NOTICE: This opinion is subject to motions for reargument under V.R.A.P. 40 as well as formal 

revision before publication in the Vermont Reports. Readers are requested to notify the Reporter 

of Decisions by email at: JUD.Reporter@vermont.gov or by mail at: Vermont Supreme Court, 109 

State Street, Montpelier, Vermont 05609-0801, of any errors in order that corrections may be made 

before this opinion goes to press.

2022 VT 10

No. 2021-124

New England Phoenix Company, Inc. Supreme Court

On Appeal from

 v. Superior Court, Grand Isle Unit,

Civil Division

Grand Isle Veterinary Hospital, Inc. et al. December Term, 2021

Robert A. Mello, J.

Herbert J. Downing of Kolvoord, Overton & Wilson, P.C., Williston, for Plaintiff-Appellant.

Anne K.G. Bazilwich, Pro Se, Blacksburg, Virginia, Defendant-Appellee.

PRESENT: Reiber, C.J., Eaton, Carroll and Cohen, JJ., and Teachout, Supr. J., 

Specially Assigned

¶ 1. CARROLL, J. New England Phoenix Company, Inc. appeals a trial court order 

denying its motion for a deficiency judgment following a foreclosure decree and an order 

confirming its purchase of a mortgaged property at a judicial sale. We reverse the order denying 

the deficiency judgment and remand. 

I. Factual Background

¶ 2. In 2010, Bank of America lent a veterinary hospital business in Grand Isle a total 

of $610,244.20.1 Paws and Laws, LLC owned the hospital’s real property, and Grand Isle 

Veterinary Hospital, Inc. owned the business assets. Bank of America lent Paws and Laws

1

 In its order, the trial court found that the total amount lent in 2010 was $574,000. 

However, the record indicates that the total amount was $610,244.20.
2

$374,000.00, secured by a mortgage on the real property. The bank also lent Grand Isle Veterinary 

Hospital $236,244.20 under a finance agreement, secured by the business’s personal property and 

assets. Guarantor Anne Bazilwich, owner and operator of the businesses, executed personal 

guarantees for both loans. 

¶ 3. In 2012, violating the terms of the 2010 mortgage, Paws and Laws conveyed the 

real property by quit claim deed to Grand Isle Veterinary Hospital. In 2014, Grand Isle Veterinary 

Hospital gave Bank of America a second mortgage on the real property securing the $236,244.20 

finance agreement. Soon thereafter the business defaulted on the loans and guarantor abandoned 

the property. Guarantor’s attempts to sell the property were unsuccessful. Bank of America did 

not initiate foreclosure proceedings on the loans. 

¶ 4. In 2018, Bank of America assigned the loans and mortgages to New England 

Phoenix. New England Phoenix filed this foreclosure action in April 2019. Guarantor, who had 

since moved to Virginia, did not respond to repeated attempts to serve her notice of the foreclosure

action, and did not participate in the proceedings.

2

 

¶ 5. In late 2019, the trial court entered a default judgment against guarantor, Paws and 

Laws, and Grand Isle Veterinary Hospital, issued a foreclosure decree by judicial sale, and set a 

thirty-day redemption period. Neither guarantor nor Grand Isle Veterinary Hospital redeemed the 

property, and a judicial sale was held in July 2020 after a delay due to COVID-19-related 

scheduling complications. At the sale, New England Phoenix submitted the winning bid of 

$325,000.00. 

¶ 6. In August 2020, New England Phoenix filed a motion for a confirmation order and 

deficiency judgment. In its motion, New England Phoenix represented that the total amount due 

for the loans was $790,230.48, which included previous unpaid interest plus interest accrued after 

2

 Guarantor also did not participate in this appeal. 
3

the foreclosure decree and the costs of the judicial sale. It then subtracted the proceeds from the 

judicial sale—$325,000.00—from this total and requested the difference—$465,230.48—as a 

deficiency. New England Phoenix did not reference Vermont Rule of Civil Procedure 80.1(j)(2)

in this motion. 

