Opinion
LLICV166013346S
04-30-2018
U.S. BANK TRUST, N.A., as Trustee FOR LSF9 MASTER PARTICIPATION TRUST v. Lesley DALLAS et al.
UNPUBLISHED OPINION
OPINION
Bentivegna, J.
The plaintiff, U.S. Bank Trust, N.A. as Trustee for LSF9 Master Participation Trust, moves to strike the defendant’s, Lesley Dallas, revised thirteen special defenses and counterclaims to the plaintiff’s mortgage foreclosure action on the ground of legal insufficiency. In response, the defendant files a request to amend those special defenses and counterclaims along with an objection to the motion to strike, which references that request to amend. The defendant does not otherwise address the legal sufficiency of her special defenses and counterclaims.
The court follows the majority of Superior Court decisions and sustains the plaintiff’s oral objections to the defendant’s request to amend the revised special defenses and counterclaims because the plaintiff’s motion to strike is pending. For the reasons set forth below, the motion to strike is granted in part and denied in part.
The plaintiff argues in a footnote to its memorandum of law that the defendant, Lesley Dallas, has no standing to assert special defenses and counterclaims against a non-party, the " substitute plaintiff." The plaintiff explains that there is no plaintiff and substitute plaintiff in this action. The court agrees that there are not two plaintiffs in this case, but the court reads the amended answer, special defenses, and counterclaims of the pro se defendant, Lesley Dallas, broadly and construes this defendant’s allegations as referring to conduct between the loan originator, Chase Bank, N.A. (who the defendant refers to as " the substitute plaintiff" ) and the actual plaintiff in this case, U.S. Bank Trust, N.A. as Trustee for LSF9 Master Participation Trust (who the defendant refers to as " the plaintiff" ).
I
Fraud Special Defenses
The plaintiff moves to strike the fraud special defenses- special defense one (" residential mortgage fraud" ), special defense two (" fraudulent nondisclosure" ), special defense three (" document fraud" ), special defense four (" fraud in the inducement" ), special defense five (" fraud in the factum" ), and special defense seven (" illegality" )- on the ground of legally insufficiency because they are not plead with " the requisite level of specificity." Specifically, the defendant does not specifically plead the fraudulent acts at issue in each of these special defenses. As to the second, third, and fifth special defense, the plaintiff argues that the defendant also does not set forth the elements of fraud in the special defenses.
Practice Book § 10-50 provides in relevant part: " No facts may be proved under either a general or special denial except such as show that the plaintiff’s statements of fact are untrue. Facts which are consistent with such statements but show, not withstanding, that the plaintiff has no cause of action must be specially alleged. Thus ... fraud ... must be specially pleaded ..."
" Fraud ... is an equitable defense to a foreclosure action. [See Fidelity Bank v. Krenisky, 72 Conn.App. 700, 705-06, 807 A.2d 968 (2002), cert. denied, 262 Conn. 915, 811 A.2d 1291 (2003).] Fraud involves deception practices in order to induce another to act to her detriment, and which causes that detrimental action ... The four essential elements of fraud are (1) that a false representation of fact was made; (2) that the party making the representation knew it to be false; (3) that the representation was made to induce action by the other party; and (4) that the other party did so act to her detriment ... Because specific acts must be pleaded, the mere allegation that a fraud has been perpetrated is insufficient ..." (Citation omitted; internal quotation marks omitted.) Chase Manhattan Mortgage Corp. v. Machado, 83 Conn.App. 183, 188, 850 A.2d 260 (2004).
A
Special Defense One- " Residential Mortgage Fraud
Special defense one (" residential mortgage fraud" ) contains the following general assertions of fraud without reference to any actor, " making of intentional fraudulent Origination documents," and " intentional and willful fraud from fulfilling the condition of her mortgage." Our Appellate Court in CitiMortgage, Inc. v. Coolbeth, 147 Conn.App. 183, 189, 81 A.3d 1189 (2013), cert. denied, 311 Conn. 925, 86 A.3d 469 (2014) stated, " [b]ecause specific acts must be pleaded, the mere allegation that a fraud has been perpetrated is insufficient." (Citation omitted; internal quotation mark omitted.) Accordingly, those mere allegations of fraud are legally insufficient because they do not contain reference to what false statements of fact were made and by whom. The defendant, however, later pleads in the special defense that the plaintiff " forged, fabricated, and robo-signed documents they knew were untrue." That allegation is that the plaintiff made a false representation of fact in a document that it signed. It is not conclusory. Accordingly, special defense one contains a legally sufficient specific allegation of fraud and the court denies the plaintiff’s motion to strike special defense one in its entirety.
" A [motion to strike] addressed simply to the count [in its entirety] will be overruled if any one theory is supported by the allegations in the count." (Internal quotation marks omitted.) Jolen, Inc. v. Brodie & Stone, PLC, Superior Court, judicial district of Fairfield, Docket No. CV-15-6053151-S (May 13, 2016, Kamp, J.) (62 Conn.L.Rptr. 343, 346 n.2) (one of plaintiff’s theories is sufficient to allow CUTPA claim to proceed, motion to strike is denied); see also Aurio v. Allstate Ins. Co., Superior Court, judicial district of Waterbury, Docket No. CV-02-0175465-S (November 26, 2003, Gallagher, J.) (36 Conn.L.Rptr. 39, 40) (where motion to strike challenges entire count, but any part of plaintiff’s claims therein are legally sufficient, motion will fail); Farago v. Pfizer, Inc., Superior Court, judicial district of New London, Docket No. 524911 (May 18, 1993, Teller, J.) (if part of count is viable, it is not subject to motion to strike).
B
Special Defenses Two- " Fraudulent Non-Disclosure," Three- " Document Fraud," Four- " Fraud in the Inducement," Five- " Fraud in the Factum," and Seven- " Illegality."
