thus, any reference to the defendant references Mrs. Schonberger as she was made a party to this action and is the only defendant movant in this present motion. The defendant, Koerner, has not participated in this motion.
On October 21, 2016, Mrs. Schonberger filed a motion " TO MAKE PARTY DEFENDANT, OR, IN THE ALTERNATIVE FOR PERMISSION TO BRING A THIRD-PARTY COMPLAINT." In her motion, Mrs. Schonberger sets forth two arguments. First, Mrs. Schonberger, pursuant to Practice Book § 9-6, requests that the court cite the estate of Mr. Schonberger, by and through his fiduciaries, as an additional party defendant, to effectuate Mr. Schonberger's intent to leave the home to Mrs. Schonberger and through his estate, pay the indebtedness. Second, and in the alternative, she requests permission from this court, pursuant to General Statutes § 52-102a, to bring a third-party complaint and implead the estate of Mr. Schonberger, by and through his fiduciaries.
The court notes that it is Mrs. Schonberger, not the fiduciaries of the estate, that is moving to cite the estate as an additional party.
General Statutes § 52-102a(a) provides that: " A defendant in any civil action may move the court for permission as a third-party plaintiff to serve a writ, summons and complaint upon a person not a party to the action who is or may be liable to him for all or part of the plaintiff's claim against him. The motion may be filed at any time before trial and permission may be granted by the court if, in its discretion, it deems that the granting of the motion will not unduly delay the trial of the action nor work an injustice upon the plaintiff or the party sought to be impleaded."
The plaintiff has not filed a written objection but did verbally object when the court heard argument at short calendar on April 24, 2016. At oral argument, the plaintiff argued that if the court were to grant the motion it would cause a delay in this case. Additional facts will be set forth when necessary.
DISCUSSION
a. Motion to Make Estate Party Defendant
Practice Book § 9-6, titled, " [i]nterested [p]ersons as [d]efendants, " provides that: " Any person may be made a defendant who has or claims an interest in the controversy, or any part thereof, adverse to the plaintiff, or who it is necessary, for a complete determination or settlement of any question involved therein, to make a party. (See General Statutes § 52-102 and annotations.)" Practice Book § 9-6. A necessary party is a " [person] having an interest in the controversy, and who ought to be made parties, in order that the court may act on that rule which requires it to decide on, and finally determine the entire controversy, and do complete justice, by adjusting all the rights involved in it . . . But if their interests are separable from those of the parties before the court, so that the court can proceed to a decree, and do complete and final justice, without affecting other persons not before the court, the latter are not indispensable parties." (Internal quotation marks omitted.) Biro v. Hill, 214 Conn. 1, 5-6, 570 A.2d 182 (1990).
" The court is vested with authority to control the process by which parties are added to pending actions to protect the interests of all other parties, and of the court itself, in the fair and efficient adjudication of all proper claims and defenses. A motion to cite in [additional parties] notifies the court of the grounds upon which . . . [the party] seeks to summon additional parties to the existing lawsuit . . . A court's order, pursuant to [General Statutes] § 52-102, permitting the joinder of the additional parties, authorizes an expansion of a civil action that was previously commenced." (Citations omitted.) Perrone v. Buttonwood Farm Ice Cream, Inc., 158 Conn.App. 550, 555, 119 A.3d 659 (2015) (plaintiff's motion to cite additional party was at issue).
In a foreclosure action, " the owner of the equity is an absolutely necessary party, and is usually the first named defendant." 1 D. Caron & G. Milne, Connecticut Foreclosures: An Attorney's Manual of Practice and Procedure, (7th Ed. 2017), § 5-3:1, p. 213. Moreover, executors, administrators, and fiduciaries are not appropriate parties to a foreclosure action. See Id., § 5-3:1.1, pp. 214-15; see also Connelly v. Fannie Mae, 251 F.Supp.2d 1071 (D.Conn. 2003) (concluding mortgagee is not required to name executor of estate in order to foreclosure a mortgage, provided plaintiff is not seeking deficiency judgment). " [A]n estate cannot hold title to property and cannot participate in a foreclosure action against the property." Trumbull v. Palmer, 104 Conn.App. 498, 503, 934 A.2d 323 (2007) cert. denied, 286 Conn. 905, 944 A.2d 981 (2008).
