Real Estate Law

(Court opinion corrected 6/23/20.) Plaintiff filed mortgage foreclosure complaint. After Defendant failed to appear, court entered default judgment of foreclosure and sale. Plaintiff then bought property at a sheriff's sale, and then sold property to a corporation. More than 7 years after that sale, Defendant filed petition for relief from judgment, arguing that court did not obtain personal jurisdiction because he was served in Cook County without a court-appointed special-process server to serve in Cook County. Court properly determined that corporate purchaser's property rights were protected by Section 2-1401(e) of Code of Civil Procedure, because no jurisdictional defect as to the summons was apparent from the face of the record. Supreme Court Rule 101(d) does not require exact compliance with the summons form provided, but requires that it be substantially adopted. The special-process server's affidavit does not state whether Defendant was served in Cook or Du Page County, and thus affidavit does not establish a jurisdictional defect on its face. Corporate purchaser's mortgage lender was entitled to bona fide-purchaser status and the protections of Section 2-1401(e). (ZENOFF and HUDSON, concurring.)

(Court opinion corrected 6/24/20.) Plaintiffs, all individual owners of condominium units, filed suit, contending that Defendants breached their fiduciary duties toward them, after approval of forced bulk sale of units under section 15 of Condominium Property Act. The common law of fiduciary duty remains in full force and applies to bulk sale of condominiums under section 15. Condominium association board members owe a fiduciary duty to other unit owners. If proved, Plaintiffs' allegations that Defendants used their control of the HOA Boards to effectuate bulk sales to a buyer that they also controlled on terms that disadvantaged the Plaintiffs could be a breach of fiduciary duty. Business judgment rule does not support dismissal of complaint.Court erred in holding that rescission was unavailable as a matter of law. However, the passage of time (as closing occurred more than 1 year ago) makes rescission less equitable, and punitive damages can be appropriate means of release. Thus, court did not err in dismissing count for rescission. (ZENOFF and JORGENSEN, concurring.)

(Court opinion corrected 6/24/20.) Plaintiff Bank, as successor by merger, filed mortgage foreclosure complaint. When Defendant failed, in her answer, to deny the deemed allegation that Bank had sent her all proper notices, she forfeited the issue of whether Bank failed to comply with a condition precedent in the mortgage contract. Plain language of mortgage indicates that a notice of acceleration was not required, because Defendant breached her duty to make timely mortgage payments, Court properly entered summary judgment for Plaintiff. (BIRKETT and ZENOFF, concurring.)

Plaintiff, which had a reverse mortgage as to long-time homeowners, filed foreclosure action, and court entered default judgment of foreclosure and sale; Plaintiff was then the successful bidder at foreclosure sale, and deed to property was executed in favor of Plaintiff. Court denied homeowners' Section 2-1401 petition for relief from judgment. As there was no extrinsic fraud that deprived the circuit court from acquiring valid jurisdiction, foreclosure judgment was not void ab initio, as section 15-1509(c) of Foreclosure Law bars homeowners' claims. The vesting of title by deed pursuant to section 15-1509(b) is an entire bar of all claims of parties to the foreclosure. (CUNNINGHAM and CONNORS, concurring.)

Court entered order directing issuance of a tax deed; and then Petitioners filed a 2-count pleading against 2 persons and their successors in interest, seeking to declare tax deed void under section 22-85 of Property Tax Code. Court properly granted Respondents' motion to dismiss. Section 22-45 of Property Tax Codew explicitly provides that a tax deed is incontestable except in 3 specifically enumerated categories, and Petitioners' count I (motion per section 22-85) does not fall into any of those categories. Court properly dismissed count II (section 2-1401 petition), as Petitioners did not have an interest in the property when they filed her petition, as they had already quitclaimed their interest in the property (a mineral interest) 2 years prior to the Petition. (OVERSTREET and BOIE, concurring.)

Court erred in entering summary judgment for Defendant corporation on complaint for possession of condominium and for monetary damages, attorney fees and costs for breach of contract.Defendant had purchased condo at a foreclosure sale which was confirmed by circuit court.Defendant paid post-sale assessments for condo for 3 months, starting in the month after the foreclosure sale. This payment confirmed the extinguishment of any lien on condo. When a judicial sale purchaser complies with provisions of section 9(g)(3) of Condominium Act by paying the common expense assessments for the unit beginning in the month after the foreclosure sale, "any lien" created by section 9(g)(1) is extinguished, at which point a condo associations's only right to recover payment for pre-foreclosure expenses from a non-mortgagee purchaser is pursuant to section 9(g)(4) of the Act. Defendant was thus obligated to pay the unpaid common expenses for 6 months prior to filing of foreclosure action, which include the attorney fees "incurred" arising out of homeowners' default in payment of monthly assessments. Costs for repair of condominium were incurred by association after the institution of its foreclosure action and thus are not part of the common expenses for the 6-month period. (ROCHFORD and DELORT, concurring.)

(Court opinion corrected 5/7/20.) Court did not err in dismissing Defendants' Truth in Lending Act (TILA) counterclaim in mortgage foreclosure action on basis that they failed to file within 1 year. As Defendants were seeking relief under section 1635, the rescission enforcement action is inextricably intertwined with the TILA damages claim that is expressly covered by the 1-year statute of limitations. (MIKVA and HARRIS, concurring.) 

Plaintiff bank filed mortgage foreclosure complaint, and issued summons from Kankakee County, listing Defendant's residence in Kankakee County. Court entered default judgment for failure to file an answer and failure to appear. Defendant filed notice of appeal but voluntarily dismissed it. Seven months after confirmation of foreclosure sale, Defendant filed a Section 2-1401 petition challenging judgment as void. A duly licensed or registered private detective may serve process, without special appointment, anywhere in Illinois so long as the summons was issued from a county with a population less than 2 million. A registered detective served Defendant, in Cook County, with process 14 days after summons issued from Kankakee County, which has a population less than 2 million. Thus, court had personal jurisdiction over Defendant to enter default judgment, and judgment is not void. (HOLDRIDGE, concurring; SCHMIDT, specially concurring.)