Moran v. Morneau

• Decision Date: 15 January 2013
• Docket Number: No. 34139.,34139.
• Citation: 57 A.3d 872,140 Conn.App. 219
• Court: Connecticut Court of Appeals
• Parties: Michel MORAN v. Ricky A. MORNEAU et al.

140 Conn.App. 219

57 A.3d 872

Michel MORAN

v.Ricky A. MORNEAU et al.

No. 34139.

Appellate Court of Connecticut.

Argued Sept. 18, 2012.

Decided Jan. 15, 2013.

John–Henry M. Steele, for the appellant (plaintiff).

Sean P. Clark, for the appellee (defendant Chase Home Finance, LLC).

DiPENTIMA, C.J., and BEACH and BISHOP, Js.

BEACH, J.

The dispositive issue in this foreclosure action is whether a default judgment entered against the defendant Chase Home Finance, LLC (Chase), ¹ definitively established the lien priority order alleged in the amended complaint ² of the plaintiff, Michel Moran. Because we hold that the factual allegations in the complaint, even if true, did not, as a matter of law, establish that the plaintiff held the first priority, Chase's default did not operate to reify the plaintiff's erroneous legal conclusions. We therefore affirm the judgment of the trial court.

The facts and procedural history relevant to the disposition of this issue were largely recounted in a prior appeal taken in this case. See Moran v. Morneau, 129 Conn.App. 349, 19 A.3d 268 (2011).³ “Ricky A. Morneau owns the subject propertycommonly known as 399 Main Street in Portland. The plaintiff ... commenced this action seeking to foreclose on a judgment lien that she holds on the property. In the operative complaint, the plaintiff alleged that on July 17, 2003, she recorded a ‘[n]otice [r]e: constructive [t]rust 1/2 [o]wnership’ of the subject property on the Portland land records.⁴ She obtained a prejudgment attachment against the property in the amount of $54,000, which she recorded on the land records on May 28, 2004. The plaintiff prosecuted a successful breach of contract action against Morneau and was awarded a monetary judgment in the principal amount of $63,061, plus interest.⁵ She recorded the judgment lien on the land records on February 15, 2006.

“[Chase] is the assignee of and successor in interest to a promissory note and mortgage deed in the original principal amount of $185,000, which was recorded on the Portland land records on August 22, 2003.... The plaintiff's position is that both the attachment and the judgment lien relate back to the July, 2003 ‘[n]otice [r]e: constructive [t]rust 1/2 [o]wnership,’ which would give her claim priority over that of ... Chase....” Id. at 350–51, 19 A.3d 268.

Chase was defaulted for its failure to appear in the lien foreclosure action, and on April 30, 2009, the court rendered a judgment of strict foreclosure in favor of the plaintiff. Chase timely moved to open the default judgment and to convert it to a judgment of foreclosure by sale. See Practice Book § 17–43. The court, Holzberg, J., heard arguments on the motion on September 14, 2009. Chase argued that the default should be set aside because it had been improperly served and that, contrary to the allegations in the complaint, its lien held first priority over the subject property because the filing of the notice of constructive trust had no enforceable effect on the priority of the plaintiff's judgment lien. The plaintiff contended that service had been properly made on Chase,⁶ and, moreover, that Chase's default effectively admitted the priority order alleged in her complaint. Following arguments, the court converted the judgment to a foreclosure by sale, and set a sale date of November 21, 2009. The court did not open the default.

Chase then filed a motion to determine the priorities of the liens, which was argued on October 29, 2009. The parties again disputed the effect of Chase's default. The plaintiff reasserted her position that the default conclusively established the allegations in the complaint, i.e., that she held the first priority possession. Chase argued that the default had no effect on the determination of priorities, which determination generally occurs during a supplemental judgment proceeding, and that its interest in the subject property was superior to the plaintiff's because there was no legal basis for her judgment lien to relate back to the notice of constructive trust filed on July 17, 2003. On November 16, 2009, the court issued an order that Chase's position was first in priority. The court held that the plaintiff's notice of constructive trust was not a valid lien or encumbrance on the subject property and that the plaintiff's subsequent attachment and judgment lien did not relate back to it.⁷

Prior to the date set for the foreclosure sale, the plaintiff appealed the determination of priorities to this court. See Moran v. Morneau, supra, 129 Conn.App. at 350, 19 A.3d 268. The appeal was dismissed for lack of a final judgment. Id. at 359, 19 A.3d 268. The plaintiff then moved in the trial court for a judgment of strict foreclosure to facilitate appellate review of the determination of priorities, which motion was granted on December 12, 2011. This appeal followed.

