U.S. Bank N.A. v. Gonzales
Defense allegations that amounts charged were so "one-sided" as to be unconscionable can be sufficient to provide a defense to a foreclosure action. The plaintiff, U.S. Bank, filed a foreclosure suit against the defendant, Ana Gonzalez, who filed an answer, special defenses and counterclaims. The plaintiff bank moved to strike the special defenses and counterclaims. In Fidelity Bank v. Krenisky, the Connecticut Appellate Court wrote, "[I]f the mortgagor is prevented by accident, mistake or fraud, from fulfilling a condition of the mortgage, foreclosure cannot be had." The Appellate Court added, "Other equitable defenses that our Supreme Court has recognized in foreclosure actions include unconscionability . . . abandonment of security . . . and usury." The Superior Court found that the defendant, Gonzalez, adequately alleged that the amounts charged were so "one-sided" as to be unconscionable. "The purpose of the doctrine of unconscionability is to prevent oppression and unfair surprise," pursuant to LaSalle National Bank v. Freshfield Meadows LLC, a 2002 decision of the Connecticut Appellate Court. The Superior Court denied the bank's motion to strike Gonzalez's special defense that forbearance plans were unconscionable. The court granted the bank's motion to strike the defendant's special defense that payments were not properly credited, because it did not attack the making, validity or enforcement of the note or mortgage. Gonzalez did not allege that the mortgage required notice of default, and the court granted the bank's motion to strike the special defense that the bank engaged in bad faith, because it failed to provide notice of default. Gonzalez adequately alleged that the instrument upon which the bank based its cause of action was renegotiated and that the bank failed to comply with the modified terms. This special defense concerned the making, validity or enforcement of the note or mortgage, and the court denied the bank's motion to strike. Gonzalez apparently abandoned counterclaims and failed to provide arguments in support of her objection to the bank's motion to strike, and the court granted the motion to strike the counterclaims.