Connecticut Cases January 04, 2019: Ocwen Loan Servicing, LLC v. Martinaj

Case Description

UNPUBLISHED OPINION

OPINION

PECK, JTR

The defendant, Artan Martinaj, has moved to open and vacate a judgment of strict foreclosure against him, entered on October 3, 2016, on the grounds that he was never served with process, and therefore, the court lacked in personam jurisdiction rendering the judgment against him void.

The foreclosure action was commenced by the original plaintiff, Ocwen Loan Servicing, LLC (Ocwen), on August 7, 2015, against the defendants, Artan Martinaj and his brother Avni Martinaj, to foreclose on a property then known as 375 Goodwin Street in East Hartford, Connecticut (the property). The complaint alleges that on October 20, 2005, the defendants owned the property at 375 Goodwin Street, East Hartford, particularly described in a Schedule A appended to the complaint. It further alleges that Artan deeded his interest to Avni in a quitclaim deed dated June 14, 2013, and recorded in the East Hartford land records on September 26, 2013, at volume 3422, page 155. The Schedule A to the quitclaim deed was corrected on March 25, 2014, and recorded in the East Hartford land records on March 27, 2014, at volume 3458, page 244. The complaint further alleges that, on or about October 20, 2005, Artan executed and delivered to IndyMac Bank, F.S.B. (IndyMac Bank), a note for a loan in the original principal amount of $ 220, 000. To secure that note, Artan and Avni, executed and delivered to Mortgage Registration Systems, Inc. (MERS), as nominee for IndyMac Bank, a mortgage on the property dated October 20, 2005, and recorded in the East Hartford land records on October 21, 2005, at volume 2650, page 158. Thereafter, MERS assigned the mortgage to Ocwen on March 20, 2015. The assignment was recorded on April 10, 2015, in the East Hartford land records, at volume 3527, page 40. Subsequently, on February 29, 2016, Ocwen assigned the mortgage to Nationstar Mortgage, LLC (Nationstar). Pursuant to that assignment, a motion to substitute Nationstar as the plaintiff in this action was filed on March 16, 2016, and granted by the court on March 28, 2016. The complaint further alleges that Avni is "the owner of the equity of redemption ... and, on information and belief, is in possession of the Property."

The summons listed the address of Artan as 375 Goodwin Street, East Hartford, Connecticut, and the address of Avni as 9 West Street, New Britain, Connecticut. The original return of service, filed in court on August 7, 2015, is dated July 31, 2015, and states that Avni was served with process, in hand, on July 31, 2015, at 2615 Ellington Road, South Windsor, and that Artan was served at his usual place of abode, 2615 Ellington Road, South Windsor, on the same date. A supplemental return, filed in court on September 10, 2015, indicates that abode service was made on both Artan and Avni at 2615 Ellington Road, South Windsor, on September 9, 2015. Both returns include a statement that, upon investigation, the marshal discovered that both defendants resided at that address rather than the addresses listed on the summons. On November 27, 2015, a default was entered against Artan for failure to appear. The motion for default was certified by the plaintiff’s counsel as mailed to Artan at both 2615 Ellington Road, South Windsor and 375 Goodwin Street, East Hartford.

On March 20, 2018, 454 days after title vested and 534 days after the entry of the judgment of strict foreclosure, an appearance was filed by counsel of behalf of Artan along with a motion to open the judgment. An evidentiary hearing was held by this court on the motion to open and vacate the judgment on May 16, 2016. Thereafter, post-hearing memoranda were filed and oral argument was heard on October 4, 2018. The witnesses at the hearing on the motion to open were State Marshall Barbara Coffey, Artan Martinaj and Ohrida Martinaj. The documentary evidence entered as full exhibits at the hearing included the marshal’s return and supplemental return of service, property tax payment records for 355 Goodwin Street, East Hartford for the years 2015 and 2016; property ownership records concerning 2615 Ellington Road, South Windsor, for the year 2015, and concerning 355, 365 and 375 Goodwin Street, East Hartford, for the years 2013-2017; the underlying note and mortgage; Artan’s voter information records from the State of Connecticut Secretary of the State; certain State of Connecticut motor vehicle records concerning Artan; surveys of the property at 375 Goodwin Street, East Hartford, dated August 31, 2006, and recorded in the East Hartford land records in 2011; the quitclaim deed and correcting quitclaim deeds exchanged between Artan and Avni concerning 375 Goodwin Street, East Hartford, recorded in the East Hartford land records on September 26, 2013, March 27, 2014 and March 30, 2015, respectively; the quitclaim deed and correcting quitclaim deeds exchanged between Artan and Avni concerning 365 Goodwin Street, East Hartford, recorded in the East Hartford land records on September 26, 2013, March 27, 2014 and April 20, 2015; the quitclaim deeds exchanged between Artan and Avni concerning 355 Goodwin Street, East Hartford, recorded in the East Hartford land records on April 4, 2008 and a subsequent quitclaim deed exchanged between Artan and Avni, dated June 14, 2013; and the appraisal of 375 Goodwin Street, East Hartford as of August 31, 2016, filed in support of the motion for judgment of strict foreclosure as docket entry # 114.