This case reduces to a disagreement over the effect of Chase's default on the determination of priorities. The plaintiff's sole claim on appeal is that Chase's default established the priority order alleged in the complaint and that the court had no discretion, after the default, to review the plaintiff's legal conclusions regarding the effect of the filing of the notice of constructive trust. We disagree. A default may settle many issues, but it does not operate to insulate a mistaken legal proposition from judicial review.

“A default admits the material facts that constitute a cause of action ... and entry of default, when appropriately made, conclusively determines the liability of a defendant.... If the allegations of the plaintiff's complaint are sufficient on their face to make out a valid claim for the relief requested, the plaintiff, on the entry of a default against the defendant, need not offer evidence to support those allegations.” Whitaker v. Taylor, 99 Conn.App. 719, 725–26, 916 A.2d 834 (2007).

“Although the failure of a party to deny the material allegations of a pleading operates so as to impliedly admit the allegations, a default does not automatically trigger judgment for, or the relief requested by, the pleader. The pleader is entitled to an entry of judgment or a grant of relief as a function of the nonresponsive party's default and the attendant implied admission only when the allegations in the well pleaded filing are sufficient on their face to make out a claim for judgment or relief.... [T]he question as to whether a default requires judgment in favor of the pleader is to be determined by reference to the sufficiency of the pleading itself.” (Citations omitted; emphasis added.) Commissioner of Social Services v. Smith, 265 Conn. 723, 736–37, 830 A.2d 228 (2003); cf. Mountview Plaza Associates, Inc. v. World Wide Pet Supply, Inc., 76 Conn.App. 627, 634, 820 A.2d 1105 (2003) (reversing trial court's judgment in favor of defaulted defendants where “the material allegations of the complaint satisf[ied] the threshold legal test for piercing the corporate veil”). Put another way, “in both equitable and legal actions, the plaintiff must establish his right to relief to the court's satisfaction, even though some issues may have been laid at rest by the default.” (Internal quotation marks omitted.) Ratner v. Willametz, 9 Conn.App. 565, 576, 520 A.2d 621 (1987); cf. R. Bollier et al., Stephenson's Connecticut Civil Procedure (3d Ed.1997) § 43, p. 135 (“[t]he legal conclusion pleaded [in a complaint] is disregarded if inconsistent with or unsupported by the facts alleged”).⁸

Here, the plaintiff's assertion of priority over Chase requires that we review the allegations in the complaint to determine whether they make out a valid claim for the relief requested. See Tang v. Bou–Fakhreddine, 75 Conn.App. 334, 338, 815 A.2d 1276 (2003). Our review of the legal sufficiency of pleadings is plenary. Id. at 337, 815 A.2d 1276.

According to the complaint, the plaintiff obtained a prejudgment remedy of attachment against the subject property in the civil action between her and Morneau, which was recorded on the land records of the town of Portland on May 28, 2004. This prejudgment attachment, the complaint alleges, relates back to the filing of the notice of constructive trust. The complaint further states that on February 6, 2006, the plaintiff obtained a judgment against Morneau in the amount of $63,061, plus interest. Thereafter, the plaintiff secured a judgment lien against the property, which was recorded on February 15, 2006. The complaint states that the “judgment lien relates back to the aforementioned [n]otice [r]e: [c]onstructive [t]rust 1/2 [o]wnership dated June 19, 2003 and recorded July 17, 2003, in ... the Portland [l]and [r]ecords.” The ultimate effect of these allegations, according to the complaint, is that Chase's interest, as the assignee of a mortgage recorded on August 22, 2003, is subordinate to the plaintiff's interest, which accrued approximately a month earlier.

These factual allegations do not support such a conclusion. There is no legal basis for relating either the judgment lien or the prejudgment attachment back to the filing of the notice of constructive trust. Pursuant to General Statutes § 52–380a (b), “[f]rom the time of the recording of the judgment lien certificate, the money judgment shall be a lien on the judgment debtor's interest in the real property described. If, within four months of judgment, the lien is placed on real property which was previously attached in the action, the lien on that property shall hold from the date of attachment....” Accordingly, here, the plaintiff's judgment lien related back to May 28, 2004, the date of the filing of the prejudgment attachment, as alleged in the complaint. See Farmers & Mechanics Savings Bank v. Garofalo, 219 Conn. 810, 814, 595 A.2d 341 (1991). From that date forward, the plaintiff's lien would enjoy priority over any subsequent claim to the attached property. See Mac's Car City, Inc. v. DiLoreto, 238 Conn. 172, 179–80, 679...