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First Mortg. Co., LLC v. Dina

Court of Appeals of Illinois, Second District

March 31, 2014

FIRST MORTGAGE COMPANY, LLC, Plaintiff-Appellee,
v.
DANIEL DINA and GRATZIELA DINA, Defendants-Appellants (Unknown Owners and Nonrecord Claimants, Defendants)

Modified upon denial of rehearing May 22, 2014.

Appeal from the Circuit Court of Lake County. No. 10-CH-2877. Honorable Luis A. Berrones, Judge, Presiding.

SYLLABUS

The summary judgment for foreclosure entered for plaintiff mortgagee and the order confirming the sale of defendants' property were vacated where plaintiff was not a licensed lender under the Residential Mortgage License Act, and the mortgage was therefore unenforceable and void as a matter of public policy.

George H. Olsen, of Rogers Law Group, of Deerfield, for appellants.

Eleazar E. Calero, of Pierce & Associates, P.C., of Chicago, for appellee.

PRESIDING JUSTICE BURKE delivered the judgment of the court, with opinion. Justices Zenoff and Schostok concurred in the judgment and opinion.

OPINION

BURKE PRESIDING JUSTICE.

Page 344

[¶1] Defendants, Daniel and Gratziela Dina, appeal after the confirmation of the judicial sale of their property. They argue that the court improperly granted summary judgment for foreclosure in favor of plaintiff, First Mortgage Company, LLC; they assert, among other things, that they properly raised the defense that the mortgage lender, First Mortgage Company of Idaho, LLC (FMCI), was not a licensed lender under the Residential Mortgage License Act of 1987 (License Act) (205 ILCS 635/1-1 et seq . (West 2006)). We conclude that a material issue of fact existed concerning FMCI's status under the License Act and that this precluded a proper grant of summary judgment. We further conclude that the way defendants raised the defense, by a response in opposition to summary judgment, did not cause them to forfeit the defense; their defense amounted to a claim that the mortgage contract was contrary to public policy, and such a defense is not forfeited by a technical error in raising it. We therefore vacate the grant of summary judgment and the confirmation of the judicial sale and remand the cause.

[¶2] I. BACKGROUND

[¶3] Plaintiff filed a foreclosure complaint relating to the property at 580 Christopher Drive, North Barrington, on May 21, 2010. It made Daniel Dina a defendant as the property owner and borrower. It also

Page 345

made Gratziela Dina, who had signed the mortgage, a defendant. The mortgage showed that the lender was FMCI; this was also the mortgagee according to the complaint. The original amount of the loan was $985,000. The note required a balloon payment of $991,566.67 on March 15, 2008. Defendants did not make this payment.

[¶4] Defendants appeared through counsel and filed an answer and affirmative defenses. They denied that plaintiff was either the mortgagee or the successor in interest to the mortgagee. They also asserted that this same lack of demonstrated interest resulted in plaintiff's lacking standing. They further asserted that plaintiff had failed to mitigate its damages and to comply with federal obligations to consider whether defendants were eligible under modification programs. ...


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