GMB Financial Group, Inc. v. Marzano

SUPREME COURT CASES

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State: Illinois

Court: 2nd District Appellate

Docket No: 2-07-0047 Rel

Case Date: 10/17/2008

Preview:No. 2--07--0047 ______________________________________________________________________________ IN THE APPELLATE COURT OF ILLINOIS SECOND DISTRICT ______________________________________________________________________________ GMB FINANCIAL GROUP, INC., ) Appeal from the Circuit Court ) of McHenry County. Plaintiff-Appellee, ) ) v. ) No. 06--CH--110 ) MICHELE MARZANO, ) ) Defendant-Appellant ) ) Honorable (Northstar Condominium Association, ) Michael T. Caldwell, Defendant). ) Judge, Presiding. _________________________________________________________________________________ JUSTICE O'MALLEY delivered the opinion of the court: In this mortgage foreclosure action, defendant, Michele Marzano, appeals the orders of the trial court (1) granting the motion of plaintiff, GMB Financial Group, Inc., to strike defendant's motion to quash service of process and vacate the court's default judgment of foreclosure; and (2) confirming the sale of the subject property. We affirm. I. BACKGROUND On February 1, 2006, plaintiff filed a complaint to foreclose mortgage against defendant. After defendant failed to timely answer or file an appearance, plaintiff sought and obtained a default judgment of foreclosure and order of sale. A judicial sale was set for September 14, 2006. On September 14, defendant, by attorney Scott Bentley, filed an emergency motion to stay the sale. The trial court granted the motion and scheduled the sale for October 13. On October 13, the trial court

No. 2--07--0047 entered an "agreed order" staying the sale until October 31. (The order states that it was entered on defendant's motion but no such motion appears in the record.) On October 26, defendant, again by attorney Bentley, filed another motion to stay the sale. The motion recited that the sale was currently scheduled for November 2 (not October 31 as stated in the October 13 order). The trial court denied the motion. The next document appearing in the record is a November 2, 2006, order of the trial court stating: "This case coming on the oral motion of defendant, the court being fully advised, It is hereby ordered-That since no evidence of service of process upon defendant being filed, the foreclosure sale set for today is stayed until November 17, 2006[,] under the same terms and conditions, and a status as to service is set for November 16, 2006, at 9:00 a.m." On November 6, plaintiff filed a motion to vacate the November 2 order, contending that there were no grounds for doubting the court's jurisdiction over defendant. The court moved the status hearing from November 16 to November 14. On November 14, attorney Michael Cortina entered an appearance for defendant. Over plaintiff's objection, the court granted defendant leave to file a motion to quash service of summons. The court set the motion for a hearing on November 17. In the motion, defendant asserted that she was never served with a summons and complaint in the action and therefore the court lacked personal jurisdiction over her when it entered the default judgment. On November 17, plaintiff filed a motion to strike and dismiss defendant's motion

to quash. Defendant was first given a copy of the motion at the hearing that morning. She opposed the filing of the motion in light of the lack of notice. Impliedly rejecting her complaint, the court gave defendant time to review the motion to strike and then took argument on both that motion and

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No. 2--07--0047 the motion to quash. The arguments of the parties concentrated on whether defendant's filings in the case after the default judgment but before her motion to quash constituted a waiver of any objection based on lack of personal jurisdiction. Plaintiff argued: "They had been into court, Judge, three times on a motion to stay the sale. That waives the issue pursuant to [section 2--301 of the Code of Civil Procedure (735 ILCS 5/2--301 (West 2006))], pursuant to just about every Supreme Court case you want to come up with and--and this is as basic as it gets, Judge, you can't come into court and participate and then say, oh, by the way, everything we've done here I've availed myself to [sic] the court's jurisdiction but everything--you didn't have jurisdiction, it was improper. You can't do it." In response, defendant cited J.C. Penney Co. v. West, 114 Ill. App. 3d 644 (1983). Defendant provided the court with a copy of the case and noted that she had previously given plaintiff a copy. Defendant argued that, under J.C. Penney, an implied waiver of personal jurisdiction has effect only prospectively and so her filings prior to the motion to quash did not deprive her of the right to challenge personal jurisdiction with respect to the prior default judgment. In reply, plaintiff again cited section 2--301 of the Code of Civil Procedure (Code) (735 ILCS 5/2--301 (West 2006)). Plaintiff argued that the statute "says if you do anything other than file a motion to quash service on your initial appearance, [personal jurisdiction] is waived." The trial court granted the motion to strike, reasoning that defendant "submitted herself to the court's jurisdiction by her previous motions to stay [and] continue Judicial Sale." The trial court also noted that the order was "final and appealable."

