Skip to Content



April & May Connecticut Appellate Update and Wrap Up – Banking and Financial Institution Services


The month of March turned out to be a slow one for appellate decisions in the Banking and Financial Institution Services realm but April and May saw a full slate of cases that lenders and mortgagees should be aware of released. So, before we jump into summer, let’s see where the courts led us throughout the spring.

Ion Bank v. J.C.C. Custom Homes, LLC, et al. – This matter involved the Appellate Court’s review of a dismissal of a replevin action by the plaintiff-lender which was commenced after an assignment of the relevant loan documents to a third party. The defendant moved to dismiss the action for lack of standing and prevailed in the Superior Court. The Appellate Court, on review of the claim, considered three main claims propounded by the plaintiff-lender. First, that the filing of an amended complaint cured the defect in standing; second, that the trial court improperly concluded a motion to substitute the proper party plaintiff was required; and third, that the Superior Court should have construed the original complaint as an action by the assignee in the name of the assignor. Each claim was rejected and the underlying dismissal was affirmed. 

Simply stated, a plaintiff-lender should always be vigilant regarding the status of its documents before it undertakes legal action for enforcement of any rights against a defaulting party. While some jurisdictional defects can be remedied by proper filings, the Appellate Court made clear in this instance that standing is determined based on rights of enforcement at the time of commencement of the action.

Bank of America, N.A. v. Grogins – In a foreclosure action, the defendant (an executor of an estate) appealed the denial of a motion to open the judgment of strict foreclosure. The defendants claimed that the Superior Court erred in determining that they did not present “good cause” to open the judgment notwithstanding a multiple day evidentiary hearing at which evidence was presented regarding lending practices which were allegedly predatory. After consideration of the record and limited standard of review inherent to a motion to open a judgment of strict foreclosure under General Statutes section 49-15, the Appellate Court affirmed the order denying the motion to open judgment by finding there was no abuse of discretion. Essentially, because the motion to open judgment and appeal were not filed within the original appeal period extending from the entry of the judgment of strict foreclosure, the deferential abuse of discretion standard was applicable and the Superior Court’s wide latitude in determining the issue of whether or not “good cause” had been demonstrated under section 49-15 compelled affirmance of the underlying order.

Wachovia Mortgage, FSB v. Toczek – This appeal revolved around a rather complicated set of facts which implicated the technical aspects of the rules regarding appellate stays in Connecticut procedure. Essentially, in a long-standing foreclosure action, an appeal was taken by the defendants which resulted in a dismissal. After re-entry of the terms of the judgment of foreclosure by the Superior Court a second appeal was taken which was affirmed by the Appellate Court. On remand, the Superior Court entered new law days and prospectively terminated any further appellate stay in the action pursuant to Practice Book 61-11. A third appeal was thereafter filed by the defendant along with a timely motion for review of the Superior Court’s order terminating any future appellate stay. The plaintiff-mortgagee filed a motion to dismiss the third appeal which was granted on September 6, 2018. On September 17, 2018, the defendant filed a timely motion for reconsideration of the dismissal with the Appellate Court. The motion for reconsideration was not denied until October 31, 2018. However, on September 14, 2018, the plaintiff-mortgagee moved to reset the law days while the motion for reconsideration was still pending a ruling from the Appellate Court. The plaintiff-mortgagee’s motion was granted on October 15, 2018.

On October 25, 2018, the defendant filed a fourth appeal claiming that the Superior Court’s order in resetting the law days on October 15, 2018 was in violation of the appellate stay. The Appellate Court, after reviewing the various provisions of the rules of practice regarding the appellate stay concluded that there was a stay still in effect on October 15, 2018 which precluded the Superior Court from re-entering the law days as it had. In fact, it concluded that the stay did not terminate until November 20, 2018 which was twenty days from the denial of the defendant’s motion for reconsideration en banc. As a result, the judgment entered on October 15, 2018 was reversed and the action remanded with instruction to reset the law days.  

The critical component to take away from Tockzek is a realization that, even if a party has obtained an order terminating the appellate stay, there may still be other provisions in the rules of practice which impose a stay to preclude further orders from entering before the final extinguishment of the appellate stay.

Wells Fargo Bank, N.A. v. Fitzgerald – After trial, the defendant appealed the entry of a judgment of foreclosure in favor of the plaintiff claiming that the Superior Court had improperly found that the underlying notice of default and intent to foreclose was proper and that defendant had not proven their special defense of laches. In its consideration of the claims asserted, the Appellate Court, relying on the substantial compliance caselaw, found that the notice of default did properly satisfy the requirements of the note and mortgage deed despite having been transmitted to counsel for the borrowers as opposed to directly to the borrowers. As a result of the admissions that they received two notices of default which, between both, complied with the requirements of the mortgage deed there was no error.

Similarly, the Appellate Court found that the Superior Court did not err when it found the defendants failed to prove the elements of their special defense of laches. Defendants’ claimed defense was largely predicated solely on the passage of time from the institution of a first foreclosure action to the completion of the second, underlying foreclosure action which, under established authorities, does not establish laches without a demonstration of prejudice to the party claiming the defense. Accordingly, the judgment of foreclosure was affirmed.

U.S. Bank Trust, N.A. v. Giblen – Giblen revolved around the approval of a foreclosure sale by the Superior Court that the defendants claimed exceeded the scope of an order terminating the automatic bankruptcy stay. A judgment of foreclosure by sale was entered by the Superior Court on May 23, 2016 and the sale subsequently occurred on December 3, 2016. After the sale itself but prior to the approval of the sale, the defendants filed for chapter 7 bankruptcy protection in the United States Bankruptcy Court. After an order to show cause directed to the defendants was entered by the Bankruptcy Court, it annulled the automatic stay retroactive to the date of the defendants’ petition to permit completion of the sale by the committee. The committee of sale filed a supplement to the motion for approval previously filed and the defendants objected thereto on three grounds. The Superior Court, after hearing, approved the sale on July 7, 2017 and overruled the defendants’ objections.

On appeal the defendants claimed that the Superior Court erred in approving the sale because the approval of the sale exceeded the scope of the Bankruptcy Court’s annulment of the automatic stay. The Appellate Court disagreed and stated that the Bankruptcy Court’s order annulling the automatic stay was clear and within its powers. Defendants also claimed that the irregularities with the sale (no interior appraisal; no second advertisement; sign removed from premises) and, for the first time on appeal, asserted two new claimed irregularities that were not presented to the Superior Court. The Appellate Court disagreed that any of the claimed irregularities inflicted any actual prejudice upon the defendants and, as a result, that the Superior Court did not abuse its discretion in approving the sale. As a result, the judgment was affirmed.


For questions relative to these matters or to discuss how SGL can assist in your business or litigation requirements, please feel free to contact any of the attorneys in the Banking and Financial Institution Services practice group:

Linda Hadley –; 860-760-8428

Jerry Garlick –; 860-760-8427

Andrew Barsom –; 860-760-8423