U.S. Bank Nat'Lass'N v. tail Fund Algonquin Commons, LLC

• Decision Date: 21 June 2013
• Docket Number: Docket No. 2–13–0213.
• Citation: 372 Ill.Dec. 633,2013 IL App (2d) 130213,992 N.E.2d 172
• Parties: U.S. BANK NATIONAL ASSOCIATION, as Successor in Interest to Bank of America, N.A., Successor to Wells Fargo Bank, N.A., as Trustee for the Registered Holders of TIAA Seasoned Commercial Mortgage Trust 2007 C–4, Commercial Mortgage Pass–Through Certificates, Series 2007–C4, Plaintiff–Appellee, v. IN RETAIL FUND ALGONQUIN COMMONS, LLC; In Retail Fund, LLC; and Inland Commercial Property Management, Inc., Defendants–Appellants (Jeffrey R. Anderson Real Estate; Xtreme Fire Protection, Inc.; Mike Kokosis, d/b/a All Circuits Electric Inc.; Unknown Owners; and Nonrecord Claimants, Defendants).
• Court: United States Appellate Court of Illinois

2013 IL App (2d) 130213

992 N.E.2d 172

372 Ill.Dec. 633

U.S. BANK NATIONAL ASSOCIATION, as Successor in Interest to Bank of America, N.A., Successor to Wells Fargo Bank, N.A., as Trustee for the Registered Holders of TIAA Seasoned Commercial Mortgage Trust 2007 C–4, Commercial Mortgage Pass–Through Certificates, Series 2007–C4, Plaintiff–Appellee,

v. IN RETAIL FUND ALGONQUIN COMMONS, LLC; In Retail Fund, LLC; and Inland Commercial Property Management, Inc., Defendants–Appellants(Jeffrey R. Anderson Real Estate; Xtreme Fire Protection, Inc.; Mike Kokosis, d/b/a All Circuits Electric Inc.; Unknown Owners; and Nonrecord Claimants, Defendants).

Docket No. 2–13–0213.

Appellate Court of Illinois, Second District.

June 21, 2013.

Eugene S. Kraus, Miles V. Cohen, and Jason R. Sleezer, all of Scott & Kraus, LLC, of Chicago, for appellants.

Jerry L. Switzer and Jean Soh, both of Polsinelli Shughart, P.C., of Chicago, and Brett D. Anders and Aaron Jackson, both of Polsinelli Shughart, P.C., of Kansas City, Missouri, for appellee.

OPINION

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

[372 Ill.Dec. 634]¶ 1 Defendants IN Retail Fund Algonquin Commons, LLC, IN Retail Fund, LLC, and Inland Commercial Property Management, Inc., appeal various orders entered by the trial court. For the reasons that follow, we dismiss this appeal for lack of jurisdiction.

¶ 2 BACKGROUND

¶ 3 In December 2012, plaintiff, U.S. Bank National Association, brought a complaint for foreclosure against defendants. The subject property is a commercial development in Algonquin, Illinois. On January 11, 2013, plaintiff moved for appointment of a receiver for the property. Also in January 2013, plaintiff filed (1) two motions for admission pro hac vice; (2) a motion for a temporary restraining order; and (3) a motion to file an amended complaint. The temporary restraining order that plaintiff sought would “restrain [ ] [defendants] from in any manner removing, destroying or diminishing the [c]ollateral,” except that defendants would be permitted “to make use of the [c]ollateral in the ordinary course of their business and for payment of ordinary operating expenses currently incurred in the ordinary course of business.”

¶ 4 On February 1, 2013, IN Retail Fund filed a motion to quash service of summons as noncompliant with Supreme Court Rule 101 (Ill. S.Ct. R. 101 (eff. May 30, 2008)). Also on February 1, the Honorable Edward C. Schreiber heard all of plaintiff's pending motions. At the hearing, defendants objected that the certificates of service for the motions were deficient. The trial court agreed and directed plaintiff to “re-notice” the motions. On February 8, 2013, plaintiff refiled the motions and also filed a motion to strike the jury demand of Inland Commercial Property Management. At a February 11 hearing, Judge Schreiber agreed with defendants that the refiled motions likewise had deficient certificates of service. Judge Schreiber again directed plaintiff to “re-notice” the motions. On February 14, plaintiff moved for substitution of judge as a matter of right under section 2–1001(a)(2) of the Code of Civil Procedure (735 ILCS 5/2–1001(a)(2) (West 2010)). On February 22, plaintiff filed a “notice of motion” for each of the following motions: (1) two motions for admission pro hac vice; (2) a motion for appointment of a receiver; (3) a motion for a temporary restraining order; (4) a motion for leave to file an amended complaint; and (5) a motion to strike Inland Commercial Property Management's jury demand. Plaintiff did not file the motions themselves along with the notices, but stated that copies of the motions were previously served upon defendants. Meanwhile, the motion for substitution was granted and the case reassigned to the Honorable John G. Dalton.

¶ 5 On February 28, plaintiff's third round of motions (or, more precisely, notices) came up for hearing before Judge Dalton. Defendants now objected that plaintiff failed to comply with local rule 6.05(d) (16th Judicial Cir. Ct. R. 6.05(d) (June 20, 2001)), which provides that “[a] copy of the motion, any papers to be presented with the motion, and proof of service shall be served with the notice.” Judge Dalton denied the objection. After argument on the merits of the motions, the trial court granted the motion for appointment of a receiver. In light of the appointment, plaintiff withdrew its motion for a temporary restraining order. The court then ordered that, pending the receiver taking possession of the property, defendants were enjoined “from making or cashing payments related to the property * * * effective [immediately].” The court also granted plaintiff's remaining motions.