Special defenses two (" fraudulent non-disclosure" ), three (" document fraud" ) and five (" fraud in the factum" ) do not contain factual pleadings to identify what specific false statements of fact were made and by whom. For example, special defense two (" fraudulent non-disclosure" ) and three (" document fraud" ) allege that the defendant " was prevented by reason of fraud from fulfilling a condition of her mortgage." Such allegations are legally insufficient to specifically plead fraud. See CitiMortgage v. Coolbeth, supra, 147 Conn.App. 189 (" mere allegation that a fraud has been perpetrated is insufficient" ). Special defense five (" fraud in the factum" ) alleges that the loan originator " forged key documents and omitted mandatory HUD1A and TILA disclosures from pre-closing package sent to Defendant regarding key material facts." That special defense does not contain factual allegation or demonstrate that the defendant was " tricked [by the plaintiff] into signing a note in the belief that it is merely a receipt or some other document ... and had no reasonable opportunity to obtain knowledge [of the nature of the document]." Cadle Co. v. Ginsburg, 51 Conn.App. 392, 403-04, 721 A.2d 1246 (1998), cert. denied, 247 Conn. 963, 724 A.2d 1125 (1999). For all of these reasons, special defenses two, three, and five are legally insufficient and the court grants the plaintiff’s motion to strike special defenses two, three, and five.
1
Special Defense Four- " Fraud in the Inducement
Special defense four (" fraud in the inducement" ), to be legally sufficient, must advise the plaintiff of what relevant facts are claimed as fraud that induced the defendant to enter into the agreement. Horse Tavern Builders, LLC v. Pizzino, Superior Court, judicial district of Fairfield, Docket No. CV-15-6049934-S (April 13, 2016, Kamp, J.) (special defense legally insufficient for that reason). The plaintiff argues that special defense four cannot rely upon a vague, self-serving or conclusory allegation of fraud and cites Maruca v. Phillips, 139 Conn. 79, 81, 90 A.2d 159 (1952) (" Where a claim for damages is based upon fraud, the mere allegation that a fraud has been perpetrated is insufficient; the specific acts relied upon must be set forth in the complaint" ). In this special defense, the defendant pleads that the loan originator and the plaintiff " and their agents made knowing, willful and intentionally false, misleading statements, trickery, lies, deceit, forged documents, and/or omissions in the making of the Original Note and subsequent fabricated assignments; that induced the Defendant to act on their behalf ..." The loan originator and the plaintiff " willfully, knowingly, and intentionally intended that their representation mislead and induce Defendant to act on it; and did so to her detriment of an alleged $1.3 million in debt." The court disagrees with the plaintiff that these allegations are conclusory and not specific, and the court denies the plaintiff’s motion to strike special defense four on those grounds.
2
Special Defense Seven- " Illegality
Similarly, the plaintiff moves to strike special defense seven (" illegality" ) on the ground the defendant has not specifically pleaded the fraudulent act and inappropriately relies upon a conclusory allegation of fraud in that special defense. The plaintiff specifically pleads in special defense seven, like special defense four, that " each and every cause of action therein [the plaintiff’s complaint], is barred by the Doctrine of Fraud in the Factum ..." In addition, the defendant alleges, the loan originator and the plaintiff, generally, engaged in " fraudulent conduct," " willful, knowing and intentionally wrongful conduct" and " willful[ly] and intentionally] fail[ed] to comply with the rules and regulations promulgated by the State of Connecticut" and engaged in " fraud in the making, validity and enforcement of the loan note and mortgage." The defendant alleges that " was intentionally prevented by reason of fraud from fulfilling a condition of her mortgage." Such allegations do not allege that the defendant was tricked by the plaintiff into signing the note, so special defense seven does contain a legally sufficient allegation of fraud to state a fraud in the factum special defense against the plaintiff under Cadle Co. v. Ginsburg, supra, 51 Conn.App. 403-04. These allegations of fraud in the special defense are also conclusory. Accordingly, special defense seven is legally insufficient and the court grants the motion to strike special defense seven.
II
Breach of Contract Special Defense
The sixth special defense (" breach of contract" ) alleges that " each and every cause of action" in the complaint is " barred by Breach of Contract law violations" so that " foreclosure cannot be had" because " she was prevented by reason of intentional fraud from fulfilling a condition of her mortgage."
The plaintiff moves to strike this special defense on the ground of legal insufficiency because, inter alia, the defendant has failed to set forth the elements of breach of contract and fraud. " The elements of a breach of contract claim are the formation of an agreement, performance by one party, breach of the agreement by the other party, and damages." Meyers v. Livingston, Adler, Pulda, Meiklejohn & Kelly, P.C., 311 Conn. 282, 291, 87 A.3d 534 (2014). Fraud must be specifically pleaded in a special defense to be legally sufficient. Practice Book § 10-50; Chase Manhattan Mortgage Corp. v. Machado, supra, 83 Conn.App. 188. The court agrees with the plaintiff that the defendant has not pleaded sufficient facts in this special defense to set forth the elements of a breach of contract special defense or a breach of contract action based upon a specific fraudulent act. For these reasons, the sixth special defense is legally insufficient and the court grants the motion to strike the sixth special defense.
III
Equitable Estoppel Special Defense
The eighth special defense (" equitable estoppel" ) pleads that " every cause of action contained in the unverified complaint is barred by reason of fraudulent acts, omissions, representations, and courses of conduct by ... [the loan originator and the plaintiff], by which the answering Defendant was, misled to rely on to her financial and emotional detriment, thereby barring each and every cause of action under the Doctrine of Equitable Estoppel." The defendant further pleads that " she was intentionally and willfully prevented by reason of fraud from fulfilling a condition of her mortgage, so foreclosure cannot be had." The plaintiff moves to strike this special defense on the ground, inter alia, the defendant has failed to plead the elements of an equitable estoppel claim. The plaintiff further moves to strike this special defense on the ground the defendant’s allegation of fraud has not been pleaded with the requisite specificity to be legally sufficient as a special defense.
