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03/16/88 Marathon Finance Company, v. Pioneer Bank & Trust

March 16, 1988

MARATHON FINANCE COMPANY, PLAINTIFF-APPELLEE

v.

PIONEER BANK & TRUST COMPANY, AS TRUSTEE, ET AL., DEFENDANTS (HENRY W. DISHAROON, DEFENDANT-APPELLANT)



APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, SECOND DIVISION

1

522 N.E.2d 248, 168 Ill. App. 3d 148, 118 Ill. Dec. 793 1988.IL.368

Appeal from the Circuit Court of Cook County; the Hon. George M. Marovich, Judge, presiding.

APPELLATE Judges:

PRESIDING JUSTICE HARTMAN delivered the opinion of the court. STAMOS and SCARIANO, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE HARTMAN

Defendant Henry W. Disharoon sought to quash service of process by publication in a mortgage foreclosure case after entry of an order of default, a judgment for foreclosure and a sheriff's sale, favoring plaintiff Marathon Finance Co. (Marathon), a holder of the note secured by the mortgage sought to be foreclosed by virtue of an assignment from the original mortgagee, Cheker Oil Company. Other defendants in the case have not joined in this appeal. Disharoon presents as the issue on appeal whether the circuit court lacked jurisdiction over him due to Marathon's failure to comply with the requirements for service by publication. Marathon claims that the appeal is so meritless and frivolous as to warrant sanctions.

On September 30, 1985, Marathon filed a verified complaint against defendants Pioneer Bank & Trust Company (Pioneer), as trustee of trust No. 23481 (Trust), Harry Yourell, Cook County registrar of deeds, Disharoon and "Unknown Owners" to foreclose the mortgage and to foreclose their equitable rights to redeem. Relief requested included a judicial sale of the real estate involved, a personal deficiency judgment against Disharoon as guarantor of the note, and appointment of a receiver after the property sale if a deficiency then existed. Marathon also sought attorney fees, costs and expenses. Disharoon evidently guaranteed the promissory note for $80,000 from Pioneer to Cheker Oil Company, which the latter assigned to Marathon. A mortgage rider, however, characterized Disharoon as the mortgagor.

Service of summons on Disharoon was not attempted until October 9, 1985. The deputy sheriff reported that he could not obtain personal service because Disharoon was out of town, according to Disharoon's officer manager. Before personal service was attempted, however, an affidavit supporting service by publication was sworn to on September 30, 1985, by Marathon's attorney, who averred that upon due inquiry Disharoon could not be found for personal service and that on diligent inquiry his residence could not be ascertained. Service by publication was undertaken in the Chicago Daily Law Bulletin on October 2, 9 and 16, 1985. A notice was mailed to Disharoon on October 8, 1985.

On October 10, 1985, defendant Yourell filed an answer, but no other defendants filed any responses. On November 19, 1985, Marathon moved for summary judgment, attaching affidavits from its assistant treasurer and attorney. An order of default was entered and on November 19, 1985, the circuit court entered judgment for foreclosure and sale, finding all defendants properly before it. The circuit court found that $86,465.31 was due Marathon and the rights of all other parties in the property were inferior to Marathon's lien. The court authorized the sale of the property by the sheriff unless the judgment was paid within three days and declared that if the premises were not redeemed within six months defendants would be forever barred from all rights of redemption of the property.

On January 14, 1986, the property was sold to Marathon for $15,000 at a sheriff's sale with a resulting deficiency of $73,541.25. On January 17, 1986, the circuit court approved the sheriff's report of sale and distribution.

On October 14, 1986, Disharoon filed a special appearance and moved to quash service, alleging lack of diligence in attempting to obtain service on him and thus a lack of jurisdiction. (See R. W. Sawant & Co. v. Allied Programs Corp. (1986), 111 Ill. 2d 304, 308-10, 489 N.E.2d 1360.) On October 30, 1986, Disharoon filed an amended motion to quash service of process, pointing out that the service by publication began on October 2, 1985, one week prior to personal service being attempted on October 9, 1985. Marathon moved to strike both the original and amended motions to quash. On November 18, 1986, after a hearing, the circuit court denied Disharoon's motion to quash with an order containing appealable language pursuant to Supreme Court Rule 304(a) (107 Ill. 2d R. 304(a)). On December 18, 1986, Disharoon moved for rehearing and reconsideration, which was denied in an order entered March 13, 1987. Disharoon appeals. I

It is unclear from the record as to why the circuit court appended Rule 304(a) language to the dismissal order. Even were we to assume its applicability here, we first note that in Elg v. Whittington (1987), 119 Ill. 2d 344, 352-54, our supreme court held that filing a post-judgment motion cannot extend the time period for filing a Rule 304(a) notice of appeal. That opinion was modified to make the Rule 304(a) decision prospective and applicable in those cases in which the notice of appeal was due to be or was filed on or after November 16, 1987. In the case sub judice, the circuit court denied Disharoon's motion to quash on November 18, 1986. Disharoon moved for rehearing and reconsideration on December 18, 1986. That motion was denied on March 13, 1987, thereby leaving undisturbed the foreclosure of the mortgage and the equitable interest Disharoon may have had. Disharoon's appeal, having been filed on April 13, 1987, precedes Elg and will be considered on its merits. II

Disharoon first claims that Marathon's failure to comply with publication service requirements resulted in depriving the ...


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