Flagstar Bank, FSB v. Kepple, AC 41185

CourtAppellate Court of Connecticut
Citation190 Conn.App. 312,210 A.3d 628
Docket NumberAC 41185
Parties FLAGSTAR BANK, FSB v. Christine KEPPLE et al.
Decision Date04 June 2019

190 Conn.App. 312
210 A.3d 628

FLAGSTAR BANK, FSB
v.
Christine KEPPLE et al.

AC 41185

Appellate Court of Connecticut.

Argued February 4, 2019
Officially released June 4, 2019


210 A.3d 630

Albert L.J. Speziali, with whom, on the brief, were Paul M. Geraghty, New London, and Mark R. Kepple, self-represented, for the appellants (defendants).

Scott H. Bernstein, for the appellee (plaintiff).

DiPentima, C.J., and Alvord and Moll, Js.

MOLL, J.

210 A.3d 631
190 Conn.App. 314

The defendants, Christine Kepple and Mark Kepple,1 appeal from the judgment of foreclosure by sale rendered in favor of the plaintiff, Flagstar Bank, FSB. On appeal, the defendants claim that the trial court lacked subject matter jurisdiction over this action as a result of the plaintiff's alleged lack of standing. We disagree and, accordingly, affirm the judgment of the trial court.

The following facts and procedural history are relevant to the resolution of the defendants' claim on appeal. The plaintiff filed this action in February, 2011, seeking to foreclose a residential mortgage on property located at 140 Elm Street in Stonington. According to the complaint, on November 19, 2004, Mark Kepple executed a promissory note payable to the order of Atlantis Mortgage Co., Inc., in the amount of $ 322,700. To secure the note, the defendants executed a mortgage on the property in favor of Mortgage Electronic Registration Systems, Inc., as nominee for Atlantis Mortgage Co., Inc. The complaint alleged that the plaintiff was the owner of the note and mortgage by virtue of an assignment of the mortgage dated February 3, 2011. The complaint further alleged that the note was in default and that the plaintiff was exercising its option to declare the entire balance on the note due and payable. On October 23, 2017, the court rendered a judgment of foreclosure by sale. The court thereafter denied the defendants' motion to reconsider, and the defendants filed the present appeal.

190 Conn.App. 315

On appeal, the defendants claim that the trial court lacked subject matter jurisdiction over this action because of the plaintiff's alleged lack of standing. Specifically, the defendants argue that (1) the plaintiff merely was the holder of the note and not the owner of the debt, and (2) the evidence in the record, taken as a whole, rebutted the presumption that the plaintiff, as the holder of the note, was the owner of the debt.2 We disagree.

At the outset, we note that "[t]he issue of standing implicates [the] court's subject matter jurisdiction.... Standing is the legal right to set judicial machinery in motion. One cannot rightfully invoke the jurisdiction of the court unless he [or she] has, in an individual or representative capacity, some real interest in the cause of action, or a legal or equitable right, title or interest in the subject matter of the controversy.... When standing is put in issue, the question is whether the person whose standing is challenged is a proper party to request an adjudication of the

210 A.3d 632

issue .... Because standing implicates the court's subject matter jurisdiction, the plaintiff ultimately bears the burden of establishing standing." (Citation omitted; internal quotation marks omitted.) JPMorgan Chase Bank, National Assn . v. Simoulidis , 161 Conn. App. 133, 142, 126 A.3d 1098 (2015), cert. denied, 320 Conn. 913, 130 A.3d 266 (2016). "Because a determination regarding the trial court's subject matter jurisdiction raises a question of law, [the standard of] review is plenary." (Internal quotation marks omitted.) Id. "In addition, because standing implicates the court's subject matter jurisdiction, the issue of standing is not subject to waiver and may be

190 Conn.App. 316

raised at any time." (Internal quotation marks omitted.) U.S. Bank, National Assn . v. Schaeffer , 160 Conn. App. 138, 145, 125 A.3d 262 (2015).

The following additional facts are necessary for the resolution of the defendants' claim. On March 14, 2012, the plaintiff filed a motion for default for failure to disclose a defense, which the court, Martin, J ., granted on March 26, 2012. On April 3, 2012, Mark Kepple filed (1) an appearance as a self-represented party in lieu of the appearance filed by his initial attorney and (2) a motion for inclusion in the foreclosure mediation program. On August 13, 2012, Attorney Paulann Hosler Sheets filed an appearance for the defendants in addition to the self-represented appearance filed by Mark Kepple. The defendants then filed a motion to open the default, an answer, and a motion to dismiss, claiming that the plaintiff lacked standing to prosecute the action because it did not own the underlying debt.

