U.S. Bank National Ass'n v. Scialabba

2021 IL App (3d) 200269-U
Appellate Court of Illinois·Decided July 22, 2021·No. 3-20-0269·Unpublished·Cited by 1 cases

Opinion

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1).

2021 IL App (3d) 200269-U Order filed July 22, 2021 IN THE

APPELLATE COURT OF ILLINOIS THIRD DISTRICT

2021

U.S. BANK NATIONAL ASSOCIATION, ) Appeal from the Circuit Court ) of the 12th Judicial Circuit, Plaintiff-Appellant, ) Will County, Illinois, )

v. )

)

DEBRA L. SCIALABBA, JAMES V. ) SCIALABBA, BMO HARRIS BANK ) Appeal No. 3-20-0269 NATIONAL ASSOCIATION f/k/a Harris Bank ) Circuit Nos. 17-CH-998 cons. w/ National Association, Successor by Merger to ) 16-CH-576 NLSB Bank, KAREN SPRINGS II ) HOMEOWNERS ASSOCIATION, JAMAL ) BARGHOUTHI, Unknown Owners and Non- ) Record Claimants, )

) Honorable Theodore J. Jarz, Defendants-Appellees. ) Judge, Presiding.

JUSTICE WRIGHT delivered the judgment of the court.

Justices Daugherity and Schmidt concurred in the judgment.

ORDER

¶1 Held: Due to the nature of the consolidation in two mortgage foreclosure proceedings, the trial court retained jurisdiction to proceed on an amended complaint in case No. 17-CH-998 after entering a final order in case No. 16-CH-576.

¶2 This appeal involves the legal effect of the trial court’s order, consolidating two separate mortgage foreclosure proceedings, on the motion of the defendant property owners in each case, James and Debra Scialabba. In 2016, BMO Harris Bank National Association (Harris Bank)

initiated the first mortgage foreclosure proceeding, Will County case No. 16-CH-576, to enforce a mortgage lien, recorded in 2005, against the residential property owned by the Scialabbas. Harris Bank’s complaint did not name U.S. Bank National Association (U.S. Bank) as a lienholder or party defendant.

¶3 In 2017, U.S. Bank initiated the second mortgage foreclosure proceeding, Will County case No. 17-CH-998, to enforce a second mortgage lien, recorded in 2012, against the same residential property owned by the Scialabbas. U.S. Bank’s complaint named Harris Bank and the Scialabbas, among others, as party defendants.

¶4 Eventually, the trial court granted the Scialabbas’ motion to consolidate, which was filed on the grounds of convenience and judicial economy. After the consolidation, case No. 16-CH- 576, initiated by Harris Bank to enforce its 2005 mortgage lien, resulted in a final order confirming the sale of the residential property to Mount Olive LLC, by defendant, Jamal Barghouthi. Following the entry of the order confirming the sale, the trial court initially allowed U.S. Bank to amend its complaint in case No. 17-CH-998 to add Barghouthi, a third-party purchaser, as a party defendant. Thereafter, the trial court allowed Barghouthi’s motion to reconsider and dismiss U.S. Bank’s amended complaint, finding it lacked jurisdiction to take any further action with respect to case No. 17-CH-998. U.S. Bank appeals. We reverse.

¶5 I. BACKGROUND

¶6 On March 22, 2016, Harris Bank initiated Will County case No. 16-CH-576 under the Illinois Mortgage Foreclosure Law, 735 ILCS 5/15-1101 et seq. (West 2014). Harris Bank’s lawsuit sought to foreclose on a mortgage, recorded in 2005, that was secured by the Scialabbas’ residential property. U.S. Bank was not named as a party defendant in Harris Bank’s complaint.

¶7 On May 15, 2017, U.S. Bank initiated Will County case No. 17-CH-998 under the Illinois Mortgage Foreclosure Law. U.S. Bank’s lawsuit sought to foreclose on a second mortgage, recorded in 2012, that was secured by the Scialabbas’ residential property. U.S. Bank designated the Scialabbas and Harris Bank, among others, as party defendants. U.S. Bank alleged its mortgage on the residential property was superior to the interests of all other defendants.

