Real Estate Law

Lien priority dispute in mortgage foreclosure proceedings on residential property. Court erred in granting partial summary judgment in favor of junior lienholder bank whose mortgage, court ruled, had priority over other bank's mortgage. Bank did not lose its senior lienholder status because it did not have a recorded interest in the note at the time of the other bank's refinancing. The purpose of having MERS as the mortgagee is to allow repeated assignments of notes without recordation, as MERS continues to hold the mortgage. (SCHOSTOK and ZENOFF, concurring.)

Court entered two separate orders, in consolidated case, relating to mortgage foreclosure proceedings initiated by mortgage lender, which later assigned mortgage to servicing company. Court properly entered default order against one Defendant. Court properly entered order disbursing proceeds from sale of other Defendant's prior marital home to bank. A special process server is not required to serve an out-of-state Defendant. Purported deficiencies in process server's affidavit of service, including that server's license number and contact information were not included, and 8-year-difference in estimated age and Defendant's actual age, are irrelevant to determine validity of service. Court was not obligated to hold evidentiary hearing before ruling on fully briefed motions to quash service and to pay out the sale proceeds.(FITZGERALD SMITH and LAVIN, concurring.)

Plaintiff savings and loan company filed foreclosure action and submitted affidavit stating that process server personally served Defendant at her home. Court entered default judgment, as Defendant failed to file appearance. After property was sold, Defendant filed pro se petition to quash personal jurisdiction, claiming she was never served. Attorney for Defendant then filed amended motion to quash. Court properly struck amended motion, as Defendant failed to properly provide notice of this motion, and court properly denied Defendant's request for leave to amend motion, which was untimely filed as it was filed more than 30 days after denial of her pro se motion, and properly treated motion as a motion for reconsideration. Court properly confirmed judicial sale, as Defendant failed to corroborate by clear and convincing evidence her denial of service.(PIERCE and SIMON, concurring.)

Mortgage company's sale of mortgage loan to Plaintiff loan servicing company, between date judgment of foreclosure was entered and date sale was conducted, without substituting it as Plaintiff until after date of sale, does not entitle homeowner to relief from order confirming judicial sale of residential property. The fact that loan servicing company had not yet been substituted in caption of foreclosure complaint as Plaintiff had no effect on manner in which sale was conducted. (HYMAN and PUCINSKI, concurring.)

Bank filed complaint against trustee to foreclose adjustable rate home equity conversion mortgage (also known as "reverse mortgage") and adjustable rate note secured on condominium held by land trust which was principal dwelling of consumer, now deceased, who had entered into mortgage and note. Trustee filed answer and counterclaim, seeking to rescind mortgage, alleging violations of Truth in Lending Act (TILA). Court erred in granting motion to dismiss counterclaim. Reverse mortgages are consumer credit transactions covered by TILA. Under Regulation Z, enacted by Federal Reserve Board to carry out purposes of TILA, right to rescind extends to each consumer whose ownership interest is or will be subject to security interest or is subject to risk of loss. Trustee of land trust is a consumer, whose ownership interest is subject to security interest. Thus, trustee was entitled to TILA disclosures and has the right to rescind the transaction. When a consumer timely exercises its right to rescind a consumer credit transaction through proper notice to creditor, a sale of property does not terminate a consumer's right to rescind. (GARMAN, FREEMAN, THOMAS, KILBRIDE, KARMEIER, and THEIS, concurring.)

Section 15-1504.1 of Code of Civil Procedure imposes a $50 filing fee in residential mortgage foreclosure cases, 2% of which is retained by clerk of court in which complaint is filed. Section 15-1504.1 does not violate judicial fee officer prohibition in Article VI, Section 14, of Illinois Constitution. Fee officer prohibition was aimed at officers who had a direct role in adjudicative process of court system, and were compensated for their services through payment of fees taxed to the litigants. Clerks of court are nonjudicial officers, and perform no adjudicative or quasi-judicial function, and thus do not fall within ambit of fee officer provision of Illinois Constitution. (GARMAN, FREEMAN, THOMAS, KILBRIDE, KARMEIER, and BURKE, concurring.)

Dispute over real estate transaction after purchase of veterinary practice; purchase agreement contained lease for clinic that housed the practice, with option to buy property 6 years later. When Plaintiff tried to exercise her option to purchase, a present contract was not formed because all terms of purchase agreement had not been established, as price had not been determined. Plaintiff "exercised" her option when option became executory, and lease obligations continued until Plaintiff became the equitable owner, once the price was set. Once Plaintiff's right to purchase was vested, the rights given to her by option were no longer dependent on her lease obligations, so that her ceasing to make rent payments did not terminate her purchase option. Defendant is entitled to rent under lease until Plaintiff became equitable owner of property, and Plaintiff is entitled to purchase property for price determined by neutral third-party appraiser. (PIERCE and HYMAN, concurring.)

Plaintiff corporations filed complaint for damages against County, alleging that as a result of County's construction project, Plaintiffs' property development for residential and commercial use no longer had frontage on or direct access from a certain road. Court properly granted County's motion for summary judgment after concluding that County's construction project did not result in Plaintiffs' property being materially impaired. Plaintiffs still had the same access point as before the project's relocation of that road by 400 feet, and no substantial change in physical characteristics of that road occurred. (BURKE and BIRKETT, concurring.)