PennyMac Corp. v. Colley
47 N.E.3d 564
Ill. App. Ct.2015Background
- Edward and Carol Colley executed a mortgage and promissory note with CitiMortgage; CitiMortgage filed a foreclosure complaint in 2008 after default.
- In March 2010 CitiMortgage assigned its interest to PennyMac; the assignment was later attached to motions to substitute plaintiff and amend pleadings.
- CitiMortgage moved for summary judgment in November 2013; PennyMac submitted a prove-up affidavit by Teri Gerrish and loan payment history records.
- The trial court granted default, summary judgment, a judgment of foreclosure and sale, and granted leave to amend pleadings captioning PennyMac as plaintiff; PennyMac moved to confirm the judicial sale.
- The Colleys challenged PennyMac’s standing (arguing the assignment/robosigning was invalid and substitution untimely) and moved to stay the sale; the trial court denied the stay, confirmed the sale, and entered possession/eviction orders.
- The Appellate Court affirmed, rejecting Colleys’ standing challenge and finding the Gerrish affidavit and business records sufficient for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the sale should be stayed / judicial sale confirmed | PennyMac (via CitiMortgage’s pleadings and assignment) was entitled to confirm sale; defendants waited too long to challenge standing | Colley: PennyMac lacked standing because assignment/robosigner invalid and substitution was untimely; justice requires vacatur | Court: Denial of stay and confirmation affirmed; Colley forfeited standing defense by delaying challenge and suffered no prejudice |
| Whether PennyMac had standing to foreclose | Plaintiff relied on CitiMortgage’s original complaint, subsequent assignment, and amendment to pleadings to show standing | Colley: Assignment executed by M. Arndt (alleged robosigner) invalidated PennyMac’s standing | Court: Standing is determined at complaint filing; defendant waived affirmative defense by failing to timely object and by participating in proceedings |
| Whether summary judgment was proper on foreclosure claim | Gerrish affidavit plus payment history and available loan records satisfied Rule 191 and business-records foundation | Colley: Affiant lacked personal knowledge and supporting documents were insufficient/unsworn | Court: Affidavit and attached payment history satisfied Rule 191 and business-record rule; no counteraffidavits raised a genuine issue of material fact |
| Whether assignment/substitution timing required dismissal or amended complaint | Plaintiff: CitiMortgage was master of its cause; delay in formally substituting plaintiff did not prejudice defendant | Colley: Delay (two years) and failure to formally substitute PennyMac barred relief | Court: Delay irrelevant; no impropriety or prejudice shown; amendment and subsequent orders naming PennyMac cured any formality issues |
Key Cases Cited
- Philips Electronics, N.V. v. New Hampshire Ins. Co., 295 Ill. App. 3d 895 (trial court’s docket-control and stay factors)
- Household Bank, FSB v. Lewis, 229 Ill. 2d 173 (standards for confirming judicial sale)
- Mortgage Electronic Registration Systems, Inc. v. Barnes, 406 Ill. App. 3d 1 (standing as affirmative defense and waiver)
- Greer v. Ill. Housing Dev. Auth., 122 Ill. 2d 462 (affirmative defenses may be waived)
- Collins v. St. Paul Mercury Ins. Co., 381 Ill. App. 3d 41 (Rule 191 affidavit requirements)
- Preze v. Borden Chem., Inc., 336 Ill. App. 3d 52 (failure to attach supporting documents is fatal)
- Champaign Nat’l Bank v. Babcock, 273 Ill. App. 3d 292 (business-records summary rule; opposing party’s failure to file counteraffidavits)
- Cole Taylor Bank v. Corrigan, 230 Ill. App. 3d 122 (summary document rule for loan files)
- Jackson v. Graham, 323 Ill. App. 3d 766 (de novo review of affidavit sufficiency in summary judgment)