Full Text of HB0174 97th General Assembly
HB0174 97TH GENERAL ASSEMBLY |
| | 97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012 HB0174 Introduced 1/18/2011, by Rep. Mary E. Flowers SYNOPSIS AS INTRODUCED: |
| 735 ILCS 5/15-1401 | from Ch. 110, par. 15-1401 | 735 ILCS 5/15-1402 | from Ch. 110, par. 15-1402 | 735 ILCS 5/15-1506 | from Ch. 110, par. 15-1506 |
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Amends the Code of Civil Procedure. In provisions concerning deeds in lieu of foreclosure, provides that a mortgagee must file an action to confirm the deed in lieu of foreclosure, prove by clear and convincing documentary evidence, other than by oral testimony or affidavit, that the party seeking a judgment to confirm the deed in lieu of foreclosure is the actual, legal mortgagee entitled to bring the action, and obtain a judgment confirming the deed that finds that the mortgagee is entitled to bring the action. In provisions concerning foreclosure by consent and provisions concerning the trial of a foreclosure, provides that a mortgagee must prove by clear and convincing documentary evidence, other than by oral testimony or affidavit, that the party seeking a judgment of foreclosure is the actual, legal mortgagee and is entitled to bring the foreclosure action. In provisions concerning the trial of a foreclosure, provides that where an allegation of fact in the complaint is not denied by a party's verified answer or verified counterclaim or where a party states or is deemed to have stated that it has no knowledge of the allegation sufficient to form a belief and attaches the required affidavit, a sworn verification of the complaint or a separate affidavit setting forth such fact is not sufficient evidence thereof against such party and further evidence of such fact shall be required (rather than that a sworn verification of the complaint or a separate affidavit setting forth such fact is sufficient evidence thereof against such party and further evidence of such fact shall not be required).
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| | A BILL FOR |
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| 1 | | AN ACT concerning civil law.
| 2 | | Be it enacted by the People of the State of Illinois,
| 3 | | represented in the General Assembly:
| 4 | | Section 5. The Code of Civil Procedure is amended by | 5 | | changing Sections 15-1401, 15-1402, and 15-1506 as follows:
| 6 | | (735 ILCS 5/15-1401) (from Ch. 110, par. 15-1401)
| 7 | | Sec. 15-1401. Deed in Lieu of Foreclosure. The mortgagor | 8 | | and
mortgagee may agree on a termination of the mortgagor's | 9 | | interest in the
mortgaged real estate after a default by a | 10 | | mortgagor provided that the mortgagee must file an action to | 11 | | confirm the deed in lieu of foreclosure, prove by clear and | 12 | | convincing documentary evidence, other than by oral testimony | 13 | | or affidavit, in that action that the party seeking a judgment | 14 | | to confirm the deed in lieu of foreclosure is the actual, legal | 15 | | mortgagee entitled to bring the action, and obtain a judgment | 16 | | confirming the deed that finds that the mortgagee is entitled | 17 | | to bring the action . Any mortgagee or
mortgagee's nominee may | 18 | | accept a deed from the mortgagor in lieu of
foreclosure subject | 19 | | to any other claims or liens affecting the real estate.
| 20 | | Acceptance of a deed in lieu of foreclosure shall relieve from | 21 | | personal
liability all persons who may owe payment or the | 22 | | performance of other
obligations secured by the mortgage, | 23 | | including guarantors of such
indebtedness or obligations, |
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| 1 | | except to the extent a person agrees not to be
relieved in an | 2 | | instrument executed contemporaneously. A deed in lieu of
| 3 | | foreclosure, whether to the mortgagee or mortgagee's nominee, | 4 | | shall not
effect a merger of the mortgagee's interest as | 5 | | mortgagee and the
mortgagee's interest derived from the deed in | 6 | | lieu of foreclosure.
