Phoenix NPL, LLC v. Shah

2021 IL App (2d) 191130-U
CourtAppellate Court of Illinois
DecidedOctober 25, 2021
Docket2-19-1130
StatusUnpublished
Cited by1 cases

This text of 2021 IL App (2d) 191130-U (Phoenix NPL, LLC v. Shah) 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
Phoenix NPL, LLC v. Shah, 2021 IL App (2d) 191130-U (Ill. Ct. App. 2021).

Opinion

2021 IL App (2d) 191130-U No. 2-19-1130 Order filed October 25, 2021

NOTICE: This order was filed under Supreme Court Rule 23(b) and is not precedent except in the limited circumstances allowed under Rule 23(e)(l). ______________________________________________________________________________

IN THE

APPELLATE COURT OF ILLINOIS

SECOND DISTRICT ______________________________________________________________________________

PHOENIX NPL, LLC, as Successor in Interest ) Appeal from the Circuit Court to National Republic Bank of Chicago, ) of Du Page County. ) Plaintiff-Appellee, ) ) v. ) No. 15-L-446 ) SHAILESH SHAH and BHAVNA SHAH, ) Individually and as Trustee of the Bhavna ) Shah Trust Under Trust Agreement Dated ) 3/24/06, LAW OFFICE OF PAUL CAGHAN, ) P.C., and LAW OFFICE OF PAUL CAGHAN, ) LLC, ) ) Defendants ) Honorable ) Robert W. Rohm, (Paul Caghan, Defendant-Appellant). ) Judge, Presiding. ______________________________________________________________________________

PRESIDING JUSTICE BRIDGES delivered the judgment of the court. Justices Zenoff and Birkett concurred in the judgment.

ORDER

¶1 Held: The trial court did not err in denying Caghan’s section 2-1401 petition or his motion to reconsider the denial, Caghan lacked standing to challenge judgments against the underlying defendants, we had no basis to reverse the trial court’s nunc pro tunc change to an order, and we found no error in the trial court’s denial of Caghan’s request to disqualify plaintiff’s attorneys. Therefore, we affirm.

¶2 Defendant, attorney Paul Caghan, appeals from the trial court’s dismissal of his petition 2021 IL App (2d) 191130-U

under section 2-1401 of the Code of Civil Procedure (735 ILCS 5/2-1401 (West 2018)), the denial

of his motion to reconsider the aforementioned dismissal, and several other orders. On appeal,

defendant argues that the trial court erred in dismissing the section 2-1401 petition, that summary

judgment for plaintiff was improper as a matter of law, that the trial court erred in amending a

judgment nunc pro tunc more than 60 days after its entry, and that the trial court erred in failing to

disqualify plaintiff’s attorneys. We affirm.

¶3 I. BACKGROUND

¶4 On May 12, 2015, plaintiff, Phoenix NPL, LLC, as successor in interest to National

Republic Bank of Chicago, brought suit against defendants, Shailesh Shah and Bhavna Shah,

individually and as trustee of the Bhavna Shah Trust Under Trust Agreement Dated 3/24/06, as

personal guarantors of a loan. Caghan entered his appearance as defendants’ attorney on October

25, 2016.

¶5 On April 27, 2017, the trial court granted plaintiff’s motion to strike all but one of

defendants’ affirmative defenses, and it granted plaintiff’s motion to dismiss all of defendants’

counterclaims. It also denied defendants’ motion for leave to file second amended counterclaims.

Defendants sought reconsideration of this ruling on November 6, 2017, and they also sought a stay

of the case pending resolution of an alleged common issue in related federal cases. The trial court

denied the motion to reconsider on February 15, 2018, but expressly reserved ruling on defendants’

request to stay the proceedings. Defendants filed a notice of interlocutory appeal on March 16,

2018, on the basis that the trial court refused to grant an injunction in the form of their request for

a stay of all proceedings. Plaintiff filed a motion to dismiss the appeal for lack of jurisdiction, and

we granted the motion on May 1, 2018. Our mandate issued the same day. Defendants filed a

-2- 2021 IL App (2d) 191130-U

petition for leave to appeal to the supreme court on May 31, 2018, which was denied on September

26, 2018. The supreme court mandate issued on October 31, 2018.

