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EQUITABLE REAL ESTATE INVS. v. UNITED STATES HUD

August 7, 1998

EQUITABLE REAL ESTATE INVESTMENTS, INC., Plaintiff,
v.
UNITED STATES DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT; OTIS TOWERS; ANNIE C. TOWERS; BEVERLY NATIONAL BANK; DEVELOPING ECONOMICAL & BETTER LIVING, INC.; UNKNOWN OWNERS and NON-RECORD CLAIMANTS, Defendants.



The opinion of the court was delivered by: KEYS

MEMORANDUM OPINION AND ORDER

 This matter comes before the Court on Defendant's Motion for Summary Judgment, pursuant to Federal Rule of Civil Procedure 56. For the reasons set forth below, this Court grants Defendant's motion. *fn1"

 BACKGROUND

 This dispute involves a property commonly known as 17706 Pebblewood, Hazel Crest, Illinois ("the subject property"). (Defendant's 12(M) Statement of Material Facts [Def.'s 12(M)] at P 1.) Plaintiff Equitable Real Estate Investments, Inc. ("Equitable") is in the home remodeling business. (Def.'s 12(M) P 2.) On or about March 28, 1995, Equitable received a warranty deed to the subject property. (Id. at P 3.) This property, however, was subject to a mortgage foreclosure judgment entered on December 8, 1992, in the case of Chase Home Mortgage Corp. v. Phillip, no. 90 C 6350 (N.D. Ill. 1992). (Id. at P 1.) Defendant, United States Department of Housing and Urban Development ("HUD") was assigned the property by a Special Commissioner's Certificate of Sale and Deed dated December 14, 1993. (Id.)

 Unfortunately, Equitable erroneously believed that the encumbrance had been cleared. (First Amended Complaint at P 4.) Equitable, not withstanding a title search that indicated that the property was subject to a mortgage foreclosure lien, purchased the subject property. (Def.'s 12(M) PP 4-5.) Equitable then received a title commitment and an owner's title insurance policy for the subject property; both documents indicated the existence of the mortgage foreclosure lien. (Id. at PP 6-7.) In fact, the title insurance policy expressly noted that it would not insure the loss of title against that judgment lien. (Id. at P 7.) Despite this notice, Equitable believed that it had clear title and was the true owner of the property. (First Amended Complaint at P 3.)

 Equitable began making improvements to the subject property on or about April 17, 1995. (First Amended Complaint at PP 7-9.) It entered into various contracts with subcontractors for labor, and to purchase materials. (Id. at PP 7-9.) Equitable allegedly spent $ 28,755.55 in order to complete these improvements. (Id. at P9.) However, Equitable was never able to realize a profit from this project because HUD sold this property to Developing Economical & Better Living, Inc. ("Economical"). Economical, who is no longer a defendant in this case, took possession some time after the improvements were completed, and is still the owner of the subject property. *fn2" (Id. at P 6.)

 Equitable filed this action in the Circuit Court of Cook County. HUD then filed a Notice of Removal on March 25, 1997. Thereafter, the case was removed to this Court. Equitable filed its First Amended Complaint on May 30, 1997, alleging that HUD benefited from the improvements to the subject property, and was unjustly enriched because the sales price reflected the increase in value resulting from Equitable's labor and materials. (First Amended Complaint at P 11.)

 SUMMARY JUDGMENT STANDARD

 Summary judgment is appropriate if "there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law." FED. R. CIV. P. 56(b). "The court has one task and one task only: to decide, based on the evidence of record, whether there is any material dispute of fact that requires a trial." Waldridge v. American Hoechst Corp., 24 F.3d 918, 920 (7th Cir. 1994). Only disputes over facts that might affect the outcome of the suit under the governing law will preclude the entry of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-50, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

 
[A] party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact.

 Celotex Corp. v. Catrett, 477 U.S. 317, 323, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986) (quoting FED. R. CIV. P. 56). The non-moving party must set forth specific facts showing that there is a genuine issue as to any material fact. Anderson, 477 U.S. at 248-50. Then the non-movant may not rest upon mere allegations in the pleadings: rather, he must go beyond the pleadings and support his contentions with proper documentary evidence. Celotex, 477 U.S. at 324; Waldridge, 24 F.3d at 920.

 In deciding a motion for summary judgment, the court must usually view all the facts in the light most favorable to the non-moving party. Anderson, 477 U.S. at 255. Equitable, however, in its Response to the Motion for Summary Judgment "adopted" Defendant's Rule 12(M) Statement of Material Facts. (Pl.'s Resp. to Def.'s Mot. Summ. J. at 1.) Therefore, this motion will be considered using these facts.

 DISCUSSION

 I. Equitable's Failure to Comply with Local ...


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