Appeal from the Circuit Court of Cook County; the Hon. George
A. Higgins, Judge, presiding.
JUSTICE SULLIVAN DELIVERED THE OPINION OF THE COURT:
This appeal is from summary judgment for defendants in an action to set aside the sale of plaintiffs' beneficial interest in a land trust and in a consolidated action in forcible entry and detainer brought by defendants against plaintiff Harold Motz (Harold). Plaintiffs contend that summary judgment was improperly granted. In the alternative, they maintain that the trial court erred in ruling that they were not entitled to a homestead exemption.
It is undisputed that plaintiffs purchased the subject property, a single-family residence located in Glenwood, Illinois, as joint tenants in 1966, assuming a $27,000 mortgage as part of the consideration therefor. In 1968, the property was deeded to Steel City National Bank of Chicago (Steel City), *fn1 as trustee under Trust No. 562 (the Steel City trust), with plaintiffs as sole beneficiaries thereunder. Subsequently, plaintiffs encountered financial difficulties, and Harold sought a loan from Steel City, signing a 60-day promissory note on October 7, 1980, secured by a purported pledge of 100% of the beneficial interest in the Steel City trust. Harold was unable to pay the note when it became due, and the debt was refinanced by a 180-day promissory note in the total amount of $19,141.57, again secured by a purported pledge of 100% of the beneficial interest in the Steel City trust. Each note was signed solely by Harold. When the loan was not repaid, Steel City sold the beneficial interest at public sale on January 8, 1982, subject to the prior mortgage, then in default, to Arthur M. Heller (Heller) acting as nominee of Central National Bank, as trustee (CNB) under Trust No. 24962 (the CNB trust), for $22,501 — one dollar more than the amount then due Steel City under the defaulted note.
Plaintiffs received notification of the sale to Heller, and Heller, as agent of Magna Management Company (Magna), offered to rent the premises to plaintiffs under a month-to-month lease. When plaintiffs refused that offer, Magna and CNB brought a forcible entry and detainer action against Harold on February 5, 1982. Shortly thereafter, plaintiffs filed a complaint seeking to set aside the sale of the beneficial interest in the subject property, and the two actions were consolidated at Harold's request.
Plaintiffs' amended complaint alleged in pertinent part that the property in question had a fair market value of $100,000, and that Steel City failed to sell the beneficial interest therein in a commercially reasonable manner, as required by section 9-504 of the Uniform Commercial Code (the Code) (Ill. Rev. Stat. 1981, ch. 26, par. 9-504), in that it failed to make reasonable efforts to attract bidders likely to bid on the property, imposed unreasonable terms of sale — making the property extremely unattractive to most potential bidders, sold the property for a grossly inadequate amount in a one-bidder sale, and otherwise conducted the sale in a commercially unreasonable manner. Plaintiffs further alleged that Heller knew that the sale was not conducted in a commercially reasonable manner and was defective, and that he collusively entered into the transaction with Steel City.
Defendants CNB and Magna, without answering the amended complaint, moved for summary judgment in both actions, maintaining that there were no genuine issues as to any material facts in either, and asserting also that plaintiffs' complaint failed to state a cause of action against them. In support thereof, defendants submitted Heller's affidavit, which states in pertinent part that he is a beneficiary under the CNB trust; that he operates a realty and management business, doing business as Magna Management Company; that he became aware of the sale of plaintiffs' beneficial interest through a public notice published in a newspaper of general circulation; that he was the only bidder to appear at Steel City's offices at the time specified in the public notice; that he bid and paid $22,501 for the 100% beneficial interest in plaintiffs' land trust; that he caused Steel City, as trustee under the Steel City trust, to convey its legal and equitable title to CNB under the CNB trust; that the public sale was conducted in the usual and customary practice of such financial institutions; that he did not wrongfully collaborate with Steel City as trustee; and that he gave good and valuable consideration and was a bona fide purchaser for value.
The trial court granted defendants' motions for summary judgment in both actions and awarded possession of the subject premises to Heller, ordering plaintiffs to pay $15 per day rent to Heller from the date of judgment to the date they vacated the premises. Plaintiffs' post-trial motion seeking vacation of the order or, in the alternative, modification thereof to provide compensation for their homestead rights, was denied, and this appeal followed.
Plaintiffs contend that the summary judgments were improperly granted. They argue (a) that defendants have failed to negate the allegations of their complaint or set forth facts which would entitle them to summary judgment as a matter of law; and (b) that defendants have failed to establish their entitlement to summary judgment in the forcible entry and detainer action, because there were questions of fact as to the validity of the sale.