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No. 2--07--0047 The subject property was sold on November 17, 2006. Plaintiff thereafter filed a motion to confirm the sale. At the January 9, 2007, hearing on the motion, defendant objected that plaintiff failed to provide the special notice required by section 15--1507(c)(4) of the Illinois Mortgage Foreclosure Law (Mortgage Law) (735 ILCS 5/15--1507(c)(4) (West 2006)) where a judicial sale is postponed 60 days or more beyond the original date for sale. The trial court rejected defendant's argument and, in a written order dated January 9, confirmed the sale. Defendant filed her notice of appeal on January 10. II. ANALYSIS Defendant challenges the trial court's orders granting plaintiff's motion to strike her motion to quash and confirming the judicial sale. A. Jurisdiction As a preliminary matter, plaintiff argues that we have no jurisdiction over the order granting the motion to strike, because the trial court designated the order as final and appealable yet defendant did not appeal within 30 days of the order. See 155 Ill. 2d R. 303(a)(1) ("The notice of appeal must be filed with the clerk of the circuit court within 30 days after the entry of the final judgment appealed from"). The trial court's characterization of the order as final and appealable did not make it so. See Djikas v. Grafft, 344 Ill. App. 3d 1, 14 (2003) ("it is well settled that a trial court's designation of an order as final and appealable does not in itself render an order final and appealable"). By its nature the order did not have the requisite finality. "A judgment ordering the foreclosure of a mortgage is not final and appealable until the court enters orders approving the sale and directing the distribution." In re Marriage of Verdung, 126 Ill. 2d 542, 555 (1989). The grant of the motion to strike was an intermediate order in a process that did not culminate for purposes of

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No. 2--07--0047 appeal until the January 9, 2007, order confirming the sale. Defendant appealed well within 30 days of the January 9 order, and therefore we have jurisdiction to review the prior order granting the motion to strike. B. Notice of the Motion to Strike We turn to the merits of this appeal. Defendant proposes two grounds for reversing the trial court's order granting plaintiff's motion to strike. First, defendant argues that the order is voidable because she was not served with a copy of the motion until the November 17 hearing. Second, on the substance of the order, defendant argues that the trial court erred in holding that her participation in the case after the default judgment waived any objection she might have had that the court lacked personal jurisdiction over her when it entered the default judgment. We address these arguments in turn. On the notice issue, defendant asserts that it was improper for the trial court to hear the motion to strike when she was not provided a copy until the November 17 hearing. Defendant cites Supreme Court Rule 104(b) (134 Ill. 2d R. 104(b)), which provides: "Pleadings subsequent to the complaint, written motions, and other papers required to be filed shall be filed with the clerk with a certificate of counsel or other proof that copies have been served on all parties who have appeared and have not theretofore been found by the court to be in default for failure to plead." Defendant complains of the "harm and prejudice [she] faced because of the unfair surprise and lack of adequate time to prepare a response." She asserts that she deserved "ample time to prepare a statement and a formal objection" but instead was "forced to respond extemporaneously during a previously scheduled court call for an entirely different motion [the motion to quash service of process]." Defendant acknowledges that the court provided her time to review the motion, but maintains that

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No. 2--07--0047 "[r]eviewing a motion in the hallway for ten minutes is not the same as having proper notice and the ability to digest the arguments, research cited authorities and respond, in writing, to the motion." As defendant recognizes, the failure to provide notice rendered the court's order voidable, not void. In Larson v. Pederson, 349 Ill. App. 3d 203, 207 (2004), we held, in fidelity to our supreme court's decision in Belleville Toyota, Inc. v. Toyota Motor Sales, U.S.A., Inc., 199 Ill. 2d 325 (2002), that "[a] party may attack a judgment as void only when jurisdiction is totally wanting." We acknowledge that we held in In re A.W., 343 Ill. App. 3d 396, 399 (2003), that "[a]n order entered without notice is void" even where the court has jurisdiction over the parties and the subject matter. We disavow that holding, together with its ancestors and descendants (see, e.g., Mara v. Bertholdt, 126 Ill. App. 3d 876, 881 (1984)), as illegitimized by Belleville Toyota, the latest in a long line of cases holding that an order is void only where the court lacked " 'inherent power' " to enter it (In re Marriage of Mitchell, 181 Ill. 2d 169, 177 (1998), quoting In re Estate of Steinfeld, 158 Ill. 2d 1, 12 (1994)). As the supreme court explained in People v. Davis, 156 Ill. 2d 149, 157 (1993): "Clearly, the infringement of certain fundamental rights, like due process and equal protection, is constitutionally impermissible. However, although violation of such rights may present a proper subject for an exercise of the court's jurisdiction, the rights do not, themselves, vest a court with subject matter jurisdiction. See 21 C.J.S. Courts

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