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April 24, 1995



As Corrected May 16, 1995. Released for Publication May 26, 1995.

The Honorable Justice Braden delivered the opinion of the court: Buckley and Wolfson, JJ., concur.

The opinion of the court was delivered by: Braden

JUSTICE BRADEN delivered the opinion of the court:

Defendant, Fireman's Fund Mortgage Corporation, now known as Source One Mortgage Services Corporation ("Source One"), appeals from an order of the Circuit Court of Cook County, pursuant to Supreme Court Rule 308 (107 Ill. 2d R. 308), and argues that the trial court erred in denying a motion to dismiss under the doctrine of forum non conveniens.

We affirm.

Plaintiff, Gloria Hayes, filed a class action complaint in the Chancery Division of the Circuit Court of Cook County. The complaint alleged that Source One had systematically imposed excessive late charges on plaintiff's and fellow class members' mortgages. These mortgages were all guaranteed by the Veterans Administration and can be classified as VA mortgages.

Plaintiff alleges that these late charges are in excess of the late charges permissible and authorized under the terms of the VA form mortgages. It is conceded that under the terms of the mortgages, Source One is permitted to impose late charges on payments, which are more than 15 days late, in an amount equal to 4% of "any installment." The dispute arises concerning the definition of the words "any installment."

The VA note and mortgage form defines "installment" to include only principal and interest due every month. The term "aggregate monthly payment" is defined as the installment plus escrow deposit requirements for taxes and insurance. Plaintiff alleges that Source One overcharged her and class members when imposing late charges by calculating and collecting late charges based on 4% of the aggregate monthly payment including principal, interest, taxes and insurance.

The complaint seeks injunctive relief, damages and declaratory relief. Additionally, it alleges that the imposition and collection of excessive late charges by Source One violates the Illinois Consumer Fraud and Deceptive Business Practice Act (815 ILCS 505/1 et seq. (West 1992)), as well as the corresponding consumer statutes of other states.

Plaintiff is an Illinois resident whose mortgage is serviced by Source One. She alleges to be the class representative of all similarly situated mortgagors who reside throughout all 50 United States and the District of Columbia. Source One is a mortgage loan service company that services approximately 500,000 mortgage loans and is located in Farmington Hills, Michigan.

After the complaint was filed, Source One removed the case to Federal court. The Federal court, however, later granted plaintiff's motion to remand the cause back to the Circuit Court of Cook County. Subsequently, Source One filed a motion to dismiss for forum non conveniens. The motion asserted that Source One had met the legal requirements, under Illinois law, for invoking the equitable doctrine of forum non conveniens. Source One argued that the private interests of the litigants and the public interest require that the cause be litigated in the State of Michigan. Source One elaborated that all the material witnesses and documents are located in Michigan and that the courts in Michigan are less congested than those of Cook County. Moreover, Source One asserted that the case had no particular connection with the State of Illinois except that plaintiff resided in Illinois.

Plaintiff countered this argument by asserting that the cause of action has a substantial nexus with Illinois. Plaintiff resides in Illinois. The property, which the VA mortgage secures, is the plaintiff's home and is located in Chicago, Illinois. The mortgage was negotiated and executed in Illinois. Source One states the 2,145 of the putative class members reside in Illinois, but points out that this number only represents 2.15% of the putative class. Source One further states that Michigan has a greater number of putative class members. Plaintiff does not dispute this statistic but notes that a significant number of Illinois residents hold mortgages serviced by defendant.

Plaintiff notes that Source One makes frequent use of the Illinois court system in seeking foreclosures and judgments against Illinois residents. Source One has filed 810 such actions in the Federal and State courts of Illinois between January 1, 1989, and 1992.

Source One argues that the personnel responsible for servicing these mortgages all reside in Michigan. Plaintiff maintains that the nature of the case is such as to not ...

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