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Taylor, Bean, & Whitaker Mortgage Corp. v. Cocroft

Court of Appeals of Illinois, First District, Fourth Division

May 3, 2018

TAYLOR, BEAN, & WHITAKER MORTGAGE CORPORATION, Plaintiff-Appellee,
v.
DAVID COCROFT and VEYNECIA COCROFT, Defendants David Cocroft, Defendant-Appellant.

          Appeal from the Circuit Court of Cook County. No. 2012 CH 34114 The Honorable Anna M. Loftus, Judge Presiding.

          JUSTICE GORDON delivered the judgment of the court, with opinion. Presiding Justice Burke and Justice Ellis concurred in the judgment and opinion.

          OPINION

          GORDON, JUSTICE.

         ¶ 1 The instant appeal arises from a foreclosure action filed against defendant David Cocroft and his wife, Veynecia[1] Cocroft, by plaintiff Taylor, Bean, & Whitaker Mortgage Corporation. The trial court granted summary judgment in plaintiff's favor, and the property was sold at a judicial sale, at which plaintiff was the highest bidder. Defendant appeals, arguing (1) the trial court erred in permitting plaintiff to amend its complaint to substitute plaintiff as a party instead of the originally-named plaintiff, (2) the trial court erred in denying defendant's motion to strike the note attached to the amended complaint, (3) the trial court erred in granting plaintiff's motion for summary judgment despite defendant's allegation that he had not received the required grace period notice and his arguments that plaintiff was not the holder of the note, and (4) the trial court erred in confirming the sale because justice was not done. For the reasons that follow, we affirm the trial court's judgment.

         ¶ 2 BACKGROUND

         ¶ 3 On September 10, 2012, Colonial Bank filed a complaint to foreclose mortgage against defendant and his wife, Veynecia, which alleged that the mortgagee was "M.E.R.S., Inc., as Nominee for Taylor, Bean & Whitaker Mortgage Corp." and further alleged that Colonial Bank was the "holder of the Mortgage and Note." Attached to the complaint was a copy of the mortgage, which named Mortgage Electronic Registration Systems, Inc. (MERS), as the mortgagee acting solely as nominee for the lender, and named plaintiff as the lender. Also attached to the complaint was a copy of the note, which was in the amount of $572, 000 and was executed by defendant and by one of plaintiff's representatives.

         ¶ 4 Defendant was served with the summons and complaint on September 16, 2012.

         ¶ 5 On December 18, 2012, plaintiff filed a motion for leave to file an amended complaint to substitute plaintiff for Colonial Bank as the named plaintiff in the foreclosure case.

         ¶ 6 On January 14, 2013, defendant filed a pro se appearance and, on the same day, filed an "Objection to Plaintiffs' [sic] Motion for Default and Motion for Substitution of Plaintiff, "[2]arguing, inter alia, that the complaint was defective, that plaintiff lacked standing, that defendant had rescinded the mortgage on May 19, 2009, and that the complaint was time-barred because there had been a previous foreclosure complaint that had been voluntarily dismissed and the instant complaint was filed more than one year from the date of that dismissal. The trial court set a briefing schedule on defendant's motions, which also included a motion for sanctions against plaintiff's attorney and a motion to dismiss that does not appear in the record on appeal. On February 19, 2013, plaintiff renoticed its motion for leave to amend the complaint, setting the motion for hearing on May 7, 2013, and defendant filed another "Objection to Plaintiffs' [sic] Petition to Amend Complaint" on March 12, 2013. On March 13, 2013, plaintiff filed a motion for extension of time to respond to defendant's motions or, in the alternative, leave to file an amended complaint, in which it renewed its request for leave to file an amended complaint.

         ¶ 7 On April 19, 2013, defendant filed a pro se motion for partial summary judgment; the motion raised the same general issues as his previous filings but did not specify why summary judgment would be appropriate.

