City Nat. Bank of Connecticut v. Traffic Engineering Associates, Inc.

• Decision Date: 19 March 1974
• Citation: 166 Conn. 195,348 A.2d 637
• Parties: The CITY NATIONAL BANK OF CONNECTICUT v. TRAFFIC ENGINEERING ASSOCIATES, INC., et al.
• Court: Connecticut Supreme Court

Page 637

348 A.2d 637

166 Conn. 195

The CITY NATIONAL BANK OF CONNECTICUT v. TRAFFIC ENGINEERING ASSOCIATES, INC., et al.

Supreme Court of Connecticut.

March 19, 1974.

Ralph S. Kantrowitz, Bridgeport, with whom was Jonathan D. Kantrowitz, Bridgeport, for appellant (defendant The Arnold Co., Inc.).

Howard R. Matzkin, Waterbury, with whom was Richard A. Danen, Waterbury, for appellee (plaintiff).

Before HOUSE, C.J., and SHAPIRO, LOISELLE, MacDONALD and BOGDANSKI, JJ.

SHAPIRO, Associate Justice.

In this action, following a judgment ordering a foreclosure by sale, the Superior Court, pursuant to a motion made, determined priorities among the defendants with respect to the payment of any sums remaining from the sale in excess of the amount due the plaintiff. There followed a supplemental judgment in which the sale was ratified and the proceeds therefrom ordered distributed. From the judgment, the defendant The Arnold Company, Inc., hereinafter called Arnold, has appealed.

The court found the following facts: A foreclosure action was brought by The City National Bank of Connecticut, successor to the Waterbury National Bank, made returnable to the Superior Court on the third Tuesday of August, 1972, and involved real property in Naugatuck belonging to the defendant Traffic Engineering Associates, Inc., hereinafter called Traffic Engineering. On March 9, 1971, the Waterbury National Bank, in an earlier, separate action for money borrowed, had placed an attachment on this realty. On June 3, 1971, the Waterbury National Bank and the City Trust Company consolidated and merged into a new national banking association under the name of The City National Bank of Connecticut. On September 29, 1972, the court decreed a judgment of foreclosure by sale to take place on November 11, 1972. On January 2, 1972, Arnold had filed an attachment lien covering the property in question, obtained a judgment on June 2, 1972, against Traffic Engineering in the amount of $1493.03 with costs, and on June 7, 1972, placed a judgment lien on record. On October 20, 1972, predicated on its attachment of March 9, 1971, the Waterbury National Bank obtained a judgment against the defendant Traffic Engineering in the amount of $36,407.05 with costs. On January 9, 1973, it filed a judgment lien which recited: 'This lien is filed four (4) months after such judgment was rendered, and the same real estate herein described was attached in said action on the 9th of March, 1971.' After payment of all expenses of the sale there remained in the hands of the clerk of the court a balance of $5911.79 for distribution, and on January 24, 1973, based on a motion filed December 27, 1972, by Arnold, the court determined that the Waterbury National Bank equitably was entitled to have priority to this sum as against Arnold. ¹

On these facts the court concluded that the plaintiff, successor to the Waterbury National Bank, has priority over Arnold with respect to the balance in the hands of the clerk; that during the four-month period after the rendition of the judgment in favor of Arnold, the plaintiff could offer evidence of its judgment and obtain priority over Arnold; that the plaintiff perfected its attachment lien by filing a judgment lien within the four-month period and before any determination as to priorities; and that the plaintiff is equitably entitled to the funds on hand over Arnold and the latter has not been prejudiced in any way by any failure on the part of the plaintiff.

The defendant Arnold made the claims that on January 5, 1973, at the time of the hearing on the motion for establishment of priorities, it had priority over the Waterbury National Bank because it had perfected its lien, whereas the Waterbury National Bank had not; that the judgment lien, thereafter filed by that bank, was filed at a time when the property no longer belonged to Traffic Engineering, the judgment debtor of the Waterbury National Bank, hence that bank could make no levy of execution against the property and therefore the judgment lien was invalid pursuant to the provisions of General Statutes § 49-45; that the priority between the Waterbury National Bank and Arnold should have been established on September 29, 1972, at the time judgment of foreclosure was rendered; and that the Waterbury National Bank had been guilty of laches for not filing its judgment lien until long after judgment of foreclosure had been rendered, the property had been sold and the proceeds of the sale were awaiting distribution.

Section 49-44 is entitled 'Recording of judgment lien. When it holds from attachment.' It provides that any person having an 'unsatisfied judgment' may cause a certificate to be filed in the form prescribed by the statute and that to secure the amount due a judgment lien 'is hereby placed' upon the real estate described in the certificate. The statute continues, in part, as follows: 'Such judgment, from the time of filing such certificate, shall constitute a lien upon the real estate described in such certificate; and, if such lien is placed upon real estate attached in the suit upon which such judgment was predicated and within four months after such judgment was rendered, it shall hold from the date of such attachment,' if the judgment lien contains a clause referring to and identifying such attachment, substantially in the form recited therein. 'In Beardsley v. Beecher, 47 Conn. 408, decided the year after the law was first enacted (Public Acts 1878, c. 58, authorizing judgment liens to be filed against real estate; now § 49-44 et seq.), the nature of this lien is discussed, and it was pointed out that the lien was intended as a substitute for proceedings by way of execution, to be adopted at the option of the creditor, and that it did not constitute a continuance of the attachment lien even when placed upon the property attached, but was a...