JOHN R. CARUSO, JUDGE TRIAL REFEREE.
This foreclosure action was commenced by the filing of a summons and complaint with a return date of June 3, 2003. The property sought to be foreclosed was and continues to be owned by the defendant William C. Taff, and is located on Hard Hill Road in Bethlehem, Connecticut. The plaintiffs,' Louden Legal Group, LLC and Carlo Forzani, LLC, are two Connecticut law firms. There were a number of defendants made parties to the case because of a claimed interest in the property being foreclosed, most of whom have not appeared or disclosed a defense. For all practical purposes the principal defendant is William C. Taff. In addition to William C. Taff, his brother, James C. Taff, and the law firm of Secor, Cassidy McPartland remained as party defendants. Trial of the issues was held in the Litchfield Superior Court on August 30, 2005, August 31, 2005, November 29, 2005 and November 30, 2005. Following closing argument counsel were ordered to file simultaneous briefs by January 3, 2006.
Prior to commencing evidence counsel informed the court that they had agreed to a bifurcation of the case in that, if the court found the mortgages to be enforceable, there would be a further trial on the determination of the amounts due, including interest and attorneys fees.
Throughout this memorandum of decision the name Taff refers to the defendant William C. Taff unless otherwise specified, Bettcher to Jayma Bettcher, Forzani to Attorney Carlo Forzani and Louden to Attorney Bruce Louden. Before the court makes its findings a chronological history of the case and related files is necessary. The matter of William Taff v. Jayma Bettcher, Docket number FA 92-0059231S was a custody/visitation matter commenced by Taff against Bettcher. It is undisputed that as a result of an intimate relationship Taff impregnated Bettcher and as a result a son was born to Bettcher. CT Page 9764
The case of Taff v. Bettcher commenced on or about April 1992, and continued until October 22, 1999. According to the case information contained on Edison, 215 motions, documents, stipulations, etc. were processed during this period. The case was highly conflicted. Forzani represented Taff from February 1992 to September 1995. The aggregate legal fees and costs amounted to $225,401.90 of which Taff paid $50,942.98 and provided the law firms with which Forzani was associated with notes and mortgages in the amount of $60,000. The balance of the fees and costs amounting to $114,458.92 were not pursued by Forzani.
In Louden Forzani Katz v. Taff et al, Docket No. CV97-0073970 (Litchfield Judicial District) Forzani sought to foreclose the mortgages. The case was dismissed by the court (Moraghan, J.) because the named plaintiffs were not the names of the legal entities in whose names the notes and mortgages stood. The instant action followed.
Rather than repeat the lengthy chronological proceedings in this file the court has distilled the issues to be decided as follows:
1. The plaintiffs seek to foreclose on two (2) mortgages in connection with real property owned by Taff and as more particularly set forth in the pleadings.
2. The defendants, Taff and his brother, James Taff have filed replies to the complaint and in addition have set forth twelve special defenses.
3. The special defenses are as follows;
a. Statute of limitations
b. Doctrine of res judicata
c. Doctrine of collateral estoppel
d. Violation of Rule 1.5 of the Rules of Professional Conduct
e. Violation of Rule 1.8 of the Rules of Professional CT Page 9765 Conduct
f. Misrepresentation
g. Breach of fiduciary duty
h. Lack of consideration
i. Doctrine of "stopped" — the court has treated this special defense as collateral estoppel
j. In the tenth special defense the defendant requests the court to deny equitable relief to the plaintiffs on their conduct
k. In the eleventh special defense the defendant seeks attorneys fees and costs should he prevail.
l. Doctrine of laches
At trial the defendant added the defense of payment.
4. The defendant also filed a counterclaim in the nature of an action to quiet title.
5. The plaintiffs have also responded to the special defenses by invoking the doctrine of "unclean hands."
On November 5, 2004 Taff filed a Motion for Summary Judgment dated November 5, 2004 (#145) together with a Memorandum in Support and numerous documents pertinent to the Motion. On February 22, 2005 the plaintiffs filed a Memorandum in Opposition and likewise attached numerous documents in support thereof. On June 1, 2005 the court (Brunetti, J.) filed a twelve-page Memorandum of Decision denying the Motion. Judge Brunetti addressed the following special defenses in some detail: statute of limitations, laches, res judicata, collateral estoppel, and Rule 1.8 of the Code of Professional Conduct. Taff neither requested nor did the court focus on the other special defenses except as they may have related to the special defenses enumerated by Judge Brunetti.
At trial, plaintiffs' counsel called Attorney Bruce Louden who gave testimony as to the relationship of the plaintiffs in the first foreclosure action as well as the instant case. Taff had CT Page 9766 executed two notes for $15,000 and $45,000 respectively. The first note dated January 8, 1993 was payable to Louden, Forzani Whitehead (designated the "Holder") and the second note dated June 16, 1994 was payable to Louden, Forzani Katz (designated the "Holder"). Attorneys Whitehead and Katz were formerly associated with Louden and Forzani in the practice of matrimonial law. Both notes and mortgages were subsequently assigned to the present plaintiffs. The plaintiffs are the holders of said notes. Counsel filed pre-trial memoranda.
Plaintiffs' counsel next called Forzani to testify. His direct, cross, redirect and recross consumed two full days and a portion of the third day of trial. Forzani presently practices exclusively in matrimonial law and has done so since 1998. Prior to that year a substantial amount of his practice was in matrimonial law. He has been in practice in Connecticut since 1976. He is a member of the American Academy of Matrimonial Lawyers and a Past President of the Connecticut Chapter. He has substantial experience in complex litigation involving custody disputes.