" The doctrine of equitable estoppel is well established. [W]here one, by his words or actions, intentionally causes another to believe in the existence of a certain state of things, and thereby induces him to act on that belief, so as injuriously to affect his previous position, he is [precluded] from averring a different state of things as existing at the time ... Our Supreme Court ... stated, in the context of an equitable estoppel claim, that [t]here are two essential elements to an estoppel: the party must do or say something which is intended or calculated to induce another to believe in the existence of certain facts and to act upon that belief; and the other party, influenced thereby, must actually change his position or do something to his injury which he otherwise would not have done. Estoppel rests on the misleading conduct of one party to the prejudice of the other ... Broadly speaking, the essential elements of an equitable estoppel ... as related to the party to be estopped, are: (1) conduct which amounts to a false representation or concealment of material facts, or, at least, which is calculated to convey the impression that the facts are otherwise than, and inconsistent with, those which the party subsequently attempts to assert; (2) the intention, or at least the expectation, that such conduct shall be acted upon by, or influence, the other party or other persons; and (3) knowledge, actual or constructive, of the real facts ..." (Citations omitted; internal quotation marks omitted.) Johnnycake Mountain Associates v. Ochs, 104 Conn.App. 194, 208-09, 932 A.2d 472 (2007), cert. denied, 286 Conn. 906, 944 A.2d 978 (2008).
The court agrees with the plaintiff that the defendant has not pleaded legally sufficient facts to support an equitable estoppel special defense in the eighth special defense under Johnnycake Mountain Associates v. Ochs, supra, 104 Conn.App. 208-09. To the extent the defendant is alleging that a fraudulent act forms the basis of her equitable estoppel special defense, the court agrees with the plaintiff that the defendant has not specially pleaded what specific fraudulent act occurred and by whom as the basis of this special defense. For these reasons, the equitable estoppel special defense is legally insufficient and the court grants the motion to strike the eighth special defense.
IV
CUTPA Special Defense
The ninth special defense attempts to allege a violation of the Connecticut Unfair Trade Practices Act (CUTPA), which the plaintiff moves to strike as a legally insufficient special defense in a foreclosure action. Our Appellate Court held in Bank of America v. Aubut, 167 Conn.App. 347, 374, 143 A.3d 638 (2016) that " [i]t is clear from our case law that, generally, a legally valid special defense in a foreclosure action, insofar as it relates to the making, validity or enforcement of the loan, note and mortgage, is a means of asserting that a party who has commenced a foreclosure action may not prevail. Thus, a special defense operates as a shield, to defeat a cause of action, and not as a sword, to seek a judicial remedy for a wrong. Against this backdrop, [the Appellate Court] readily conclude[s] that a CUTPA violation may not be asserted as a special defense. In reaching this conclusion, [the Appellate Court is] mindful that, by its express terms, CUTPA provides a cause of action for its violation, but it does not expressly provide a defense by invalidating, or otherwise rendering unenforceable, agreements that are the product of unfair trade practices." For this reason, the ninth special defense is legally insufficient and court grants the motion to strike the ninth special defense.
V
RESPA Special Defense
The tenth special defense attempts to allege a violation of RESPA, which the plaintiff moves to strike on the ground, inter alia, the special defense does not relate to the making, validity or enforcement of the note. " [A] violation of RESPA is not a valid [special] defense to [a] mortgage foreclosure [action]." Webster Bank v. Linsley, Superior Court, judicial district of New Haven at Meriden, Docket No. CV-97-0260406-S (August 14, 2001, Booth, J.). " [A] violation of RESPA, by terms of the act, does not discharge the debt or invalidate the mortgage agreement and, therefore, does not provide a defense to foreclosure. See 12 U.S.C. § 2615 [provides] ‘[n]othing in this Act shall affect the validity or enforceability ... of any loan, loan agreement, mortgage or lien made or arising in connection with a federally related mortgage loan.’ " Id. (granting motion to strike on ground of legal insufficiency); Security Pacific National Bank v. Robertson, Superior Court, judicial district of Stamford, Docket No. CV-92-0124622-S (August 28, 1997, Hickey, J.) (holding RESPA is not a valid special defense in a foreclosure action); see also Deutsche Bank National Trust Co. v. Medina, Superior Court, judicial district of Stamford, Docket No. CV-08-5006907-S (January 10, 2011, Mintz, J.) (51 Conn.L.Rptr. 270, 276-77) (finding that " allegations that the plaintiff violated TILA and RESPA requirements do not, standing alone, present a legal attack on the validity of the note or mortgage and, therefore, the allegations are not valid special defenses" ). For these reasons, the tenth special defense is legally insufficient and the court grants the motion to strike the tenth special defense.
VI
Creditors’ Collection Practices Act Special Defense
The eleventh special defense attempts to allege a violation of the Creditors’ Collection Practices Act (CCPA), which the plaintiff moves to strike on the ground, inter alia, the defendant does not set forth or explain how the plaintiff allegedly violated the statute. The District Court of Connecticut in Aviles v. Wayside Auto Body, Inc., 49 F.Supp.3d 216, 236 (D.Conn. 2014) found that, contrary to earlier decisions of the Superior Court, when General Statutes § 36a-648(a) was enacted by the legislature in 2007, it provides a person with a private right of action under the CCPA. No decision of the Superior Court has decided post-Aviles whether a violation of the CCPA may be properly alleged as a special defense, that is, as a shield so that a violation of the CCPA would mean the plaintiff has no action against the defendant, rather than as a sword. See, by analogy, Bank of America v. Aubut, supra, 167 Conn.App. 374 (in CUTPA context). In the eleventh special defense, the defendant alleges that " she was intentionally prevented by reason of fraud from fulfilling a condition of her mortgage, so foreclosure cannot be had." This court agrees, after reviewing the complaint, that the quoted language is legally insufficient to put the plaintiff on notice of how the CCPA is violated and how that violation bars the plaintiff from relief on its complaint. For this reason, the eleventh special defense is legally insufficient and the court grants the motion to strike the eleventh special defense.
VII
Civil Conspiracy Special Defense
The twelfth special defense attempts to allege civil conspiracy in that " each and every cause of action" in the complaint is " barred by violations of Civil Conspiracy" because the plaintiff " was intentionally prevented by reason of fraud from fulfilling a condition of her mortgage, so foreclosure cannot be had." The plaintiff moves to strike the twelfth special defense on the ground, inter alia, the defendant has not pleaded sufficient facts to state a cause of action for conspiracy and, essentially, the plaintiff has not specifically pleaded the tort- the fraudulent act, which prevented the plaintiff from fulfilling a condition of her mortgage.
