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Citibank, N.A. v. Michael Anthony Wilbern

United States District Court, N.D. Illinois, Eastern Division

March 28, 2014




Plaintiff, Citibank, N.A. ("Citibank") has sued Defendants Michael Anthony G. Wilbern and Sandra D. Wilbern for default on a promissory note, and seeks to foreclose on a home in Wadsworth, Illinois. Defendants stopped making monthly payments in October 2010, and in February 2012, Plaintiff filed this foreclosure action. Defendants' substantial indebtedness is undisputed, but they have challenged Plaintiff's right to foreclose on a number of procedural grounds. For the reasons explained here, all but one of Defendants' objections are overruled. Because Plaintiff has not established that it mailed the statutorily-required notice of default, however, the court is unable to enter a judgment of foreclosure. Defendants' motion to strike various exhibits supporting Plaintiff's summary judgment motion [50] is granted in part and denied in part. Plaintiff's motions for summary judgment [45] and to appoint a special commissioner [49] are denied without prejudice.


Most of the facts are undisputed. On April 18, 2007, American Mortgage Network, Inc. ("American Mortgage") made a loan to Defendant Michael Wilbern in the amount of $645, 000. (Interest-Only Period Fixed Rate Note, Ex. 1 to Pl.'s 56.1 Statement [46], hereinafter "Note, " at 1; Defs.' Resp. to Pl.'s 56.1 Statement [76] ¶ 1.) In exchange, Mr. Wilbern executed a promissory note in favor of American Mortgage, agreeing to pay the principal plus interest on the unpaid principal at an annual rate of 7.5% as well as taxes, insurance, and other escrow items. (Defs.' Resp. to Pl.'s 56.1 ¶¶ 1, 3, 4, 10.) A single page located after the Note and before a document titled "Planned Unit Development Rider" appears to be the indorsement, and states:

Without Recourse American Mortgage Network, Inc. DBA AmNet Mortgage

The document bears the signature of Deborah Picchiotti, who is identified as "Post Closing Supervisor." Also on April 28, 2007, both Defendants executed a security instrument, that is, a mortgage for a residence located at 16816 Cherrywood Lane, Wadsworth, Illinois 60083.[1] (Mortg., Ex. 2 to Pl.'s 56.1; Defs.' Resp. to Pl.'s 56.1 ¶¶ 6-7.) The mortgage identifies American Mortgage as the "Lender, " and MERS, Inc. ("Mortgage Electronic Registration Systems, Inc.") both as "nominee" for American Mortgage and its "successors and assigns, " and as the "mortgagee." (Mortg. at 1, 3.) The mortgage document further provides that it "secures to Lender: (i) the repayment of the Loan...; and (ii) the performance of Borrower's covenants and agreements under this Security Instrument and the Note." ( Id. at 3.) On May 29, 2007, MERS, Inc., acting as nominee for American Mortgage, recorded its interest in the mortgage with the Lake County Recorder of Deeds.[2] (Pl.'s 56.1 ¶ 5.)

Defendants stopped making monthly payments in October 2010, and have not made a payment since then, at least through February 14, 2014. (Defs.' Resp. to Pl.'s 56.1 ¶¶ 11, 15.) The Mortgage, provides that if, after receiving notice of their default, Defendants failed to cure it in the specified time, then "Lender at its option may require immediate payment in full of all sums secured by [the] Security Instrument without further demand and may foreclose [the] Security Instrument by judicial proceeding." (Mortg. ¶ 22.) Plaintiff asserts that it mailed Defendants "[a] notice of default and acceleration, including a counseling notice" on August 9, 2011 (Pl.'s 56.1 ¶ 16), but Defendants claim that they did not receive the notice. (Defs.' Resp. to Pl.'s 56.1 ¶ 16) (citing Michael Wilbern Aff., Ex. C to Defs.' 56.1 [77], ¶¶ 3-5.) On February 2, 2012, Plaintiff filed this action to foreclose its mortgage and recover an outstanding balance of $769, 943.33, with interest accruing on unpaid principal at a rate of $134.12 per day, as well as "attorney's fees, foreclosure costs, late charges, advances, and expenses incurred." (Compl. [1]; Pl.'s 56.1 ¶ 17.) Defendants submitted a Making Home Affordable Program ("HAMP") Request for Mortgage Assistance with Ocwen Loan Servicing, Inc. ("Ocwen")[3] (as servicer) on July 22, 2013, though the parties dispute whether the application was complete. (Pl.'s Resp. to Defs.' 56.1 [80] ¶ 15; Defs.' 56.1 ¶ 15.) Plaintiff claims that "it informed Defendants['] counsel of the missing documents on February 11, 2014 via email, " and, as of February 28, 2014, it has not received any additional documents. (Pl.'s Resp. to Defs.' 56.1 ¶ 15.)