The mere tender of an executed deed by the | 7 | | mortgagor or the recording of
a deed by the mortgagor to the | 8 | | mortgagee shall not constitute acceptance by
the mortgagee of a | 9 | | deed in lieu of foreclosure.
| 10 | | (Source: P.A. 86-974.)
| 11 | | (735 ILCS 5/15-1402) (from Ch. 110, par. 15-1402)
| 12 | | Sec. 15-1402. Consent Foreclosure.
| 13 | | (a) No Objection. In a
foreclosure, the court shall enter a | 14 | | judgment satisfying the mortgage
indebtedness by vesting | 15 | | absolute title to the mortgaged real estate in the
mortgagee | 16 | | free and clear of all claims, liens (except liens of the United
| 17 | | States of America which cannot be foreclosed without judicial | 18 | | sale) and
interest of the mortgagor, including all rights of | 19 | | reinstatement and
redemption, and of all rights of all other | 20 | | persons made parties in the
foreclosure whose interests are | 21 | | subordinate to that of the mortgagee and
all nonrecord | 22 | | claimants given notice in accordance with paragraph (2) of
| 23 | | subsection (c) of Section
15-1502 provided that the party | 24 | | seeking the judgment must prove by clear and convincing | 25 | | documentary evidence, other than by oral testimony or |
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| 1 | | affidavit, that it is the actual, legal mortgagee and is | 2 | | entitled to bring the foreclosure action, if at any time before | 3 | | sale:
| 4 | | (1) the mortgagee offers, in connection with such a | 5 | | judgment, to waive
any and all rights to a personal | 6 | | judgment for deficiency against the
mortgagor and against | 7 | | all other persons liable for the indebtedness or
other | 8 | | obligations secured by the mortgage;
| 9 | | (2) such offer is made either in the foreclosure | 10 | | complaint or by motion
upon notice to all parties not in | 11 | | default;
| 12 | | (3) all mortgagors who then have an interest in the | 13 | | mortgaged real
estate, by answer to the complaint, response | 14 | | to the motion or
stipulation filed with the court expressly | 15 | | consent to the
entry of such judgment;
| 16 | | (4) no other party, by answer or by response to the | 17 | | motion or stipulation,
within the time allowed for such | 18 | | answer or response, objects to the entry
of such judgment; | 19 | | and
| 20 | | (5) upon notice to all parties who have not previously | 21 | | been found in default
for failure to appear, answer or | 22 | | otherwise plead.
| 23 | | (b) Objection. If any party other than a mortgagor who
then | 24 | | has an interest in the mortgaged real estate objects to the | 25 | | entry
of such judgment by consent, the court, after hearing, | 26 | | shall enter an order
providing either:
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| 1 | | (1) that for good cause shown, the judgment by consent | 2 | | shall not be allowed; or
| 3 | | (2) that, good cause not having been shown by the | 4 | | objecting party and
the objecting party not having agreed | 5 | | to pay the amount required to redeem
in accordance with | 6 | | subsection (d) of Section 15-1603, title to the mortgaged | 7 | | real estate
be vested in the mortgagee as requested by the | 8 | | mortgagee and consented to
by the mortgagor; or
| 9 | | (3) determining the amount required to redeem in | 10 | | accordance with
subsection (d) of Section
15-1603, finding | 11 | | that the objecting party (or, if more than one party so
| 12 | | objects, the objecting party who has the least priority) | 13 | | has agreed to pay such
amount and additional interest under | 14 | | the mortgage accrued to the date of
payment within 30 days | 15 | | after entry of the order, and declaring that upon
payment | 16 | | of such amount within 30 days title to the mortgaged real | 17 | | estate
shall be vested in such objecting party. Title so | 18 | | vested shall be free and
clear of all claims, liens (except | 19 | | liens of the United States of America
which cannot be | 20 | | foreclosed without judicial sale) and interest of the
| 21 | | mortgagor and of all rights of other persons made parties | 22 | | in the
foreclosure whose interests are subordinate to the | 23 | | interest of the
mortgagee and all nonrecord claimants given | 24 | | notice in accordance with
paragraph (2) of subsection (c) | 25 | | of Section 15-1502. If any objecting party
subject to such | 26 | | an order has
not paid the amount required to redeem in |
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| 1 | | accordance with that order within
the 30-day period, the | 2 | | court (i) shall order that such title to the
mortgaged real | 3 | | estate shall vest in the objecting party next higher in | 4 | | priority
(and successively with respect to each other | 5 | | objecting party in increasing order
of such party's | 6 | | priority), if any, upon that party's agreeing to pay within
| 7 | | 30 days after the entry of such further order, such amount | 8 | | as specified in
the original order plus additional interest | 9 | | under the terms of the mortgage
accrued to the date of | 10 | | payment, provided that such party pays such amount
within | 11 | | the 30-day period, and (ii) may order that the non-paying | 12 | | objecting
party pay costs, interest accrued between the | 13 | | start of the preceding
30-day period and the later of the | 14 | | date another objecting party makes the
payment, if | 15 | | applicable, or the date such period expired, and the | 16 | | reasonable
attorneys' fees incurred by all other parties on | 17 | | account of that party's objection.
