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Deutsche Bank Nat'l Trust Co. v. Snick
Factual and Procedural Background
Deutsche Bank National Trust Company (the Bank) filed a mortgage foreclosure complaint against Kari Snick and others, alleging Snick's default on a $750,000 mortgage. The complaint, filed on March 1, 2007, identified the Bank as the legal holder or servicing agent of the indebtedness and attached the mortgage and note. Snick did not answer the complaint, resulting in a default judgment of foreclosure entered on June 18, 2007, which included a finding that there was no just cause to delay enforcement or appeal.
Following the default judgment, Snick filed multiple emergency motions to stay the judicial sale of the property between 2007 and 2009, some granted and others denied. The property was eventually sold at a sheriff's sale. The Bank moved for an order approving the sale, to which Snick responded by challenging the Bank's standing for the first time. The trial court ruled the standing issue untimely and confirmed the sale. Snick subsequently moved to vacate the order approving the sale, which was denied, prompting this appeal.
Legal Issues Presented
- Whether the trial court erred in refusing to consider Snick's challenge to the Bank's standing to foreclose when raised after the default judgment and at the time of approving the sale.
- Whether the trial court abused its discretion in approving the judicial sale under section 15–1508(b) of the Illinois Code of Civil Procedure.
Arguments of the Parties
Appellant's Arguments
- Snick argued that the issue of the Bank's standing was timely raised in her response to the motion approving the sale and should have been considered by the trial court.
Appellee's Arguments
- The Bank contended that standing is an affirmative defense that must be raised before entry of judgment and that Snick waived this defense by failing to raise it timely.
- The Bank further argued that the judgment of foreclosure was a final and appealable order, barring relief under section 2–1401 of the Code of Civil Procedure.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| In re Marriage of Verdung, 126 Ill.2d 542 (1989) | Finality and appealability of judgments under Illinois Supreme Court Rule 304(a). | Confirmed that a judgment with an express finding of no just reason to delay enforcement or appeal is final and appealable. |
| Santana v. Zipperstein, 142 Ill.App.3d 386 (1986) | Distinction between final but not appealable orders and those with findings under Rule 304(a). | Distinguished orders of foreclosure that are final but not appealable due to absence of the requisite finding. |
| Greer v. Illinois Housing Development Authority, 122 Ill.2d 462 (1988) | Standing as an affirmative defense and waiver by failure to timely raise it. | Supported the court's conclusion that Snick waived standing by not timely raising it. |
| Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill.App.3d 1 (2010) | Requirements for foreclosure complaints and waiver of standing; limitations on trial court's discretion to refuse confirmation of judicial sales under section 15–1508(b). | Applied to affirm that the Bank met pleading requirements and Snick waived standing; upheld trial court's confirmation of the sale absent statutory grounds to refuse. |
Court's Reasoning and Analysis
The court first determined that the default judgment of foreclosure was a final and appealable order because the trial court expressly found there was no just cause to delay enforcement or appeal, consistent with Illinois Supreme Court Rule 304(a). Thus, the judgment was final as of June 18, 2007.
Next, the court addressed the standing issue, emphasizing that standing is an affirmative defense that must be raised timely. Because Snick did not raise standing before the default judgment and participated in proceedings by filing multiple motions to stay the sale, she waived the defense by failing to raise it earlier.
The court also noted that Snick did not appeal the foreclosure judgment but only challenged the order approving the sale. Under section 15–1508(b) of the Illinois Code of Civil Procedure, the trial court's discretion to refuse confirmation of a judicial sale is limited to four specific grounds: lack of required notice, unconscionable terms, fraud in the sale, or injustice. Snick did not argue any of these grounds, only raising the waived standing issue.
Accordingly, the court concluded that the trial court did not abuse its discretion in approving the judicial sale.
Holding and Implications
The court affirmed the judgment of the circuit court of Will County, upholding the trial court's order approving the sale and denying Snick's motion to reconsider.
The direct effect of this decision is to confirm the validity of the foreclosure sale and deny the appellant relief based on a waived standing defense. The opinion does not establish new precedent beyond reaffirming existing principles regarding finality of judgments, waiver of affirmative defenses, and the limited grounds for refusing confirmation of judicial sales under Illinois law.
Harvey Wright, Attorney at Law, South Holland, for Kari Snick. Mariclaire O'Connor, Brooks Brehme, Codilis & Associates, Burr Bridge, for Deutsche Bank. OPINION
Justice O'BRIEN delivered the judgment of the court, with opinion.
¶ 1 Plaintiff Deutsche Bank National Trust Company (the Bank) filed a complaint to foreclose a mortgage against defendant Kari Snick and others. A default judgment of foreclosure was entered against Snick. More than two years later, after several motions to stay a judicial sale, the trial court entered an order approving the sale of the property. Snick appeals from the trial court's order approving the sale and also from the subsequent denial of Snick's motion to reconsider the approval of the sale. We affirm.
¶ 2 FACTS¶ 3 The Bank filed its complaint to foreclose a $750,000 mortgage on March 1, 2007. The complaint alleged that the Bank was bringing the foreclosure action as the legal holder of the indebtedness or as the servicing agent for the legal holder of the indebtedness. The complaint further alleged that Snick was the mortgagor and that Snick was in default. The mortgage and the note, defining Snick as the borrower, were attached to the complaint. The lender was defined in the mortgage as IMPAC Funding Corporation.