¶6 On October 22, 2018, defendants filed a motion in the supreme court for a supervisory

order pursuant to Illinois Supreme Court Rule 383 (eff. July 1, 2017), which the supreme court

denied on November 8, 2018.

¶7 Meanwhile, on August 1, 2018, the trial court granted summary judgment in favor of

plaintiff against defendants for $2,750,791.99. The order stated that a separate order under Illinois

Supreme Court Rule 137 (eff. Jan. 1, 2017) was entered that day with monetary sanctions in

addition to the judgment amount. Finally, the order stated that the case was closed.

¶8 The order granting plaintiff’s motion for sanctions under Rule 137 was actually entered on

August 9, 2018. The trial court awarded plaintiff $129,375.09 against Caghan and the Law Office

of Paul Caghan, P.C. It additionally awarded $10,000 against these parties and Shailesh Shaw. On

October 11, 2018, plaintiff filed a motion to amend the order to add the Law Office of Paul Caghan,

LLC, as a judgment debtor. The trial court granted the motion on October 15, 2018, stating that

plaintiff should submit an order for entry. The order was entered on October 17, 2018, adding nunc

pro tunc the Law Office of Paul Caghan, LLC, to both sanction amounts, and stating that the named

parties were liable jointly and severally.

¶9 Several months later, on March 21, 2019, defendants and Caghan filed a section 2-1401

petition alleging that the August 1, August 9, October 15, and October 17, 2018, 1 orders were void

1 The section 2-1401 motion listed an order dated October 16, 2018, rather than October

17, 2018. The trial court’s nunc pro tunc order was dated October 16, 2018, but filed on October

17, 2018. A written judgment order is considered entered when it is entered of record (People v.

-3- 2021 IL App (2d) 191130-U

for lack of jurisdiction because the supreme court had not yet returned the mandate when the trial

court entered the judgments. Defendants argued that the revestment doctrine did not apply.

Defendants further contested the grant of summary judgment and argued that the trial court should

allow certain discovery.

¶ 10 On May 2, 2019, plaintiff filed a motion to dismiss the section 2-1401 petition under

section 2-619 of the Code of Civil Procedure (735 ILCS 5/2-619 (West 2018)). Plaintiff argued

that the petition was barred by res judicata and that the trial court never lost jurisdiction of the

case.

¶ 11 On August 15, 2019, the Shah defendants withdrew their participation in the section 2-

1401 petition, and the trial court granted plaintiff’s motion to dismiss the petition as to Caghan. It

stated that it did not believe that res judicata applied but that an interlocutory appeal filed without

proper Illinois Supreme Court Rule 307 (eff. Nov. 1, 2017) grounds did not divest the trial court

of jurisdiction.

¶ 12 On September 13, 2019, Caghan filed a motion to reconsider various orders, including the

August 15, 2019, order. Caghan also argued that plaintiff’s attorneys should be disqualified. On

December 2, 2019, Caghan filed an emergency motion to stay proceedings pending a final

determination on his motion for disqualification of plaintiff’s attorneys. The same day, the trial

court denied the emergency motion with prejudice, and it denied Caghan’s motion to reconsider.

¶ 13 Caghan filed a notice of appeal on December 23, 2019. In his brief’s jurisdictional

statement, he states that he is appealing the trial court’s December 2, 2019, order denying his

motion to reconsider the August 15, 2019, order that granted plaintiff’s section 2-619 motion to

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Bluebook (online)
2021 IL App (2d) 191130-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/phoenix-npl-llc-v-shah-illappct-2021.