¶ 6 On March 1, Judge Dalton heard and denied IN Retail Fund's motion to quash service of summons. That same day, defendants filed a notice of appeal under Illinois Supreme Court Rule 307(a)(1) (eff.Feb.26, 2010), which provides that “[a]n appeal may be taken to the Appellate Court from an interlocutory order of court * * * granting, modifying, refusing, dissolving, or refusing to dissolve or modify an injunction.” On March 4, defendants amended the notice to identify 11 separate orders entered by the trial court on February 28 and March 1 in disposing of plaintiff's various motions and IN Retail Fund's motion to quash service of summons.

¶ 7 ANALYSIS

¶ 8 Defendants argue that the trial court erred by (1) rejecting their objection that plaintiff violated local rule 6.05(d) by serving notices without accompanying motions; (2) denying IN Retail Fund's motion to quash service of summons; and (3) granting plaintiff's motion for substitution of judge as a matter of right. Notably, though defendants claim jurisdiction under a supreme court rule that permits appeals from interlocutory orders pertaining to injunctions, they do not challenge the substance of the injunctive order entered by the trial court. They believe nonetheless that we have jurisdiction over the various other orders. They reason that “[t]he Trial Court's Orders on these points—including the improper granting of the Motion for Substitution of Judge—taint all further orders entered by the Trial Court,” and, therefore, “[i]t is appropriate for this Court to undertake review, in order to avoid such dire consequences, and before the trial court proceeding further advances.” As authority, they cite two cases, Sarah Bush Lincoln Health Center v. Berlin, 268 Ill.App.3d 184, 205 Ill.Dec. 325, 643 N.E.2d 276 (1994), decided by the Fourth District Appellate Court, and Partipilo v. Partipilo, 331 Ill.App.3d 394, 264 Ill.Dec. 440, 770 N.E.2d 1136 (2002), decided by the First District Appellate Court.

¶ 9 The defendant in Berlin moved for substitution of judge as a matter of right. The court denied the motion and later granted the plaintiff's motion for a preliminary injunction. The defendant appealed under Rule 307(a)(1). The defendant's sole challenge to the injunction was that it was entered by a judge for whom another judge should have been substituted. The appellate court held that jurisdiction under Rule 307(a)(1) lay nonetheless. In so ruling, the court acknowledged two authorities that appeared to instruct otherwise: Murges v. Bowman, 254 Ill.App.3d 1071, 194 Ill.Dec. 214, 627 N.E.2d 330 (1993), and City of Chicago v. Airline Canteen Service, Inc., 64 Ill.App.3d 417, 20 Ill.Dec. 897, 380 N.E.2d 1106 (1978), both decided by the First District Appellate Court. Both Airline Canteen and Murges were Rule 307(a)(1) appeals from injunctive orders, and in each case the trial court, prior to entering the injunction, denied a motion to change venue. See Murges, 254 Ill.App.3d at 1076, 194 Ill.Dec. 214, 627 N.E.2d 330;Airline Canteen, 64 Ill.App.3d at 423, 20 Ill.Dec. 897, 380 N.E.2d 1106. The appellate court in each case held that its Rule 307(a)(1) jurisdiction did not extend to the order denying a change of venue. See Murges, 254 Ill.App.3d at 1084, 194 Ill.Dec. 214, 627 N.E.2d 330;Airline Canteen, 64 Ill.App.3d at 428, 20 Ill.Dec. 897, 380 N.E.2d 1106. The court in Airline Canteen reasoned:

“Only final judgments or orders are appealable unless the particular judgment or order comes within one of the specified exceptions set forth [in the Supreme Court rules]. The denial of a motion for change of venue is not a final order, nor does any Supreme Court rule authorize an appeal from an interlocutory order of such nature. [Citations.] * * * An appeal under Rule 307 does not open up the door to a general review of all orders entered by the trial court up to that date. Interlocutory appeals are piecemeal in nature and Rule 307 provides for some very specific exceptions to the rules against piecemeal appeals.” Airline Canteen, 64 Ill.App.3d at 428, 20 Ill.Dec. 897, 380 N.E.2d 1106.

¶ 10 Besides declining to review the venue challenge, the court in Murges held that it had no jurisdiction to consider the denial of the defendants' motion to dismiss the plaintiff's complaint on the ground that the plaintiff lacked legal capacity to sue. Murges, 254 Ill.App.3d at 1084, 194 Ill.Dec. 214, 627 N.E.2d 330. The court said: “This order is not final and appealable, and the appeal from a later order under Rule 307 does not give this court jurisdiction to review the prior order denying the motion to dismiss.” Id.

¶ 11 The court in Berlin declined to follow Murges and Airline Canteen, because the “difficulty with the[ir] holdings * * * is that they permit a judge who should not be hearing a motion for interlocutory injunctive relief to hear that matter without the objecting party having any recourse.” Berlin, 268 Ill.App.3d at 186–87, 205 Ill.Dec. 325, 643 N.E.2d 276. As the Berlin court understood it, Rule 307 permits the reviewing court “to review any prior error that bears directly upon the question of whether the order on appeal was proper.” Id. at 187, 205 Ill.Dec. 325, 643 N.E.2d 276.

¶ 12 Berlin cited one case to support its reading of Rule 307: ...