" The [elements] of a civil action for conspiracy are: (1) a combination between two or more persons, (2) to do a criminal or an unlawful act or a lawful act by criminal or unlawful means, (3) an act done by one or more of the conspirators pursuant to the scheme and in furtherance of the object, (4) which act results in damage to the plaintiff." ( [Citation omitted; ] [i]nternal quotation marks omitted.) Harp v. King, 266 Conn. 747, 779, 835 A.2d 953 (2003). There is, however, no independent claim of civil conspiracy. Rather, [t]he action is for damages caused by acts committed pursuant to a formed conspiracy rather than the conspiracy itself ... Thus, to state a cause of action, a claim of civil conspiracy must be joined with an allegation of a substantive tort. (Citation omitted; emphasis in original; internal quotation marks omitted.) Id., 779 n.37." Macomber v. Travelers Property & Casualty Corp., 277 Conn. 617, 635-36, 894 A.2d 240 (2006).
Even without deciding whether civil conspiracy is a proper special defense in a foreclosure action, if the court were to assume that the defendant’s civil conspiracy special defense relates to an alleged fraudulent act, where fraud is the purported underlying tort, the court agrees with the plaintiff that the defendant has not specifically pleaded the tort: what fraudulent act occurred and by whom to state a legally sufficient claim of fraud. See Johnnycake Mountain Associates v. Ochs, supra, 104 Conn.App. 208-09 (discussing the elements of fraud). The defendant has also not pleaded facts to support the elements of a conspiracy linked with that fraud. See Macomber v. Travelers Property & Casualty Ins. Corp., supra, 277 Conn. 635-36. For these reasons, the twelfth special defense is legally insufficient and the court grants the motion to strike the twelfth special defense.
VIII
RICO Special Defense
The thirteenth special defense purports to allege a violation of the Racketeer Influenced and Corrupt Organizations Act (RICO). The defendant pleads that " each and every cause of action" in the complaint is barred by RICO because the defendant " was intentionally prevented by reason of fraud from fulfilling a condition of her mortgage" and that the loan originator and the plaintiff had a " knowing, continuous, organized system of residential mortgage fraud" that " utiliz[ed] the U.S. Mail to defraud the Defendant of illegal payments." The plaintiff moves to strike this special defense on the ground, inter alia, of legal insufficiency because the fraud allegation has not been pleaded with particularity and the defendant has not pleaded sufficient facts to support a RICO special defense. The court agrees. For those reasons, the thirteenth special defense is legally insufficient and the court grants the motion to strike the thirteenth special defense.
IX
Counterclaim
A
Assignee’s Liability for Conduct of Loan Originator
The plaintiff moves to strike the following counts of the revised counterclaim- " first count" (" residential mortgage fraud" ), " second count" (" fraudulent nondisclosure" ), " third count" (" document fraud" ), " fourth count" (" fraud in the inducement" ), " fifth count" (" fraud in the factum" ), " sixth count" (" breach of contract" ), " seventh count" (" illegality" )- on the ground, inter alia, the counts are legally insufficient because they allege conduct on behalf of the loan originator, which occurred before the defendant’s note and mortgage were assigned to the plaintiff. The plaintiff contends these counts are legally insufficient as pleaded against an assignee of the note and mortgage because the " [p]laintiff was not involved in the origination of the subject loan."
Our Appellate Court addressed this issue in a mortgage foreclosure action in Hartford v. McKeever, 139 Conn.App. 277, 284-86, 55 A.3d 787 (2012), aff’d on different grounds, 314 Conn. 255, 101 A.3d 229 (2014). " An assignment of a right is a manifestation of the assignor’s intention to transfer it by virtue of which the assignor’s right to performance by the obligor is extinguished in whole or in part and the assignee acquires a right to such performance ... Although the general rule is that [t]he plaintiff, as assignee of the mortgage, [stands] in the shoes of his assignor, with the same rights ... unless there has been an express assumption of liability, the assignee is not liable to the debtor for liabilities incurred by the assignor in connection with the subject matter of the assignment ... As such, [i]n the absence of an express contract provision, an assignee generally does not assume the original responsibilities of the assignor, but he or she may be liable for breach of the terms of the assignment or for his or her failure to perform obligations of the assignor which he or she has assumed ... Therefore, an assignee of a contract takes it subject to all defenses which might have been asserted against the assignor ... but does not take it subject to affirmative claims against the assignor arising from the assignor’s prior conduct without express assumption of such liability by the assignee." (Citations omitted; emphasis omitted; internal quotation marks omitted.) Id.
1
Plaintiff’s Conduct
Although the plaintiff argues in a conclusory manner in its memorandum of law that the " [p]laintiff was not involved in the origination of the subject loan," the court notes that " a motion to strike challenges the legal sufficiency of a pleading and, consequently, requires no factual findings by the trial court ... [The court] construe[s] the [counterclaim] in the manner most favorable to sustaining its legal sufficiency ... Thus, [i]f facts provable in the [counterclaim] would support a cause of action, the motion to strike must be denied ... It is fundamental that in determining the sufficiency of [a counterclaim] challenged by a [plaintiff’s] motion to strike, all well-pleaded facts and those facts necessarily implied from the allegations are taken as admitted ..." Geysen v. Securitas Security Services USA, Inc., 322 Conn. 385, 398, 142 A.3d 227 (2016). " If any facts provable under the express and implied allegations in the [defendant’s counterclaim] support a cause of action ... the [counterclaim] is not vulnerable to a motion to strike." Bouchard v. People’s Bank, 219 Conn. 465, 471, 594 A.2d 1 (1991).
The plaintiff’s conclusory argument that it " was not involved in the origination of the subject loan" is improper for the court to consider on a motion to strike. " A speaking motion to strike is one improperly importing facts from outside the pleadings ... [They] have long been forbidden by our practice ..." (Citations omitted.) Mercer v. Cosley, 110 Conn.App. 283, 292 n.7, 955 A.2d 550 (2008). Accordingly, the issue before this court is whether the defendant has pleaded in the first through seventh counts of the revised counterclaim that the plaintiff participated in the alleged conduct.
This court disagrees with the plaintiff’s contentions that the first through seventh counts of the revised complaint are legally insufficient because they attempt to impose liability on the plaintiff for the loan originator’s conduct exclusively. These counts all contain allegations of the plaintiff’s conduct and not just the conduct of the loan originator.