¶ 7. A hearing was held on New England Phoenix’s motion in January 2021. The court 

granted New England Phoenix’s motion for a confirmation order but requested additional

information before it would rule on the deficiency, including the appraised value in 2010 when the 

loans were first disbursed, when exactly guarantor abandoned the property, how long guarantor

had the property on the market and for what listing price. Neither the court nor counsel mentioned 

Rule 80.1(j)(2) at the hearing. 

¶ 8. In response to the court’s request, New England Phoenix filed a supplemental 

affidavit again detailing a deficiency judgment of $465,230.48. The supplemental affidavit 

represented that the value of the property had continued to decline in the years since guarantor had 

abandoned it, and that the current tax assessment of the property was $439,500.00. New England 

Phoenix told the court that its purchase of the property for $325,000.00 was “in between the current 

listing price of $295,000.00 and the [tax-]assessed value of $439,500.00 and, therefore, a 

reasonable reflection of the fair market value.” 

¶ 9. In March 2021, the court issued an order confirming the sale and transferring title 

to the property to New England Phoenix.3In a separate entry order, the trial court restated its 

request from the hearing that New England Phoenix provide the 2010 appraisal before it would 

rule on the deficiency judgment. New England Phoenix explained that it had not provided the 

court with a copy of the 2010 appraisal in its supplemental affidavit because Bank of America

never supplied one. New England Phoenix argued, in effect, that the 2010 appraisal was 

immaterial to the court’s decision, and that in any case, by the time it took an assignment of the 

3

 New England Phoenix subsequently sold the property for $260,000.00 in May 2021. 
4

loans and mortgages, the property had long been abandoned and contained no business assets. 

New England Phoenix represented that the buildings on the property would likely need to be 

demolished and that guarantor’s uncooperativeness was to blame for the delays in bringing the 

matter to a close. Finally, New England Phoenix argued that “the value of the [m]ortgaged 

[p]roperty today is low in relation to the debt owed.” 

¶ 10. The trial court denied New England Phoenix’s motion for deficiency judgment. 

The court cited a Connecticut case for the proposition that “it is within this court’s discretion 

whether to grant or deny a motion for a deficiency judgment, in whole or in part.” The court found

that New England Phoenix knew when it took the assignment “that the loans had been in default 

for many years and the value of the mortgaged premises had depreciated very significantly due to 

years of abandonment and disuse.” The court concluded that the foreclosure proceedings “ha[d]

been extremely protracted.” Accordingly, the court found that assessing “so large an amount of 

interest” under these circumstances would be unjust. 

¶ 11. New England Phoenix filed a motion to reconsider. It first conceded that it had 

erred by not pleading for a deficiency under Rule 80.1(j)(2). Now using the Rule, New England 

Phoenix calculated that the deficiency was $340,230.48, not $465,230.48. Moreover, it argued 

that Vermont case law contains no “factors in equity” which would permit a trial court to deny a 

deficiency judgment in its entirety, and suggested that the case the court cited, to the extent it was

applicable, merely stood for a court’s ability to equitably reduce the interest owed. In the 

alternative, New England Phoenix argued that, even if the court did have the authority to deny the 

deficiency judgment outright, it could independently recover against guarantor in her personal 

capacity, because she was a guarantor not a mortgagor. 

¶ 12. The court denied the motion to reconsider. It concluded that New England Phoenix 

was attempting to “obtain a second bite at the apple” by presenting new arguments and introducing

new facts, which it is not permitted to do in a motion to reconsider. The court found that New 
5

England Phoenix’s claim against guarantor should have been raised earlier. It found that New 

England Phoenix’s supplemental affidavit, filed with its motion to reconsider, contained facts that

contradicted New England Phoenix’s earlier representations. For example, New England Phoenix 

now represented that guarantor did not default and abandon the property “within a few years” of 

the 2010 loan origination as the court’s order had found. New England Phoenix now represented 

that the greatly reduced value of the property was not due to the deterioration of the property but 

rather to its location, and that the buyers would not demolish or reconstruct buildings on the 

property. 

