Connecticut Sav. Bank of New Haven v. Hanoman Realty Corp.

• Decision Date: 03 June 1975
• Parties: CONNECTICUT SAVINGS BANK OF NEW HAVEN v. HANOMAN REALTY CORPORATION et al.
• Court: Connecticut Supreme Court

Page 827

362 A.2d 827

168 Conn. 554

CONNECTICUT SAVINGS BANK OF NEW HAVEN v. HANOMAN REALTY CORPORATION et al.

Supreme Court of Connecticut.

June 3, 1975.

[168 Conn. 555] Alexander Winnick, New Haven, with whom, on the brief, was Edward B. Winnick, New Haven, for appellant (defendant Hermann S. Cutler).

Richard J. Beatty, New Haven, with whom was Dennis P. Anderson, New Haven, for appellee (plaintiff).

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

MacDONALD, Associate Justice.

The plaintiff bank obtained a judgment of strict foreclosure of an open end mortgage which secured the joint and several obligation to it of Hermann S. Cutler, the appellant herein, and of Hanoman Realty Corporation and Milton Hanoman. Upon the motion of the plaintiff, three disinterested appraisers were appointed by the court, and they, under oath, within ten days after the time limited for redemption, appraised the mortgaged property and made a written report thereof to the court as required by General Statutes § 49-14. The court overruled a remonstrance to the acceptance of the report and, thereafter, rendered a supplemental judgment for the plaintiff for the deficiency resulting from the difference between the total amount due on the mortgage debt with interest, costs and fees and the appraised value of the property. The defendant Cutler has appealed, assigning error in the court's overruling of his remonstrance.

The initial challenge to the appraisers' report is one of form, the defendant contending that the appraisal was not in conformity with the requirements of § 49-14, that the report merely stated that the appraisers 'appraised said property' and then listed a value opposite each appraiser's name without relating the basis for the appraisers' conclusion as to this value or stating whether it constitutes the fair market value for the property and, further that the language employed in Practice Book Form No. 361 (fourth form) ¹ was not contained in the report. For purposes of comparison, we have reprinted in footnote 2 the report issued jointly by the three appraisers The defendant's contention that the report is formally irregular is based on the absence in the report of the words 'and find its value to be' as stated in Form 361. The forms set forth in the Practice Book, as stated in a preamble to the section on forms, are merely illustrative; Practice Book, p. 249; and do not carry the force of law. These forms were compiled for the convenience of the bench and bar and their language is not mandatory. The report of the appraisers was in conformity with the requirement of § 49-14 and the absence of the phrase 'and find its value to be' quoted by the defendant from Form 361 did not render the report invalid. The defendant's argument ignores substance and constitutes a pedantic adherence to form not required in this instance.

omitting the description of the property.

The absence of any stated basis for the appraisal does not render the written report invalid. The determination of value by the appraisers is final and conclusive. General Statutes § 49-14; Buck v. Morris Park, Inc., 153 Conn. 290, 293, 216 A.2d 187, appeal dismissed, 385 U.S. 2, 87 S.Ct. 33, 17 L.Ed.2d 2. The court's power to review the determination of value upon a remonstrance is confined to questions of law. Ibid; Equitable Life Assurance Society v. Slade, 122 Conn. 451, 456, 190 A. 616. The appraisers determine the value of property upon their own experience and judgment. Buck v. Morris Park, Inc., supra. The defendant suggests in his brief that the appraisers should be required to employ uniformly one of three appraisal methods: (1) market data approach, (2) comparable sales approach, or (3) reconstruction approach. It is not uniformity of method that is intended by the employment of three indifferent appraisers but the obtaining of three independent judgments as to value. Although the court may properly consider the methods employed by the appraisers, errors of judgment as to the value of the property must stand uncorrected. Equitable Life Assurance Society v. Slade, supra, 457, 190 A. 616.

The defendant next complains that one of the three appraisers made a substantial mistake of fact by employing what the defendant refers to as the 'reconstruction approach.' The simple answer to this contention is contained in Equitable Life Assurance Society v. Slade (p. 458, 190 A. 619): '(T)he appraisal is not made by one individual but is the joint act of all three, bringing to bear upon the problem the individual knowledge and the individual judgment of each, affording the opportunity for the correction of an individual member's error by action of the others. It is for this reason that a mistake by a single appraiser is insufficient to invalidate the appraisal reached by all three acting jointly. In no case can an appraisal so determined be set aside in the absence of a showing of some serious mistake of fact or the adoption of an erroneous principle of law which substantially affected it as made by the three considered as a joint board. While inquiry of the individual appraiser as to the principles and methods which he used is permissible where an appraisal is challenged on these grounds, the ultimate inquiry must be, not whether the individual appraiser made a mistake, but whether there was a mistake of fact or law which substantially affected the appraisal which was finally made.'

The appraisers concluded that the cost of rehabilitating a dilapidated building upon the mortgaged property was prohibitive. All three appraisers agreed that rehabilitation was infeasible but ascribed different costs to rehabilitating or reconstructing the building. By the defendant's calculations, this reconstruction or rehabilitation...