The " first count" of the revised counterclaim (" residential mortgage fraud" ) alleges in paragraph four that the loan originator and the plaintiff " misled the legally unrepresented Defendant into a false sense of security so she would sign their intentionally drafted predatory Origination documents that led to her extreme financial and emotional detriment; as well as forging, fabricating and robosigning subsequent assignments, affidavits and notarizations ..." In paragraph sixteen, the defendant alleges that " she has irrefutable evidence of omitted, fraudulent, forged, and fabricated signatures on her TILA and HUD1A Disclosures, that represent a false representation of fact by [the loan originator and the plaintiff] that knew or should have known that they were conducting themselves in a criminal manner when they forged and omitted key material disclosure documents that would induce the Defendant to act, and did so to her detriment; the Defendant further asserts that she has retained an expert 3rd Party forensic graphologist witness willing to testify under oath to the extensive evidence of willful fraud alleged in these said documents." Based upon these allegations, the court disagrees with the plaintiff that the defendant only alleges conduct on behalf of the loan originator. The court declines to strike the " first count" of the revised counterclaim on that ground.
The " second count" of the revised counterclaim (" fraudulent non-disclosure" ) alleges in the first paragraph that the loan originator and the plaintiff " have knowingly and willfully violated fraudulent non-disclosure law pursuant to General Statutes 49-9a by making false representations of fact that they knew or should have known were false, and that the false representation was made to mislead and induce the Defendant to action, and did so to her detriment." Although it is unclear the precise nature of those statements, the plaintiff did not move to strike the " second count" of the revised counterclaim on that ground. Based upon the quoted allegation, the court disagrees with the plaintiff that the defendant only alleges conduct on behalf of the loan originator. The court declines to strike the " second count" of the revised counterclaim on that ground.
The " third count" of the revised counterclaim (" document fraud" ) alleges in the fourth paragraph that the plaintiff " knowingly and willfully fabricated and forged the Defendant’s mortgage documents, assignments." A reasonable inference to this allegation is that the defendant may be alleging that as a result of the plaintiff’s fraud, the plaintiff is not the holder of its note, and the mortgage cannot be foreclosed. " Counterclaims that address the making, validity and/or enforcement of a note or mortgage are proper in the context of a foreclosure action." (Citation omitted.) M.B. Financial Bank, N.A. v. Meriden Hotel Partners, LLC, Superior Court, judicial district of New Haven, Docket No. CV-11-6022600-S (August 31, 2012, Zemetis, J.); see also U.S. Bank, N.A. v. Blowers, 177 Conn.App. 622, 172 A.3d 837 (2012) (declining to adopt transaction test and affirming counterclaims that relate to making, validity and/or enforcement of note or mortgage in foreclosure action is proper inquiry), cert. granted, 328 Conn. 904, 177 A.3d 1160 (2018). Based upon this allegation, the court, therefore, disagrees with the plaintiff that the defendant only alleges conduct on behalf of the loan originator. The court declines to strike the " third count" of the revised counterclaim on that ground.
The " fourth count" of the revised counterclaim (" fraud in the inducement" ) alleges in the third paragraph that " fraud in the inducement occurred when the Defendant entered into the alleged mortgage agreement with [the loan originator] believing the representations that were made by [the loan originator] as true ..." The defendant later alleges in paragraph seven that the plaintiff also made " misleading statements" that " intended to mislead the Defendant by reason of inducing her into signing a predatory and illegal loan ..." The court, therefore, disagrees with the plaintiff’s contention that the " fourth count" of the revised counterclaim only alleges conduct of the loan originator. The court declines to strike the " fourth count" of the revised counterclaim on that ground.
The " fifth count" of the revised counterclaim (" fraud in the factum" ) alleges in the fourth paragraph that the loan originator and the plaintiff made " intentional, knowing and willful" misstatements that " intended to mislead the Defendant by reason of inducing her into signing a predatory and illegal loan they knew or should have known, was going to fail ..." The court, therefore, disagrees with the plaintiff’s contention that the " fifth count" of the revised counterclaim only alleges conduct of the loan originator. The court declines to strike the " fifth count" of the revised counterclaim on that ground.
The " sixth count" of the revised counterclaim (" breach of contract" ) alleges that the loan originator made statements to induce the defendant into executing the note and mortgage, which the loan originator and the plaintiff breached. The " seventh count" of the revised counterclaim (" illegality" ) alleges that the loan originator and the plaintiff made fraudulent and misleading statements to induce the defendant to sign the mortgage documents, by for example, as alleged in the second paragraph, omitting " key mandatory pre-closing disclosures," " knowingly and willfully [using] infamous foreclosure mills, document fabrication companies, and unqualified persons without first-hand knowledge," " conspir[ing] and us[ing] the U.S. Mail to extort illegal payments from the defendant" and " [bringing] fraud before the court with an alleged photocopy of the Defendant’s Original note to claim they were real parties of interest with standing to foreclosure." The court, therefore, disagrees with the plaintiff’s contention that the sixth and seventh counts of the revised complaint only allege conduct of the loan originator. The court declines to strike the sixth and seventh counts of the revised counterclaim on that ground.
B
Statute of Limitations
The plaintiff simultaneously moves to strike the following counts of the revised counterclaim, " first count" (" residential mortgage fraud" ), " second count" (" fraudulent nondisclosure" ), " third count" (" document fraud" ), " fourth count" (" fraud in the inducement" ), " fifth count" (" fraud in the factum" ), " sixth count" (" breach of contract" ), " seventh count" (" illegality" ), " ninth count" (" CUTPA" ) and " tenth count" (" RESPA" ), on the ground the counts are barred by the applicable statute of limitations. As to the first through seventh counts of the revised counterclaim, the plaintiff explains that " General Statutes [§ ] 52-577 imposes a two-year limitations period for fraud claims. Here, Defendant’s claims date back to the origination of the subject loan, which took place nearly twelve (12) years before Defendant filed her answer and, therefore, they are barred by the statute of limitation." (Footnote omitted.). As to the ninth and tenth counts of the revised complaint, the plaintiff argues that the conduct would be barred by the applicable three-year statute of limitations.