¶ 13. The court reasoned that any errors in the factual record on which it relied to deny 

the deficiency judgment were the fault of New England Phoenix, and not the fault or mistake of 

the trial court. Moreover, it concluded that New England Phoenix had failed to present any new 

authority as to why the court could not deny a deficiency judgment in its entirety. However, it did 

not address New England Phoenix’s argument that the court had erred by failing to use Rule 

80.1(j)(2) to calculate a potential deficiency judgment. 

¶ 14. On appeal New England Phoenix makes three arguments: (1) the trial court erred

when it did not apply Rule 80.1(j)(2) in its order denying the deficiency; (2) the trial court abused

its discretion by denying the deficiency in its entirety; and (3) New England Phoenix’s claim 

against guarantor is an independent cause of action because she is not a “mortgagor” within the 

meaning of the applicable statute. 

II. Standard of Review

¶ 15. We begin with New England Phoenix’s argument that the court abused its 

discretion by denying its motion for deficiency judgment in its entirety. As an initial matter, we 

must determine the appropriate standard of review to evaluate this argument. New England 

Phoenix suggests the correct standard is for an abuse of discretion. However, this depends on 

whether the relevant statutes provide trial courts the discretion to alter or deny a deficiency 
6

judgment, a question of law that we review de novo. State v. Eldredge, 2006 VT 80, ¶ 7, 180 Vt. 

278, 910 A.2d 816. 

¶ 16. “Our primary objective in construing a statute is to effectuate the Legislature’s 

intent.” Shires Hous., Inc. v. Brown, 2017 VT 60, ¶ 9, 205 Vt. 186, 172 A.3d 1215 (quotation 

omitted). We assume the Legislature intends the plain, ordinary meaning of language in statutes. 

Id. If a statute is unambiguous on its face our inquiry ends. Green Mtn. Fireworks, LLC v. Town 

of Colchester, 2020 VT 64, ¶ 11, __ Vt. __, 249 A.3d 296. Only where the statutory language is 

ambiguous or creates uncertainty will “we resort to statutory construction to ascertain the 

legislative intent.” T.C. v. L.D., 2020 VT 19, ¶ 4, 211 Vt. 582, 229 A.3d 77 (quotation omitted). 

¶ 17. The Legislature provides courts the authority to grant mortgage foreclosures by 

judicial sale. 12 V.S.A. § 4945(a) (“All . . . mortgages affecting real property may . . . at the 

discretion of the court . . . be foreclosed by a judicial foreclosure sale.”). A separate section, 12 

V.S.A. § 4954, governs the process following a judicial sale. This process includes issuing an 

order confirming the sale, transferring title to the mortgaged property, calculating disbursement of 

surplus sale proceeds, and considering the conditions necessary to assess a deficiency judgment. 

Id. § 4954(a)-(d). 

¶ 18. As relevant here, § 4954(d) provides that after a sale “[t]he court may assess a 

judgment against the mortgagor for the deficiency if the proceeds of [the] sale are insufficient to 

meet the expenses incurred in making the sale and amount due to the plaintiff.” Id. (emphasis 

added). We generally give the word “may” its plain, ordinary meaning, which connotes discretion. 

Vt. Nat’l Tel. Co. v. Dep’t of Taxes, 2020 VT 83, ¶ 55, __ Vt. __, 250 A.3d 567. We do not depart 

from our general rule here. 

¶ 19. The Legislature used “may” in § 4954(d) in the context of a statutory scheme where 

“it is proper for [courts] to weigh the equities of the situation.” Merchs. Bank v. Lambert, 151 Vt. 