In support of the motion to dismiss, the defendants filed an affidavit of Mark Kepple with accompanying exhibits. In the affidavit, Mark Kepple stated facts in support of the defendants' claim that Federal Home Loan Bank of Indianapolis was the owner of the mortgage and that the plaintiff lacked standing to bring this action.3 The defendants also submitted a document produced by Mortgage Electronic Registration Systems,

190 Conn.App. 317

Inc., indicating that Federal Home Loan Bank of Indianapolis was the "investor." At a hearing on the defendants' motion to dismiss on September 7, 2012, the defendants argued that the owner of the underlying debt was Federal Home Loan Bank of Indianapolis and not the plaintiff.4 The plaintiff responded by

210 A.3d 633

arguing that it had standing to bring the foreclosure action as the holder of the note.5 The plaintiff also argued that the affidavit submitted in support of the motion to dismiss contained inadmissible hearsay.

In a memorandum of decision dated September 21, 2012, the court, Cosgrove, J., denied the defendants' motion to dismiss, concluding that the plaintiff had standing to commence the action. In its decision, the court noted that the plaintiff had produced a copy of the note, endorsed by Atlantis Mortgage Co., Inc., to the plaintiff, and established a prima facie case for foreclosure against the defendants. With regard to Mark Kepple's affidavit, the court stated: "Absent some exception to the hearsay rule, which is not present here, the statements of third parties contained within Mark

190 Conn.App. 318

Kepple's affidavit constitute hearsay and cannot be considered by the court for the truth of the matters contained therein. Even if considered ... Kepple's statement would not, alone, rebut the presumption created by possession of the note in this case. In viewing the remainder of the available evidence, the court finds that the defendants failed to rebut the presumption that the plaintiff owns the underlying debt, and thus the plaintiff has standing to commence the present foreclosure action."

On October 2, 2012, the court denied the defendants' motion to open the default and granted the defendants' motion to participate in the foreclosure mediation program. The parties participated in the foreclosure mediation program from October, 2012 through August, 2014. The final foreclosure mediation took place on August 6, 2014. The foreclosure mediator's report from that mediation stated in part that "[t]he parties have been in mediation since [October 26, 2012] and the same issues are brought up at every mediation without resolution."

Following the denial of the defendants' motion to dismiss, and after almost two years in the foreclosure mediation program, the defendants continued to raise the plaintiff's alleged lack of standing in various proceedings over the next several years. On August 21, 2014, the defendants filed a petition for reinclusion in the foreclosure mediation program and a motion to order the plaintiff to produce documentation of a purported investor restriction. In the latter motion, the defendants contended that the plaintiff repeatedly had denied their request for a loan modification because of an alleged investor restriction and sought, inter alia, an order that the plaintiff produce evidence of the purported investor restriction. On September 4, 2014, the defendants filed a second motion to open the default for failure to disclose a defense. In that motion, the

190 Conn.App. 319

defendants argued that they were waiting for the plaintiff to disclose any agreements between itself and Federal Home Loan Bank of Indianapolis regarding the servicing, including modification, of the defendants' loan. According to the defendants, these documents were relevant to their defense

210 A.3d 634

that the plaintiff lacked standing to bring this action.

On September 8, 2014, a hearing took place on the defendants' petition for reinclusion in the foreclosure mediation program and the defendants' motion to order the...

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3 cases
  • U.S. Bank, Nat'l Ass'n v. Moncho
    • United States
    • Appellate Court of Connecticut
    • 2 Marzo 2021
    ...on its status as the holder of the note." (Emphasis in original; internal quotation marks omitted.) Flagstar Bank, FSB v. Kepple , 190 Conn. App. 312, 326, 210 A.3d 628 (2019). In the present case, we agree with the trial court that the plaintiff had standing to prosecute this action and th......
  • St. Denis-Lima v. St. Denis
    • United States
    • Appellate Court of Connecticut
    • 4 Junio 2019
    ...to be heard, and the basic principles of due process were applied. Given this, we conclude that the court did not abuse its discretion 190 Conn.App. 312 in affording comity to the judgment rendered by the Brazilian court.The judgment is affirmed.In this opinion the other judges concurred.--......
  • Zaniewski v. Zaniewski
    • United States
    • Appellate Court of Connecticut
    • 4 Junio 2019
    ...Conn. App. 317, 334, 629 A.2d 1137 (Lavery, J. , dissenting), cert. denied, 228 Conn. 902, 634 A. 2d 295 (1993). Having considered all the 210 A.3d 628 competing interests involved, which includes the plaintiff's interest in not having to relitigate issues that she would contend properly we......

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