         ¶ 8 On May 1, 2013, plaintiff filed another motion for leave to amend the complaint, claiming that Colonial Bank had been named as the original plaintiff "due to scriverners [sic] error." The motion also claimed that plaintiff "also intends to attach the relevant Assignment of Mortgage/Deed to its amended pleading to further substantiate its standing to foreclose in this action." The motion further claimed that amending the complaint would "resolve any need" for plaintiff to respond to defendant's motion to dismiss or motion for partial summary judgment.[3] On June 18, 2013, plaintiff filed a motion for extension of time to file its proposed amended complaint, which it set for hearing on September 30, 2013. On the same day, it filed a proposed amended complaint. Defendant filed a pro se objection to the motion, raising the same arguments as in his prior motions and objections.

         ¶ 9 Additionally, on July 25, 2013, defendant filed a pro se "Motion to Dismiss Instanter, " seeking to dismiss the case in its entirety under section 2-619 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619 (West 2012)). Defendant claimed that the claim was barred by res judicata, that the claim was time-barred, and fraudulent misrepresentation based on his claim that plaintiff was not the legal holder of the mortgage and note.

         ¶ 10 On August 2, 2013, defendant filed another pro se motion for sanctions.

         ¶ 11 On September 30, 2013, the parties appeared before the trial court on plaintiff's motion to amend the complaint, and the trial court granted plaintiff leave to file a supplemental memorandum on the issue, which it did on November 7, 2013; in connection with that supplemental memorandum, plaintiff also filed a "Motion to Substitute as Plaintiff Real Party in Interest, " which it requested be granted if its motion to amend the complaint was denied.

         ¶ 12 On December 3, 2013, defendant filed a pro se "Motion to Request a Ruling on Defendants [sic] Motion to Dismiss Instanter."

         ¶ 13 On April 10, 2014, the trial court entered an order concerning (1) "Plaintiff's Motion to Amend Complaint to Foreclose Mortgage, " (2) "Plaintiff's Motion to Substitute as Plaintiff Real Party in Interest, " (3) "Defendants [sic] Motion for Sanctions Instanter, " (4) "Defendants' Motion in Objection to Plaintiff's Motion for Default and Motion for Substitution of Plaintiff, " (5) "Defendants [sic] Motion to Dismiss Instanter, " and (6) defendant's "Motion to Request a Decision on Defendants [sic] Motion to Dismiss Instanter." The court granted plaintiff's motion to amend the complaint, denied defendant's motion for sanctions, and struck all remaining motions as moot due to the court's ruling on the motion to amend.

         ¶ 14 On April 30, 2014, defendant filed a pro se motion for reconsideration, arguing that plaintiff lacked standing.

         ¶ 15 On May 22, 2014, plaintiff filed an amended complaint for foreclosure and for breach of the note, alleging that it filed the case as assignee of MERS, who was the mortgagee solely as nominee for plaintiff. The complaint alleged that defendant was in default for failure to make the payments owed under the note from June 1, 2008, to the present, as well as for transferring title to the property to the David Cocroft Living Trust without plaintiff's prior written consent. The complaint alleged that, as of May 15, 2014, there was due and owing $922, 589.14, plus attorney fees and costs. The complaint alleged that the capacity in which plaintiff filed suit was "[a]s legal holder of the indebtedness and holder of the Mortgage which was pledged as security therefore." As relevant to the instant appeal, the complaint further alleged that a grace period notice was sent to defendant on February 24, 2012.

         ¶ 16 Attached to the amended complaint was an assignment of mortgage for the mortgage recorded as document No. 0726911063, which provided that MERS, as nominee for plaintiff, assigned to plaintiff "all interests in and under that certain Mortgage dated 6/26/2007 and executed by" defendant and MERS, as nominee for plaintiff, "together with note or notes therein described or referred to, the money due and to become due thereon, with interest, and all rights accrued or to accrue under said Mortgage." The assignment was dated November 14, 2008, and was executed by Erla Carter-Shaw on behalf of MERS.