Based on the foregoing credible and essentially uncontested evidence, the court finds the following facts. Artan signed the note for 375 Goodwin Street, East Hartford, in the amount of $ 220, 000, on October 20, 2005, to IndyMac Bank, F.S.B. The note was secured by a mortgage signed by both defendants on October 20, 2005, and recorded October 21, 2005, in volume 2650 at page 158 of the East Hartford land records. The mortgage was in favor of MERS as Nominee for IndyMac Bank, F.S.B. Shortly thereafter, Artan and his brother, Avni, began to subdivide the property. A survey map entitled "A First Survey Prepared for a First Cut of Property of Artan and Avni Martinaj, 375 Goodwin Street, East Hartford, Connecticut," was filed in the East Hartford land records as Map No. 2873, on March 26, 2008. The parcel created by the first cut, pursuant to the survey map, was quitclaimed by both brothers to themselves on April 1, 2008, and recorded in volume 3001, page 327, of the East Hartford land records on April 4, 2008. See Defendant’s Exhibit K. This cut became known as 355 Goodwin Street. Thereafter, on June 14, 2013, "355 Goodwin Street" was quitclaimed by Artan and Avni to Artan alone, and was recorded in volume 3422, page 146, of the East Hartford land records on September 26, 2013. See id. The property identified as 355 Goodwin Street has its own assessors card. See Defendant’s Exhibit G. A second survey, titled "A Dependent Resurvey Prepared for a Two-Lot Subdivision of Property of Artan & Avni Martinaj 375 Goodwin Street, East Hartford, Connecticut," was recorded in the East Hartford land records on March 10, 2011. This map shows another subdivided piece, which became known as 365 Goodwin Street. The brothers subsequently quitclaimed 365 Goodwin Street to Avni on June 14, 2013, recorded on September 26, 2013, at volume 3422, page 153, and then corrected the Schedule A by way of a "correcting quitclaim deed," dated March 25, 2014, and recorded on March 27, 2014, at volume 3458, page 247. Subsequently, they further corrected the Schedule A by way of a second "correcting quitclaim deed," on March 30, 2015, recorded in the East Hartford land records on April 20, 2015, volume 3528, page 295. The Schedule A, incorporated in the latter "correcting quitclaim deed" specifically references the survey map on file in the East Hartford land records and the relationship of 365 Goodwin Street to both 355 and 375 Goodwin Street. Finally, the largest piece of the subdivided property, called 375 Goodwin Street, was quitclaimed by both brothers to Avni alone on March 30, 2015, and recorded on the East Hartford land records, on April 20, 12015, at volume 3528, page 298.

The three parcels comprising the property, as subdivided, 355, 365 and 375 Goodwin Street, East Hartford, were established as separate, discrete pieces and properties by the Town of East Hartford as evidenced in the land records, previously referenced, and the assessor’s records and tax records, before the commencement of the foreclosure action, on or about July 31, 2015. See Defendant’s Exhibits C, G, H, I, K, L and M. In 2015, the original mortgage was assigned to Ocwen Loan Servicing, LLC, pursuant to an assignment dated March 20, 2015, and recorded April 10, 2015, then assigned to Nationstar, LLC dated February 29, 2016, and recorded in the East Hartford land records on April 4, 2016.

At the hearing on the motion to open, the state marshal, Barbara Coffey, testified that when she served Avni, upon inquiry, he informed her that Artan also resided at 2615 Ellington Road, South Windsor. Based solely upon that information, Coffey left the papers for Artan with Avni. Artan was never informed by Avni or anyone else that Avni accepted papers on Artan’s behalf or that there was an attempt to serve Artan with a summons and complaint seeking foreclosure of the property at 375 Goodwin Street, East Hartford. Coffey’s search of the South Windsor tax assessor’s records revealed that Avni and his wife Vera were the sole owners of 2615 Ellington Road, South Windsor. Based upon Coffey’s testimony and the full exhibits presented as evidence at the hearing, there is no doubt that Avni resided at 2615 Ellington Road, South Windsor, at the time of service. There is no evidence, however, that Artan has ever resided at 2615 Ellington Road, South Windsor; nor is there any evidence that has he has ever had an ownership interest in that property.

