Opinion
No. CV-09-5006813S
August 3, 2010
RULING ON PLAINTIFF'S MOTION FOR STRICT FORECLOSURE (#111)
The plaintiff, Robar General Funding Corporation, has moved for a judgment of strict foreclosure. The primary issue in dispute is the correct valuation of the subject property. The plaintiff contends that it should be valued at $950,000. The owner of the property, Donna E. Connolly, who is also one of the defendants, produced evidence that the property should be valued at approximately $2,000,000. As discussed below, the court concludes that under all of the circumstances presented, a compromise figure of $1,750,000 most accurately reflects fair market value. The equity in the property is well in excess of the current debt. Therefore, the motion to foreclose is granted, but this matter will proceed as a foreclosure by sale.
FACTS
The plaintiff filed its complaint on September 2, 2009, asserting that Donna E. Connolly is indebted to the plaintiff as a result of a March 2, 2007 note for $1,100,000, plus interest. The plaintiff claims that the defendant never made payments on the note, which was secured by a mortgage on property known as 146 Transylvania Road, Roxbury, Connecticut. The plaintiff moved for a judgment of strict foreclosure on October 29, 2009. The primary issue in dispute is the correct valuation of the property.
On November 2, 2009, the plaintiff submitted an appraisal, prepared by Jo-Ann Ansaldo on October 21, 2009, indicating that the property was valued at $1,050,000. Approximately one month later, the plaintiff submitted another appraisal, also prepared by Ansaldo, but dated November 25, 2009, indicating that the property was valued at $1,300,000. Donna E. Connolly objected to the motion for strict foreclosure on November 3, 2009, and supported that objection with two different appraisals. One appraisal, dated October 24, 2008, valued the property at $2,900,000, and the second appraisal, dated February 17, 2009, valued the property at $2,925,000.
On July 19, 2010, this matter came before the court for a hearing on the motion for strict foreclosure. At that time, the plaintiff offered a third appraisal, also by Ansaldo, indicating that she now values the property at $950,000. That appraisal, which was filed on July 20, 2010, was prepared on June 28, 2010. In summary, the plaintiff takes the position that, in late 2009, the property gained $250,000 in value in just one month. The plaintiff also claims that the same property lost $350,000 in value over the next seven months.
Donna E. Connolly was unavailable to attend the July 19, 2010 hearing due to a family emergency, and she did not offer the testimony of a professional appraiser. Despite this, the parties recognized that an owner is entitled to testify with regard to the value of his or her own property. Pursuant to a stipulation reached by the parties, the owner's husband, Arthur Connolly (Connolly), was allowed to testify and offer his opinion as to the value of the property. Connolly, a resident of Roxbury for twenty-three years, was the designer and general contractor of the property at issue. He testified that the property was built as an investment and that he has thirty-eight years of experience as a builder.
Connolly's testimony falls roughly into two categories, an enumeration of errors in the appraisal prepared by Ansaldo and a description of the relevant property features that did not appear to be considered in her appraisal. The alleged errors will be addressed seriatim.
Connolly testified that the house has a "full house generator system," valued at approximately eighty thousand dollars, and is not identified in the appraisal. The property, built onto sloping land, has an elevator that stops at four different levels in the house. There is an attic, a large space above the upper floor that is accessible by a pull-down staircase, which can be characterized as a fifth level. The plaintiff's appraisal, however, asserts that the property is "1.25 stories" and mistakenly concludes that the home does not have an attic.
Connolly noted that the house, a European style design, was misidentified by Ansaldo as a "contemporary cape." Moreover, while Ansaldo concluded that the full basement is "0%" finished, Connolly testified that the basement is 50% finished. He testified that it is roughed in, sheet rocked and includes a full bathroom, kitchenette, closets and a fireplace.
Ansaldo's appraisal does not identify any appliances, yet, according to Connolly, the home has a stove. Connolly also noted that Ansaldo lists the home as having four and a half baths, even though it actually has five and a half baths. Ansaldo's appraisal shows three fireplaces, even though there are actually four fireplaces, one of which has a flue that is four stories high. Additionally, Ansaldo's appraisal lists the "energy efficient items" as "typical," even though the house has a full-house generator and a state-of-the-art electronic control system, designed to provide exceptional efficiency, that can be accessed and controlled through the internet from any location in the world. Furthermore, Ansaldo lists the view as a "residential/view," but Connolly testified that the house has the highest elevation in Roxbury, and, on a clear day, the view is almost eighty miles.
