Parkway Bank & Trust Co. v. Korzen, 1–13–0380.

CourtUnited States Appellate Court of Illinois
Citation2013 IL App (1st) 130380,2 N.E.3d 1052,377 Ill.Dec. 771
Docket NumberNo. 1–13–0380.,1–13–0380.
PartiesPARKWAY BANK AND TRUST COMPANY, Plaintiff–Appellee, v. Victor KORZEN and Tomas Zanzola, Defendants–Appellants (Unknown Owners and Nonrecord Claimaints, Defendants).
Decision Date15 January 2014

2013 IL App (1st) 130380
2 N.E.3d 1052
377 Ill.Dec.

Victor KORZEN and Tomas Zanzola, Defendants–Appellants (Unknown Owners and Nonrecord Claimaints, Defendants).

No. 1–13–0380.

Appellate Court of Illinois,
First District, First Division.

Sept. 23, 2013.
As Supplemented Dec. 16, 2013.

Rehearing Denied Jan. 15, 2014.

[2 N.E.3d 1054]

Victor Korzen, Tomas Zanzola, Chicago, appellants pro se.

Scott & Kraus, Chicago, (Eugene S. Kraus, Sonia S. Kinra, of counsel), for appellee.


Justice DELORT delivered the judgment of the court, with opinion.

¶ 1 This appeal of a mortgage foreclosure case involving an empty lot is so groundless that we would normally dispose of it with a brief summary order. However, it provides us an opportunity to review a number of tactics a small number of debtors use both to delay the ultimate resolution of cases against them and to use

[2 N.E.3d 1055]

the legal system for improper purposes. Some people might classify those who engage in these tactics as “ sovereign citizens,” but regardless of the nomenclature, their methods are not only counterproductive, but detrimental to the efficient and fair administration of justice. A recent New York Times article noted the FBI has labeled the strategy as “ ‘paper terrorism.’ ” Erica Goode, In Paper War, Floor of Liens Is the Weapon, N.Y. Times, Aug. 23, 2013, at A1.

¶ 2 Because of the growing number of these cases, we issue this opinion to provide guidance to the many courts confronted with similar matters.1 We affirm the judgment below and retain jurisdiction to award additional attorney fees as provided by the underlying contract and to consider the imposition of sanctions under Illinois Supreme Court Rule 375 ( Ill. S.Ct. R. 375 (eff. Feb. 1, 1994)).


¶ 4 Defendants-appellants, Victor Korzen and Tomas Zanzola, who are the owners of the subject property, raise no less than 15 points in their pro se appeal. Establishing a framework to properly analyze these contentions requires us to set out the chronology of the case in unusually excruciating detail, as follows.

¶ 5

Date Event
January 5, 2007
Defendant Zanzola signs a promissory note to borrow $100,000 from Parkway Bank & Trust Company (Parkway). The note matures six months later, on July 5, 2007. The note provides that Zanzola will be responsible to pay Parkway's attorney fees, court costs, and expenses, including for appeals, if Zanzola fails to repay the note on time. The note states that it is secured by a January 5, 2007 mortgage, assignment of rents, and “commercial security agreement” between Zanzola and defendant Korzen for property located at 1527 East Thomas Street in Palatine (the property). The note was thereafter renewed in like form for six successive six-month terms, the last terminating on July 5, 2010.
January 5, 2007
Zanzola and Korzen sign a mortgage on the Thomas Street property with Parkway. The mortgage contains a standard “due on sale” clause providing that Parkway may declare the note immediately due and payable if the mortgagors transfer any of their interest in the property. The mortgage also provides that if the note is not paid on time, Parkway may obtain a court order foreclosing the mortgagors' interest in the property. Like the note, the mortgage provides that the mortgagors shall pay Parkway's “reasonable” attorney fees and court costs “at trial and upon any appeal.”

In the mortgage, Zanzola and Korzen waived their rights of redemption and reinstatement in case of a foreclosure, a waiver which is only valid if the property is not “residential” as defined by the Illinois Mortgage Foreclosure Law (Foreclosure Law) (735 ILCS 5/15–1101 et seq. (West 2010)). Under the Foreclosure Law, the property is only “residential” if the borrower actually lives in a residence constructed on the property. 735 ILCS 5/15–1219 (West 2010).
January 5, 2007
Zanzola and Korzen sign an assignment of rents in favor of Parkway, another act which suggests that the property is not “residential” under section 15–1219 of the Foreclosure Law.
January 22, 2007
Korzen signs and records a deed quit claiming his interest in the property to himself and Zanzola as joint tenants. Korzen signs a certificate with the deed asserting that the transaction between Zanzola and him is exempt from real estate transfer taxes.
August 26, 2010
Parkway files this mortgage foreclosure lawsuit, along with a civil cover sheet indicating that the property is “vacant land.” The lawsuit names both Korzen and Zanzola as defendants.

