Devlin v. Wiener
1995 Conn. LEXIS 95, 656 A.2d 664, 232 Conn. 550 (1995)
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Rule of Law:
A mortgage deed is sufficiently definite to be enforceable against a third party if it provides reasonable notice of the nature and amount of the secured obligation, even if the deed itself omits specific details, so long as it refers to other documents that put an interested party on a track leading to discovery of those details, and a mortgage can secure the performance of an act rather than just a specific monetary debt.
Facts:
- Gerald Devlin owned a nine-acre parcel of real estate in Branford, which included his residence.
- Pine Orchard Associates, Inc., and Pine Orchard Development Corporation (collectively, Pine Orchard) sought to acquire and subdivide Devlin’s land.
- On February 18, 1984, Gerald Devlin executed a contract to sell his nine-acre parcel and residence to Pine Orchard.
- The agreement provided Devlin with an $86,000 cash payment (used to extinguish an existing first mortgage) and Pine Orchard's promise to either (1) convey to Devlin a finished three-bedroom unit in the planned subdivision, (2) transfer a building lot plus materials for a three-bedroom residence, or (3) return Devlin's original residence plus one-half acre of land.
- The agreement stipulated that Pine Orchard would mortgage the transferred property back to Devlin to secure Pine Orchard’s additional promise, with the mortgage securing a debt of $84,000, and stated that this agreement was on file at Pine Orchard's attorney's office.
- On February 29, 1984, Gerald Devlin conveyed his interest in the property to Pine Orchard Development Corporation, which then mortgaged the same real estate back to Devlin; the mortgage deed stated it secured the obligation to 'transfer certain properties' pursuant to the February 18, 1984 contract.
- On July 8, 1985, Pine Orchard Development Corporation conveyed its interest in the property to Pine Orchard Development Associates, which later transferred the property to Daniel J. Wiener and Gloria Maddox Wiener jointly.
- On April 13, 1990, Daniel J. Wiener transferred his interest in the Branford property to his wife, Gloria Maddox Wiener, by quitclaim deed for no consideration.
- No other consideration beyond the initial $86,000 cash payment was ever paid to Gerald Devlin.
Procedural Posture:
- On January 31, 1992, Gerald Devlin filed suit against Pine Orchard Associates, Inc., Pine Orchard Development Corporation, and Gloria Maddox Wiener in the trial court (court of first instance) for foreclosure of his mortgage.
- The named defendant, Gloria Maddox Wiener, filed an answer and various special defenses, including the argument that the mortgage deed failed to define any obligation or debt in sufficient detail and therefore did not secure an enforceable obligation.
- After a hearing, the trial court concluded that an indebtedness of $84,000 was due to Devlin and was secured by a valid mortgage.
- On motion by Devlin, the trial court ordered a foreclosure by sale and rendered judgment accordingly.
- Gloria Maddox Wiener appealed from the judgment of the trial court to the Appellate Court.
- The appeal was transferred from the Appellate Court to the Supreme Court of Connecticut (this court) pursuant to Practice Book § 4023 and General Statutes § 51-199 (c).
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Issue:
Does a mortgage deed and its underlying obligation provide sufficient notice to third parties and adequately define the debt, even if the deed itself does not state a specific monetary amount or secure a note, but rather refers to a purchase and sale agreement that specifies the nature and value of a performance-based obligation, such that it can sustain a foreclosure action?
Opinions:
Majority - Callahan, J.
Yes, a mortgage deed and its underlying obligation can be sufficiently definite to sustain a foreclosure action, even against a third party, if the mortgage deed refers to a separate, identifiable agreement that specifies the nature and value of a performance-based obligation. The court affirmed the trial court's judgment, concluding that the mortgage was sufficiently definite to be enforceable against Gloria Maddox Wiener. The court reasoned that for a mortgage to be valid against third parties, it must provide 'reasonable notice' of the nature and amount of the secured obligation, as established in prior cases like Dart & Bogue Co. v. Slosberg and Connecticut National Bank v. Esposito. This 'reasonable notice' means the record must put an interested party 'on a track leading to discovery' of the debt's details. Here, the mortgage deed explicitly referenced the February 18, 1984 purchase and sale agreement and stated it was on file, providing clear direction. The court clarified that a mortgage is not invalid simply because it secures a 'performance' rather than a specific monetary obligation or because the deed itself lacks the specific amount, so long as the underlying agreement provides sufficient detail. Reviewing the purchase and sale agreement, the court found that paragraph twenty-nine specifically indicated the mortgage secured an obligation in the amount of $84,000, and paragraph twenty-eight outlined three alternative performances, each valued at $84,000, and referenced a two-year timeframe for performance. Therefore, the underlying obligation was deemed sufficiently definite, legally and logically supporting the trial court’s finding of an $84,000 debt secured by a valid mortgage.
Analysis:
This case clarifies the 'reasonable notice' standard for the validity of mortgage deeds, particularly when the secured obligation is not fully detailed within the deed itself or when it involves a non-monetary performance. It reinforces that a reference within the mortgage to an external, ascertainable document can provide sufficient notice to third parties, preventing them from being misled. The decision solidifies the principle that mortgages can secure obligations beyond simple monetary debts, expanding the types of agreements that can be legally protected by real property. This ruling is significant for parties drafting mortgages, emphasizing the need for clarity in underlying agreements, even if the mortgage deed itself is concise, and for title searchers who must diligently follow leads indicated in land records.