" [O]rdinarily, [a] claim that an action is barred by the lapse of the statute of limitations must be pleaded as a special defense, not raised by a motion to strike." (Citation omitted; internal quotation marks omitted.) Greco v. United Technologies Corp., 277 Conn. 337, 344 n.12, 890 A.2d 1269 (2006). " [T]here are two exceptions to that holding. Those exceptions relate to situations in which a motion to strike, filed instead of a special defense of a statute of limitations, would be permitted." Girard v. Weiss, 43 Conn.App. 397, 415, 682 A.2d 1078, cert. denied, 239 Conn. 946, 686 A.2d 121 (1996). " The first is when [t]he parties agree that the complaint sets forth all the facts pertinent to the question [of] whether the action is barred by the [s]tatute of [l]imitations and that, therefore, it is proper to raise that question by [a motion to strike] instead of by answer." (Citation omitted; internal quotation marks omitted.) Forbes v. Ballaro, 31 Conn.App. 235, 239, 624 A.2d 389 (1993). The second exception " exists ... when a statute gives a right of action which did not exist at common law, and fixes the time within which the right must be enforced, the time fixed is a limitation or condition attached to the right- it is a limitation of the liability itself as created, and not of the remedy alone." (Citation omitted; internal quotation marks omitted.) Greco v. United Technologies Corp., supra .
The first through seventh counts of the revised counterclaim, according to the plaintiff, all implicate the tort statute of limitations, General Statutes § 52-577. Therefore, the second Greco exception is not at issue before this court because torts are actionable at common law. The issue, therefore, is whether the first Greco exception applies and allows this court to consider whether to strike the first through seventh counts of the revised counterclaim because all parties agree that those counts plead all the necessary facts for the court to adjudicate whether the conduct at issue in those counts is barred by the applicable statute of limitations.
" In the absence of an agreement that every relevant fact is before the court, a motion to strike is a procedurally inadequate mechanism to assert the statute of limitations. Rather, a motion for summary judgment, filed at the appropriate time is preferable. ‘Facts that are not alleged in a complaint may be added to the procedural mix and facts in avoidance of the statutory time limitation of action can be considered in a motion for summary judgment, whereas they cannot be considered in a motion to strike.’ Girard v. Weiss, 43 Conn.App. 397, 416, 682 A.2d 1078, 1087 (1996)." Horner v. Harford Roman Catholic Diocesan Corp., Superior Court, judicial district of Waterbury, Complex Litigation Docket, Docket No. X10-CV-17-6034898-S (October 25, 2017, Lager, J.) (65 Conn.L.Rptr. 444, 445).
The plaintiff’s argument to strike the first through seventh count of the revised counterclaim does not address whether the plaintiff and defendant agree that all relevant facts have been pleaded in the counts so that the court could adjudicate whether the first Greco exception (Forbes exception) applies. See Horner v. Hartford Roman Catholic Diocesan Corp., supra, 65 Conn.L.Rptr. 444 (declining to apply the Forbes exception because the plaintiff did not agree that all of the applicable dates were contained in his complaint); Gianetti v. Neigher, Superior Court, judicial district of Stamford, Docket No. CV-15-60253226-S (October 23, 2017, Jacobs, J.) (declining to apply the Forbes exception and explaining the alternative would " deny the plaintiff the opportunity to affirmatively plead avoidance of the statute of limitations" ). In the present case, the defendant did not file a memorandum of law in opposition to the motion to strike and did not address, in her pleadings or at oral argument, whether all of the relevant dates were included in the first through seventh counts of the revised counterclaim so the court may adjudicate whether the statute of limitations may bar her from adjudicating those counts. Without the parties’ agreement that all of the relevant dates are contained in the first through seventh counts of the revised counterclaim, the first Greco exception (Forbes exception) does not apply to permit this court to adjudicate the plaintiff’s statute of limitations arguments. The court declines to strike the first through seventh counts of the revised counterclaim on the ground of the statute of limitations.
On the other hand, the ninth and tenth counts of the revised counterclaim, according to the plaintiff, implicate a three-year statute of limitations under applicable CUPTA and RESPA statutes. The plaintiff cites Wells Fargo Bank, N.A. v. Caldrello, Superior Court, judicial district of New London, Docket No. CV-12-6014902-S (January 5, 2016, Cosgrove, J.), which explains how CUPTA and RESPA statutes created causes of action that were not available at common law but are each subject to three-year statutes of limitations. This court, therefore, concludes that the second Greco exception applies, to the " ninth count" (" CUTPA violation" ) and the " tenth count" (" RESPA violation" ) of the revised counterclaim.
As to the CUPTA count (" ninth count" of the revised counterclaim), the defendant only alleges conduct related to the 2005 loan origination; therefore, the defendant’s action on that conduct expired three years later in the year 2008. That count, however, suggests that the plaintiff’s action that violated CUPTA occurred after the loan origination. In the first paragraph of the " ninth count" of the revised counterclaim, the defendant alleges that the loan originator and the plaintiff " knowingly and willfully violated CUTPA by way of the alleged false representation of fact that was intentionally made by reason of fraud and forgeries on Defendant’s key material mortgage documents the defendant was induced into signing, and further assignments ..." The court is unable to determine from the defendant’s pleadings in the " ninth count" of the revised complaint the date of the plaintiff’s assignment at issue that allegedly violated CUTPA. For these reasons, the court declines to strike the " ninth count" of the revised complaint on the ground of the statute of limitations.
The RESPA count in the revised complaint (" tenth count" ), however, only alleges conduct of the loan originator and plaintiff at the date of the closing. Specifically, the defendant alleges in the ninth paragraph that the loan originator and the plaintiff " violated RESPA laws by: (1) failing to have the mandatory ‘3 signature’ from 3rd party closing witness present at closing, then forging a ‘squiggle mark’ signature without proper designations after the fact that ‘someone’ was there, (2) omitting and withholding the mandatory disclosures prior to closing." In the eleventh paragraph of this count, the defendant alleges the closing occurred on November 5, 2005. On December 12, 2016, the defendant filed her answer, special defenses and counterclaim, alleging RESPA violation, which the defendant revised on October 25, 2017 pursuant to the plaintiff’s request to revise. The court agrees with the plaintiff that the RESPA counterclaim, which may relate back to the December 12, 2016 filing, is beyond the three-year statute of limitations for a RESPA action, which expired on November 5, 2008. For this reason, the RESPA counterclaim is barred by the statute of limitations. The court grants the plaintiff’s motion to strike the " tenth count" of the revised counterclaim.