204, 206, 559 A.2d 665, 666 (1989) (describing nature of foreclosure actions). For example, in 
7

HSBC Bank USA N.A. v. McAllister, we held that judicial confirmation of a foreclosure sale 

pursuant to § 4954(a)4is discretionary because the statute is clear, on its face, that courts possess

the equitable authority to ensure fairness in the foreclosure process. 2018 VT 9, ¶ 7, 206 Vt. 445, 

182 A.3d 593 (emphasizing word “may” in § 4954(a) connotes discretion). We noted, with respect 

to the court’s exercise of discretion to order a new sale where one had already occurred, that 

§ 4954(a)’s lack of “specific criteria for setting aside a judicially ordered public sale” meant that 

the court could “consider all factors it finds relevant and necessary to fulfill the purpose of 

confirmation orders.” Id. ¶¶ 8, 10. 

¶ 20. Conversely, in the section detailing the distribution of surplus sale proceeds, the 

Legislature used “shall,” not “may,” in the operative provision. Section 4954(c) provides that 

when the proceeds exceed the amount due, after satisfying the claims of the mortgagee and other 

creditors, “the excess shall be paid to the defendant mortgagor.” We have said that “[s]tatutes 

generally use ‘shall’ as imperative or mandatory language.” State v. Rafuse, 168 Vt. 631, 632, 

726 A.2d 18, 19 (1998) (mem.) (citing Black’s Law Dictionary 1375 (6th ed. 1990)). “Shall” is 

“a word of command, and it is inconsistent with a concept of discretion.” Id.; see also Baldauf v. 

Vt. State Treasurer, 2021 VT 29, ¶ 19, __ Vt. __, 255 A.3d 731 (reasoning that though “we 

presume that the Legislature chooses statutory language intentionally, so different words carry 

different meanings,” we “read and construe together subsections of a statute that were drafted as 

part of an overall statutory scheme” (quotation omitted)). 

¶ 21. Considering this overall language and context of § 4954, we conclude that 

§ 4954(d) provides trial courts with the discretion to deny deficiency judgements.5 The Legislature 

4

 Section 4954(a) provides in relevant part: “The court may issue an order of confirmation 

of the sale without hearing, unless the court in its discretion determines that a hearing is necessary.”

5

 We note some states have decided this question differently. For example, the South 

Carolina Supreme Court, in a case involving similar facts, held that the word “may” in the

analogous South Carolina statute “clearly conflicts with South Carolina case law on this issue.” 

Am. Gen. Fin. Servs., Inc. v. Brown, 658 S.E.2d 99, 100 (S.C. 2008); but see Nat’l Enters., Inc. v. 
8

could have used “shall” instead of “may,” if it intended to require courts to mechanically grant 

deficiency judgments where the amount owed exceeds “the proceeds of [the] sale.” 12 V.S.A.

§ 4954(d). But it did not because “ ‘[a] foreclosure action, even when by sale, remains an equity 

action.’ ” Bank of Am., N.A. v. O’Kelly, 2018 VT 71, ¶ 15, 208 Vt. 20, 194 A.3d 746 (quoting 

Reporter’s Notes—1982 Amendment, V.R.C.P. 80.1). 

¶ 22. We examine a trial court’s discretionary rulings using “an abuse of discretion 

standard of review, which requires a showing that the trial court has withheld its discretion entirely 

or that it was exercised for clearly untenable reasons or to a clearly untenable extent.” HSBC 

Bank, 2018 VT 9, ¶ 8 (quotation omitted). “[A] trial court fails to exercise its discretion where it 

does not consider factors relevant to the statutorily mandated procedural requirements of a 

foreclosure sale, any requirements set out in the foreclosure judgment, and other factors 

implicating the fairness or integrity of the foreclosure sale.” O’Kelly, 2018 VT 71, ¶ 14. With 

this standard of review in mind, we now turn to the trial court’s denial of New England Phoenix’s 

motion for deficiency judgment.

