In Waterbury Firefighters F.C.U. v. D’Occhio, the trial court granted senior mortgagee Wells Fargo Bank, N.A.’s (Wells) motion to be made a party defendant in junior mortgagee Waterbury Firefighters F.C.U.’s (Waterbury) foreclosure action based on Wells’s claim of equitable subrogation and reformation in another foreclosure action.

The pertinent facts are as follows: In October 2006, Wells was given a mortgage from defendant borrower Edith D’Occhio to secure a note in the amount of $354,750. At the time, the mortgage property was owned by Edith and William D’Occhio. Due to an error at the closing, William D’Occhio failed to sign the mortgage. Two years later, Waterbury obtained a mortgage executed by both Edith and William D’Occhio to secure a note in the amount of $86,389.20. In 2010, Wells commenced a foreclosure action against Edith D’Occhio and William D’Occhio seeking a reformation of the mortgage to include William D’Occhio, as well as equitable subrogation. In that action, Wells named Waterbury as a defendant due to its junior interest.

During the pendency of Wells’s foreclosure, Waterbury commenced its own foreclosure action where Wells was not named as Wells held a senior interest over Edith D’Occhio. In April 2012, Wells moved to be made a party in Waterbury’s foreclosure action in order to assert its senior interest over both Edith and William D’Occhio. Waterbury objected on the grounds that Wells was not a necessary party and, even if it were, Wells’s claims should be barred as it did little to advance its case in Wells Fargo v. D’Occhio. Waterbury also alleged that Wells’s claims of reformation and subrogation were not raised in its action and thus were best resolved in Wells’s case. Waterbury’s final claim was that Wells was estopped due to the doctrine of laches.

The trial court found that pursuant to Connecticut General Statute § 52-107 and Franco v. East Shore Development, Inc. , 271 Conn. 623, 630 (2004), Wells’s claims of reformation and subrogation, if true, created a “direct and immediate interest” that would be affected by a judgment in Waterbury’s case. The trial court also found that Wells would suffer a greater prejudice than Waterbury should Wells not be made a party, as a judgment in favor of Waterbury would “impair” Wells’s claims of reformation and subrogation.

Although the trial court was not directly presented with the equitable claims of reformation and subrogation, in granting Wells’s motion, the trial court recognized the importance of those claims and the potential negative effect a tangential judgment would pose.