BMO BANK N.A., Plaintiff-Appellant, v. JAMES ZBROSZCZYK; MIDLAND FUNDING LLC; and UNKNOWN OWNERS AND NONRECORD CLAIMANTS, Defendants (James Zbroszczyk, Defendant-Appellee).
No. 1-24-1333
First District, Third Division
June 18, 2025
2025 IL App (1st) 241333
JUSTICE REYES delivered the judgment of the court, with opinion. Presiding Justice Lampkin and Justice D.B. Walker concurred in the judgment and opinion.
Appeal from the Circuit Court of Cook County. No. 2023 CH 08578. The Honorable William B. Sullivan, Judge Presiding.
¶ 1 The instant appeal arises from the dismissal of a foreclosure complaint filed by plaintiff BMO Bank N.A. against defendant James Zbroszczyk. Plaintiff filed the foreclosure complaint in the circuit court of Cook County in October 2023, and defendant sought dismissal pursuant to
¶ 3 Mortgage and Equity Line Credit Agreement
¶ 4 On February 18, 2008, plaintiff1 and defendant executed an “Equity Line Credit Agreement and Disclosure” (the agreement), secured by a mortgage on a home in Chicago. The agreement provided for a revolving line of credit, up to a credit limit of $100,000, with the term of the agreement expiring on February 22, 2018. During the term of the agreement, defendant would be entitled to request “credit advances” up to the amount of the credit limit, which would generally be honored by plaintiff, and defendant would be permitted to “borrow against the Credit Line, repay any portion of the amount borrowed, and re-borrow up to the amount of the Credit Limit.” Upon receipt of credit advances, periodic finance charges would immediately begin accruing on the amount advanced. The finance charges would be calculated using an adjustable rate based, in part, on the prime rate published in the Wall Street Journal. If there was a balance owing on the credit line account, or any other account activity, plaintiff would issue a periodic statement, which would include, “among other things, credit advances, FINANCE CHARGES, other charges, payments made, other credits, your ‘Previous Balance,’ and your ‘New Balance,’ ” in addition to identifying the minimum payment owed during the billing period and the due date.
¶ 5 The agreement provided that “You promise to pay [plaintiff], or order, the total of all credit advances and FINANCE CHARGES, together with all costs and expenses for which you are
“Minimum Payment. Your ‘Regular Payment’ will equal the amount of your accrued FINANCE CHARGES. You will make 119 of these payments. You will then be required to pay the entire balance owing in a single balloon payment. If you make only the minimum payments, you may not repay any of the principal balance by the end of this payment stream. Your payments will be due monthly. Your ‘Minimum Payment’ will be the Regular Payment, plus any amount due and all other charges. An increase in the ANNUAL PERCENTAGE RATE may increase the amount of your Regular Payment. You agree to pay not less than the Minimum Payment on or before the due date indicated on your periodic billing statement.”
¶ 6 The agreement also included a provision indicating that, if defendаnt failed to satisfy the repayment terms of the agreement, plaintiff “can terminate your Credit Line Account and require you to pay us the entire outstanding balance in one payment.” The mortgage similarly provided that if defendant failed to satisfy the repayment terms of the agreement, upon that failure “and at any time thereafter,” plaintiff “shall have the right at its option without notice to [defendant] to declare the entire Indebtedness immediately due and payable.”
¶ 7 Communications with Defendant
¶ 8 The record contains evidence of three letters sent by plaintiff to defendant.2 First, on August 27, 2020, plaintiff sent defendant a letter indicating that the servicing of his loan would
¶ 9 Next, on July 28, 2022, plaintiff sent defendant another letter, indicating that plaintiff would resume the servicing of the loan. Plaintiff further indicated—in bold, all-caps typeface—that, ”[I]F YOU DO NOTHING OR SPEAK TO US ABOUT THIS DEBT, WE WILL NOT SUE YOU TO COLLECT IT. THIS IS BECAUSE THE DEBT IS TOO OLD. BUT IF YOU MAKE A PAYMENT OR ACKNOWLEDGE IN WRITING THAT YOU OWE THIS DEBT, THEN WE CAN SUE YOU TO COLLECT IT. ALTHOUGH WE MAY NOT SUE YOU PERSONALLY, THE LIEN REMAINS INTACT AND BMO HARRIS BANK, N.A. STILL HOLDS A SECURITY INTEREST IN THE PROPERTY.” As with the previous letter, this letter did not contain any information as to the loan balance or any outstanding payments which were owed.