III. Discussion

A. Rule 80.1(j)(2)

¶ 23. Although it provides courts the discretion to grant or deny a deficiency judgment, 

§ 4954(d) is silent regarding the factors the trial court must consider in doing so, including the 

calculation of a deficiency. This Court has long held that “[w]here . . . [a] deficiency can be 

demonstrated, a personal judgment for the balance may be sought and secured by the mortgagee.” 

United Sav. Bank v. Barber, 135 Vt. 278, 279-80, 375 A.2d 993, 994 (1977) (tracing doctrine back 

to Lovell v. Leland, 3 Vt. 581 (1831)). We have reasoned that “[i]f the security is less in value 

than the amount of the decree the payment is pro tanto.” Hewey v. Richards, 116 Vt. 547, 551, 80 

Thompson, 682 So. 2d 677, 678 (Fla. Dist. Ct. App. 1996) (per curiam) (“A trial court's discretion 

with regard to granting or denying a deficiency, although entitled to great weight, is not absolute.”).
9

A.2d 541, 543 (1951); see Vt. Nat’l Bank v. Leninski, 166 Vt. 577, 578, 687 A.2d 890, 892 (1996) 

(mem.) (“[T]he deficiency is the difference between the fair market value of the premises and the 

debt.”). However, we have approved of a court’s discretion to deny a deficiency judgement if the 

court decides the judgment would be inequitable. See, e.g., Bank of Am., N.A. v. O’Kelly, No. 

2019-223, 2019 WL 6048912, *5 (Vt. Nov. 14, 2019) (unpub. mem.) (citing HSBC Bank, 2018 

VT 9), https://www.Vermont judiciary.org/sites/default/files/documents/eo19-223.pdf [https://

perma.cc/38NB-FUCJ] (affirming trial court’s decision denying mortgagee deficiency judgment

because mortgagee’s conduct likely prejudiced mortgagor’s interests). 

¶ 24. In situations where, as here, the foreclosing mortgagee is also the purchaser at a 

judicial sale, Rule 80.1(j)(2) sets forth specific considerations in determining a deficiency 

judgment. It provides: 

 In the event that the proceeds of the sale are insufficient to meet 

the expenses incurred in making the sale and the amount due the 

plaintiff, the court shall provide in its order of confirmation for the 

payment of the reasonable expenses incurred in making the sale and 

the payment of the balance of the proceeds to the plaintiff on account 

of the amount due the plaintiff. If the plaintiff so requests in the 

complaint, the court may assess a judgment against the mortgagor 

for the deficiency. Where the mortgagee is the purchaser at the sale, 

any deficiency shall be limited to the difference between the fair 

market value of the premises at the time of sale, as determined by 

the court based on the appraisal provided in subdivision (i) and such 

other evidence as may be received, and the amount due the plaintiff 

plus the reasonable expenses incurred in making the sale.

V.R.C.P. 80.1(j)(2) (emphases added). The Rule, like § 4954(d), provides courts the discretion to 

“assess a judgment against the mortgagor for the deficiency.” The Rule further clarifies that where 

the mortgagee is the purchaser, “any deficiency shall be limited.” New England Phoenix argues 

that this language means the court is required to grant a deficiency precisely equal to the difference 

between the fair market value at the time of the sale and the outstanding debt plus costs. It argues 

that the under the Rule, “the determination of the deficiency is a matter of arithmetic.” 
10

¶ 25. “In interpreting rules of procedure . . . we employ tools similar to those we use in 

statutory construction.” State v. Amidon, 2008 VT 122, ¶ 16, 185 Vt. 1, 967 A.2d 1126. “[O]ur 

ultimate goal is to give effect to the intent” of the rule and to do this “we rely principally on the 

plain meaning of the rule.” In re Atwood Planned Unit Dev., 2017 VT 16, ¶ 11, 204 Vt. 301, 167 

A.3d 312 (quotation omitted). “When the rule is part of a larger scheme, we read the scheme’s 

operative sections . . . in context and the entire scheme in pari materia.” Id. (quotation omitted). 

