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09/28/95 ANKA PODVINEC v. PREDRAG POPOV ET AL. (LA

September 28, 1995

ANKA PODVINEC, APPELLANT,
v.
PREDRAG POPOV ET AL. (LA SALLE NATIONAL BANK ET AL., APPELLEES).



Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. Alexander P. White, Judge, presiding.

The Honorable Justice Heiple delivered the opinion of the court: Chief Justice Bilandic took no part in the consideration or decision of this case.

The opinion of the court was delivered by: Heiple

JUSTICE HEIPLE delivered the opinion of the court:

At issue in this cause is the validity of a "judicial lien" which the judgment creditor, Anka Podvinec, seeks to enforce against the respondents, La Salle National Bank (La Salle), Dusan Zivkovic, Milan Rakic and Milorad Cupic. The respondents are defendants in a lawsuit initiated by the judgment debtor, Predrag Popov. The circuit court of Cook County found that the respondents violated the judicial lien and entered a judgment in favor of Podvinec. A divided appellate court reversed the judgment of the circuit court. (266 Ill. App. 3d 72, 639 N.E.2d 613, 203 Ill. Dec. 293.) We reverse the judgment of the appellate court, affirm the circuit court in part, reverse the circuit court in part and remand to the circuit court.

BACKGROUND

This cause arises from two separate actions. In early 1987, Podvinec brought an action against Predrag Popov and Jovanka Popov in the law division of the circuit court of Cook County (hereinafter the Podvinec action). In April 1987, a judgment was entered in favor of Podvinec and against the Popovs in the amount of $57,955.

On May 24, 1987, Predrag Popov was served with a citation to discover assets issued by the clerk of the circuit court of Cook County. Pursuant to the citation, Podvinec learned that Popov had pending against the respondents, as well as Citicorp Savings of Illinois and other unknown owners of real estate, a suit in the chancery division of the circuit court of Cook County to foreclose on a mechanic's lien involving certain real estate and for breach of contract (hereinafter the Popov action). La Salle was included as a defendant in the Popov action, as it was trustee of a land trust involving the real estate.

On December 22, 1988, the trial court in the Podvinec action entered an order imposing a "judicial lien upon any funds realized in the case of P. Popov v. La Salle National Bank et al. *** in the amount of $57, 955.00 plus costs (effective upon notice to proper parties)." On January 31, 1989, on Podvinec's motion, the trial court in the Popov action ordered "that a judicial lien is spread of record in this cause of action in favor of Anka Podvinec in the amount of $57,955.00." Respondents were given notice of the motion to spread the lien of record through service to their attorney of record in the Popov action. Respondents did not object to the lien's being spread of record.

On June 6, 1989, the trial judge in the Podvinec action entered an order discharging the previous citations to discover assets served on Popov. This order stated that the discharge "shall in no manner affect the lien interest of the plaintiff [Podvinec] spread of record" in the Popov action. Popov subsequently reached a settlement with the respondents and the Popov action was dismissed pursuant to the parties' agreement on April 18, 1991. Podvinec did not recover any funds from this settlement to satisfy the judgment and lien.

On June 27, 1991, Podvinec filed a petition for enforcement of the judicial lien. In the petition, Podvinec requested (1) that Popov and the respondents be held in contempt for violating the December 22, 1988, and January 31, 1989, orders which imposed the judicial lien and spread the lien of record and (2) that an order be entered against Popov and the respondents finding them jointly and severally liable for the $57,955 plus interest. The petition was granted and judgment was entered against the respondents. The trial court originally awarded Podvinec post-judgment interest. In a memorandum decision, the trial court found that the court had subject matter jurisdiction to spread the lien of record pursuant to section 2-1402(d)(2) of the Code of Civil Procedure (Code) (735 ILCS 5/2-1402(d)(2) (West 1992)). Furthermore, a party had a duty to honor any lien spread of record. On the respondents' motion for reconsideration, the trial court eliminated the award of post-judgment interest. Respondents appealed and Podvinec cross-appealed on the issue of post-judgment interest.

The appellate court reversed, finding that the trial court imposed a lien unauthorized by law or by statute. (266 Ill. App. 3d 72, 639 N.E.2d 613, 203 Ill. Dec. 293.) In support, it stated that the trial court had the power to enforce judgments, but did not have the power to create a lien. Thus, the respondents could not be found liable for violating an unauthorized lien. Justice Greiman dissented, stating that although Podvinec failed to follow the specific requirements of section 2-1402 of the Code, Podvinec sufficiently followed the requirements and the respondents had notice of the judicial lien's being spread of record. We granted Podvinec's petition for leave to appeal (145 Ill. 2d R. 315(a)).

ANALYSIS

Before this court, Podvinec contends that the Podvinec trial court did indeed have the power to enter the judicial lien. Podvinec argues that the judicial lien initially bound Popov. Podvinec states that once the respondents were given notice of the lien and the lien was spread of record in the Popov action, the respondents were subject to the lien and could not assist Popov in circumventing the lien. Podvinec asserts that the respondents violated the lien and the orders which imposed the lien and spread it of record when they paid the settlement proceeds to Popov without notifying her. We agree.

The service of the citation to discover assets on Popov created a general lien in favor of Podvinec on the property of Popov. (Sec 735 ILCS 5/2-1402(m) (West 1992).) The order imposing the lien and the lien itself were an attempt by Podvinec to gain control over any proceeds of the Popov action before Popov himself obtained the proceeds. The respondents, in their answer to the petition for leave to appeal, agreed that "the citation [to discover assets] created a lien on property in Popov's possession or control or which might thereafter come within his possession or control." Although ...


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