C
Conduct After Note and Mortgage Executed
The plaintiff moves to strike the " twelfth count" (" civil conspiracy" ) and the " thirteen count" (" civil RICO violations" ) of the revised counterclaim on the ground the counts contain allegations of conduct after the note and loan were executed and, therefore, these counts are legally insufficient because they do not relate to the making, validity or enforcement of the note. The court disagrees with the plaintiff’s argument on both counts.
The " twelfth count" (" civil conspiracy" ) of the revised counterclaim alleges in the first paragraph that the loan originator and plaintiff made " false representations of fact" " to mislead and induce the Defendant to action." Specifically, in the third paragraph, the defendant alleges that the loan originator and the plaintiff " knowingly and willfully made a concerted effort" " that induced the Defendant to enter into a harmful and predatory mortgage agreement ..." Based upon these allegations, the court disagrees with the plaintiff’s contention that the " twelfth count" of the revised counterclaim only alleges conduct that occurred after the loan was signed. The court declines to strike the " twelfth count" of the revised counterclaim on that ground.
The " thirteenth count" (" civil RICO violations" ) of the revised counterclaim essentially alleges that, together, the loan originator and plaintiff’s efforts to collect the defendant’s debt secured by the mortgage violated civil RICO laws. The plaintiff argues that the Superior Court’s decision in Mercantile Bank v. Hurowitz, Superior Court, judicial district of New Haven, Docket No. CV-95-0381091-S (May 2, 2000, Celotto, J.T.R.) stands for the proposition that a counterclaim alleging a civil RICO violation does not, as a matter of law, relate to the loan transaction and is, therefore, legally improper to allege in a foreclosure action.
In Mercantile, the defendant alleged that a " written stipulation" between the parties allowed the defendant to provide " forbearance payments" and payments to " reinstate and refinance the note." Id. The court concluded that special defenses were premised " upon the mistaken assumption that the parties’ written stipulation agreement worked a modification of the note and mortgage payments." Id. The Mercantile court found " [t]he written stipulation agreement did not work a modification of the subject note and mortgage payments." Id. As a result, the Mercantile court found that " [e]ach of the counts in the counterclaim [including the RICO counterclaim] attack[ed] an act or procedure of the plaintiff-lienholder as each alleges that the plaintiff-lienholder failed to refinance and reinstate the note and mortgage." Id. Accordingly, the Mercantile court found that " [n]one of the claims made in the sixteen counts of the counterclaim assert[ed] any connection with the subject of the foreclosure action and as such ... [none of the claims] [arose] out of the same transaction as the foreclosure action." (Citation omitted; internal quotation marks omitted.) Id.
Unlike the defendant in Mercantile, our defendant pleads conduct allegedly in violation of RICO, which may have occurred before the loan origination. For example, the defendant alleges in paragraph five of the " thirteenth count" of the revised complaint that the loan originator and plaintiff " are also guilty of fraud by reason of predatory lending practices such as targeting Defendant as naive subprime minority, falsifying documents and using extortion tactics to force Defendant to provide more collateral or to turn over asserts for which [the loan originator and plaintiff] are not entitled, they are also guilty of civil RICO violations, and therefore are not entitled to foreclosure or relief." Although, as argued by the plaintiff, the defendant does allege in the " thirteenth count" that the plaintiff’s collection practices also constitute civil RICO violations, this count also alleges that the conduct of the plaintiff, namely, its predatory lending practices and falsifying documents, constitute civil RICO violations. For that reason, the court concludes that the pleadings or reasonable inferences from allegations in the " thirteen count" allege conduct on behalf of the plaintiff that relate to the making, validity or enforcement of the note at issue in the complaint. Accordingly, the court declines to strike the " thirteenth count" of the revised counterclaim on the ground the alleged conduct implicating RICO does not relate to the making, validity or enforcement of the note or mortgage. The motion to strike the " thirteenth count" of the revised counterclaim is denied.
D
Equitable Estoppel
The plaintiff moves to strike the " eighth count" (" equitable estoppel" ) of the revised counterclaim on the ground, inter alia, the count is legally insufficient because equitable estoppel is not a cause of action but a special defense.
" [U]nder Connecticut law, ‘estoppel is generally not considered a cause of action, but rather is pleaded as a special defense.’ Covey v. Comen, 46 Conn.App. 46, 48-49 n.5, 698 A.2d 343 (1997) (treating defendants’ cause of action asserting estoppel as a special defense rather than as a counterclaim because estoppel improperly pleaded as a cause of action); see also Dickau v. Glastonbury, 156 Conn. 437, 242 A.2d 777 (1968) (equitable estoppel is available only for protection and cannot be used as a weapon of assault). In recognition of this pleading procedure, several Superior [court decisions] have stricken counts of equitable estoppel for improperly attempting to set forth a cause of action. See, e.g., GMAC Mortgage, LLC v. McCormack, Superior Court, judicial district of New London, Docket No. CV-08-5009019-S (September 12, 2011, Devine, J.) (the defendants’ counterclaim for equitable estoppel fails to state a cause of action for affirmative relief from the plaintiff and consequently, must be stricken); Brown v. Bienas, Superior Court, judicial district of New London, Docket No. CV-563212 (April 1, 2003, Hurley, J.T.R.) (granting motion to strike because equitable estoppel does not constitute a proper cause of action)." Nationwide Mutual Ins. Co. v. Pasiak, Superior Court, judicial district of Stamford, Complex Litigation Docket, Docket No. X08-CV-08-4015401-S (November 30, 2011, Brazzel-Massaro, J.) (striking equitable estoppel counterclaim as improperly pleaded because it is " not an affirmative claim for relief," but rather " is to be properly raised as a special defense" ). See Bank of Boston Connecticut v. Balbrae Associates, Ltd., Superior Court, judicial district of Hartford-New Britain at Hartford, Docket No. CV-371650-S (January 25, 1991, Hennessey, J.) (citing Dickau v. Glastonbury, supra, and striking equitable estoppel as improperly pleaded as a counterclaim).