¶ 26. We begin with the plain meaning of “shall be limited” in Rule 80.1(j)(2). A primary 

definition of “limit” is to provide “[t]he extent of power, right, or authority.” Limit, Black’s Law 

Dictionary (11th ed. 2019). “Limited,” the adjectival form of “limit,” is “characterized by 

enforceable limitations prescribed . . . upon the scope or exercise of powers.” Limited, MerriamWebster Online Dictionary, https://www.merriam-webster.com/dictionary/limited [https://perma

.cc/ 4EMY-M6XQ]. Therefore, in the context of the entire scheme, “shall be limited” means that, 

in the situation where a mortgagee is the purchaser, courts may grant deficiency judgments up to

and including the difference prescribed in the Rule, but not more. As explained in the Reporter’s 

Notes, the purpose of the Rule limiting judgment in these circumstances is to “protect the interest 

of the mortgagor.” Reporter’s Notes—1982 Amendment, V.R.C.P. 80.1. The Rule, which largely 

follows the majority approach in the United States, “is aimed primarily at preventing the unjust 

enrichment of the mortgagee.” Restatement (Third) of Prop.: Mortgs., § 8.4 cmt. a (1997); see 

also HawaiiUSA Fed. Credit Union v. Monalim, 464 P.3d 821, 832-35 (Haw. 2020) (adopting 

similar approach to calculate deficiencies where mortgagee is purchaser). Despite New England 

Phoenix’s argument otherwise, it does not follow that the Rule would mechanically mandate a 

deficiency amount where the purpose is to provide heightened considerations of a mortgagor’s 

interests. 

¶ 27. Moreover, as we have previously held, it is within the trial court’s discretion in 

confirming the sale to consider the fairness of a potential deficiency judgment. See O’Kelly, 2018 
11

VT 71, ¶¶ 13-14. However, in cases where the mortgagee is the purchaser, it is not the sale price 

that is determinative in the calculation of a deficiency judgment as it often is when the purchaser 

is a third party.

6

 The fair market value at the time of the sale is determinative.

7

 Thus, in this 

situation, the court has the discretion to deny a deficiency even after it has confirmed the sale. See 

Id. ¶ 14 (“[A] trial court fails to exercise its discretion where it does not consider factors relevant 

to the statutorily mandated procedural requirements of a foreclosure sale . . . [and] any 

requirements set out in the foreclosure judgment . . . .”). 

¶ 28. Nonetheless, “the foreclosure of mortgages is an equitable remedy, and thereby 

subject to the considerations inherent in the exercise of a court of equity’s historic jurisdiction.” 

Pownal Dev. Corp. v. Pownal Tanning Co., 171 Vt. 360, 365, 765 A.2d 489, 493 (2000) (citation 

omitted). Ordinarily, “[i]t is not the nature of equity . . . to work a forfeiture.” Merchs. Bank, 151 

Vt. at 207, 559 A.2d at 667. Even if the Rule provides enhanced considerations for the mortgagor, 

the interest of the mortgagee to be made whole remains undiminished. See Restatement (Third) 

of Prop.: Mortgs., § 8.4 cmt. a. Ordinarily, both interests are served by following the formula set 

forth in Rule 80.1(j)(2).

B. The Court’s Order Denying the Deficiency Judgment

¶ 29. Here, the trial court did not follow the formula. The Rule requires the court to 

establish fair market value at the time of the sale, “based on the appraisal provided in subdivision 

(i) and other evidence as may be received.” V.R.C.P. 80.1(j)(2); see also Reporter’s Notes—1982 

Amendment, V.R.C.P. 80.1 (“The court must affirmatively establish fair market value.”). The 

court found that the most recent tax assessed value of the property was $439,500.00 in 2012, 

6

 “One can assume that the sale price is the fair market value in most cases.” Reporter’s 

Notes—1982 Amendment, V.R.C.P. 80.1.

