J.E. Robert Co. v. Signature Properties, LLC — 7/10/2013

As the securitization of mortgage loans has become increasingly favored by financial lenders, and as arrangements for the administration of these loans have become increasingly complex, the relationship between the debtors/mortgagors and the owners of these debts has become more attenuated. Consequently, in foreclosure actions across the country on loans subject to these arrangements, challenges to the standing of parties other than the lender to bring such actions have been on the rise. Connecticut’s appellate courts have never had occasion to address this type of challenge, until today. Specifically, we must determine whether a loan servicer for the owner and holder of a note and mortgage can have standing in its own right to institute a foreclosure action against the mortgagor as a transferee of the holder’s rights under the Uniform Commercial Code (UCC), General Statutes §§ 42a-3-203 and 42a-3-301.

The defendants…appeal from the trial court’s judgment ordering strict foreclosure of Signature’s property and a deficiency judgment against the defendants predicated on the standing of both the original plaintiff, loan servicer J.E. Robert Company, Inc. (J.E. Robert), and the substitute plaintiff, Shaw’s New London, LLC (Shaw’s). Julian additionally appeals from the trial court’s order granting Shaw’s application for a prejudgment remedy. We conclude that the trial court properly determined that, under the facts of this case, J.E. Robert had standing to institute this foreclosure action in its own name and reject the defendants’ additional claims. Therefore, we affirm the judgment of the trial court.

SC19050, SC19051, SC19052

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