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Illinois Supreme Court Sides with Borrower in Foreclosure Case

Posted on in Creditor's Rights

Illinois Supreme Court Sides with Borrower in Foreclosure CaseA foreclosure case between a bank mortgagee and borrower made its way to the Illinois Supreme Court earlier this year. In Bank of New York Mellon v. Pacific Realty Group, LLC, the courts had been trying to solve two points of contention:

  • Whether service by publication was an adequate means of informing the borrower of a pending foreclosure when the borrower does not have an agent in the state; and
  • Whether the 60-day deadline for a borrower to file a motion to quash a foreclosure should have included a period during which the case was inactive.

The supreme court answered the second question in favor of the borrower and sent the case back to the appellate court in order for it to rule on the first question.


The bank first filed a residential mortgage foreclosure complaint against the borrower in June 2010. A month later, the bank filed an affidavit for service by publication because it could not find an agent of the borrower in order to serve notice. After two years of the borrower not responding, a trial court made a default judgment of foreclosure, and the property was sold in February 2013. 

In April 2013, the bank filed an order to approve the report of sale. The borrower’s attorney appeared for the first time at an April 18 hearing, but the bank did not attend the hearing. Because of the bank’s absence, the court dismissed the case for want of prosecution (DWP). The bank filed to vacate the DWP, and the court reinstated the case on May 30.

Court Decision and Appeal

On July 18, 2013, the borrower filed a motion to quash the approval of the foreclosure sale, on the grounds that the bank did not properly serve it notice of the foreclosure. The borrower is a foreign LLC without a registered agent in Illinois, which it claims means that it cannot be served notice by publication. The trial court rejected the motion on two grounds:

  • The borrower missed the deadline to file the motion because it filed more than 60 days after its initial court appearance; and
  • Service by publication was appropriate.

An appellate court upheld the lower court's ruling regarding the deadline and declined to rule on the merits of the case because there was not a valid motion. 


The Illinois Supreme Court interpreted the deadline law differently than the two lower courts. The lower courts used the borrower’s April court appearance as the start of the 60-day deadline period, which would mean that the borrower filed its motion after more than 90 days. The supreme court instead used the May date that the case was reinstated, which would mean that the borrower met the deadline. The supreme court stated that it is unreasonable to count the days before the case was reinstated towards the deadline. The borrower could not have filed a motion during that time because the case had been dismissed. Having determined that the motion was valid, the supreme court sent the case back to the appellate court, which now must rule on its merits.

Completing Foreclosure

A lesson that other lenders can learn from this case is that borrowers can try to challenge a foreclosure even after the sale has taken place. A Chicago creditor’s rights attorney at Walinski & Associates, P.C., will not rest until your foreclosure has been completed and approved. Schedule a consultation by calling 312-704-0771.


Illinois Creditors Bar Association Chicago Bar Association Illinois State Bar Association
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