7

 The sale price can be among “the evidence that may be admitted” under Rule 80.1(j)(2). 

See Leninski, 166 Vt. at 578, 687 A.2d at 892 (“The court is not limited in the manner of evidence 

or the means that may be considered for determining market value.”).
12

though it found that “the property is certainly not worth its tax assessed value.” The court noted

that the condition of property had deteriorated to the extent that New England Phoenix had at one 

point listed the property for $295,000.00, and that its winning $325,000.00 bid at the judicial sale 

was $150,000.00 more than the next highest bid.8 At no point, however, did the trial court make 

a finding of the property’s fair market value. 9 Without this crucial fact, it could not make a proper 

deficiency calculation. 

¶ 30. In addition to failing to consider the necessary factors to calculate a deficiency 

judgment, the court’s reasons for denying the deficiency judgment are “clearly untenable.” HSBC 

Bank, 2018 VT 9, ¶ 8 (quotation omitted). The court reasoned that New England Phoenix took an 

assignment of the debt and security “knowing that the loans had been in default for many years 

and that the value of the mortgaged premises had depreciated very significantly due to years of 

abandonment and disuse.” To the extent this conclusion is supported by the record, it is irrelevant

in the context of New England Phoenix’s business practices. The correct standard is whether a

secured creditor disposed of the property in a commercially reasonable manner. See Chittenden 

Tr. Co. v. Maryanski, 138 Vt. 240, 244, 415 A.2d 206, 208 (1980); see also Fed. Fin. Co. v. 

Papadopoulos, 168 Vt. 621, 623, 721 A.2d 501, 503 (1998) (mem.) (“The burden is on the secured 

party to prove that the disposition of collateral was commercially reasonable . . . .”). Though “the 

risk of loss is part of the risk of lending,” First Bank v. Fischer & Frichtel, Inc., 364 S.W.3d 216, 

227 n.5 (Mo. 2012) (en banc) (Teitelman, C.J., dissenting), without some evidence that New 

England Phoenix acted unreasonably in taking an assignment of the debt or in the disposition of 

8

 We note that New England Phoenix did not provide a copy of a March 2019 appraisal it 

had prepared to the court until after the court denied its motion for deficiency judgment. 

9

 Contrary to New England Phoenix’s argument that the 2010 appraisal was irrelevant to 

determine the fair market value of the property at the time of the judicial sale, the Rule expressly 

permits the trial court to consider “other evidence as may be received.” V.R.C.P. 80.1(j)(2). If 

the court considered the 2010 appraisal necessary to make the determination, the court’s request 

was a proper exercise of its discretion. 
13

the mortgaged property, the conclusion that New England Phoenix has to “be expected to live with 

the economic consequences of its decision” is not supported by the findings. 

¶ 31. The trial court’s conclusion that the “extremely protracted” foreclosure proceeding

rendered it inequitable “to saddle [mortgagors] with interest that has been accumulating on the 

loans for several years” is similarly untenable. Most relevant to this conclusion, the court found 

that Bank of America did not foreclose the loans, that New England Phoenix did not initiate 

foreclosure proceedings until April 2019, and that guarantor did not delay the proceedings by 

virtue of not participating. 

