HSBC Bank USA v. Rowe
36 N.E.3d 254
Ill. App. Ct.2015Background
- HSBC filed a mortgage foreclosure complaint (2010) naming MERS as original mortgagee and alleging HSBC was the mortgagee under 735 ILCS 5/15-1208; promissory note and mortgage were attached to the complaint.
- The note was executed by Scott Rowe in favor of MortgageIt, Inc.; the mortgage named MERS as mortgagee/nominee for MortgageIt.
- Defendants pleaded lack of standing, alleging (among other things) no assignment attached and that MERS’s assignment was invalid; plaintiff produced the original note in court and filed a motion to strike the standing defense, which led defendants to withdraw and then later replead standing defenses.
- Two different copies of the note appeared during litigation: one attached to the complaint bore a MortgageIt “true and correct copy” stamp; a later copy included a MortgageIt indorsement in blank beneath Rowe’s signature. Plaintiff also produced the original note in court.
- Defendants served requests for admission under Ill. S. Ct. R. 216; plaintiff objected to many requests and served unsigned responses (some objections accompanied by unsworn denials/answers). Defendants moved to deem the requests admitted; the trial court denied the motion.
- The trial court granted HSBC’s motion for summary judgment and entered a foreclosure judgment; defendants appealed contesting summary judgment/standing and the denial of their motion to deem admissions admitted.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Pleading sufficiency / standing to foreclose | Complaint identified MERS as original mortgagee and stated plaintiff’s capacity as mortgagee under the statute, satisfying 735 ILCS 5/15-1504 | Complaint failed to identify the current mortgagee at filing; thus plaintiff did not plead an interest and lacks standing/subject-matter jurisdiction | Complaint satisfied statutory pleading requirements; plaintiff had standing and summary judgment was proper |
| Ownership of the note / genuine issue from differing note copies | Plaintiff attached the note to the complaint and later produced the original; possession of a note indorsed in blank makes it bearer paper and prima facie evidence of title | Differing copies (one without indorsement, one with indorsement) created a material factual dispute over who owns the note | No genuine material fact: possession of bearer paper establishes title; differing copies were immaterial to ownership/standing |
| Requests for admission — adequacy of responses and effect of unsigned/nonresponsive answers | Plaintiff’s objections and written responses (objections need not be sworn) were proper; any objection should have been challenged by motion in trial court | Responses were unsworn, blanket/nonresponsive, and made in bad faith; Rule 216 requires treating them as admitted | Trial court did not abuse discretion: written objections need not be sworn; defendant should have moved to compel or for ruling on objections rather than obtain automatic admissions |
Key Cases Cited
- Joslyn v. Joslyn, 386 Ill. 387 (1944) (possession of bearer paper is prima facie evidence of title and supports foreclosure decree)
- Rosestone Investments, LLC v. Garner, 2013 IL App (1st) 123422 (attachment of the note to the complaint is prima facie evidence of ownership)
- Vision Point of Sale, Inc. v. Haas, 226 Ill. 2d 334 (2007) (Rule 216: responses may be either sworn denials or written objections; objections need not be sworn)
- Bruns v. City of Centralia, 2014 IL 116998 (summary judgment reviewed de novo)
- Szczeblewski v. Gossett, 342 Ill. App. 3d 344 (2003) (good-faith obligation to secure answers to requests for admission from persons/documents under a party’s control)
- La Salle National Bank of Chicago v. Akande, 235 Ill. App. 3d 53 (1992) (when a party objects to requests for admission, the requesting party must move the court to resolve objections)