¶ 10 Finally, on August 22, 2022, plaintiff sent defendant a “loan delinquency notice,” which it indicated was a “first notice.” The notice stated that “[p]ayment has not been received on your above referenced account and is now past due. Please remit the total amount past due shown below.” The notice then set forth the following:
“Past Due Date: 08/26/13
Annual percentage rate: 0.0000001
Principal past due: 99,973.28
Finance charge past due: 0.00
Other past due charges: 0.00
Unpaid late charges: 0.00
Total amount past due: 99,973.28”
¶ 12 On October 4, 2023, plaintiff filed a complaint to foreclose mortgage, alleging that defendant had failed to pay the outstanding indebtedness by the agreement‘s maturity date of February 22, 2018, and that, as of September 11, 2023, the principal balance was $99,973.28, plus interest, fees, attorney fees, and costs.
¶ 13 On December 1, 2023, defendant filed a motion to dismiss the complaint pursuant tо
¶ 14 Attached to the motion to dismiss was defendant‘s affidavit, in which he averred that he had not made any payments under the agreement since June 1, 2013, as well as the letters set forth above.
¶ 15 In response, plaintiff claimed that the action was timely filed, sinсe the cause of action did not accrue until February 22, 2018, the maturity date of the agreement. Plaintiff did not include any counteraffidavits or other evidence concerning any communications with defendant.
¶ 16 On February 21, 2024, the circuit court entered an order granting defendant‘s motion and dismissing the complaint with prejudice, finding that “[t]he Court measures the running of the statute [of limitations] from August 26, 2013.”
¶ 17 Defendant timely filed a petition for attorney fees pursuant to
¶ 18 Plaintiff filed a motion to reconsider the dismissal of the complaint, claiming that the circuit court erred in determining that the cause of action accrued on August 26, 2013. Plaintiff also objected to defendant‘s fee petition, claiming that the billing records contained entries made by individuals not identified in the fee petition and that, in some cаses, the billing rates appeared to conflict with the averments in the affidavit. Plaintiff accordingly requested that fees related to those entries be stricken or, in the alternative, reduced to conform to the hourly rates set forth in the affidavit.
¶ 19 In response to the objection to the fee petition, defendant‘s counsel conceded that, although the firm had raised its rates at the beginning of 2024, the affidavit included the older rates. As such, counsel did not object to reducing the fee petition by $577, the difference between the old and new rates; defendant also provided the full names and roles of the individuals who were identified only by initials in the billing records. Defendant, however, also sought fees in connection with litigating plaintiff‘s motion to reconsider, which added $2,100 to the fee petition. Accordingly, defendant sought a revised fee award of $9,227.22 in attorney fees and costs.
¶ 20 On June 13, 2024, the circuit court denied plaintiff‘s motion to reconsider, finding that “[t]he Court applies a ten-year limitations period beginning on August 26, 2013.” The circuit court also granted defendant‘s fee petition, awarding $9,227.22 in attorney fees and costs.
¶ 22 ANALYSIS
¶ 23 On appeal, plaintiff contends that thе circuit court erred in dismissing its complaint, based on the circuit court‘s finding that the statute of limitations began running on August 26, 2013, and not February 22, 2018, the maturity date of the agreement. Plaintiff further contends that the circuit court erred in awarding defendant attorney fees. We consider each argument in turn.
¶ 24 Motion to Dismiss
¶ 25 Plaintiff‘s primary argument on appeal concerns the circuit court‘s dismissal of its complaint pursuant to
¶ 26 We review a dismissal under
¶ 27 In this case, the circuit court dismissed the complaint based on its finding that the statute of limitations barred the action. See
¶ 28 On appeal, plaintiff primarily challenges the date on which the circuit court found that the cause of action accrued. Specifically, plaintiff challenges the circuit court‘s finding that the statute of limitations began running on August 26, 2013, the date identified as the “Past Due Date” in plaintiff‘s August 22, 2022, delinquency notice to defendant, and not February 22, 2018, the maturity date of the agreement. We agree, however, with defendant‘s position that proper review of the circuit court‘s finding requires us to first determine the nature of the debt instrument and the applicable statute of limitations. While plaintiff contends that these questions were not decided by the circuit court, and therefore are not properly before us on appeal, we disagree. As noted, it is well-settled that we may affirm the circuit court‘s judgment on any basis supported by the record, regardless of whether that basis was relied upon by the circuit court. See Moore, 2024 IL App (1st) 231305, ¶ 20. Moreover, as defendant argued for a fivе-year statute of limitations in his motion to dismiss, the question of the applicable statute of limitations was presented before the circuit court. In finding the matter barred by the statute of limitations, the circuit court therefore necessarily considered the matter, even if implicitly.