Artan testified that at the time of commencement of the foreclosure action, and at least since 2012, he has continuously and exclusively resided at the property known as 355 Goodwin Street, East Hartford, with his wife, mother and four children. Artan and Avni have not spoken since 2010. Artan has never lived at 2615 Ellington Road, South Windsor, and has never been there. He was never registered to vote there, never registered a car there, did not pay taxes there and has never received mail there. Artan and Avni do not speak to each other and, although they jointly owned what was known as 375 Goodwin Street at the time the underlying note and mortgage were executed, they subsequently subdivided the property pursuant to an agreement to divide all their jointly owned property both in Connecticut and in their native Albania. The original note underlying the mortgage was in Artan’s name alone because of Avni’s immigration status. Subsequently, pursuant to the brothers’ agreement, the originally mortgaged parcel known as 375 Goodwin Street was subdivided into three parcels, 375, 365 and 355 Goodwin Street. Artan retained 355 Goodwin Street, where he and his family continue to reside and Avni agreed to take other properties, including the other two subdivided parcels, 365 and 375 Goodwin Street, East Hartford, in his name. The brothers did not obtain permission from the bank for Avni to assume the note and mortgage. The court finds Artan’s testimony to be credible and fully supported by the documentary evidence.

The pleadings and exhibits reveal that the foreclosure complaint references and appends the Schedule A property description of 375 Goodwin Street, East Hartford, as it existed on the date of the underlying mortgage on October 20, 2005. The complaint further alleges that Artan deeded his interest to Avni in a quitclaim deed dated June 14, 2013, and recorded in the East Hartford land records on September 26, 2013, at volume 3422, page 155, and also states that the Schedule A property description appended to that quitclaim deed was purportedly corrected on March 25, 2014, and recorded in the East Hartford land records on March 27, 2014, at volume 3458, page 244. The court notes, however, that although the Schedule A appended to the original mortgage deed and the Schedule A appended to the June 14, 2013 quitclaim deed between Artan and Avni are different, the Schedule A appended to the purported correcting quitclaim deed between Artan and Avni dated March 25, 2014, is exactly the same as the Schedule A appended to the original mortgage deed and the underlying complaint. Significantly, what is omitted from the complaint is that a second "correcting" quitclaim deed was executed between Artan and Avni concerning 375 Goodwin Street, on March 30, 2015, appended to which is a Schedule A with the now current and substantially different description of the property constituting 375 Goodwin Street, East Hartford, as referenced in the August 31, 2006, survey. See Defendant’s Exhibit J, Plaintiff’s Exhibit 8 and Defendant’s Exhibit M.

Although the underlying foreclosure complaint was served on Avni July 31, 2015, subsequent to the April 20, 2015 filing of the second correcting quitclaim deed on the East Hartford land records, the plaintiff apparently failed to update its title search of the property prior to commencing the foreclosure action. Further, upon review of the various deeds relating to 375 Goodwin Street, East Hartford, it is now apparent that the appraisal of the property dated August 31, 2016, submitted in support of the plaintiff’s motion for judgment of strict foreclosure on September 16, 2016, was based on the smaller subdivided parcel which now constitutes 375 Goodwin Street, and not the larger parcel constituting the property described in the "Exhibit A" to the mortgage deed and the Schedule A appended to the foreclosure complaint. Thus, the appraisal incorrectly established the market value of the property subject of the mortgage as $ 202, 000, a valuation which is no doubt substantially less than the likely market value of the larger parcel subject of the mortgage.

General Statutes § 49-15(1)(a) provides in relevant part that "[a]ny judgment foreclosing the title to real estate by strict foreclosure may, at the discretion of the court rendering the judgment ... be opened and modified, notwithstanding the limitation imposed by section 52-212a ... provided no such judgment shall be opened after the title has become absolute in any encumbrancer except as provided in subdivision (2) of this subsection." General Statutes § 49-15(2) provides in relevant part that "[a]ny judgment foreclosing the title to real estate by strict foreclosure may be opened after title has become absolute in any encumbrancer upon agreement of each party to the foreclosure action who filed an appearance in the action and any person who acquired an interest in the real estate after title became absolute in any encumbrancer, provided ... [that] such judgment may not be opened more than four months after the date such judgment was entered or more than thirty days after title became absolute in any encumbrancer, whichever is later ..." As for a title becoming absolute, the court in Myrtle Mews Assn., Inc. v. Bordes, 125 Conn.App. 12, 15, 6 A.3d 163 (2010), found that "the title became absolute in the plaintiff because the defendant neither redeemed the property nor filed a motion to open until after the passing of the law days."