The plaintiff's appraiser testified that she did not examine the electronic control system.
Finally, Connolly testified that the land, which was worth $352,000 in February 2007, has had approximately $1,822,000 in improvements since that date. The property is currently marketed in "as is" condition for approximately $2,000,000, and it is generating significant interest at that price. He estimates that the cost to complete the project is approximately $413,240.
In addition to Connolly's testimony, Ansaldo testified in support of her appraisal. She did not disagree with Connolly's identification of the errors in her appraisal, but she testified, in essence, that her errors made no difference in her final opinion. She testified that she has been an appraiser for ten years, working principally in New Haven and Litchfield counties, but she does not know if she has ever appraised any other house in Roxbury.
DISCUSSION
"The determination of [a property's] value by a court is the expression of the court's opinion aided ordinarily by the opinions of expert witnesses, and reached by weighing those opinions in light of all the circumstances in evidence bearing upon value and its own general knowledge of the elements going to establish it." (Internal quotation marks omitted.) Hartford Federal Savings Loan Assn. v. Tucker, 196 Conn. 172, 183, 491 A.2d 1084, cert. denied, 474 U.S. 920, 106 S.Ct. 250, 88 L.Ed.2d 258 (1985). "[T]he determination of the credibility of expert witnesses and the weight to be accorded their testimony is within the province of the trier of facts, who is privileged to adopt whatever testimony he reasonably believes to be credible." Id. "When confronted with conflicting evidence as to valuation the trier may properly conclude that under all the circumstances a compromise figure most accurately reflects fair market value." (Internal quotation marks omitted.) Eichman v. J J Building Co., 216 Conn. 443, 452, 582 A.2d 182 (1990).
It is clear that there is significantly conflicting evidence as to the appropriate valuation in this case. The owner appears to have improved land worth more than $300,000 with a home that cost her, even in its unfinished state, nearly $2,000,000. These facts do not, of course, necessarily mean that one can accurately value the property simply by adding the latter two figures together. The court recognizes that Connolly's belief in the value of the property is fueled, in part, by the passion he has for the project, which was evident throughout his testimony. See Farmers Mechanics Bank v. Arbucci, 24 Conn.App. 486, 486-88, 589 A.2d 14 (1991) (affirming the trial court's decision to credit the testimony of an independent appraiser over that of the defendant homeowner in establishing value). The court also recognizes, however, that Connolly has an intimate knowledge of the construction and contents of the home at issue. He is not simply a homeowner. Rather, he has had a lengthy career in the construction industry and is a twenty-three year resident of Roxbury, where the home is situated.
The testimony of the appraiser, Ansaldo, is more troubling. She was not able to articulate any prior occasion on which she appraised a home in Roxbury. She appears to have made numerous errors in examining the home; errors that, at best, appear to reflect indifference to detail and, at worst, reflect a disinterest in accuracy. The home at issue is clearly a substantial property. There are many reasons to conclude that not only is it a well-designed, well-built home, but also that it is a home that is not out of character for the community in which it is located. The plaintiff's appraiser, herself, recognized that the "[c]onstruction quality and market appeal are typical of the subject's area."
Taking all of the foregoing testimony and documentary evidence into consideration, the court finds that a compromise figure of $1,750,000 most accurately reflects the fair market value.
The court finds that all necessary defaults have entered and that, based upon the affidavit of debt, the debt is $1,342,902.08. Based upon the court's finding of fair market value as compared to the outstanding debt, this matter will proceed with foreclosure by sale. The court further allows an appraisal fee in the amount of $250, a title search fee in the amount of $225, and attorneys fees in the amount of $3,500. The sale date will be December 4, 2010. So ordered.
This figure includes interest at $299.51 per day through the date of this opinion, August 3, 2010.
"The decision to order a strict foreclosure or a foreclosure by sale lies within the discretion of the court." National City Mortgage Co. v. Stoecker, 92 Conn.App. 787, 794, 888 A.2d 95 (2006).