According to the judicial website, the church has been defaulted for failure to plead and the matter is scheduled for a pre-trial conference on September 30, 2011. http://civilinquiry.jud.ct.gov/CaseDetail/PublicCaseDetail.aspx?DocketNo=NNHCV106014252S
I haven't checked the file and this default may apply to either their special defenses and/or counter-claim. It most likely pertains only to the counter-claim as there is usually no reason to file a responsive pleading to a special defense.
The special defense and counter-claim are both based on the church's claim that they were not notified of the change in tax status. If the default applies to both, the court will hear no evidence on that issue; if the default applies only to the counter-claim, then the church may use the lack of notice as a defense to the foreclosure but the court cannot award them damages.
In many cases, the judges will vacate a default so until a judgment is entered, while bad news for the church, it is not the end of the case. . .yet!
The case may resolve tomorrow (9-30-11) at the pre-trial. There is a huge backlog of foreclosure cases and the judges are pressuring the attorneys and parties to resolve the matters without trial. I suspect that the church's ability to pay any judgment is really at the heart of the matter and wonder if and to what extent, the mother church will bail them out.
One other question I have is whether the church is current on the mortgage payments. The failure to pay taxes is most certainly a violation of the terms of the note and mortgage. The church has to know there is little to no chance of success and continuing to make payments on the note for property that will be lost makes no business sense. There is no reason for the bank to initiate a separate foreclosure because, as junior lien holders, they have what is called a right of redemption to the property. If the property is ordered auctioned, the bank will generally bid the amount due for taxes plus the amount of their note. They will either own the property or any subsequent bid, which must be higher than their bid, will be enough to pay their debt. If the judgement is of strict foreclosure, the church will be given a "law day" with which to pay the taxes or lose the property. If they fail to redeem, the bank will simply pay the taxes and take title to the property.
I haven't checked the file and this default may apply to either their special defenses and/or counter-claim. It most likely pertains only to the counter-claim as there is usually no reason to file a responsive pleading to a special defense.
The special defense and counter-claim are both based on the church's claim that they were not notified of the change in tax status. If the default applies to both, the court will hear no evidence on that issue; if the default applies only to the counter-claim, then the church may use the lack of notice as a defense to the foreclosure but the court cannot award them damages.
In many cases, the judges will vacate a default so until a judgment is entered, while bad news for the church, it is not the end of the case. . .yet!
The case may resolve tomorrow (9-30-11) at the pre-trial. There is a huge backlog of foreclosure cases and the judges are pressuring the attorneys and parties to resolve the matters without trial. I suspect that the church's ability to pay any judgment is really at the heart of the matter and wonder if and to what extent, the mother church will bail them out.
One other question I have is whether the church is current on the mortgage payments. The failure to pay taxes is most certainly a violation of the terms of the note and mortgage. The church has to know there is little to no chance of success and continuing to make payments on the note for property that will be lost makes no business sense. There is no reason for the bank to initiate a separate foreclosure because, as junior lien holders, they have what is called a right of redemption to the property. If the property is ordered auctioned, the bank will generally bid the amount due for taxes plus the amount of their note. They will either own the property or any subsequent bid, which must be higher than their bid, will be enough to pay their debt. If the judgement is of strict foreclosure, the church will be given a "law day" with which to pay the taxes or lose the property. If they fail to redeem, the bank will simply pay the taxes and take title to the property.