¶ 4 Although an attorney entered a general appearance on Snick's behalf, Snick did not answer the complaint, and the judgment for foreclosure and sale was entered upon the Bank's motion for a default judgment. The affidavit in support of the motion was signed by an attorney of GMAC Mortgage, LLC, as the servicer on behalf of the Bank. The default judgment was entered on June 18, 2007, and included a clause providing:
“This is a final and appealable order and there is no just cause for delaying the enforcement of this judgment or appeal therefrom.”
¶ 5 Thereafter, on five occasions between October 31, 2007 and December 16, 2009, Snick filed emergency motions to stay the sale of the subject property. One motion was stricken, three were granted, and the final motion was denied on December 16, 2009. The property was sold at a sheriff's sale, and the Bank filed a motion for an order approving the sale. On February 3, 2010, Snick filed a response to the Bank's motion, challenging the Bank's standing for the first time. The trial court found that the issue of standing was not timely raised, and it entered an order confirming the sale. Thereafter, Snick filed a motion pursuant to section 2–1203 of the Code of Civil Procedure (735 ILCS 5/2–1203 (West 2008)) to vacate the order approving the sale, which was denied by the trial court. Snick appealed.
¶ 6 ANALYSIS¶ 7 Snick contends that the trial court erred in refusing to consider her challenge to the Bank's motion for an order approving the sale, arguing that the issue of standing was timely raised. The Bank contends that standing was an issue that should have been raised prior to the entry of the judgment of foreclosure and that Snick was not entitled to relief from the judgment of foreclosure under section 2–1401 of the Code of Civil Procedure (735 ILCS 5/2–1401 (West 2008)) because it was a final and appealable order.
¶ 8 When a trial court enters a judgment that does not dispose of an entire action, but makes an express written finding that there is no just reason for delaying enforcement or appeal, the judgment is final and appealable. Ill. S.Ct. R. 304(a) (eff.Feb.26, 2010); see In re Marriage of Verdung, 126 Ill.2d 542, 129 Ill.Dec. 53, 535 N.E.2d 818 (1989); cf. Santana v. Zipperstein, 142 Ill.App.3d 386, 96 Ill.Dec. 771, 491 N.E.2d 1231 (1986) (an order of foreclosure was final but not appealable, and thus modifiable, where the trial court had not made the finding that there was no just cause for delaying enforcement or appeal). In this case, the default judgment of foreclosure was a final and appealable order when it was entered on June 18, 2007, because the trial court specifically made the finding pursuant to Rule 304(a) that there was no just reason for delaying enforcement of the appeal.
¶ 9 In any event, the lack of standing is an affirmative defense, which is waived if not raised in a timely fashion. Greer v. Illinois Housing Development Authority, 122 Ill.2d 462, 120 Ill.Dec. 531, 524 N.E.2d 561 (1988); Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill.App.3d 1, 346 Ill.Dec. 118, 940 N.E.2d 118 (2010). In this case, the Bank's foreclosure complaint complied with the requirements of section 15–1504(a) of the Illinois Mortgage Foreclosure Law (735 ILCS 5/15–1504(a) (West 2008)), alleging that the Bank was the legal holder of the indebtedness or the servicing agent for the legal holder of the indebtedness, and attaching a copy of the note and mortgage. Snick failed to answer the complaint and was defaulted. By her default, Snick admitted the well-pleaded allegations of the complaint, including the allegation that Bank held an interest in the subject property. See Mortgage Electronic Registration Systems, Inc., 406 Ill.App.3d at 7, 346 Ill.Dec. 118, 940 N.E.2d 118. Thereafter, Snick participated in the court proceedings by filing several motions to stay the sale of the subject property. At no time did Snick raise the issue of standing until her objection to the Bank's motion for an order approving the sale of the property, which was almost three years after the entry of the judgment of foreclosure. We find that Snick waived the issue of the Bank's standing by failing to raise the issue while, at the same time, participating and accepting the benefits of the court proceedings.
¶ 10 Snick did not appeal the judgment of foreclosure; she only challenged the order approving the sale. Section 15–1508(b) of the Code of Civil Procedure limits a trial court's discretion to refuse confirmation of a judicial sale to the four grounds specified in the statute. 735 ILCS 5/15–1508 (West 2008); Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill.App.3d 1, 346 Ill.Dec. 118, 940 N.E.2d 118 (2010). Section 15–1508(b) provides:
“Unless the court finds that (i) a notice required in accordance with subsection (c) of Section 15–1507 [ (735 ILCS 5/15–1507) ] was not given, (ii) the terms of sale were unconscionable, (iii) the sale was conducted fraudulently or (iv) that justice was otherwise not done, the court shall then enter an order confirming the sale.” 735 ILCS 5/15–1508(b) (West 2008).
¶ 11 Although Snick limited her appeal to the order approving the sale, she does not contend that the trial court made any of the findings required by section 15–1508. Instead, she argues that the Bank lacked standing, an argument that we have already found waived. Since Snick did not give the trial court any basis to refuse confirmation of the sale under section 15–1508, we conclude that the trial court did not abuse its discretion in approving the judicial sale.
¶ 12 CONCLUSION¶ 13 The judgment of the circuit court of Will County is affirmed.
¶ 14 Affirmed. Presiding Justice CARTER and Justice LYTTON concurred in the judgment and opinion.
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