Kingston Partners, LLC v. Lynn Plaza, LLC
2023 IL App (1st) 220652
Ill. App. Ct.2023Background
- Kingston Partners purchased 245 Avon Ave., Northfield, by quitclaim deed on October 28, 2019, and spent >$110,000 on exterior renovations; a Village permit listing Kingston as owner was posted on the property.
- Kingston listed the house for sale in April 2020; on May 11, 2020 Kingston’s counsel emailed Lynn Plaza’s counsel a copy of the quitclaim deed notifying them Kingston owned the property.
- Lynn Plaza held a personal judgment against Allan Rodin and had a memorandum of judgment prepared and submitted for e-recording (Simplifile) on May 7, 2020; the Recorder’s office file-stamped the memorandum on May 29, 2020 at 9:49 a.m.; Kingston’s deed was file-stamped later that same day.
- Kingston sued to quiet title and for slander of title; trial court granted summary judgment quieting title for Kingston, declaring Lynn Plaza’s recorded memorandum null and void, finding Lynn Plaza had constructive or inquiry notice before recording.
- The trial court denied Kingston’s request for attorney fees and punitive damages (no finding of malice); the court consolidated and dismissed the overlapping petition count in the related case as to the same relief.
- Lynn Plaza appealed the quiet-title ruling; Kingston cross-appealed the denial of fees/punitive damages. The appellate court affirmed both the quiet-title judgment and denial of fees/punitive damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Lynn Plaza’s recorded memorandum of judgment takes priority over Kingston’s unrecorded deed under the Conveyances Act | Kingston: deed/possession predated judgment lien; Kingston’s open possession gave constructive/inquiry notice so Lynn Plaza was not "without notice" | Lynn Plaza: its memorandum was filed for record before Kingston’s deed and thus has priority under 765 ILCS 5/30; filing date is May 7 (electronic submission) | Court: Lynn Plaza had constructive/inquiry notice from Kingston’s open possession before filing/recording, so Lynn Plaza was not a creditor "without notice"; summary judgment for Kingston affirmed |
| Whether the operative date for notice is the electronic submission (May 7) or the Recorder’s file-stamp (May 29) | Kingston: constructive/inquiry notice existed before any filing, so date dispute irrelevant | Lynn Plaza: May 7 (submission to Recorder/e-filing vendor) is the filing date and governs priority | Court: even if May 7 is treated as filing, undisputed possession facts gave Lynn Plaza notice before then; thus Kingston prevails |
| Whether Kingston’s renovations, permit posting, and listing constituted sufficient possession to charge Lynn Plaza with constructive/inquiry notice | Kingston: extensive visible renovations and posted permit amounted to actual, open, visible possession equivalent to recorded deed | Lynn Plaza: renovations could be contractor work for record owner; it did not physically inspect property and relied on public records showing Rodins as owners | Court: undisputed renovations and posted permit constituted open possession, imposing a duty to inquire on Lynn Plaza; possession equated to constructive notice |
| Whether Kingston was entitled to attorney fees or punitive damages on the quiet-title claim based on malice | Kingston: Lynn Plaza acted maliciously by recording and refusing to release the memorandum after receiving proof of Kingston’s ownership | Lynn Plaza: acted reasonably as a judgment creditor, having conducted title searches and submitted lien for recording; no malice | Court: fees/punitive damages require malice tied to slander of title; slander claim not decided (summary judgment denied as to slander), so fees/punitive damages on the quiet-title count not awarded; denial affirmed |
Key Cases Cited
- Banco Popular v. Beneficial Systems, Inc., 335 Ill. App. 3d 196 (Ill. App. 1st 2002) (explains creditor priority under Conveyances Act and that possession can give constructive notice equivalent to recording)
- Echols v. Olsen, 63 Ill. 2d 270 (Ill. 1976) (recognizes judgment creditor may prevail over holder of prior unrecorded interest)
- East St. Louis Lumber Co. v. Schnipper, 310 Ill. 150 (Ill. 1923) (early statement of rule that judgment lien attaches to interests apparent of record absent notice)
- Union Bank of Chicago v. Gallup, 317 Ill. 184 (Ill. 1925) (creditor bound to inquire when possession indicates title may differ from record)
- Beals v. Cryer, 99 Ill. App. 3d 842 (Ill. App. 2d 1981) (possession, improvements, or acts of dominion can constitute constructive notice)
- Home Investment Fund v. Robertson, 10 Ill. App. 3d 840 (Ill. App. 4th 1973) (awarding attorneys’ fees in slander-of-title context where malice proven)
- People ex rel. Madigan v. Illinois Commerce Comm’n, 231 Ill. 2d 370 (Ill. 2008) (filing deemed filed when submitted even if compliance review occurs later)