Article Library
Blog Home All Blogs
Search all posts for:   

 

View all (522) posts »
 

Mediation Updates from Four States: Connecticut

Posted By USFN, Thursday, August 01, 2013
Updated: Monday, November 30, 2015

August 1, 2013

 

by James A. Pocklington
Hunt Leibert, P.C.
USFN Member (Connecticut)

On May 31, 2103, the Connecticut Legislature passed “An Act Concerning Homeowner Protection Rights,” Public Act No 13-136. It was signed by the governor on June 18, effective July 15, 2013. The act fundamentally changes the foreclosure mediation program in Connecticut.

First, it lays out a mission statement for mandatory settlement discussions by quantifying the “Objectives of the Mediation Program” and then defining the “ability to mediate” in a manner consistent with those objectives. This change requires individual servicer representatives taking part in the mediation process to be aware of both the program’s statutory requirements and the specifics of any given file’s history in the program. It goes into detail as to how such file-specific familiarity may be obtained.

Next, it alters who may be present during a session and the role of counsel in that regard. Currently, all mortgagors must be physically present for the first meeting, which is critical to obtaining proper intentions, given the significant percentage of separating/separated mortgagors and thereafter at least one mortgagor must be physically present at each session unless waived by the court. A niche is carved out for the mortgagee to appear telephonically with counsel to be physically present. The act changes this, requiring physical attendance at only the first session and permitting telephonic participation with physically-present counsel for all parties. Further, the act explicitly permits the attendance of a non-mortgagor spouse, who may not even be a party to the foreclosure action. The act does not apply the same exception to any other relationship.

Third, it shifts a significant portion of the document collection process from mutual meetings between the mortgagee and mortgagor to meetings between the mortgagor and/or their legal counsel and the court’s foreclosure mediation specialists, with limited direct involvement of the mortgagee or counsel. The act requires the mortgagor to meet with the court’s mediator and for them to work together to provide the necessary documents for any foreclosure alternative. It gives the mortgagor and mediator significant time — up to 84 days from the initiation of the lawsuit — to compile the documentation and submit it to the servicer and/or counsel.

Fourth, it imposes a much stricter timeline on all participating parties. The mortgagee is expected to have a substantive response within 35 days of receipt of a complete financial package for review for any foreclosure alternative, including those options that historically require third-party involvement. The statutory mediation period concludes after the third session between the mortgagee and mortgagor, and any further sessions may be granted by the court on an individual basis only on a showing that it is “highly probable the parties will reach an agreement through mediation” or on a showing that there has been “conduct that is contrary to the objectives of the mediation program.” Any such findings must be articulated on the record.

Lastly, and perhaps most significantly, the act eviscerates the confidentiality of the parties’ settlement negotiations and creates statutory permission for the court to consider anything that takes place in the mediation context. In addition to requiring exhaustively detailed reports by the court’s mediators after each session, which become part of the public record, the court is explicitly permitted to “consider all matters that have arisen in the mediation” as part of its review. This is particularly noteworthy given Connecticut’s motion hearing practice, where the judges sitting on mediation-related issues are currently the same judges who handle any other aspects of a pending foreclosure, up to and including entry of judgment.

©Copyright 2013 USFN. All rights reserved.
Summer USFN Report.

This post has not been tagged.

Share |
Permalink | Comments (0)
 
Membership Software Powered by YourMembership.com®  ::  Legal