KeyBank v. Yazar
| Docket Number | SC 20648 |
| Decision Date | 01 August 2023 |
| Parties | KEYBANK, N.A. v. EMRE YAZAR ET AL. |
| Court | Connecticut Supreme Court |
Argued November 21, 2022
Procedural History
Action to foreclose a mortgage on certain real property owned by the defendants, and for other relief, brought to the Superior Court in the judicial district of Stamford-Norwalk, where the defendants were defaulted for failure to plead; thereafter the court, Genuario, J., granted the plaintiff's motion for summary judgment as to liability only subsequently, the court, Genuario, J., granted the plaintiffs motion for a judgment of strict foreclosure and rendered judgment thereon, from which the defendant Ozlem Yazar appealed to the Appellate Court, Moll Alexander and DiPentima, Js., which reversed the trial court's judgment and remanded the case with direction to render judgment dismissing the action thereafter, the plaintiff, on the granting of certification, appealed to this court. Reversed in part; judgment directed.
Geoffrey K. Milne, with whom, on the brief, was Victoria L. Forcella, for the appellant (plaintiff).
Ozlem Yazar, self-represented, the appellee (defendant).
Jeffrey Gentes, Anika Singh Lemar, Zachary Shelley, law student intern, and Natasha Reifenberg, law student intern, filed a brief for the Housing Clinic of Jerome N. Frank Legal Services Organization as amicus curiae.
Robinson, C. J., and McDonald, D'Auria, Mullins and Ecker, Js.
This certified appeal concerns this state's Emergency Mortgage Assistance Program (EMAP),[1]General Statutes §§ 8-265cc through 8-265kk,[2] which is designed to assist homeowners in avoiding foreclosure by providing a mechanism and funding for emergency mortgage and lien assistance payments, among other resources. See General Statutes §§ 8-265dd and 8-265ee. As part of EMAP, § 8-265ee (a) requires mortgagees to provide notice to homeowners to inform them of the resources available under the program. In this appeal, we must consider two questions relating to this notice requirement. First, we have to determine whether the EMAP notice requirement in § 8-265ee (a) is jurisdictional. Second, we must decide whether an EMAP notice sent before the commencement of a prior foreclosure action by the predecessor mortgagee is valid for a subsequent action initiated by the successor mortgagee. We conclude that the EMAP notice requirement in § 8-265ee (a), although a mandatory condition precedent, is not jurisdictional in nature. Second, we conclude that § 8-265ee (a) requires that a mortgagee provide an EMAP notice for each foreclosure action initiated. Therefore, in the present case, the plaintiff, KeyBank, N.A., was required to provide an EMAP notice to the defendant Ozlem Yazar[3] prior to initiating a subsequent foreclosure action after a prior foreclosure action had been dismissed.
In June, 2014, Emre Yazar (Emre) executed and delivered a note in the principal amount of $580,000 to First Niagara Bank, N.A., to refinance an existing loan and to convert it from a fixed rate to a variable rate. The defendant, who is Emre's former spouse,[4] was not a signatory to the note. To secure the note, Emre and the defendant executed a mortgage on real property they jointly owned in Weston. Beginning in March, 2016, and for the months following, Emre failed to make required payments on the note. On August 22, 2016, First Niagara sent separate notices of default to both Emre and the defendant at the address of the mortgaged property. Accompanying each notice of default was a notice from First Niagara regarding EMAP. As required by § 8-265ee (a), the EMAP notices advised Emre and the defendant of the availability of EMAP and informed them of the resources available to help them avoid foreclosure. The notices informed them that, within sixty days of the date of the letter, they had the right to have a meeting with the mortgagee or a consumer credit counseling agency to attempt to resolve the default, and they had the right to contact the Connecticut Housing Finance Authority to obtain information and to apply for emergency mortgage assistance payments if the parties were unable to resolve the default. See General Statutes § 8-265ee (a). Lastly, the notices advised Emre and the defendant that a court may not render a foreclosure judgment prior to the expiration of a required waiting period.
In October, 2016, First Niagara merged with and into the plaintiff. The plaintiff is now the payee of the note as successor by virtue of merger with First Niagara. On January 16, 2017, the plaintiff commenced a foreclosure action against Emre and the defendant based on an alleged default on the note by Emre, beginning in March, 2016. KeyBank, N.A. v. Yazar, Superior Court, judicial district of Fairfield, Docket No. FBT-CV-17-6061930-S. On April 26, 2017, the trial court dismissed the action because of the plaintiffs failure to provide the foreclosure mediator with the forms and information required by General Statutes (Rev. to 2017) § 49-3 U (c) (4) (now § 49-3 U (d)) and its subsequent failure to comply with the court's order requiring submission of such forms by a date certain.
