As explained in the 2010 Connecticut Appellate Court case of Chase Home Finance, LLC v. Fequiere, Connecticut General Statutes §49-17 "permits the holder of a negotiable instrument that is secured by a mortgage to foreclose on the mortgage even when the mortgage has not yet been assigned to him." CitiMortgage, Inc. brought this foreclosure action against William Gaudiano in 2010. The court denied Gaudiano's motions to dismiss the action for lack of subject matter jurisdiction claiming that the plaintiff lacked standing as it was not the owner of the mortgage and note before the action commenced. Gaudiano appealed from the judgment of strict foreclosure, challenging the court's finding of standing. The Appellate Court affirmed the judgment. While the defendant argued that the plaintiff did not have a valid assignment of the note on the land records, he provided no authority imposing such a requirement. The plaintiff availed itself of C.G.S. §49-17 and the trial court specifically found that the plaintiff became the owner and holder of the note in July 2005, years before commencing this action. That finding was supported by the record and was not clearly erroneous. The plaintiff produced a copy of the note assigned to Lehman Brothers Bank, FSB and, thereafter, by that bank to Lehman Brothers Holdings, Inc. Lehman Brothers Holdings, Inc. endorsed the note in blank and the plaintiff stamped its name thereon, converting it to a special endorsement under C.G.S. §42a-3-205(c). The trial court credited this evidence and deposition testimony and an affidavit stating that the plaintiff was the owner and holder of the note before the action commenced. The defendant submitted a certified copy of an assignment of the mortgage filed on the land records on July 9, 2004 purportedly assigning the note and mortgage from Lehman Brothers Bank, FSB, to MERS, Mortgage Electronic Registration Systems, Inc. The court found that on April 14, 2004 Lehman Brothers Bank, FSB had assigned the note to Lehman Brothers Holdings, Inc. and could not have assigned the note to MERS months later. The Appellate Court rejected the defendant's assertion that the land records controlled the issue. What truly controlled was the evidence the trier of fact deemed credible. The plaintiff had standing under C.G.S. §49-17. Judge Flynn concurred, separately, noting the mischief done to the land records.

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