¶ 29 Nature of Instrument
¶ 30 In its brief, plaintiff characterizes the agreement as a “note” subject to the 10-year statute of limitations applicable to promissory notеs. See
¶ 31 Nevertheless, while not identifiеd by either party, we find that the most appropriate description of the agreement in the instant case is a “revolving credit loan.” A revolving credit loan is defined as:
“[A]n arrangement, including by means of a credit card ***[,] between a lender and debtor pursuant to which it is contemplated or provided that the lender may from time to time make loans or advances to or for the account of the debtor through the means of drafts, items, orders for the payment of money, evidences of debt or similar written instruments, whether or not negotiable, signed by the debtor or by any person authorized or permitted so to do on behalf of the debtor, which loans or advances are charged to an account in respect of which account the lender is to render bills or statements to the debtor at regular intervals (hereinafter sometimes referred to as the ‘billing cycle‘) the amount of which bills or statements is payable by and due from the debtor on a specified date stated in such bill or statement or at the debtor‘s option, may be payable by the debtor in installments. A revolving credit arrangement which grants the debtor a line of credit in excess of $5,000 may include provisions granting the lender a security interest in real рroperty or in a beneficial interest in a land trust to secure amounts of credit extended by the lender.”
815 ILCS 205/4.1 (West 2022) .
A bank may engage in making revolving credit loans secured by mortgages or deeds of trust on real property (see
¶ 32 The agreement at issue in the instant case falls squarely within the definition of a “revolving credit loan,” as it was an arrangement between plaintiff and defendant in which plaintiff agreed to make credit advances on defendant‘s account up to the amount of defendant‘s сredit limit, and upon making such advances, plaintiff would issue periodic statements which were to be paid by defendant in installments. As the agreement provided for a line of credit in excess of
¶ 33 Statute of Limitations
¶ 34 As noted, plaintiff contends that the applicable statute of limitations is the 10-year statute of limitations for actions based on “bonds, promissory notes, bills of exchange, written leases, written contracts, or other evidences of indebtedness in writing.”
¶ 35 We have discovered no case law interpreting the statute of limitations for revolving credit loans generally, nor does there appear to be any Illinois authority squarely addressing the statute of limitations applicable to a line of credit that is secured by a mortgage on real estate.5 There is, however, authority discussing the statute of limitations with respect to credit card agreements. Plaintiff contends that this authority is not applicable, as a credit card is not analogous to the type of agreement at issue here. While we recognize that the two types of transactions are not identical, both are considered “revolving credit loans” under the law. See
¶ 36 The cardholder agreement between a bank issuing a credit card and its customer has been found to be in the nature of a loan. Harris Trust & Savings Bank v. McCray, 21 Ill. App. 3d 605, 610 (1974). As such, in appropriate circumstances, a cause of action under the cardholder agreement may be subject to the 10-year statute of limitations applicable to written contracts. Id. The issuance of the credit card itself, however, does not create a contract; instead, a separate contract is created each time the card is used according to the terms of the cardholder agreement then in force. Garber v. Harris Trust & Savings Bank, 104 Ill. App. 3d 675, 678 (1982).
¶ 37 Illinois law strictly construes a “written contract” for purposes of the statute of limitations, finding a written contract only where “all the essential terms of the contract are in writing and are ascertainable from the instrument itself.” Brown v. Goodman, 147 Ill. App. 3d 935, 939 (1986). Consequently, if parol evidence is needed to establish the essential terms and conditions of the contract, the contract is treated as oral for purposes of the statute of limitations. Id.; see Armstrong v. Guigler, 174 Ill. 2d 281, 287 (1996) (the “dispositive question” for purposes of the statute of limitations is whether the existence of the contract or one of its essential terms must be proven by parol evidence). Similarly, where parol evidence is required, a written document does not qualify as “other evidences of indebtedness” under
¶ 38 In this case, we similarly find that the dispositive question is whether parol evidence is required to establish the essential terms of the agreement. There are three possible categories under
¶ 39 Likewise, while the Code does not define “promissory note” for purposes of
¶ 40 In this case, we cannot find that the agreement between the parties falls within the scope of
¶ 41 The agreement in this case is silent as to the amount that defendant was obligated to pay. Defendant was entitled to borrow up to $100,000 under the terms of the agreement, but the agreement does not specify how much defendant did borrow. It is the latter, not the former, that serves as the amount of defendant‘s obligation, as defendant was only required to repay that which he borrowed. This was not the type of agreement in which defendant was provided a certain sum of money that he was obligated to repay over time. Instead, plaintiff provided the outer limit of the credit advances it was willing to make, and defendant had the option of requesting as much—or as little—of those funds as he desired. Consequently, the amount of defendant‘s obligation to pay is not ascertainable from the terms of the agreement itself but
¶ 42 Accrual of Statute of Limitations
¶ 43 Having determined the applicable statute of limitations, we turn to reviewing the circuit court‘s finding that the statute of limitations accrued on August 26, 2013. Generally, the statute of limitations in a breach of contract action begins to run “when facts exist which authorize the bringing of an action.” (Internаl quotation marks omitted.) Hassebrock v. Ceja Corp., 2015 IL App (5th) 140037, ¶ 35. ” ‘[W]here a money obligation is payable in installments, a separate cause of action arises on each installment and the statute of limitations begins to run against each installment as it becomes due.’ ” Deutsche Bank Trust Co. Americas v. Sigler, 2020 IL App (1st) 191006, ¶ 42 (quoting Thread & Gage Co. v. Kucinski, 116 Ill. App. 3d 178, 184 (1983)). This general rule is subject to an exception, however, where the contract contains an acceleration provision and such a provision “provides that payment of the entire debt upon default is automatic, or where the acceleration provision is optional and the creditor unequivocally exercises the option.” Kucinski, 116 Ill. App. 3d at 184. In such a cаse, courts have sometimes found that the statute of limitations begins to run immediately upon default. Id.
