Real Estate Law

Lessor rented space to lessee for 2 years. By a separate written guaranty, Defendant, lessee's president, personally guarantied its obligations under lease. The personal guaranty did not remain in effect with respect to "lease extension" of 5 years later, which was a new agreement between parties, or the month-to-month holdover that followed it. As guaranty was not a part of "lease extension" it could not obligate lessee's president for any missed rent payments under it or any holdover period following it. Any extension of lease to which guaranty is attached must be specifically contemplated by that lease.  (HARRIS and SIMON, concurring.)

(Court opinion corrected 12/22/16.) In mortgage foreclosure action, bank served process on Defendant by publication. After Defendant did not appear or answer, court entered default judgment and ordered judicial sale of Defendant's property. Court properly denied Defendant's motion to quash service, as Plaintiff complied with statutory and local rule requirements by filing affidavits establishing due inquiry and due diligence. Court properly denied as premature Defendant's Section 2-1401(f) petition to vacate, as it was filed prior to entry of order approving judicial sale. Court properly entered personal deficiency against Defendant in order approving judicial sale, as Plaintiff complied with Section 15-1508(e) of Foreclosure Law. (HALL, concurring; GORDON, specially concurring.)

Defendant attempted to rescind mortgage by mailing a letter to mortgage company, which had filed foreclosure action after he stopped making mortgage payments. Defendant properly invoked rescission mechanism when he sent mortgage company rescission letter. Defendant's counterclaim related to mortgage company's failure to disclose certain information when loan closed is time-barred. To bring a time-barred counterclaim pursuant to Section 13-207 of Code of Civil Procedure, counterclaim must not have been time barred when cause of action forming basis of primary complaint arose.(SIMON and MIKVA, concurring.)

(Supplemental opinion filed 11/30/16.) Appellate court imposed sanctions of $30,093 on Defendants-Appellants, and the law firm that represented them on appeal. Defendants had argued on appeal that agreed order of foreclosure has no legal effect because mortgage itself was void due to an alteration to the mortgage. This argument was fundamentally deficient: mortgage was not altered, but as signed, expressly contemplated that full legal description would be added later; and argument failed to address distinction between void and voidable; and argument ignored fact that Defendants had already settled case and accepted a $10,000 payment.(SCHMIDT, concurring; CARTER, specially concurring.)

Wind energy system was built on property; property owners entered into windpark easement agreement with wind energy developer. Subcontractor that worked on tower filed complaint to foreclose m$3 million mechanic's lien against property. Court properly granted property owner's motion to dismiss complaint, and properly granted general contractor's motion for summary judgment. Subcontractor's work was an improvement to a trade fixture, which is not lienable; work was not improvement to real property, which is lienable. Although expensive to remove, the tower was not "incapable of removal", and this consideration does not outweigh fact that tower was intended to be temporary. (McLAREN and JORGENSEN, concurring.)

Commercial real estate firm filed broker's lien against a property in dispute of a real estate broker's commission. Plaintiff (the owner of iO Theatre, a comedy club) filed complaint to extinguish lien as improper. Defendants filed counterclaim for payment of their broker's commission. After bench trial, court awarded Defendants a $50,000 commission. Court properly denied Plaintiff's claim for attorney's fees, as Plaintiff cannot be considered a prevailing party by grant of an interlocutory motion for preliminary injunction, as it was not a final disposition on merits of Plaintiff's claim, and did not confer Plaintiff a permanent relief. Court's holding that Defendants were the procuring cause of the off-market property was not against manifest weight of evidence. (HARRIS and MIKVA, concurring.)

Plaintiff Condominium Board filed claims that condo building developed and sold by one Defendant and built by another Defendant suffered from many construction defects. Court erred in dismissing 2 counts of Board's 2nd amended complaint, as a plaintiff is permitted to bring a claim for breach of implied warranty of habitability against a builder absent a showing that developer-vendor is insolvent. Court erred in dismissing amended 3rd-party complaint of Defendant developer-seller, because bankruptcy trustee's assignment of any claims against builder cured any lack of standing that might have resulted from Defendant developer-seller's bankruptcy filing. (LAVIN and COBBS, concurring.)

Plaintiff filed mortgage foreclosure action against Defendants (including U.S. and U.S. Treasury Department) to obtain possession of property because Defendant failed to make payments on her note. A notice provision with an acceleration clause in a mortgage is a condition precedent and prescribes servicing requirements that a lender must comply with in order for lender to have a right to file an aciton to recover possession of a secured property. Bank failed to comply with condition precedent present in one paragraph in mortgage, and bank's failure to give homeowner the notice required by that paragraph divested lender of its right to file foreclosure action. Thus, court erred in granting bank's motion for summary judgment and entering order approving report of sale and distribution.(HYMAN and PIERCE, concurring.)