Taff contacted Forzani and related to him that he was the father of a 1-year-old son. He and the mother were never married and lived separate and apart. Taff retained Forzani to represent him in litigation with the mother involving custody and visitation issues. Forzani submitted to Taff a fee agreement which had been signed by Forzani but the copy submitted to court and made an exhibit did not have Taff's signature on it. Forzani claimed that his entire 7 files had been turned over to Taff's new counsel without copying and was unclear if the original with Taff's signature was in one of the files.
In the Taff v. Bettcher case Forzani's representation lasted approximately 3 years. With few exceptions Forzani submitted to Taff monthly itemized billings with the services rendered and the member of Forzani's firm who performed the services. To secure payment of some of the fees Taff provided Forzani with the notes and mortgages in question. Taff admitted he signed the notes in question and duly executed the mortgage deeds and returned them to Forzani. As previously mentioned the notes were assigned to the plaintiffs and they continue to hold said notes. The court finds the complaint proven and true.
The following findings are dispositive of all of the special defenses except for the doctrines of res judicata and collateral CT Page 9767 estoppel which will be dealt with separately. Taff retained the services of Forzani in connection with all matters in the Taff v. Bettcher litigation which was pending in the Litchfield Judicial District for a period of approximately 7 years. At the time Forzani was retained or shortly thereafter he sent to Taff a fee agreement which he had signed. Although Forzani did not produce a copy signed by Taff, Forzani testified credibly that Taff had signed it. Forzani undertook Taff's representation pursuant to the terms of the agreement. The court finds that Forzani complied with Rule 1.5.
The Taff v. Bettcher case turned into a nightmare from the very beginning. Forzani sent to Taff a billing on almost a monthly basis itemizing the services rendered, the time spent on performing the services and what member of Forzani's staff performed the services. The hourly billing rates were in conformity with the rates set forth in the fee agreement.
During the ensuing 3 years Taff and Forzani conferred frequently on the amount of the bills but at no time did Taff terminate Forzani's services. Forzani ultimately filed a Motion to Withdraw and for the next 4 years Taff was represented by other counsel. Further, Taff was counseled by his brother, James Taff, a practicing attorney in Massachusetts who also met with Forzani. It is interesting to note that James Taff filed an Answer and Special Defenses to the Complaint as "Executor and Trustee" having an interest in the land of Taff subject to this foreclosure action. His Answer and Special Defenses were almost a verbatim repeat of the Answer and Special Defenses filed by Taff. The court finds that James Taff, who did not appear at trial to offer any testimony, was counseling Taff during much of the time period Forzani was representing his brother.
As the fees began to accumulate in excess of preliminary estimates given to Taff by Forzani, Forzani prepared and forwarded to Taff a promissory note and mortgage deed in the amount of $25,000. The amount due at that time was approximately $15,000. Taff was advised to obtain legal counsel to review the documents. Taff redrafted the note in its entirety and changed the amount to $15,000. He executed the documents outside the presence of Forzani and ultimately returned to him the executed documents. Taff claimed the note was to be applied against his outstanding bill and once he paid $15,000 the note was paid. The court finds this claim lacking in credibility. At no point did Taff present any evidence that he thought the note was satisfied CT Page 9768 nor did he request the note be returned to him together with a release of mortgage. Forzani made a number of attempts to have Taff enter into a payment plan. While Taff did make payments on his bill he never entered into such a plan. Forzani sent a second note and deed for $45,000 which Taff executed outside the presence of Forzani as additional security. The bill at that time was well in excess of $60,000. Again, Forzani attempted to have Taff enter into a payment plan but he failed to do so.
Based upon a review of the testimony and the documentary evidence introduced at trial as well as the arguments of counsel and an examination of their briefs the court finds that Forzani did not make any misrepresentations to Taff. At best Forzani underestimated the fees in handling the case of Taff v. Bettcher. Taff's expectations and demands versus Bettcher's intransigence were the causes the fees escalated as they did. The court further finds that the reduction by Taff of the first note from $25,000 to $15,000 did not constitute a discharge of that debt when he made further payments on account. Under the circumstances of this case the court does not adopt Taff's position that his payments on account should be applied against the note. As far as lack of consideration, the services rendered by plaintiffs constituted adequate consideration for the indebtedness secured by the mortgages. Indeed, plaintiffs have elected not to pursue $114,458.92 of the balance due. As to the defense of laches there is substantial evidence to indicate that the plaintiffs actively pursued payment.
As to the special defenses of res judicata, collateral estoppel, statute of limitations and Rule 1.8, the court adopts the reasoning set forth in Judge Brunelli's Memorandum of Decision.
The plaintiffs, in response to the special defenses raised by Taff, claimed that even if one or more of the special defenses were proven Taff comes into court with "unclean hands."
In light of the court's rulings as hereinabove set forth the court will not address this issue.
In summary the following orders shall enter:
1. The court finds in favor of the plaintiffs on the complaint.
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2. The court finds in favor of the plaintiffs on all of Taff's special defenses.
3. The court finds in favor of the plaintiffs as to all matters pertaining to James Taff.
4. The court finds in favor of the plaintiffs on the counterclaim.
The court orders counsel to obtain an additional hearing date to try the issue of amounts due to plaintiffs, including interest and attorneys fees, if any.
SO ORDERED. CT Page 9770
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