| 18 | | (c) Judgment. Any judgment entered pursuant to Section | 19 | | 15-1402 shall
recite the mortgagee's waiver of rights to a | 20 | | personal judgment for
deficiency and shall bar the mortgagee | 21 | | from obtaining such a deficiency
judgment against the mortgagor | 22 | | or any other person liable for the
indebtedness or other | 23 | | obligations secured by the mortgage.
| 24 | | (Source: P.A. 86-974.)
| 25 | | (735 ILCS 5/15-1506) (from Ch. 110, par. 15-1506)
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| 1 | | Sec. 15-1506. Judgment. (a) Evidence. In the trial of a | 2 | | foreclosure, the evidence to support the
allegations of the | 3 | | complaint shall be taken in open court, and notwithstanding any | 4 | | provision of this Article, the mortgagee must prove by clear | 5 | | and convincing documentary evidence, other than by oral | 6 | | testimony or affidavit, that the party seeking a judgment of | 7 | | foreclosure is the actual, legal mortgagee and is entitled to | 8 | | bring the foreclosure action, except:
| 9 | | (1) where an allegation of fact in the complaint is not | 10 | | denied by a
party's verified answer or verified counterclaim, | 11 | | or where a party pursuant
to subsection (b) of Section 2-610 of | 12 | | the Code of Civil Procedure states,
or is deemed to have | 13 | | stated, in
its pleading that it has no knowledge
of such | 14 | | allegation sufficient to form a belief and attaches the | 15 | | required
affidavit, a sworn verification of the complaint or a | 16 | | separate affidavit
setting forth such fact is not sufficient | 17 | | evidence thereof against such party
and no further evidence of | 18 | | such fact shall be required; and
| 19 | | (2) where all the allegations of fact in the complaint have | 20 | | been proved
by verification of the complaint or affidavit, the | 21 | | court upon motion
supported by an affidavit stating the amount | 22 | | which is due the mortgagee,
shall enter a judgment of | 23 | | foreclosure as requested in the complaint.
| 24 | | (b) Instruments. In all cases the evidence of the | 25 | | indebtedness and the
mortgage foreclosed shall be exhibited to | 26 | | the court and appropriately
marked, and copies thereof shall be |
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| 1 | | filed with the court.
| 2 | | (c) Summary and Default Judgments. Nothing in this Section | 3 | | 15-1506
shall prevent a party from obtaining a summary or | 4 | | default judgment
authorized by Article II of the Code of Civil | 5 | | Procedure.
| 6 | | (d) Notice of Entry of Default. When any judgment in a | 7 | | foreclosure is
entered by default, notice of such judgment | 8 | | shall be given in accordance
with Section 2-1302 of the Code of | 9 | | Civil Procedure.
| 10 | | (e) Matters Required in Judgment. A judgment of foreclosure | 11 | | shall
include the last date for redemption and all rulings of | 12 | | the court entered
with respect to each request for relief set | 13 | | forth in the complaint. The
omission of the date for redemption | 14 | | shall not extend the time for
redemption or impair the validity | 15 | | of the judgment.