The lawsuit contains two counts. Count I seeks a mortgage foreclosure and follows the standard statutory format. Parkway attached three exhibits to the complaint to support its allegations in count I:(a) a copy of the January 5, 2007 promissory note, whose most recent renewal matured on July 5, 2010; (b) a copy of the January 5, 2007 mortgage; and (c) a copy of the January 5, 2007 assignment of rents. Count I, paragraph 3, alleges that the default on the note and mortgage occurred through failure to pay amounts due under the note on and after March 8, 2010, and that the amount currently due is about $106,377.23 plus continuing per diem interest of $28.39.

Count II is a claim for breach of the promissory note against Zanzola.
September 1, 2010
The circuit court appoints a special process server to serve defendants.
September 12, 2010
The special process server personally serves Zanzola at an address in Prairie Grove, McHenry County, Illinois.
September 14, 2010
The Cook County sheriff's deputy assigned to serve defendants reports that he could not serve Korzen at 410 South Warner in Palatine, because he moved from that address “five years ago.”
October 20, 2010
Both defendants file motions in the circuit court to defend as poor persons without paying filing fees. The court grants the motions.
October 28, 2010
Zanzola files an appearance, listing his Prairie Grove address; Korzen also files an appearance, listing an address in Chicago. The two defendants jointly file a fill-in-the-blank form answer, denying the allegations of count I, paragraph 3 of the complaint, and claiming that they have insufficient knowledge to admit or deny count I, paragraph 2.

Under the portion of the answer labeled “Other affirmative matter,” defendants state the following:


4.1 Proof of claim accompanied with the evidence of debt;

4.2 Original Wet Script ink Promissory Note;

4.3 Original Title;

4.4 Current complete copy of the Bank's Original Application and the CUSIP number of the Application.”
January 31, 2011
The special process server personally serves Korzen at his address in Chicago.
February 22, 2011
Defendants fail to appear for the case management conference.
August 16, 2011
Parkway issues a request to admit facts to defendants, seeking admission of various basic facts regarding the transaction. These include genuineness of the documents signed by defendants and the default created by the missed payments.
August 31, 2011
On Parkway's motion, the circuit court strikes the affirmative matter contained in paragraph 4 of defendants' answer. Defendants never amended these statements, nor filed traditional affirmative defenses at any later date.
September 15, 2011
Korzen recasts the “other affirmative matter” material which the circuit court struck from his answer and files it as a request for production of documents on Parkway. Included in the request is a demand for an “Original Wet Script ink Promissory Note [ sic].”
October 12, 2011
Parkway responds to defendants' request for production of documents, acknowledging that Parkway will produce the original note for inspection. Parkway responds to the other requests by generally stating that they held no responsive documents or that the requests were vague.
December 7, 2011
Parkway presents a motion for summary judgment which relies, in part, on defendants' failure to respond to Parkway's request to admit facts. Defendants file a written motion for a continuance on Parkway's motion for summary judgment.
December 8, 2011
The circuit court grants a briefing schedule on Parkway's motion for summary judgment, and sets hearing on the motion for February 9, 2012. The court also orders Parkway to produce the original note for inspection at its office by December 29, 2011.
December 15, 2011
Parkway's attorneys send Zanzola and Korzen letters stating as follows:

“This letter will serve to confirm our telephone conversation earlier today. You previously requested that Parkway Bank produce the original Note at issue in the above-captioned case for inspection by you at a Parkway Bank location. As discussed in our telephone conversation, Parkway Bank shall produce the Note for your inspection upon setting up an appointment with your loan officer.

Your loan officer is Loukas Rogaris. Mr. Rogaris can be reached at [phone number]. The Order entered on December 8, 2011, requires that you inspect the original Note by December 29, 2011, so please be sure to contact Mr. Rogaris promptly.

Please feel free to contact me should you have any questions.”
January 4, 2012
Defendants file responses to Parkway's request to admit facts, about four months late. Defendants' response includes a request to “toll the statute of limitations.” The response is laden with objections and nonsense legalistic jargon. The record does not indicate that defendants ever: (1) requested a conference pursuant to Illinois Supreme Court Rule 201(k) (Ill.S.Ct. R. 201(k) (eff. July 1, 2002)) to resolve the objections; (2) filed any motion to request a ruling on the objections; or (3) filed or presented a motion asking the circuit court to extend the time to respond to the request to admit facts. See Ill. S.Ct. R. 216(c) (eff. Jan. 1, 2011) (“Any objection to a request or to an answer shall be heard by the court upon prompt notice and motion of the party making the request.”).
January 12, 2012
Defendants file a pleading objecting to Parkway's motion for summary judgment. In the

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