Parkway Bank and Trust Co. v. Meseljevic
940 N.E.2d 215
Ill. App. Ct.2010Background
- Development of a 40-unit commercial condo project in Chicago began in 2006 by Haso, Samel, and Albin Meseljevic and was organized as 1633 Farwell Ave. LLC.
- Beta Electric contracted in April 2006 to perform electrical work for the project; Parkway Bank and Trust Company loaned money and recorded a construction mortgage in May 2006.
- Beta recorded a mechanic's lien for $136,200 on August 5, 2008; Parkway sued for foreclosure on the mortgage in August 2008.
- Beta answered with a counterclaim asserting its lien had priority over Parkway’s mortgage; Parkway moved for judgment on the pleadings on the counterclaim in May 2009.
- Beta filed a late response to the motion (June 5, 2009) and a motion to approve late filing; the court struck the response, denied the late-filing motion, barred Beta from oral argument, and granted Parkway’s motion on the pleadings, finding Beta’s lien defective for lack of 90-day notice and for mischaracterizing subcontractor vs contractor.
- The trial court ultimately concluded Beta, as a subcontractor, failed to perfect its lien under the Mechanics Lien Act, resulting in Parkway’s lien priority over Beta’s.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the late response was properly handled under Rule 183 | Parkway argues Beta failed to show good cause for late filing | Beta asserts court should exercise discretion to accept late filing | No abuse of discretion; no good-cause shown; late filing denied and response struck |
| Whether the trial court correctly granted judgment on the pleadings | Parkway contends Beta was a subcontractor with defective lien due to lack of notice | Beta contends it could be treated as a contractor with valid lien | affirmed; Beta’s lien invalid for lack of 90-day notice and improper status as subcontractor under the Act |
| Whether Beta waived issues on appeal due to untimely filing | Parkway contends Beta waived arguments by not preserving below | Beta preserved objections despite untimely filing | Beta's objections preserved; not barred on waiver grounds |
Key Cases Cited
- Vision Point of Sale, Inc. v. Haas, 226 Ill.2d 334 (Ill. 2007) (Rule 183 extensions require good cause; discretionary)
- Bright v. Dicke, 166 Ill.2d 204 (Ill. 1995) (good-cause standard for extensions of time)
- Gillen v. State Farm Mutual Automobile Insurance Co., 215 Ill.2d 381 (Ill. 2005) (standard for judgments on the pleadings)
- Petrik v. Monarch Printing Corp., 150 Ill.App.3d 248 (Ill. App. 1986) (2-615(e) motion considers only pleadings; no factual disputes)
- Korbelik v. Staschke, 232 Ill.App.3d 114 (Ill. App. 1992) (oral argument is discretionary; scheduling orders affect rights)
- Crawford Supply Co. v. Schwartz, 396 Ill.App.3d 111 (Ill. App. 2009) (mechanics lien strict construction; remedies liberal if properly perfected)
- Petroline Co. v. Advanced Environmental Contractors, Inc., 305 Ill.App.3d 234 (Ill. App. 1999) (notice to known lender required for subcontractors)
- Hill Behan Lumber Co. v. Irving Federal Savings & Loan Ass'n, 121 Ill.App.3d 511 (Ill. App. 1984) (constructive knowledge of lender by subcontractor)
- Bajwa v. Metropolitan Life Insurance Co., 208 Ill.2d 414 (Ill. 2004) (evidence rules for counterclaims; exhibits control)
- Crerar Clinch Coal Co. v. Board of Education, 13 Ill.App.2d 208 (Ill. App. 1957) (principle of evidentiary weight in counterclaims)
- Gore v. Indiana Insurance Co., 376 Ill.App.3d 282 (Ill. App. 2007) (exhibits accompanying counterclaim treated as part of pleading)