| 16 | | (f) Special Matters in Judgment. Without limiting the | 17 | | general
authority and powers of the court, special matters may | 18 | | be included in the
judgment of foreclosure if sought by a party | 19 | | in the complaint or by separate
motion. Such matters may | 20 | | include, without limitation:
| 21 | | (1) a manner of sale other than public auction;
| 22 | | (2) a sale by sealed bid;
| 23 | | (3) an official or other person who shall be the officer to
| 24 | | conduct the sale other than the one customarily designated by | 25 | | the court;
| 26 | | (4) provisions for non-exclusive broker listings or |
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| 1 | | designating a duly
licensed real estate broker nominated by one | 2 | | of the parties to exclusively
list the real estate for sale;
| 3 | | (5) the fees or commissions to be paid out of the sale | 4 | | proceeds to the
listing or other duly licensed broker, if any, | 5 | | who shall have procured the accepted bid;
| 6 | | (6) the fees to be paid out of the sale proceeds to an | 7 | | auctioneer, if
any, who shall have been authorized to conduct a | 8 | | public auction sale;
| 9 | | (7) whether and in what manner and with what content signs | 10 | | shall be
posted on the real estate;
| 11 | | (8) a particular time and place at which such bids shall be | 12 | | received;
| 13 | | (9) a particular newspaper or newspapers in which notice of
| 14 | | sale shall be published;
| 15 | | (10) the format for the advertising of such sale,
including | 16 | | the size, content
and format of such advertising, and | 17 | | additional advertising of such sale;
| 18 | | (11) matters or exceptions to which title in the real | 19 | | estate may be subject
at the sale;
| 20 | | (12) a requirement that title insurance in a specified form | 21 | | be provided
to a purchaser at the sale, and who shall pay for | 22 | | such insurance;
| 23 | | (13) whether and to what extent bids with mortgage or other
| 24 | | contingencies will be allowed;
| 25 | | (14) such other matters as approved by the court to ensure | 26 | | sale of the
real estate for the most commercially favorable |
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| 1 | | price for the type of real
estate involved.
| 2 | | (g) Agreement of the Parties. If all of the parties agree | 3 | | in writing on
the minimum price and that the real estate may be | 4 | | sold to the first person
who offers in writing to purchase the | 5 | | real estate for such price, and on
such other commercially | 6 | | reasonable terms and conditions as the parties may
agree, then | 7 | | the court shall order the real estate to be sold on such terms,
| 8 | | subject to confirmation of the sale in accordance with Section | 9 | | 15-1508.
| 10 | | (h) Postponement of Proving Priority. With the approval of | 11 | | the court
prior to the entry of the judgment of foreclosure, a | 12 | | party claiming an
interest in the proceeds of the sale of the | 13 | | mortgaged real estate may defer
proving the priority of such | 14 | | interest until the hearing to confirm the sale.
| 15 | | (i) Effect of Judgment and Lien.
(1) Upon the entry of the | 16 | | judgment of foreclosure, all rights of a party
in the | 17 | | foreclosure against the mortgagor provided for in the judgment | 18 | | of foreclosure
or this Article shall be secured by a lien on | 19 | | the mortgaged
real estate, which lien shall have the same | 20 | | priority as the claim to
which the judgment relates and shall | 21 | | be terminated upon confirmation of a judicial
sale in | 22 | | accordance with this Article.
| 23 | | (2) Upon the entry of the judgment of foreclosure, the | 24 | | rights in the
real estate subject to the judgment of | 25 | | foreclosure of (i) all persons made
a party in the foreclosure | 26 | | and (ii) all nonrecord claimants given notice in
accordance |
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| 1 | | with paragraph (2) of subsection (c) of Section 15-1502, shall
| 2 | | be solely as provided for in
the judgment of foreclosure and in | 3 | | this Article.
| 4 | | (Source: P.A. 85-907.)
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