In the present case, the plaintiff's original complaint, filed prior to Mr. Schonberger's death, named all of the necessary parties. Mr. Schonberger was a necessary party because he executed the note and mortgage on the property. Thus, Mr. Schonberger's interest would be necessary for this court to determine the outcome of this foreclosure outcome. See Biro v. Hill, supra, 214 Conn. 5-6. Similarly, Koerner, holding title to the property as trustee, also qualifies him as a necessary party because of the declaration of trust entered into on April 13, 2006.
Subsequent to Mr. Schonberger's death, Mrs. Schonberger applied to be cited as an additional party to this action. This court granted her motion and the plaintiff, in response, filed an amended complaint on January 11, 2016. In its amended complaint, the plaintiff updated its allegations to reflect Mrs. Schonberger's status as a defendant. Specifically, in its amended complaint the plaintiff alleges that: " By virtue of a Quit Claim Deed from PHILIP A. SCHONBERGER recorded on March 17, 2006 in Volume 333 at Page 209 of the Old Lyme Land Records, the Defendant(s), Allan W. Koerner, TRUSTEE, and ROBIN SCHONBERGER, BENEFICIARY OF THE TRUST, became the owner of real property situated in the Town of Old Lyme, County of New London and State of Connecticut . . ."
The estate of Mr. Schonberger, by and through his fiduciaries, has not submitted any application to be cited as an additional party. Nor has Mrs. Schonberger offered any evidence to support the notion that the estate does in fact wish to become a party to this action. The court addressed Mrs. Schonberger's interest when this court granted her application to become a party defendant. Thus, the plaintiff's amended complaint has named all parties necessary to determine the outcome of this foreclosure action. Here, Mr. Schonberger's estate, by and through his fiduciaries, is not a necessary, nor proper, party to this foreclosure action. For these reasons, the motion to cite in certain of these defendants is denied.
The plaintiff alleges in paragraph nine, of its amended complaint, that it has caused a lis pendens to be recorded on the land records of the town of Old Lyme. The purpose of a lis pendens is to give constructive notice to persons who may subsequently acquire an interest in the property. See Ghent v. Meadowhaven Condominium, Inc., 77 Conn.App. 276, 284-85, 823 A.2d 355 (2003); see also Corsino v. Telesca, 32 Conn.App. 627, 632-33, 630 A.2d 154, cert. denied, 227 Conn. 931, 632 A.2d 703 (1993) (discussing lis pendens is appropriate where outcome of case will affect title or interest in real property). Thus, the court finds that the plaintiffs have put the fiduciaries of Mr. Schonberger's estate on constructive notice of this foreclosure action.
This conclusion also aligns with this court's denial (#132.01) of the defendant's motion to strike (#132) the plaintiff's complaint.
b. Request for Permission to File Third-Party Complaint
" Pursuant to section 52-102a, [t]he defendant . . . [does] not have a statutory right to implead a third party; the statute commits the decision of such motions to the sound discretion of the trial court." (Emphasis omitted; internal quotation marks omitted.) Cupina v. Bernklau, 17 Conn.App. 159, 164, 551 A.2d 37 (1988). A defendant may implead a person not a party to the action only after receiving permission from the court. See Schurgast v. Schumann, 156 Conn. 471, 484, 242 A.2d 695 (1968).
Mrs. Schonberger moves for permission, pursuant to General Statutes § 52-102a, to bring a third-party complaint and implead the estate of Mr. Schonberger, by and through his fiduciaries. Mrs. Schonberger argues that Mr. Schonberger's estate is legally and equitably obligated to pay any amounts found to be due on the note so that Mrs. Schonberger does not lose her interest in the home through foreclosure. The plaintiff objected during oral argument, contending that granting this motion will cause delay in this case.
An estate cannot hold title to property and cannot participate in a foreclosure action against the property. See Trumbull v. Palmer, supra 104 Conn.App. 503. Additionally, fiduciaries are not appropriate parties to a foreclosure action. 1 D. Caron & G. Milne, Connecticut Foreclosures: An Attorney's Manual of Practice and Procedure, (7th Ed. 2017), § 5-3, p. 213.
In the present case, for reasoning set forth above, the court denies Mrs. Schonberger's request to file a third-party complaint because neither the estate, nor the fiduciaries, can participate in a foreclosure action against the property.
CONCLUSION
For the foregoing reasons, both the defendant's motion to cite in the estate of Mr. Schonberger as an additional party and/or, in the alternative, her motion to receive permission to file a third-party complaint against the estate are each denied.
It is so ordered.