Webster Bank v. Oakley

Summary

The Connecticut Supreme Court affirmed a strict foreclosure judgment in favor of Webster Bank. It held that the bank’s series of default, acceleration, and cure letters clearly and unequivocally exercised the mortgage’s acceleration option, and that the mortgage’s nonwaiver clause prevented subsequent conduct from constituting waiver. The court also concluded that the federal Fair Housing Amendments Act provisions governing reasonable accommodations under 42 U.S.C. § 3604 did not apply to mortgage enforcement, while addressing the relationship to 42 U.S.C. § 3605.

Holdings

1. A lender exercising an optional mortgage acceleration clause must take affirmative action that clearly and unequivocally manifests the election to accelerate and apprises the borrower of that election. Webster Bank satisfied that requirement through its default and cure letter, its subsequent notice that the debt was accelerated, and its counsel's later communication, which did not retract the acceleration.
2. Claims alleging disability discrimination in the enforcement of mortgage loan agreements fall within 42 U.S.C. § 3605 rather than § 3604. Section 3604 and its reasonable-accommodation provision do not govern the mortgage-enforcement conduct at issue.
3. The FHAA does not require a lender to alter generally applicable mortgage terms or foreclosure procedures to accommodate a borrower's disability because § 3605 does not define discrimination to include a failure to provide reasonable accommodations.
4. Connecticut's fair housing statutes apply to mortgage servicing and enforcement but do not require a lender to vary the terms or conditions of an otherwise generally applicable mortgage policy to accommodate a borrower's disability.
5. Mortgage servicing and enforcement are services provided by a bank, a public accommodation under Title III of the ADA. Title III therefore applies to access to those services, but it does not require the bank to alter the content or generally applicable terms and conditions of its mortgage or foreclosure policies to accommodate a borrower's disability.

Questions Presented

1. Whether Webster Bank's series of letters clearly and unequivocally exercised the mortgage's optional acceleration provision despite a subsequent attorney letter allowing additional time to cure.
2. Whether the federal Fair Housing Amendments Act, particularly 42 U.S.C. § 3604, requires a lender enforcing a mortgage to provide reasonable accommodations for a disabled mortgagor.
3. Whether 42 U.S.C. § 3605, the federal provision governing residential real-estate-related transactions, requires reasonable accommodations in mortgage servicing and enforcement.
4. Whether Connecticut's fair housing statutes require a lender to modify generally applicable mortgage-servicing or foreclosure terms to accommodate a borrower's disability.
5. Whether Title III of the Americans with Disabilities Act applies to mortgage servicing and enforcement and requires a lender to modify the content or generally applicable terms of a mortgage to accommodate a disabled borrower.

Disposition

affirmed