On a motion for summary judgment, the trial court must determine whether there is a genuine issue as to any material fact that requires a trial. (Bezin v. Ginsburg (1978), 59 Ill. App.3d 429, 375 N.E.2d 468.) The motion should be granted where the pleadings, exhibits, depositions, and affidavits of record show that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. (Ill. Rev. Stat. 1981, ch. 110, par. 2-1005.) However, because this is a drastic measure, it is to be granted only where the evidence, when construed most strongly against the moving party, establishes clearly and without doubt his right thereto. (Marquette National Bank v. Heritage Pullman Bank & Trust Co. (1982), 109 Ill. App.3d 532, 440 N.E.2d 1033; Pitler v. Michael Reese Hospital (1980), 92 Ill. App.3d 739, 415 N.E.2d 1255.) Furthermore, where the movant seeks to establish evidentiary facts by way of affidavit, Supreme Court Rule 191 requires that the affidavits relied upon consist of facts admissible in evidence, not mere conclusions (87 Ill.2d R. 191); and although facts in an affidavit which are not contradicted by counteraffidavit will be taken as true despite contrary averments in the pleadings (Marquette National Bank v. Heritage Pullman Bank & Trust Co. (1982), 109 Ill. App.3d 532, 440 N.E.2d 1033), the movant must present evidence which precludes any possible liability before the party opposing summary judgment is required to present some factual basis by way of counteraffidavit which would arguably entitle him to judgment (see Cohen v. Washington Manufacturing Co. (1979), 80 Ill. App.3d 1, 398 N.E.2d 1202). Thus, we have held that "even though the party opposing the motion for summary judgment fails to file counteraffidavits, the moving party should not be awarded summary judgment unless the affidavits filed in support of the motion establish the judgment as a matter of law." Marquette National Bank v. Heritage Pullman Bank & Trust Co. (1982), 109 Ill. App.3d 532, 535, 440 N.E.2d 1033, 1035-36.
In the instant action, plaintiffs have relied upon the allegations in their pleadings and various exhibits of record, and have not filed any counteraffidavits. Therefore, we must take as true the facts, but not the conclusions, contained in Heller's affidavit in support of the motion in reviewing the trial court's granting of summary judgment. The parties agree that the sale in question is governed by article 9 of the Code, relating to secured transactions. (Ill. Rev. Stat. 1981, ch. 26, par. 9-101 et seq.) Plaintiffs' complaint relies in particular on section 9-504, which provides in relevant part that "every aspect of the [sale of collateral upon default] including the method, manner, time, place and terms must be commercially reasonable" (Ill. Rev. Stat. 1981, ch. 26, par. 9-504(3)) and that, where the secured party fails to comply with these requirements, a purchaser at the sale takes free of all rights and interests of the debtor only if "in the case of a public sale * * * the purchaser has no knowledge of any defects in the sale and * * * he does not buy in collusion with the secured party * * *." Ill. Rev. Stat. 1981, ch. 26, par. 9-504(4)(a).
Plaintiffs' amended complaint alleges that the terms of the sale and the price received were commercially unreasonable, that Heller knew of these defects, and that he purchased in collusion with the secured party — Steel City. Defendants countered these allegations with Heller's affidavit wherein he states that he learned of the sale from a public notice in a newspaper of general circulation. He does not indicate what newspaper contained the notice, and the only such notice appearing in the record advertises a sale to take place in October 1981; whereas, it is undisputed that the sale in question took place on January 8, 1982. Nevertheless, that notice does contain the terms which plaintiffs allege are commercially unreasonable; therefore, it appears that Heller did have knowledge of those terms at the time of the sale. Plaintiffs' amended complaint further alleges that the sale was commercially unreasonable because Heller was the sole bidder and because the property in question had an estimated fair market value of $100,000 but was sold for only $22,501.
• 1 While it appears from his affidavit that Heller had knowledge of the terms, price, and method of sale which plaintiffs allege were commercially unreasonable, knowledge of these defects alone is insufficient, as the purchaser also must act in collusion with the secured party. Here, although plaintiffs allege such collusion, Heller's affidavit only denies collusion with Steel City, as trustee. It is our view that this denial is insufficient, since it is clear from the record that in selling the beneficial interest, Steel City was acting in its capacity as a secured party under the security agreement, not as trustee under the Steel City land trust. Absent that security agreement, Steel City had no power as trustee to sell the beneficial interest; it could only deal with the title to the property as directed by the beneficial owners.
• 2 Since Heller's affidavit fails to establish that he did not know of the alleged defects in the sale or that he did not purchase in collusion with the secured party, summary judgment was proper only if the evidence established that Steel City's disposition of the collateral was, contrary to plaintiffs' allegations, commercially reasonable. Heller's affidavit seeks to establish this by his averment that "the public sale was conducted in the usual and customary practices of such financial institutions," apparently relying on section 9-507 of the Code, which provides in relevant part that "[i]f the secured party * * * sells the collateral in the usual manner in any recognized market therefor * * * or if he has otherwise sold in conformity with reasonable commercial practices among dealers in the type of property sold he has sold in a commercially reasonable manner." (Ill. Rev. Stat. 1981, ch. 26, par. 9-507.) However, Heller's affidavit contains no basis for his conclusion that the sale was conducted in "the usual and customary" manner of "such financial institutions"; nothing herein establishes his expertise in such matters, or his qualifications to give his opinion as to what is or is not "usual and customary" among banking institutions in the sale of a beneficial interest in a land trust pursuant to section 9-504. Because Heller's statement constitutes a conclusion rather ...