For these reasons, the " eighth count" of the revised counterclaim purporting to allege an " equitable estoppel" counterclaim against the plaintiff is legally insufficient, and the court grants the motion to strike the " eighth count" of the revised counterclaim.
E
Creditors’ Collection Practices Act
The plaintiff moves to strike the " eleventh count" of the revised complaint, which alleges violations of General Statutes § 36a-646, the Creditors’ Collection Practices Act, on the ground of legal insufficiency. The plaintiff contends that this count does not relate to the making, validity or enforcement of the note, and its allegations are conclusory and lack specificity as to the nature of the alleged wrongdoing.
As mentioned earlier, the U.S. District Court in Aviles v. Wayside Auto Body, Inc., supra, 49 F.Supp.3d 236 found that contrary to earlier decisions of the Superior Court, General Statutes § 36a-648(a) enacted in 2007, provides a person with a private right of action under the Creditors’ Collection Practices Act. The issue before this court, therefore, is whether the defendant’s allegations relate to the making, validity or enforcement of the note and are pleaded with specificity and are not conclusory.
Even if a counterclaim alleging violation of the Creditors’ Collection Practices Act may be brought against the plaintiff in a mortgage foreclosure action; see also Fleet National Bank v. Squillacote, Superior Court, judicial district of New Britain, Docket No. CV-99-0497487-S (October 30, 2003, Cohn, J.) (finding under different facts and claims that " the manner of collection of [the subject note] in default [did] impact the enforcement of the note" ); this court need not address whether such a claim is viable in a foreclosure action because it agrees with the plaintiff that the defendant’s pleadings are conclusory. For example, the defendant pleads in the first paragraph of the " eleventh count" of the revised counterclaim that the loan originator and the plaintiff " have knowingly and willfully violated FDCPA § 36a-646 Violation by making false representations of fact that they knew or should have known were false, and that the false representation was made to mislead and induce the Defendant to action, and did so to her detriment." The defendant does not, however, specify what those false statements of fact were in the " eleventh count" of the revised counterclaim. Later, the defendant pleads in the second paragraph of the " eleventh count" of the revised complaint that the loan originator and the plaintiff violated the Creditors’ Collection Practices Act by " knowingly, intentionally, and willfully committing prohibited acts ... including by not limited to abusive, harassing, fraudulent, deceptive and misleading representation, device or practice or attempt to collect the alleged debt." The defendant does not, again, specify what those prohibited acts were in the " eleventh count" of the revised counterclaim. For the reason of conclusory allegations, the " eleventh count" of the revised counterclaim is legally insufficient. The court grants the motion to strike the " eleventh count" of the revised counterclaim.
CONCLUSION
For all of the foregoing reasons, the plaintiff’s motion to strike is granted in part and denied in part. The court grants the motion to strike the defendant’s revised special defenses two (" fraudulent non-disclosure" ), three (" document fraud" ), five (" fraud in the factum" ), six (" breach of contract" ), seven (" illegality" ), eight (" equitable estoppel" ), nine (" CUTPA" ), ten (" RESPA), eleven (Creditors’ Collection Practices Act (CCPA) ), twelve (" civil conspiracy" ) and thirteen (" RICO" ). The court grants the motion to strike the " eighth count" (" equitable estoppel" ), " tenth count" (RESPA), and " eleventh count" (Creditors’ Collection Practices Act) of the defendant’s revised counterclaim.
The court denies the motion to strike special defense one (" residential mortgage fraud" ) and special defense four (" fraud in the inducement" ). The court denies the motion to strike the " first count" (" residential mortgage fraud" ), " second count" (" fraudulent non-disclosure" ), " third count" (" document fraud" ), " fourth count" (" fraud in the inducement" ), " fifth count" (" fraud in the factum" ), " sixth count" (" breach of contract" ), " seventh count" (" illegality" ), " ninth count" (CUTPA), " twelfth count" (civil conspiracy) and " thirteenth count" (civil RICO violations) of the revised counterclaim.
SO ORDERED.
" [A] motion to strike is not the proper vehicle for elimination of irrelevant, immaterial or otherwise improper allegations. The proper vehicle would be a request to revise." (Internal quotation marks omitted.) Doe No. 2 v. Norwich Roman Catholic Diocesan Corp., Superior Court, judicial district of Hartford, Complex Litigation Docket, Docket No. X07-CV-12-5036425-S (July 8, 2013, Dubay, J.) (56 Conn.L.Rptr. 460, 463); see Regal Steel, Inc. v. Farmington Ready Mix, Inc., 36 Conn.Supp. 137, 139-40, 414 A.2d 816 (1980). " [T]he proper way to cure any confusion [regarding the complaint] is to file a [request] to revise, not a motion to strike the entire complaint ... If a request to revise had been granted and complied with, the defendants would then have been in a position to move to strike any count of the plaintiff’s revised complaint pertaining to their respective liabilities for which the plaintiff was unable to allege the necessary prerequisites." (Citation omitted; footnote omitted.) Rowe v. Godou, 209 Conn. 273, 279, 550 A.2d 1073 (1988). In the present case, the plaintiff had an opportunity to file a request to amend the revised answer, special defenses, and counterclaims to eliminate improper allegations, but declined to do so. See Practice Book § 10-6 (discussing order of pleadings). Practice Book § 10-7 provides: " In all cases, when the judicial authority does not otherwise order, the filing of any pleading provided for by the preceding section will waive the right to file any pleading which might have been filed in due order and which precedes it in the order of pleading provided in that section." In the present action, the plaintiff is U.S. Bank Trust, N.A. as Trustee for LS9 Master Participation Trust, and one defendant is Lesley Dallas (hereinafter " the defendant" ). (The other named defendants allegedly hold encumbrances on Ms. Dallas’ property). Unless a party follows the rules of the court and properly adds another party to this case, the court will assess liability between the plaintiff and the defendant, Lesley Dallas, on the complaint and counterclaims at the time of trial.