The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge:
MEMORANDUM OPINION AND ORDER
In its motion and supporting exhibits, Plaintiff West Bend Insurance Company ("West Bend") states that during a July 27, 2010 deposition of third party citation respondent Banco Popular North America ("Banco Popular"), it discovered that Defendant Mark Gizynski ("Gizynski") -- who is subject to a citation in this action and against whom a default judgment has been entered -- made undisclosed cash payments on his mortgage during the pendency of the citation proceeding. In its motion, West Bend seeks: (i) an order for Gizynski to show cause why he should not be held in contempt for transferring his assets during a citation proceeding,
(ii) an injunction against Gizynski to stop him from making further transfers of his assets, (iii) an order requiring Gizynski to account for all cash he has received or possessed since the inception of the citation proceeding and an order to turnover these funds to West Bend, (iv) an order requiring Banco Popular to respond to the motion,*fn1 and (v) judgment against Banco Popular in the amount of $47,720.00, the sum total of Gizynski's cash payments between January-July 2010.
For the reasons below, the Court denies West Bend's motion for judgment and turnover of the $47,720.00, but orders Banco Popular to pay the costs associated with this motion, as permitted under 735 ILCS § 5/2-1402(h). Gizynski shall be jointly and severally liable for the payment of those costs. West Bend shall submit its fee petition on or before January 5, 2011. In the event that it receives any future deposits from Gizynski, the Court also orders Banco Popular to notify West Bend of the deposit in writing, within no more than seven business days from the date of deposit, for the duration of this enforcement proceeding or until the Court otherwise orders. The notice shall state the date of deposit, the amount deposited, and the method (i.e. cash or check) of the deposit, and it shall include a certified copy of the deposit slip.*fn2 With regard to the remainder of West Bend's motion, the Court enjoins Gizynski from making further transfers of his non-exempt assets, orders Gizynski to provide a cash accounting to West Bend by January 7, 2011, and orders Gizynski to file a submission with the Court describing any exemptions he seeks to claim on or before January 7, 2011.
The Amended Complaint in this action alleges claims for, inter alia, fraud, conspiracy, and breach of contract arising out of West Bend's issuance of a bond to Defendant Belmont State Corporation ("Belmont State") for public projects and Belmont State's ensuing failure to pay its subcontractors and suppliers. The Court entered default judgment against Belmont State and the individually named defendants, including Gizynski, in the amount of $2,150,333.60 on September 17, 2009. (R. 26-1, Default Judgment.)
On October 28, 2009, West Bend served a citation to discover assets to Gizynski (the "Gizynski Citation"). On October 29, 2009, West Bend served Banco Popular with a third party citation to discover assets (the "Banco Citation").*fn3 The citations, issued pursuant to 735 ILCS 5/2-1402, prohibit Gizynski and Banco Popular from: making or allowing any transfer or other disposition of, or interfering with, any property not exempt from execution or garnishment belonging to [Gizynski] or to which [Gizynski] may be entitled or which may be acquired by or become due to [Gizynski] and from paying over or otherwise disposing of any money not so exempt, which is due or becomes due to [Gizynski], until further order of court or termination of the proceedings.
(R. 29-1, Gizynski Citation; R. 33-1, Banco Citation.)
In connection with the citation proceedings, West Bend deposed Gizynski on January 7, 2010. There, Gizynski testified that he understood the restrictions imposed upon him by the citation. While discussing how Gizynski would handle the monthly rent payments he collected from tenants at 4944 W. Belmont -- the property subject to the Mortgage with Banco Popular -- West Bend's counsel asked Gizynski explicitly, "Do you understand that under the citation, you are prohibited from transferring any of the assets you receive; is that correct?" Gizynski replied, "Yes." (R. 116-2, Gizynski Deposition Excerpt.) Nevertheless, on July 27, 2010, while deposing a representative of third party citation respondent Banco Popular, West Bend learned that Gizynski had made mortgage payments to Banco Popular in 2010. West Bend promptly conducted further discovery and discovered that Gizynski had made six cash payments to Banco Popular between January-July 2010, totaling $47,720.00. Gizynski made the first of those payments just days after his deposition. At no time prior to July 27, 2010 did Banco Popular notify West Bend, or the Court, that it had received cash payments from Gizynski. Instead, Banco Popular accepted the deposits and applied the cash payments to the Mortgage.
West Bend and Banco Popular deposed Gizynski a second time, on
September 27, 2010. At that deposition, Gizynski admitted that he had
made cash payments, in person, at three separate Banco Popular
locations after being served with the Gizynski Citation.*fn4
(R. 132-3, Gizynski Deposition II, at 31-33.) Gizynski
testified that he made the payments using rent he had collected from
the tenants at 4944 W. Belmont. When pressed to identify whom he
collected the rent from, when he collected the rent, or the sums that
he collected, however, Gizynski gave conflicting and confused
testimony, as illustrated in the following exchange:
Q: Do you have any records to show from whom you collected rent that you used to pay your mortgage payment?
Q: You have no written records, is that what you're saying? You have no written records of who paid you rent?
A: So few tenants. I remember everything.
Q: You remember everything, is that what you're saying?
A: I remember how much they paid me.
Q: In January of 2010, who paid you rent?
A: That's eight months ago. I don't remember right now.
Q: A moment ago you said you remembered everything.
A: Only at the time they're paying. (Id. at 33-34.) Gizynski also testified that he used his tenants' rental payments for the month of August 2010 to pay for his own physical therapy sessions. (Id. at 35-36.)
West Bend filed the present motion against Gizynski and Banco Popular, asserting that both parties violated the terms of their respective citations. In its motion, West Bend asks the Court to issue a rule to show cause as to why Gizynski should not be held in contempt for violating the asset transfer prohibition in the citation. West Bend also asks the Court to: (1) order Gizynski to provide West Bend with a cash accounting "for all cash he has received or [ ] possessed," or currently possesses; (2) order Gizynski to turn over those funds; and (3) enjoin Gizynski from making further transfers of his non-exempt assets. West Bend asks the Court for a judgment and turnover order against Banco Popular in the amount of $47,720.00 -- the money Gizynski deposited between January-July 2010. West Bend contends it is entitled to these funds by virtue of its judgment lien on Gizynski's non-exempt assets, which was perfected when West Bend served the Gizynski Citation on October 28, 2009.
Gizynski and Banco Popular oppose West Bend's motion on several
grounds. Although the parties filed individual responses,*fn5
both parties argue that their respective citation proceedings
have terminated, and that West Bend's motion is thus untimely. Both
parties also assert, albeit with certain nuanced differences, that even if the
citation proceedings have not terminated, West Bend's judgment lien on
Gizynski's non-exempt assets is subordinate to Banco Popular's lien on
the specific rental payments at issue in this motion, because Banco
Popular's lien on the payments was perfected in July 2004 when Banco
Popular and Gizynski entered into an Assignment of Rents. The parties
argue that Banco Popular's earlier-filed lien trumps West Bend's
judgment lien and that, as a result, Banco Popular has the priority
right to those funds. Finally, Gizynski makes several arguments in
response to West ...