PHH Mortgage Corp. v. Restrepo
2023 IL App (3d) 220354-U
Ill. App. Ct.2023Background
- Ocwen filed to foreclose a mortgage on Kim Restrepo’s Joliet property; PHH was later substituted as plaintiff. Restrepo was personally served early in the case but ultimately defaulted and a foreclosure judgment entered.
- The property was sold at sheriff’s sale to third-party purchaser Veronica Chavez after pandemic-related delays; the trial court confirmed the sale and ordered issuance of a deed to Chavez.
- About three months after the sale-confirmation order, Restrepo (through counsel) filed a motion treated as a §2-1401 petition seeking to vacate the foreclosure judgment and the sale, alleging lack of notice, due-process violation, and extrinsic fraud.
- PHH moved to dismiss the petition under §§2-615/2-619; the trial court granted the motion and dismissed the petition.
- On appeal PHH moved to dismiss the appeal as moot, arguing the deed had vested title in a nonparty purchaser and Restrepo had not obtained a stay before the deed issued; the appellate court granted the motion and dismissed the appeal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Mootness because property sold to nonparty and no stay obtained | Sale vested title in Chavez; Rule 305(k) and §2-1401(e) protect nonparty purchaser; no effectual relief possible | Sale-confirmation order is void and may be attacked at any time | Appeal moot; Chavez protected; dismissal of appeal affirmed |
| Whether §15-1509(c) bars post-deed challenges by party-defendant | Vesting of title by deed bars all claims of parties to the foreclosure | Void-judgment exception permits challenge despite §15-1509(c) | §15-1509(c) bars Restrepo’s claims once deed issued |
| Whether the confirmation order was void for lack of personal jurisdiction (no notice/extrinsic fraud) | Personal jurisdiction was established by initial service; later notice issues are intrinsic fraud and don’t void the judgment | Lack of notice and extrinsic fraud deprived court of jurisdiction and made the order void | Judgment not void: initial service conferred personal jurisdiction; later notice issues do not negate jurisdiction |
| Whether the trial court erred in dismissing the §2-1401 petition without an evidentiary hearing | Dismissal proper because petition was moot/barred and pleaded defects did not destroy jurisdiction | Competing affidavits required an evidentiary hearing before dismissal | Court did not err to the extent appeal was moot/barred; no relief available and no hearing required on claims that cannot undo the sale |
Key Cases Cited
- Foutch v. O’Bryant, 99 Ill. 2d 389 (1984) (appellant bears duty to present sufficient record; doubts resolved against appellant)
- Steinbrecher v. Steinbrecher, 197 Ill. 2d 514 (2001) (appellate courts will not grant relief that cannot effectuate practical change; Rule 305(k) protects third-party purchasers)
- Cosmopolitan Nat’l Bank of Chicago v. Nunez, 265 Ill. App. 3d 1012 (1994) (appeal is moot where third-party buyer acquires property and no stay obtained)
- Vulcan Materials Co. v. Bee Construction, 96 Ill. 2d 159 (1983) (judgment is void only for lack of subject-matter or personal jurisdiction)
- In re M.B., 235 Ill. App. 3d 352 (1992) (distinguishing intrinsic from extrinsic fraud in post-judgment challenges)