Old Orchard Bank & Trust Co. v. Levin

464 N.E.2d 723, 124 Ill. App. 3d 443, 79 Ill. Dec. 819, 1984 Ill. App. LEXIS 1853
CourtAppellate Court of Illinois
DecidedMay 17, 1984
Docket83-1710
StatusPublished
Cited by5 cases

This text of 464 N.E.2d 723 (Old Orchard Bank & Trust Co. v. Levin) 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
Old Orchard Bank & Trust Co. v. Levin, 464 N.E.2d 723, 124 Ill. App. 3d 443, 79 Ill. Dec. 819, 1984 Ill. App. LEXIS 1853 (Ill. Ct. App. 1984).

Opinion

JUSTICE JIGANTI

delivered the opinion of the court:

The central concern of this appeal is whether certain substantive arguments raised by the appellant, Bank of Lincolnwood, are barred by principles of res judicata and collateral estoppel. The Bank of Lincolnwood and the appellees, Joseph and Marlene Levin, have been involved in two separate lawsuits, the second of which is presently before this court. In supplemental proceedings to enforce the judgment following the first action, the trial court found that the Levins were entitled to homestead exemptions in their home in Wilmette, Illinois. (See Ill. Rev. Stat. 1983, ch. 110, par. 2 — 1402.) The trial judge in the subsequent and now instant foreclosure action on the Wilmette property found that the Levins possessed homestead rights in the Wilmette premises, based upon the order entered by the court during supplementary proceedings in the first lawsuit. The Bank of Lincolnwood now raises a number of substantive issues concerning the propriety of granting homestead exemptions to the Levins and the constitutionality and retroactivity of an amendment to the homestead exemption statute. We find, however, that these matters are barred by principles of res judicata and collateral estoppel. We therefore shall not address the merits of the Bank of Lincolnwood’s substantive arguments.

The following chronology of events lays the backdrop for this appeal. Prior to 1979, a land trust was established under which the Levins possessed the beneficial interest and Old Orchard Bank & Trust Company, the land trust trustee (land trustee), possessed legal and equitable title. The res of the trust consisted of the Wilmette home and certain property located in Northfield, Illinois. Between 1979 and 1980, the land trustee executed a mortgage on the Northfield property and a note payable to the Bank of Lincolnwood. The Northfield property was later sold by the sheriff of Cook County after the land trustee defaulted on the note and the Bank of Lincolnwood obtained a judgment against the land trustee. While both the land trustee and the Levins were named as defendants in that lawsuit, the record before us is unclear as to the disposition of the case in regard to the Levins. The proceeds of the judicial sale of the Northfield property were insufficient to satisfy the Bank of Lincolnwood’s judgment in full and thus, a portion of the judgment remained unsatisfied.

In supplementary proceedings before Judge Cohen, the Bank of Lincolnwood filed a citation to discover assets as a judgment creditor of the land trustee. Although the facts surrounding the citation proceeding have not been included in the record before us, the parties agree that the proceeding disclosed that the Wilmette home was subject to sale in order to satisfy the debts and obligations of the land trustee. Judge Cohen allowed the Levins to intervene in the citation proceedings because they possessed a beneficial interest in the land trust which held both the Northfield and Wilmette properties. Subsequently, Judge Cohen ordered the land trustee to execute and deliver to the sheriff a trustee’s deed conveying its title and interest in the Wilmette premises. On July 27, 1982, Judge Cohen also entered a separate order which is crucial to the case now before us. In that order, the judge awarded the Levins a homestead exemption in the Wilmette premises by virtue of their beneficial interest in the land trust.

The Bank of Lincolnwood never appealed Judge Cohen’s order granting homestead exemptions in the Wilmette premises to the Levins. That specific order concerned absolutely no matter other than the Levins’ right to homestead exemptions. In this appeal, the Bank of Lincolnwood concedes that Judge Cohen’s order was final and appealable and makes no argument in that regard. The record reflects the Bank of Lincolnwood’s deliberate choice not to appeal Judge Cohen’s order, in part at least due to financial concerns.

Less than three months after Judge Cohen’s rulings, another circuit court judge, Judge Siegan, entered a judgment of foreclosure and sale on the Wilmette premises. This foreclosure action was brought after the land trustee defaulted on another note which had been executed in 1972. The action was brought by Old Orchard Bank, the holder of the note and trust deed. The Bank of Lincolnwood was a party to this action as well and was named as a judgment creditor of the land trustee. The Levins were also named as defendants in the case. Judge Siegan set a six-month period of redemption from the date of the sheriff’s sale. No redemption was ever made.

The sheriff conducted a sale of the Wilmette premises and the Bank of Lincolnwood was the high bidder at the sale. Judge Siegan entered an order approving the sheriff’s report of sale and distribution and further incorporated the sheriff’s report into his order. Both the order and the sheriff’s report stated that they were “subject to” Judge Cohen’s order of July 27, 1982. The July 27 order is the order previously discussed in this opinion which granted homestead exemptions in the Wilmette property to the Levins.

After the six-month redemption period had expired for the Wilmette premises, the Bank of Lincolnwood applied for the sheriff’s deed pursuant to its certificate of sale. Three days later, the Levins presented their petition for a protective order to Judge Siegan, seeking payment of their homestead exemptions in the Wilmette premises. Judge Siegan ruled that the Levins were entitled to their homestead exemptions and the Bank of Lincolnwood now appeals from Judge Siegan’s order.

“The doctrine of res judicata provides that ‘a final judgment rendered by a court of competent jurisdiction on the merits is conclusive as to the rights of the parties and their privies, and, as to them, constitutes an absolute bar to a subsequent action involving the same claim, demand or cause of action.’ ” (Housing Authority v. Young Men’s Christian Association (1984), 101 Ill. 2d 246, 251; People v. Kidd (1947), 398 Ill. 405, 75 N.E.2d 851.) Once res judicata has been established, it acts “ ‘as a bar against the prosecution of a second action between the same parties upon the same claim or demand ***’ ” and “ '*** is conclusive not only as to every matter which was offered to sustain or defeat the claim or demand, but as to any other matter which might have been offered for that purpose. ***’ ” Housing Authority v. YMCA (1984), 101 Ill. 2d 246, 251-52; Barry v. Commonwealth Edison Co. (1940), 374 Ill. 473, 29 N.E.2d 1014.

In the case at bar, the Bank of Lincolnwood maintains that neither res judicata nor collateral estoppel acts as a bar to its arguments because the cases before Judge Cohen and Judge Siegan were “two completely distinguishable and separate actions, which bear no factual or legal resemblance to each other.” We disagree. The record in this case establishes that Judge Cohen specifically decided whether the Levins, as the owners of the beneficial interest in a land trust, were entitled to a homestead exemption in the Wilmette premises. The Levins and the Bank of Lincolnwood were both parties in the action before Judge Cohen and the court was one of competent jurisdiction.

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Bluebook (online)
464 N.E.2d 723, 124 Ill. App. 3d 443, 79 Ill. Dec. 819, 1984 Ill. App. LEXIS 1853, Counsel Stack Legal Research, https://law.counselstack.com/opinion/old-orchard-bank-trust-co-v-levin-illappct-1984.