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The Bank of New York Mellon v. Laskowski

Court of Appeals of Illinois, Third District

January 31, 2017

THE BANK OF NEW YORK MELLON, f/k/a The Bank of New York, As Trustee for the Certificate Holders of CWALT, Inc., Alternative Loan Trust 2006-2CB Mortgage Pass-Through Certificates, Series 2006-2CB, Plaintiff-Appellee,
v.
MARK E. LASKOWSKI, a/k/a Mark Edward Laskowski; THE BANK OF COMMERCE; PACIFIC REALTY GROUP, LLC; UNKNOWN OWNERS and NON-RECORD CLAIMANTS, Defendants Pacific Realty Group, LLC, Defendant-Appellant.

         Appeal from the Circuit Court of the 12th Judicial Circuit, Will County, Illinois. Circuit No. 10-CH-3572 The Honorable Thomas A. Thanas, Judge, presiding.

          CARTER JUSTICE delivered the judgment of the court, with opinion. Justice Wright concurred in the judgment and opinion. Presiding Justice Holdridge dissented.

          OPINION

          CARTER JUSTICE.

         ¶ 1 Plaintiff, the Bank of New York Mellon (Bank), in its capacity as the trustee for the certificate holders of a certain alternative loan trust, brought an action against defendant, Pacific Realty Group, LLC (Pacific) and others to foreclose upon a mortgage held on certain real property in Bolingbrook, Will County, Illinois. Well into the proceedings, after the subject property had already been sold at a sheriff's sale, Pacific filed its appearance in the case. On that same court date, the trial court entered a dismissal for want of prosecution (DWP) against the Bank for failing to appear. The DWP was later vacated. About 90 days after Pacific had filed its appearance, it filed a motion to quash service of process. The trial court denied Pacific's motion and later confirmed the sale of the property and the proposed distribution of the proceeds. Pacific appeals, arguing that the trial court erred in denying its motion to quash service of process. We affirm the trial court's judgment.

         ¶ 2 FACTS

         ¶ 3 On June 11, 2010, the Bank filed a complaint for mortgage foreclosure in the instant case. Among other things, the complaint alleged or indicated that (1) Mark Laskowski was the record owner of the subject property; (2) Laskowski had borrowed a certain sum from Cornerstone Mortgage, LLC, in December 2005 and had signed a note to that effect; (3) the debt was secured by a mortgage on the subject property; (4) Laskowski had failed to make monthly mortgage payments since December 2008 and was in default on the mortgage; (5) the Bank was the legal holder of the note and the mortgage; and (6) Pacific may have had some interest in the subject property as the result of a Memorandum and Affidavit of Equitable Interest, which was recorded in December 2008. A copy of the note and the mortgage were attached to the complaint. The summons that was issued when the complaint was filed indicated that service was to be made on Pacific by publication.

         ¶ 4 In July 2010, the Bank's attorney filed an affidavit for service by publication on Pacific. In the affidavit, the Bank's attorney certified that upon diligent inquiry, Pacific could not be found so that process could be served upon it. Along with other documents that were filed later that month was an affidavit of due and diligent search. The affidavit had been subscribed and sworn on June 16, 2010. In the affidavit, the affiant averred that he had made a due and diligent search but was unable to locate the "residence" of Pacific. In attempting to find an address for service of process upon Pacific, the affiant had conducted a search of the directory assistance records but had found no telephone number listed for Pacific in Will County, Illinois. The affiant also had conducted a search of the Illinois Secretary of State records but had found no listing for Pacific. Pacific was then served by publication. A certificate of publication was later filed in the court file.

         ¶ 5 After service by publication was made, Pacific did not appear in court or otherwise respond to the complaint for foreclosure. In July 2012, the trial court entered an order of default and a judgment of foreclosure and sale in the Bank's favor. In the judgment, the trial court specifically found that service of process was properly made. The subject property was sold at a sheriff's sale in February 2013.

         ¶ 6 In April 2013, the Bank filed a motion for an order approving the report of the sale of the property and the proposed distribution of the proceeds and also for an order of possession. The motion was noticed up for April 18, 2013. On that date, the attorney for Pacific appeared in court and filed his appearance. However, because neither a representative for the Bank nor the Bank's attorney was present in court for the scheduled court date, the trial court, on its own motion, dismissed the case for want of prosecution.

         ¶ 7 The following month, in May 2013, the Bank's attorney filed a motion to vacate the DWP, stating that the attorney had inadvertently failed to appear in court on the April court date due to a scheduling error. The Bank's motion was granted on May 30, 2013, and the case was reinstated. The order granting the Bank's motion indicated that the DWP was entered in error. The order also indicated that Pacific's attorney was being granted leave to file his appearance.

         ¶ 8 Following the reinstatement of the case, on July 18, 2013, Pacific filed a motion to quash service of process and for certain other relief. The motion was later amended. In the motion, Pacific alleged that it was a foreign limited liability company registered in New Mexico and that it did not have a registered agent in Illinois. Pacific alleged further that service by publication was improper in this case because the service did not comply with the requirements of the Limited Liability Company Act (805 ILCS 180/1-50 (West 2010)).

         ¶ 9 In May 2014, a hearing was held on Pacific's motion to quash service of process. By the time of the hearing, the parties had fully briefed the issues that had been raised before the trial court. After listening to the oral arguments of the attorneys, the trial court denied Pacific's motion to quash service. In doing so, the trial court found that the motion was untimely because it had not been filed within 60 days of the first appearance date as required by statute and that the motion lacked merit because service by publication in this case was proper and in compliance with the Illinois Mortgage Foreclosure Law (Foreclosure Law) (735 ILCS 5/15-1101 et seq. (West 2010)). The trial court subsequently entered an order approving the report of the sheriff's sale and the proposed distribution of the proceeds. Pacific appealed.

         ¶ 10 ANALYSIS

         ¶ 11 On appeal, Pacific argues that the trial court erred in denying its motion to quash service of process. Pacific asserts that the trial court's erroneous ruling was based upon two incorrect findings: (1) that the motion to quash service of process was untimely and (2) that the service by publication in this case was proper. We address only the first assertion because it is dispositive of the issue before us. As to that particular assertion, Pacific contends that the 60-day time period for filing a motion to quash service in a mortgage foreclosure action (see 735 ILCS 5/15-1505.6(a) (West 2012)) is tolled during the time period that a DWP is in effect.[1] The Bank disagrees with that contention and asserts ...


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