Bayview Loan Servicing, LLC v. 2010 Real Estate Foreclosure, LLC
2013 IL App (1st) 120711
| Ill. App. Ct. | 2013Background
- Foreclosure action filed July 23, 2009, targeting 1106 E. Oakton St., Arlington Heights, IL; judgment of foreclosure and order of sale entered January 23, 2010; circuit court confirmed sale; intervenor sought to vacate confirmation under 2-1301(e) and 15-1508(b).
- Intervenor claimed it was injured by a bankruptcy stay in a second foreclosure action and argued it would suffer prejudice if sale confirmed; intervenor asserted a defective lis pendens and questioned plaintiff’s licensing under the Collection Act.
- Circuit court denied intervenor’s motion to vacate; intervenor was allowed to intervene; plaintiff argued exemption from the Collection Act and proper lis pendens.
- Appellate court analyzed only the 15-1508(b) avenue (not 2-1301(e)); held intervenor failed to show that justice was not done, and that the circuit court did not abuse discretion in denying vacation of confirmation.
- Record inconsistencies and missing transcripts were noted; court reaffirmed that the proper standard is whether four statutorily specified grounds apply under 15-1508(b).
- Court ultimately affirmed the circuit court’s denial of the motion to vacate the confirmation of sale.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 15-1508(b) governs vacation of sale confirmation. | Barnes governs; 15-1508(b) controls. | Barnes should not bar Section 2-1301(e) relief in this context. | Yes; 15-1508(b) is the proper avenue. |
| Whether intervenor proved ‘justice was otherwise not done.’ | Intervenor failed to show grounds. | Lis pendens and collection-licensing issues show injustice. | No; intervenor failed to prove grounds under 15-1508(b)(iv). |
| Lis pendens validity and reliance on the county website. | Lis pendens complied with 15-1503; plaintiff complied. | Intervenor relied on website, not the lis pendens. | Lis pendens valid; no vacatur for this reason. |
| Whether plaintiff was required to register as a collection agency under the Collection Act. | Exempt under §2.03 as servicer; also licensed under the Residential Mortgage License Act. | Plaintiff as a servicer may still be subject to Act; lack of debtor/creditor nexus. | Exempt; no violation found. |
Key Cases Cited
- Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill. App. 3d 1 (2010) (Foreclosure procedure; 15-1508(b) controls vacatur after sale)
- Wells Fargo Bank, N.A. v. McCluskey, 2012 IL App (2d) 110961 (2012) (Second District permits §2-1301(e) after foreclosure sale; conflicted with Barnes)
- Household Bank, FSB v. Lewis, 229 Ill. 2d 173 (2008) (Mandates hearing on confirmation; section 15-1508(b) applicable)
- Sewickley, LLC v. Chicago Title Land Trust Co., 2012 IL App (1st) 112977 (2012) (Burden on interested party to show grounds to disapprove sale; abuse of discretion standard)
- Roberts, Merchants Bank v. Roberts, 292 Ill. App. 3d 925 (1997) (Discussed in context of section 2-1301(e) versus 15-1508; remanded for hearing under 15-1508)
- Household Bank, FSB v. Lewis, 229 Ill. 2d 173 (2008) (Mandatory duties on circuit court for confirmation process)