CitiMortgage, Inc. v. Lewis
2014 IL App (1st) 131272
Ill. App. Ct.2015Background
- CitiMortgage foreclosed on Robin Lewis’s property at 19408 Hickory Place; sale occurred July 2, 2012 and was later confirmed; Lewis moved to set aside the sale; appeal challenges notice and FHA-HAMP compliance.
- Notice of sale was mailed June 20, 2012 to Lewis at the property address; proof of service stated mailing by an attorney on that date to the same address; sale proceeded to highest bidder CitiMortgage.
- Lewis argued lack of notice under 735 ILCS 5/15-1507(c)(3) and a material FHA-HAMP violation under 735 ILCS 5/15-1508(d-5); she sought limited discovery or an evidentiary hearing.
- Circuit court denied Lewis’s motion to set aside and granted CitiMortgage’s motion to confirm; possession stayed 60 days post-confirmation.
- On appeal, the court vacated the September 20, 2012 order and remanded for limited discovery and an evidentiary hearing on whether the sale violated FHA-HAMP requirements.
- The court discussed proper service under Rules 11 and 12 and held that proof of service was in substantial compliance; it affirmed denial of Lewis’s notice-based challenge but remanded on the FHA-HAMP issue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was notice of the sale properly provided? | CitiMortgage showed substantial compliance with Rule 11/12; proof of service supported mailing to Lewis. | Lewis did not actually receive the notice; receipt is necessary to validate service. | Notice properly provided; circuit court did not abuse discretion denying set aside. |
| Did Lewis prove a material FHA-HAMP violation under 15-1508(d-5)? | Lewis failed to prove she applied for FHA-HAMP; denial letters show evaluation and ineligibility. | Lewis submitted FHA-HAMP applications and was being evaluated; sale proceeded before proper review. | Remand for evidentiary hearing on whether sale violated FHA-HAMP requirements. |
| Should limited discovery or an evidentiary hearing be allowed on the FHA-HAMP issue? | No need for further discovery given the record; no evidentiary hearing warranted. | Limited discovery or an evidentiary hearing is necessary to resolve FHA-HAMP timing and evaluation. | Remand to permit limited discovery and an evidentiary hearing on FHA-HAMP violation. |
Key Cases Cited
- NAB Bank v. LaSalle Bank, N.A., 2013 IL App (1st) 121147 (Ill. App. 1st Dist. 2013) (abuse-of-discretion standard; foreclosing-sale mechanics not controlling here)
- Candice Co. v. Ricketts, 281 Ill. App. 3d 359 (Ill. App. 1st Dist. 1996) (report of proceedings not required under de novo review)
- Deutsche Bank National v. Burtley, 371 Ill. App. 3d 1 (Ill. App. 1st Dist. 2006) (abuse-of-discretion standard for ruling on motions to vacate sale)
- Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill. App. 3d 1 (Ill. App. 1st Dist. 2010) (broad discretion in approving/disapproving judicial sales)
- In re Marriage of Betts, 159 Ill. App. 3d 327 (Ill. App. 1st Dist. 1987) (presumption of delivery where notice mailed to proper address)
- Bernier v. Schaefer, 11 Ill. 2d 525 (1954) (service by mail requires substantial compliance with Rule 12)
- French v. French, 43 Ill. App. 2d 29 (1963) (service complete when required acts are done; rebuttable receipt not required)
- Cragin Federal Bank For Savings v. American National Bank & Trust Co. of Chicago, 262 Ill. App. 3d 115 (Ill. App. 2d Dist. 1994) (public vs. private notice considerations; not controlling here)
- GMB Financial Group, Inc. v. Marzano, 385 Ill. App. 3d 978 (Ill. App. 1st Dist. 2008) (foreclosure notice issues; reliance limited; later overruled on other grounds)
- Johnson v. CitiMortgage, 2013 IL App (2d) 120719 (Ill. App. 2d Dist. 2013) (second HAMP application evaluated; sale void for failure to review timely)
- Bermudez v. CitiMortgage, 2014 IL App (1st) 122824 (Ill. App. 1st Dist. 2014) (clarifies MHAP/HAMP application standards for 15-1508(d-5))