¶8 On July 28, 2017, the Scialabbas filed a motion to consolidate case Nos. 16-CH-576 and 17-CH-998 under section 2-1006 of the Code of Civil Procedure (Code), 735 ILCS 5/2-1006 (West 2016). The Scialabbas alleged Harris Bank “is the junior lien holder [for the residential property] and U.S. Bank alleges to be the senior lien holder of mortgages encumbering the same property.” Further, the Scialabbas alleged the “cases are separate causes but have the same nature and involv[e] the same evidence.” Therefore, “[a]s [a] means of convenience to the Court and a matter of judicial economy without prejudice,” the Scialabbas requested a consolidation.

¶9 On August 2, 2017, Judge Cory Lund entered an order in case Nos. 16-CH-576 and 17- CH-998, stating the Scialabbas’ “motion to consolidate is hereby granted.” The “cases [were] to proceed under 16-CH-0576.” The order indicated Harris Bank, U.S. Bank, and the Scialabbas were represented in court by counsel. The trial court later denied Harris Bank’s motion to sever.

¶ 10 On August 29, 2017, Harris Bank filed a motion for summary judgment under section 2- 1005 of the Code, 735 ILCS 5/2-1005 (West 2016), or for judgment under section 15-1506 of the Illinois Mortgage Foreclosure Law, 735 ILCS 5/15-1506 (West 2016), on its complaint in case No. 16-CH-576. The caption of the motion listed Harris Bank as the plaintiff and James V. Scialabba, et al., as the defendants. The order was affixed with both case Nos. 16-CH-576 and

17-CH-998. Harris Bank directed its motion at the Scialabbas but not U.S. Bank. Harris Bank’s notice of filing did not list U.S. Bank as a recipient of the motion. 1

¶ 11 After various continuances, on November 28, 2018, Judge Mark Carney held a hearing on Harris Bank’s motion for summary judgment. The record does not indicate U.S. Bank was present in court on this date. After the hearing, the trial court signed an order, prepared by counsel for Harris Bank, that granted Harris Bank summary judgment and a judgment of foreclosure and sale. The caption of the order listed Harris Bank as the plaintiff and James V. Scialabba, et al., as the defendants. The order was affixed with both case Nos. 16-CH-576 and 17-CH-998. In addition, although Harris Bank did not name U.S. Bank as a party defendant in its complaint in case No. 16-CH-576, reference U.S. Bank or U.S. Bank’s 2012 mortgage lien in its motion for summary judgment, or provide notice to U.S. Bank of its motion for summary judgment, the order of summary judgment and a judgment of foreclosure and sale was entered against both the Scialabbas and U.S. Bank.

¶ 12 The judgment of foreclosure and sale, signed by Judge Carney on November 28, 2018, listed Harris Bank as the plaintiff and James V. Scialabba, et al., as the defendants. The judgment was affixed with both case Nos. 16-CH-576 and 17-CH-998. The judgment found “the material allegations of the Complaint *** [we]re true and proven.” Further, the judgment was “fully dispositive of the interest of all Defendants.” Unlike the order of summary judgment and a judgment of foreclosure and sale, the judgment did not reference U.S. Bank. Likewise, the judgment did not reference U.S. Bank’s complaint in case No. 17-CH-998 or its 2012 mortgage lien. Instead, the judgment stated, “the Mortgage which [wa]s the subject matter of the[]

1

On September 8, 2017, Harris Bank answered U.S. Bank’s complaint, filed in case No. 17-CH-

998. Harris Bank’s answer was affixed with both case Nos. 16-CH-576 and 17-CH-998.

proceedings [wa]s extinguished and merged into Judgment.” Judge Carney ordered a sale of the residential property with any purchaser taking “subject to any and all liens, encumbrances[,] and any existing defects in title.” With respect to the termination of subordinate interests, if a sale occurred, then party defendants and nonrecord claimants with notice were “forever barred and foreclosed of any right, title, interest, claim, lien or right to redeem” in the residential property.

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