As noted, Defendants contend they did not receive the required notice of default. They argue, in addition, that Plaintiff did not own and possess the Note when this suit was filed, and urge that the Mortgage was not properly assigned from American Mortgage to Plaintiff. Plaintiff asserts that it "owned the Note and had possession of the Note" when the suit was filed (Pl.'s 56.1 ¶ 14) (citing Compl. & Lisa Negron Aff., Mar. 1, 2012, Ex. 5 to Pl.'s 56.1), but Defendants flatly deny that Plaintiff had possession, noting that Negron's affidavit "says nothing about possession." (Defs.' Resp. to Pl.'s 56.1 ¶ 14.) With respect to the mortgage assignment, Plaintiff claims that on November 30, 2011, MERS, Inc., acting as nominee for American Mortgage, assigned the mortgage to Ocwen. (Pl.'s 56.1 ¶ 12.) Ocwen then assigned the mortgage to Plaintiff on December 27, 2011. ( Id. ¶ 13.) But Defendants assert that because American Mortgage dissolved on June 2, 2009, before the first alleged assignment, it could not have assigned its interest in the mortgage, and therefore, both assignments are "invalid." (Defs.' Resp. to Pl.'s 56.1 ¶¶ 12-13.) Additionally, Defendants claim that the signatures of the corporate representatives and the notaries who executed and signed the assignments "bear[] no resemblance" to their signatures on their notary applications. (Defs.' 56.1 ¶¶ 8-13.)

Jurisdiction is proper under 28 U.S.C. § 1332. The parties are diverse in citizenship: both Defendants are Illinois citizens, and Plaintiff Citibank is chartered in New York, where its headquarters and principal place of business are located. The amount in controversy, at least $769, 943.33, well exceeds the jurisdictional minimum. (Compl. ¶ 2; Pl.'s 56.1 ¶ 17; Defs.' Resp. to Pl.'s 56.1 ¶ 1.) Plaintiff has moved for summary judgment, and to appoint a special commissioner, and Defendants have filed a motion to strike exhibits 1, 2, 5 and 6 filed in support of Plaintiff's motion for summary judgment. The motions are fully briefed.


I. Standard of Review

The court will grant summary judgment where the moving party demonstrates that "there is no genuine dispute as to any material fact, " and that the moving party "is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a). The court will "construe the facts and draw all reasonable inferences in favor of the non-moving party." Ferraro v. Hewlett-Packard Co., 721 F.3d 842, 847 (7th Cir. 2013). "Once the moving party puts forth evidence showing the absence of a genuine dispute of material fact, the burden shifts to the non-moving party to provide evidence of specific facts creating a genuine dispute." Carroll v. Lynch, 698 F.3d 561, 564 (7th Cir. 2012). Inferences "supported by only speculation or conjecture, " or "[m]ere metaphysical doubt as to the material facts" do not create a genuine dispute. Carroll, 698 F.3d at 564-65 (quoting, respectively, Koclanakis v. Merrimack Mut. Fire Ins. Co., 899 F.2d 673, 675 (7th Cir. 1990), and Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)).

In order to show the absence of any issue of material fact, the moving party may rely on "materials in the record, including... affidavits or declarations, ... or other materials, " so long as the evidence relied upon is admissible in evidence. FED. R. CIV. P. 56(c)(1)(A), (2). Rule 56 requires that affidavits "be made on personal knowledge, set out facts that would be admissible in evidence, and show that the affiant... is competent to testify on the matters stated." FED. R. CIV. P. 56(c)(4). The non-moving party may move to strike supporting evidence that would be inadmissible at trial.

II. Defendants' Motion to Strike

Defendants move to strike Lisa Negron's affidavit, the Note, the Mortgage, and the Notice of Default letter (Ex. 6 to Pl.'s 56.1) as well as "the corresponding sections of Plaintiff's 56.1"-essentially, all evidence offered in support of Plaintiff's summary judgment motion. Defendants argue that Negron lacks personal knowledge to testify, and that all of the exhibits are unauthenticated. (Defs.' Mot. to Strike at 1.)[4] The court will address each document in turn.

A. Negron's Affidavit

Lisa Negron, identified as an Ocwen "Senior Contract Manager, " states in her affidavit that she is familiar with the records Ocwen uses to service its loans, and, after reviewing Ocwen's servicing records, she concludes that Plaintiff Citibank "owns Defendant[s'] Note and Mortgage." (Negron Aff. ¶¶ 1-2, 4.) Based on her review of the servicing records, Negron identifies the sums of money that Defendants owe in principal, escrow, late charges, unpaid interest, and other expenses as of February 14, 2012, and explains that Defendants' total indebtedness is $769, 943.33. ( Id. ¶¶ 5-6.) Defendants argue that Negron's affidavit does not comply with Federal Rule of Civil Procedure 56(c)(4)[5] because she lacks personal knowledge to testify about Defendants' Note and Mortgage. (Defs.' Mot. to Strike at 2.) Specifically, Defendants contend, Negron had no personal knowledge of "what went on with any particular individual's loan or even knowledge as to how mortgage records are kept, " and therefore, they urge, she is not qualified to testify or to authenticate the accompanying business records. ( ...

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