Notwithstanding General Statutes § 49-15, if the court that rendered a judgment of strict foreclosure lacked jurisdiction over a party then this court has jurisdiction to grant a motion to open. Deutsche Bank National Trust Co. v. McKeith, 156 Conn.App. 36, 41-42, 111 A.3d 545 (2015). "It is axiomatic ... that a court cannot render a judgment without first obtaining personal jurisdiction over the parties. No principle is more universal than that the judgment of a court without jurisdiction is a nullity ... Such a judgment ... may always be challenged ... [A] defect in process ... implicates personal jurisdiction." (Internal quotation marks omitted.) Highgate Condominium Assn., Inc. v. Miller, 129 Conn.App. 429, 435, 21 A.3d 853 (2011). Thus, "a judgment of strict foreclosure may be opened only upon a finding that the court lacked jurisdiction over either the person or the case at the time the judgment of strict foreclosure was entered." Id. It is a general rule that although "a judgment of strict foreclosure ordinarily cannot be opened after the law day has passed, the judgment can be attacked on the ground that the court lacked jurisdiction over the party challenging it." Argent Mortgage Co., LLC v. Huertas, 288 Conn. 568, 576, 953 A.2d 868 (2008).

For all the foregoing reasons, Artan has established by substantial evidence that he was never served in any manner with process in this foreclosure action. Further, he was not at any time subject to service of process at 2615 Ellington Road, South Windsor. A default was granted against Artan by the court for failure to appear on November 27, 2015. A judgment of strict foreclosure was entered on October 3, 2016, with the law days commencing on December 19, 2016. Both the motion for judgment of strict foreclosure and the notice of judgment of strict foreclosure were mailed to Artan at 375 Goodwin Street, East Hartford, the property address, and 2615 Ellington Road, South Windsor, Avni’s address. Because Artan quitclaimed whatever interest he had in what is now known as 375 Goodwin Street, East Hartford, on June 14, 2013, and he does not receive mail at that address, the court finds that neither document was received by Artan. Further, the court is persuaded that the property appraised for $ 202, 000 (Defendant’s Exhibit E), and filed in support of the motion for judgment of strict foreclosure (docket entry # 114), is the subdivided parcel now known as 375 Goodwin Street, East Hartford, and is a much smaller parcel than the one subject to the underlying note and mortgage, executed in 2005, as described in the Schedule A to the Open End Mortgage Deed, subject of the foreclosure action. See Plaintiff’s Exhibit 8, and Defendant’s Exhibits J and M.

CONCLUSION

Because the court lacked personal jurisdiction over Artan at the time of the entry of the judgment of strict foreclosure due to insufficient service of process, the judgment of strict foreclosure against him is a nullity, and therefore, is void. Accordingly, for this reason, the motion to reopen and vacate the judgment of strict foreclosure as to him is hereby granted.

---------

Notes:

For the sake of simplicity, hereinafter, the defendants will be referenced to as Artan and Avni.

See Defendant’s Exhibit E.

The March 30, 2015 quitclaim deed, recorded on April 20, 2015, corrects the land description in the Schedule A appended to two otherwise identical previous deeds, recorded on September 16, 2013 and March 27, 2014, respectively. See Defendant’s Exhibit L. Notably, a correcting quitclaim deed for the property at 375 Goodwin Street, East Hartford, in its subdivided form, was also recorded in the East Hartford land records on April 20, 2015, before the commencement of this foreclosure action on or about July 31, 2015, and long before the foreclosure appraisal date of August 31, 2016. See Defendant’s Exhibit M.

Interestingly, the appraisal, Defendant’s Exhibit E, page 1 of 6, references the volume and page of the East Hartford land records with the current property description of 375 Goodwin Street, East Hartford, as subdivided, stating that the legal description upon which the appraisal is based begins at volume 3528, page 298. This volume and page reference contains the property description as corrected in the second "correcting" quitclaim deed of March 30, 2015, between Artan and Avni. A simple comparison of this description with the Schedule A appended to the complaint and/or the mortgage note would have revealed the substantial differences in these descriptions and constitutes, a gross error on the part of the appraiser.

See Defendant’s Exhibit M.

---------