¶ 32. Unreasonable delay is an equitable consideration in foreclosure proceedings. See 

Quazzo v. Quazzo, 136 Vt. 107, 114, 386 A.2d 638, 642 (1978) (“What constitutes unreasonable 

and inexcusable delay depends largely upon the circumstances of the particular case.” (quotation 

omitted)). However, delay alone is insufficient; the delay must prejudice the mortgagor. Turner 

v. Turner, 131 Vt. 253, 257, 305 A.2d 592, 595 (1973). Unreasonable delay is an affirmative 

defense, “and the burden is on the party relying on it.” Preston v. Chabot, 138 Vt. 170, 172, 412 

A.2d 930, 931 (1980). A party subject to a default judgment implicitly waives its right to raise 

affirmative defenses later in the litigation. LaFrance Architect v. Point Five Dev. S. Burlington, 

LLC, 2013 VT 115, ¶¶ 9-11, 195 Vt. 543, 91 A.3d 364.

¶ 33. The record shows that guarantor, in addition to executing a personal guarantee for 

the loans, defaulted on the payments, abandoned the property, did not answer the foreclosure 

complaint, and did not appear in the foreclosure proceedings or acknowledge the pendency of this 

appeal. Moreover, when New England Phoenix took possession of the real property, it found no

business assets, including veterinary equipment. Pursuant to the 2010 finance agreement, this 

equipment was secured collateral against the $236,244.20 loan. The record does not show that 

guarantor has failed to answer because of mistake or inadvertence, and there is no evidence that 

her neglect is excusable under the circumstances or that she has “demonstrated any good or 
14

meritorious defense to [New England Phoenix’s] claims.” LaFrance Architect, 2013 VT 115, ¶ 11 

(quotation omitted) (describing factors used to decide whether to set aside default judgment). The 

court’s order, in effect, rewards a defaulting guarantor.

¶ 34. Moreover, New England Phoenix filed the foreclosure complaint approximately

five months after taking the assignment from Bank of America. Shortly before the original March 

2020 judicial sale was scheduled, the outbreak of the COVID-19 pandemic delayed the sale until 

July 2020. Following the sale, New England Phoenix timely filed a motion for a confirmation 

order and deficiency judgment. Though it did not provide the court with the 2010 appraisal as 

ordered, this delay, to the extent it was prejudicial to guarantor, was harmless because she had 

made no attempt to appear after the court entered a default judgment against her. 

¶ 35. We therefore conclude that the court abused its discretion by failing to consider 

factors relevant to Rule 80.1(j)(2), and by exercising its discretion to deny a deficiency judgment

“for clearly untenable reasons.” HSBC Bank, 2018 VT 9, § 8 (quotation omitted). On remand, 

the trial court should determine the fair market value of the property at the time of the sale and 

determine the amount of any deficiency judgment based on its assessment of relevant factors. 

C. New England Phoenix’s Claim Against Guarantor

¶ 36. Finally, New England Phoenix argues that even if the trial court has the discretion 

to deny a deficiency, it nonetheless retains an independent cause of action to recover against 

guarantor because she is not a mortgagor within the meaning the statute. New England Phoenix

raised this argument for the first time in its motion to reconsider. A party “cannot use a motion to 

reconsider to raise a wholly new theory” that should have been raised earlier in the litigation. 

Agency Nat. Res. v. Parkway Cleaners, 2019 VT 21, ¶ 45, 209 Vt. 620, 210 A.3d 445 (quotation 

omitted). Moreover, New England Phoenix does not challenge the court’s denial of its motion to 

reconsider. See Rowe v. Brown, 157 Vt. 373, 379, 599 A.2d 333, 337 (1991) (“Issues not raised 
15

on appeal are deemed waived.”). Therefore, we need not, and do not, reach the merits of this 

argument. 

IV. Conclusion

¶ 37. Our conclusion today is not to be read as giving unbridled discretion to the trial 

courts to deny deficiency judgments where the mortgagee is the purchaser at a judicial sale. To 

the contrary, the procedure set forth in Rule 80.1(j)(2) ordinarily protects the interests of both 

mortgagee and mortgagor. Therefore, we reverse the trial court’s order and remand for further

findings and conclusions consistent with this opinion. 

Reversed and remanded for further findings and conclusions consistent with this opinion.

FOR THE COURT:

Associate Justice