Federal National Mortgage Ass'n v. DL Woodlawn I, LLC

2025 IL App (1st) 242068-U
CourtAppellate Court of Illinois
DecidedMarch 18, 2025
Docket1-24-2068
StatusUnpublished

This text of 2025 IL App (1st) 242068-U (Federal National Mortgage Ass'n v. DL Woodlawn I, LLC) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Federal National Mortgage Ass'n v. DL Woodlawn I, LLC, 2025 IL App (1st) 242068-U (Ill. Ct. App. 2025).

Opinion

2025 IL App (1st) 242068-U

SECOND DIVISION March 18, 2025

No. 1-24-2068

NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1). ______________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT ______________________________________________________________________________

FEDERAL NATIONAL MORTGAGE ASSOCIATION, ) Appeal from the A corporation established pursuant to 12 U.S.C. § 1719, ) Circuit Court of et seq., ) Cook County. ) Plaintiff-Appellee, ) ) v. ) No. 24 CH 4996 ) DL WOODLAWN I, LLC, an Illinois limited liability ) company, ) ) Defendant-Appellant ) ) (CITY OF CHICAGO, an Illinois municipal corporation, ) UNKNOWN OWNERS, and NON-RECORD ) CLAIMANTS, ) The Honorable ) Lloyd James Brooks, Defendants). ) Judge Presiding. ______________________________________________________________________________

JUSTICE HOWSE delivered the judgment of the court. Presiding Justice Van Tine and Justice Ellis concurred in the judgment.

ORDER

¶1 Held: We affirm the judgment of the circuit court of Cook County granting plaintiff’s motion to appoint a receiver in this action to foreclose a nonresidential mortgage; the trial court properly overruled defendant-mortgagor’s objection to service of process regardless of whether service was proper where plaintiff-mortgagee submitted an affidavit in support of plaintiff’s motion thereby satisfying the requirements to appoint a receiver ex parte. 1-24-2068

¶2 Plaintiff, Federal National Mortgage Association (Fannie Mae), “by and through its

attorneys, Foley & Lardner, LLP,” filed a verified Complaint for Foreclosure and Other Relief

(foreclosure complaint) against defendant, DL Woodlawn I, LLC (Woodlawn). The other

defendants named in the verified complaint are not parties to this appeal. Plaintiff filed a Motion

for Appointment of Receiver. The circuit court of Cook County granted plaintiff’s motion for

appointment of receiver. Defendant appeals on the ground the trial court erroneously relied on

the allegations in the verified complaint, rather than an affidavit or other sworn evidence as

required by statute, when issuing the ex parte order appointing a receiver. Defendant also argues

that the Illinois Mortgage Foreclosure Law (Foreclosure Law) (735 ILCS 5/15-1101 et seq.

(West 2024)) prohibits ex parte orders appointing a receiver.

¶3 For the following reasons, we affirm.

¶4 BACKGROUND

¶5 We limit our discussion to only those matters relevant to the issues on appeal. On May

28, 2024, plaintiff, the Federal National Mortgage Association (Fannie Mae), by and through its

attorneys, Foley & Lardner, LLP, filed a “Verified Complaint for Foreclosure and Other Relief”

against defendant, DL Woodlawn I, LLC (Woodlawn or Borrower). The complaint seeks to

foreclose a mortgage secured by real property in the form of four multi-family apartment

buildings. The complaint alleges that “the Note and Mortgage are in default because ***

Borrower 1) failed to make monthly debt service payments due under the Note and Mortgage

*** and 2) failed to address certain building code violations within 20 days of notice from

Fannie Mae.” The complaint has attached and incorporated the Note and Mortgage. The

complaint states the date of the initial default and that two notices of default were sent to

Borrower and has the notices of default attached and incorporated. The complaint also alleges

-2- 1-24-2068

“Facts in support of a request *** for appointment of receiver.” In that regard the complaint

alleges that “Section 3(e) of the Mortgage provides for the appointment of a receiver in the case

of the occurrence of an Event of Default (as defined therein) thereunder.” The complaint alleges

that Borrower has defaulted under the Note and Mortgage as set forth in the verified complaint

and that Fannie Mae seeks the appointment of a receiver. Also attached to the verified complaint

are the verifications of James Noakes and Patricia McHugh. Both verifications are certified

pursuant to section 1-109 of the Code of Civil Procedure (735 ILCS 5/1-109 (West 2024)) and

both are subscribed and sworn to by a Notary Public.

¶6 Noakes is a Senior Asset Manager for Fannie Mae. Noakes’ verification states that based

on a review of documents and information provided by the servicer of the loan to Woodlawn,

Noakes has personal knowledge concerning the facts alleged in the verified complaint, including

the general allegation that the Note and Mortgage are in default, and why, but specifically

excluding the separate “Statement as to defaults including *** date of default, current unpaid

principal balance, per diem interest accruing, and any further information concerning the default”

(which included a description of charges and fees Borrower incurred that constitute “an

additional indebtedness secured by the Mortgage”). Noakes certified under penalties provided by

section 1-109 that the allegations are true and correct.

¶7 McHugh is the Director of Lument, which is the servicer for the loan to Woodlawn.

McHugh stated that they have personal knowledge concerning the facts alleged in the verified

complaint specifically as to the separate “Statement as to defaults including *** date of default,

current unpaid principal balance, per diem interest accruing, and any further information

concerning the default” (which included a description of charges and fees Borrower incurred that

constitute “an additional indebtedness secured by the Mortgage”). McHugh certified under the

-3- 1-24-2068

penalties provided by section 1-109 that those allegations are true and correct to the best of

McHugh’s knowledge, information, and belief.

¶8 On June 28, 2024, plaintiff filed a Motion for Appointment of Receiver pursuant to

sections 1701, 1704, and 1706 of the Foreclosure Law. The motion incorporated by reference the

verified complaint and stated that the verified complaint “is being served upon Borrowers at the

same time as this Motion.” The motion alleged that the property is non-residential real estate

under the Foreclosure Law and that the Note and Mortgage are in default stating the same

reasons alleged in the verified complaint. The motion alleged that “[b]eause of these Events of

Default, [Fannie Mae] has the right to the appointment of a receiver ***.” The motion quoted

section 3(e) of the Mortgage, which provides, in pertinent part, that “if an Event of Default has

occurred *** Lender may apply to any court having jurisdiction for the appointment of a receiver

***. If Lender elects to seek the appointment of a receiver *** Borrower, by its execution of this

Security Instrument, expressly consents to the appointment of such receiver including the

appointment of a receiver ex parte, if permitted by applicable law.”

¶9 The motion alleged that the defaults alleged in the motion and verified complaint

constitute a default under the terms of the Loan Agreement. The motion cited the verifications

attached to the verified complaint and asserted that Fannie Mae “has established a proven default

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Cite This Page — Counsel Stack

Bluebook (online)
2025 IL App (1st) 242068-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/federal-national-mortgage-assn-v-dl-woodlawn-i-llc-illappct-2025.