Chung v. Pham

Decision Date20 March 2020
Docket NumberAppeal Nos. 3-19-0218,3-19-0536 (cons.)
Citation2020 IL App (3d) 190218,441 Ill.Dec. 430,156 N.E.3d 1179
Parties Dawn CHUNG, Plaintiff-Appellee, v. Sonny PHAM, Defendant-Appellant (Hoa Tuyet Pham, Intervenor-Appellant). Hoa Tuyet Pham, Plaintiff-Appellant, v. Sonny Pham and Dawn Chung, Defendants-Appellees.
CourtUnited States Appellate Court of Illinois

2020 IL App (3d) 190218
156 N.E.3d 1179
441 Ill.Dec.
430

Dawn CHUNG, Plaintiff-Appellee,
v.
Sonny PHAM, Defendant-Appellant

(Hoa Tuyet Pham, Intervenor-Appellant).


Hoa Tuyet Pham, Plaintiff-Appellant,
v.
Sonny Pham and Dawn Chung, Defendants-Appellees.

Appeal Nos. 3-19-0218
3-19-0536 (cons.)

Appellate Court of Illinois, Third District.

Opinion filed March 20, 2020


Rhonda Heinz, of Westervelt, Johnson, Nicoll & Keller, LLC, of Peoria, for appellant Sonny Pham.

Jeffrey Alan Ryva, of Quinn, Johnston, Henderson, Pretorius & Cerulo, of Peoria, for other appellant.

Joseph B. VanFleet and Graciela Mata Gomez, of Howard & Howard Attorneys PLLC, of Peoria, for appellee.

JUSTICE WRIGHT delivered the judgment of the court, with opinion.

441 Ill.Dec. 436

¶ 1 This appeal involves separate proceedings from the circuit court of Peoria County. Peoria County case No. 15-CH-89 was brought by plaintiff-appellee, Dawn Chung, against defendant-appellant, Sonny Pham, for the specific performance of a commercial real estate purchase agreement (purchase agreement). The circuit court granted, and our court affirmed, partial summary judgment and specific performance in favor of Dawn. While Sonny's appeal of these grants in Peoria County case No. 15-CH-89 were pending, the circuit court allowed plaintiff-appellant, Hoa Tuyet Pham, a/k/a Cindy, to file an intervention complaint in Peoria County case No. 15-CH-89. Cindy also brought a foreclosure lawsuit, Peoria County case No. 18-CH-24, against Dawn and Sonny with respect to the commercial real estate subject to the purchase agreement. The circuit court involuntarily dismissed Cindy's complaints in Peoria County case Nos. 15-CH-89 and 18-CH-24. The circuit court then awarded Dawn attorney fees, property taxes, and rent under the purchase agreement in Peoria County case No. 15-CH-89. Cindy, joined by Sonny, appeals in case No. 3-19-0218.

¶ 2 While Cindy and Sonny's appeal was pending, Dawn filed a motion to compel Sonny to transfer the commercial real estate in accordance with the purchase agreement and prior court orders. The circuit court held a hearing, during which it oversaw the transfer of the deed to and monies for the commercial real estate. Cindy appeals in case No. 3-19-0536.

¶ 3 On our court's own motion, Peoria County case Nos. 15-CH-89 and 18-CH-24 were consolidated for purposes of appeal. In addition, on our court's own motion, appeal No. 3-19-0536 was consolidated with appeal No. 3-19-0218.

¶ 4 I. BACKGROUND

¶ 5 On December 3, 2014, Dawn and Sonny executed a purchase agreement for

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441 Ill.Dec. 437

commercial real estate, located at 7814 N. Sommer Street in Peoria. The purchase price of the commercial real estate was $202,000, which, under the purchase agreement, was to be "adjusted by prorations and credits allowed the parties." Sonny represented, warranted, and covenanted that, as of the date of the purchase agreement's execution and as of the closing date, he was "the sole owner of and ha[d] good and merchantable fee simple title to the Real Property." Likewise, Sonny represented, warranted, and covenanted that, as of the date of the purchase agreement's execution and as of the closing date, "[t]here [we]re no leases (oral or written), options, purchase contracts, or other agreements of any kind or nature, written or oral, whereunder or whereby any party could claim or assert any right, title, or interest in the Real Property that have not been disclosed." Initially, the closing date was scheduled for January 14, 2015. However, Dawn and Sonny subsequently agreed to delay the closing until February 14, 2015.