On or about August 24,2017, the plaintiff commenced the present foreclosure action against Emre and the defendant based on the same default by Emre alleged in the first foreclosure action and on Emre's failure to cure such default.[5] Thereafter, the defendant attempted to participate in foreclosure mediation on various occasions, to which the plaintiff and Emre both objected because the defendant was not the borrower on the note. The trial court denied the defendant's initial petitions to participate but eventually granted a subsequent petition to participate in mediation. The foreclosure mediation was assigned to a mediator but was terminated before mediation with the mortgagee was scheduled because Emre, the borrower, indicated he was not interested in keeping the property. Even though the defendant was the resident and a homeowner, the plaintiff did not allow for assumption of the note, and, therefore, the mediation was terminated because the borrower declined any further mediation proceedings. Thereafter, Emre and the defendant were defaulted for failure to plead. The defendant then filed an answer and special defenses. On September 13, 2018, the plaintiff filed a motion for summary judgment as to liability, arguing that it complied with the requisite EMAP notice provisions and established a prima facie case for foreclosure. The plaintiff argued that the EMAP notice[6] sent by First Niagara to the defendant prior to the commencement of the previous foreclosure action satisfied the EMAP notice requirement for the present action. The defendant argued in response that the August 22, 2016 EMAP notice did not satisfy the statutory requirements for the present foreclosure action and that, in any event, she never received the initial EMAP notice, which was returned to the "sender."[7] The trial court heard argument on the motion and, thereafter, granted the plaintiffs motion for summary judgment. The court determined that there was no genuine issue of material fact regarding the default of the note and that the plaintiff satisfied its notice obligations regarding default, acceleration of the mortgage, and EMAP. The court subsequently rendered judgment of strict foreclosure.
Thereafter, the defendant appealed to the Appellate Court, arguing that the trial court lacked subject matter jurisdiction over the foreclosure action because the plaintiff failed to comply with the EMAP notice requirements contained in § 8-265ee. KeyBank, N.A. v. Yazar, 206 Conn.App. 625, 627, 261 A.3d 9 (2021). The plaintiff countered that § 8-265ee was satisfied by the August 22, 2016 EMAP notice sent by First Niagara prior to the initiation of the first foreclosure action. Id., 629-30. The Appellate Court agreed with the defendant and concluded that, in accordance with its recent decision in MTGLQ Investors, L.P. v. Hammons, 196 Conn.App. 636, 638, 645, 230 A.3d 882, cert, denied, 335 Conn. 950, 238 A.3d 21 (2020), the EMAP notice is jurisdictional. See KeyBank, N.A. v. Yazar, supra, 629-32. The court reiterated its holding in Hammons that the particular mortgagee entity that wishes to foreclose on the mortgage must be the same entity that sends the EMAP notice. See id., 631-33. It also held that § 8-265ee requires that each foreclosure action stand on its own EMAP notice. Id., 633. As such, the court concluded that the plaintiff could not rely on the previous EMAP notice sent by First Niagara before the prior foreclosure action was commenced. See id., 634 and n.8. Accordingly, the Appellate Court reversed the judgment of the trial court and remanded the case with direction to render judgment dismissing the action for lack of subject matter jurisdiction. Id., 634.
The plaintiff subsequently filed a petition for certification to appeal, which we granted, limited to the following issues: (1) "Did the Appellate Court correctly conclude that a mortgagee's failure to comply with the [EMAP] notice requirements set forth in ... § 8-265ee (a) deprives the trial court of subject matter jurisdiction over the mortgagee's foreclosure action?" And (2) "[d] id the Appellate Court correctly conclude that an EMAP notice that had been sent by a mortgagee to a [homeowner] prior to a first foreclosure action, which was later dismissed, did not satisfy the notice requirements of § 8-265ee (a) in connection with a second foreclosure action subsequently commenced against the [homeowner] based on the same default under the same mortgage?" KeyBank, N.A. v. Yazar, 340 Conn. 901, 263 A.3d 100 (2021).
On appeal, the plaintiff contends that the Appellate Court incorrectly concluded both that the EMAP notice...
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