         ¶ 17 Also attached to the complaint was a copy of a mortgage dated June 26, 2007, and recorded as document No. 0726911063, which named defendant as the borrower and listed MERS as the mortgagee acting solely as nominee for plaintiff, which was named as the lender. Additionally, a copy of the June 26, 2007, note provided that defendant promised to pay plaintiff $572, 000. The note was executed by defendant and also contained three endorsements. One provided: "Without recourse, pay to the order of IndyMac Bank, F.S.B. By: Taylor, Bean & Whitaker Mortgage Corp." and was signed by Erla Carter-Shaw. Another provided: "Pay To the Order Of Taylor, Bean & Whitaker Mortgage Corp. Without Recourse IndyMac Bank, F.S.B." and was signed by Brian[4] Brouillard. A third was a blank endorsement providing: "Without recourse, pay to the order of [space] By: Taylor, Bean & Whitaker Mortgage Corp." and was signed by Erla Carter-Shaw.

         ¶ 18 Also attached to the complaint was a document dated February 24, 2012, and addressed to defendant from RoundPoint Mortgage Servicing Corporation (RoundPoint). The document was entitled "Grace Period Notice" and provided, in all caps:

"Your loan is more than 30 days past due. You may be experiencing financial difficulty. It may be in your best interest to seek approved housing counseling. You have a grace period of 30 days from the date of this notice to obtain approved housing counseling. During the grace period, the law prohibits us from taking any legal action against you. You may be entitled to an additional 30 day grace period if you obtain housing counseling from an approved housing counseling agency. A list of approved counseling agencies may be obtained from the Illinois Department of Financial and Professional Regulation."

         The document was accompanied by a copy of an envelope addressed to defendant, with first-class postage paid.

         ¶ 19 On October 1, 2014, defendant's motion for reconsideration was denied, and on October 27, 2014, defendant filed a pro se motion to dismiss the complaint pursuant to section 2-619 of the Code, again alleging a lack of standing. Attached to defendant's motion to dismiss was a copy of a second assignment, dated February 13, 2011, in which MERS as nominee for plaintiff assigned the same mortgage loan to plaintiff; the assignment was signed by Melissa Long on behalf of MERS.

         ¶ 20 Also on October 27, 2014, defendant filed a pro se "Objection and Motion to Strike the Note Attached to Amended Complaint for Mortgage Foreclosure and Other Relief, " in which defendant claimed that the note attached to the amended complaint was "fraudulent" because it was different from the note attached to the original complaint-the note attached to the original complaint bore one blank endorsement, while the note attached to the amended complaint bore three endorsements.

         ¶ 21 On November 18, 2014, the trial court denied defendant's motions, and on December 18, 2014, defendant filed a pro se verified answer, affirmative defenses, and counterclaim. Defendant raised 10 affirmative defenses: (1) res judicata; (2) failure to comply with Illinois Supreme Court Rule 113(b) (eff. May 1, 2013), which required a copy of the note to be attached to the complaint; (3) failure to comply with a condition precedent to the foreclosure proceedings, namely, failure to provide a notice of default and acceleration of the loan; (4) lack of standing at the time the case was commenced; (5) failure to refile the complaint within one year after the voluntary dismissal of the prior foreclosure case, making the complaint time-barred; (6) "Lack of Standing to Maintain Case, " based on the allegation that plaintiff was not the holder of the note; (7) lack of authority to bring or maintain the foreclosure action; (8) lack of subject-matter jurisdiction, based on the allegations concerning the claims being time-barred or barred by res judicata; (9) forgery, based on allegations that the signature of Erla Carter-Shaw did not appear to be the same in all documents signed by her; and (10) satisfaction of the loan. Defendant also alleged four counterclaims: (1) violation of the Consumer Fraud and Deceptive Business Practices Act (815 ILCS 505/1 et seq. (West 2012)) for failure to make the proper disclosures to defendant at the time of the loan, including Truth in Lending disclosures; (2) using a false appraisal in determining the property's value, misleading defendant about the value of the property; (3) breach of the note and mortgage, for failure to provide defendant a notice of default and acceleration; and (4) slander of title.

         ¶ 22 On December 30, 2014, defendant filed a pro se motion for leave to file an amended answer, affirmative defenses, and counterclaim, and on January 8, 2015, the trial court entered an order, inter alia, (1) granting defendant's motion in part and allowing him to file an amended answer and affirmative defenses and (2) striking defendant's counterclaims for filing them without leave of court. The order also provided that "the court finds that ...


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