¶ 6 Sonny refused to close on the commercial real estate. At the time of the scheduled closing, the commercial real estate was subject to a mortgage held by Morton Community Bank but had no other encumbrances. Following Sonny's refusal to close, Dawn, on March 5, 2015, filed a 12-count verified complaint in Peoria County case No. 15-CH-89 (underlying lawsuit) seeking, among other things, the specific performance of the purchase agreement. Dawn made at least 14 unsuccessful attempts to serve Sonny in the underlying lawsuit. Before Dawn could effectuate service, Sonny, on April 8, 2015, borrowed $201,043.89 from his sister, Cindy, to pay off the mortgage held by Morton Community Bank.1 Sonny's loan from Cindy was secured by a mortgage on the same commercial real estate subject to Dawn and Sonny's purchase agreement. On the same day the mortgage was delivered by Sonny, April 8, 2015, Cindy recorded the mortgage in Peoria County. Thereafter, Morton Community Bank released its mortgage.

¶ 7 On April 14, 2015, Dawn filed a motion requesting a special order allowing service of process on Sonny's attorney. The circuit court granted Dawn's motion under section 2-203.1 of the Code of Civil Procedure (Code). 735 ILCS 5/2-203.1 (West 2014). Sonny's attorney of record was served with a copy of the verified complaint filed in the underlying lawsuit on April 21, 2015. Thereafter, on April 23, 2015, Dawn recorded a lis pendens notice in Peoria County, as required by section 2-1901 of the Code. Id. § 2-1901.

¶ 8 A. Events Related to the First Appeal—Case No. 3-17-0487

¶ 9 Eventually, on June 26, 2017, the circuit court granted partial summary judgment in favor of Dawn in the underlying lawsuit.2 The circuit court found that a valid and enforceable purchase agreement existed between Dawn and Sonny, Sonny breached the purchase agreement, and

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441 Ill.Dec. 438

Dawn proved the elements necessary for an order requiring the specific performance of the purchase agreement. The circuit court enjoined Sonny from transferring the commercial real estate to anyone other than Dawn and ordered that the terms of the purchase agreement be performed within 60 days. The circuit court retained jurisdiction to hold any hearings necessary for the enforcement of the order or a determination of attorney fees or damages. Sonny timely filed a notice of appeal on July 25, 2017. Our court affirmed the circuit court's grant of partial summary judgment and order of specific performance. See Chung v. Pham , 2018 IL App (3d) 170487-U, 2018 WL 6314749. The mandate issued on January 8, 2019.

¶ 10 On August 18, 2017, the circuit court stayed the proceedings pending Sonny's appeal. However, the stay was contingent upon Sonny filing "[b]ond * * * in the amount of $202,000.00" within 30 days. See Ill. S. Ct. R. 305(b) (eff. July 1, 2017) ("A bond or other form of security may be required in any case, and shall be required to protect an appellee's interest in property."). Sonny did not file the bond, so the stay was lifted after 30 days.

¶ 11 As a result, on September 20, 2017, Dawn filed a petition for attorney fees and rule to show cause as to why Sonny had not closed on the commercial real estate, as required by the circuit court's June 26, 2017, order. According to Dawn, no response was received from Sonny when she attempted to schedule a closing. On October 20, 2017, Sonny filed an objection to Dawn's petition for attorney fees, arguing the purchase agreement does not provide attorney fees to Dawn and, in the alternative, that Dawn's request was unreasonable. On this same day, the circuit court entered an order for rule to show cause against Sonny, stating "it appear[s] that [Sonny] has willfully refused to perform under a Real Estate Sales Contract and transfer the real property and improvements to [Dawn] pursuant to Orders of this Court." Sonny was commanded to appear at a hearing on Dawn's petition for rule to show cause.3

¶ 12 B. Events Related to the Second Appeal—Case No. 3-19-0218

¶ 13 On December 5, 2017, while Sonny's appeal was pending and on the same day he was scheduled to appear for Dawn's petition for rule to show cause, Cindy filed a petition to intervene in the underlying lawsuit. Cindy requested "the Court allow her to intervene in this action and allow her 45 days to file any necessary pleadings." This same day, the circuit court, by agreement of the parties, granted the petition to intervene and provided Cindy with "45 days to file any Pleadings."

¶ 14 Cindy filed an intervention complaint on January 18, 2018. Cindy's intervention complaint alleged that she had a mortgage on the commercial real estate subject to Dawn and Sonny's purchase agreement. Thus, intervention was appropriate to protect her position as a mortgagee. Cindy sought a court order requiring the payment of her mortgage as part of any transfer of the commercial real estate. Further, the prayer for relief contained in the intervention complaint requested "the court to allow [Cindy] to participate in the case." The mortgage executed by Sonny and Cindy was attached to Cindy's intervention complaint.

¶ 15 Also on January 18, 2018, while Sonny's appeal from the underlying lawsuit was pending, Cindy filed a foreclosure

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441 Ill.Dec. 439

complaint in Peoria County case No. 18-CH-24 (foreclosure lawsuit). In this foreclosure lawsuit, Cindy...

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