¶ 44 In this case, plaintiff contends that its October 4, 2023, complaint is timely, since it never accelerated the agreement upon defendant‘s default and, accordingly, the cause of action accrued upon defendant‘s failure to pay the final balloon payment owed on February 22, 2018. Defendant, by contrast, claims that the agreement was not payable in installments and, even if it was, the August 22, 2022, delinquency notice established that plaintiff had accelerated the
¶ 45 Attorney Fees
¶ 46 Plaintiff also contends that the circuit court erred in awarding defendant attorney fees. Defendant was entitled to an award of reasonable attorney fees pursuant to
¶ 47 An award of attorney fees is generally left to the discretion of the trial court, and we will not overturn a fee award absent an abuse of that discretion. In re Estate of K.E.J., 382 Ill. App. 3d 401, 424 (2008). “An abuse of discretion occurs only when the trial court‘s decision is arbitrary, fanciful, or unreasonable or where no reasonable person would take the view adopted by the trial court.” Haage v. Zavala, 2021 IL 125918, ¶ 40. The party seeking fees bears the burden of presenting sufficient evidence from which the circuit court may assess their reasonableness. Gambino v. Boulevard Mortgage Corp., 398 Ill. App. 3d 21, 66 (2009). Such evidence must specify “the services performed, by whom they were performed, the time expended thereon and the hourly rate charged therefor.” Id.
¶ 48 In this case, plaintiff contends that defendant failed to satisfy his burden to provide detailed records as to who performed certain services and claims that the billing records conflicted with
¶ 49 Plaintiff alsо contends that the circuit court should not have awarded defendant an additional $2,100 in attorney fees based on the briefing on the motion to reconsider, claiming that this amount is not supported by adequate evidence. While plaintiff maintains that “no business records” supported defendant‘s request, we note that defendant‘s counsel had previously included evidence of his billing rate in the fee petition and included an affidavit as to the time expended on preparation of the motion.
¶ 50 We also note that plaintiff failed to include a transcript or bystander‘s report for the proceedings оn the fee petition. The appellant has the burden of presenting a sufficiently complete record to support a claim of error. Waukegan Hospitality Group, LLC v. Stretch‘s Sports Bar & Grill Corp., 2024 IL 129277, ¶ 20. In the absence of such a record on appeal, “it will be presumed that the order entered by the trial court was in conformity with [the] law and had a sufficient factual basis.” Foutch v. O‘Bryant, 99 Ill. 2d 389, 391-92 (1984). Here, without a transcript of the proceedings, we cannot say that the evidence establishes that the circuit court abused its discretion in awarding defendant the requested attorney fees.
¶ 51 CONCLUSION
¶ 52 For the reasons set forth above, we affirm the judgment of the circuit court. The circuit court properly dismissed plaintiff‘s complaint pursuant to
¶ 53 Affirmed.
| Decision Under Review: | Appeal from the Circuit Court of Cook County, No. 23-CH-08578; the Hon. William B. Sullivan, Judge, presiding. |
| Attorneys for Appellant: | Adham Alaily, of Egan & Alaily LLC, of Chicago, for appellant. |
| Attorneys for Appellee: | Daniel A. Edelman and Keelan D. Kane, of Edelman, Combs, Latturner & Goodwin, LLC, of Chicago, for appellee. |