Full Text of SB1447 100th General Assembly
SB1447sam001 100TH GENERAL ASSEMBLY | Sen. Jason A. Barickman Filed: 3/8/2017
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| 1 | | AMENDMENT TO SENATE BILL 1447
| 2 | | AMENDMENT NO. ______. Amend Senate Bill 1447 by replacing | 3 | | everything after the enacting clause with the following:
| 4 | | "Section 5. The Code of Civil Procedure is amended by | 5 | | changing Sections 15-1603.5 and 15-1701 as follows: | 6 | | (735 ILCS 5/15-1603.5) | 7 | | Sec. 15-1603.5. Strict foreclosure of an omitted | 8 | | subordinate interest. | 9 | | (a) As used in this Section, "omitted subordinate interest" | 10 | | means a recorded subordinate interest in real estate where: | 11 | | (1) the real estate is the subject of a foreclosure | 12 | | action under this Article; | 13 | | (2) a motion to confirm judicial sale under subsection | 14 | | (b) of Section 15-1508 is either pending or has been | 15 | | granted; | 16 | | (3) the interest attached to the real estate prior to |
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| 1 | | the filing or recording of any notice in accordance with | 2 | | Sections 2-1901 and 15-1503; and | 3 | | (4) the person who has the interest was not named in | 4 | | the foreclosure complaint or was a named party in the | 5 | | foreclosure action over which the court lacked personal | 6 | | jurisdiction due to defective service of process . | 7 | | (b) The holder of the certificate of sale or any person who | 8 | | acquired title pursuant to Section 15-1509 or any subsequent | 9 | | successor, assignee, transferee, or grantee who discovers an | 10 | | omitted subordinate interest may file a strict foreclosure | 11 | | complaint naming the person who has the omitted subordinate | 12 | | interest as the defendant. A complaint filed under this Section | 13 | | must include substantially the following: | 14 | | (1) the identity of the plaintiff and how the plaintiff | 15 | | acquired its interest in the property which is the subject | 16 | | of the strict foreclosure; | 17 | | (2) the docket number of the prior foreclosure action | 18 | | and the recording number and date of the mortgage that was | 19 | | previously foreclosed; | 20 | | (3) the legal description, common address, and parcel | 21 | | identification number of the real estate which is the | 22 | | subject of the strict foreclosure; | 23 | | (4) the recording number and a copy of the recorded | 24 | | instrument identifying the person who has the omitted | 25 | | subordinate interest that is named as the defendant; | 26 | | (5) the amount of the successful bid at the foreclosure |
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| 1 | | sale, as stated in the report of sale in the prior | 2 | | foreclosure action, with a copy of the report of sale | 3 | | attached to the complaint; | 4 | | (6) an allegation that, due to inadvertence or mistake | 5 | | or such other reason as may be applicable, the person who | 6 | | has the omitted subordinate interest was not made a party | 7 | | defendant in the prior foreclosure action and the omitted | 8 | | subordinate interest was not terminated by the judgment of | 9 | | foreclosure and when the subject property was sold by | 10 | | judicial sale; and | 11 | | (7) a request for relief setting forth the redemption | 12 | | period as provided in this Section and identifying a | 13 | | contact by name and telephone number who will accept tender | 14 | | of the redemption amount. | 15 | | (c) Subject to the objection of the defendant, the court | 16 | | shall enter a judgment extinguishing the omitted subordinate | 17 | | interest. | 18 | | (d) If the defendant objects to the entry of the judgment, | 19 | | the court, after a hearing, shall enter an order providing | 20 | | either: | 21 | | (1) that the defendant has not agreed to pay the amount | 22 | | required to redeem, in which event the court shall proceed | 23 | | to enter the judgment; or | 24 | | (2) that the defendant has agreed to pay the amount | 25 | | required to redeem. | 26 | | (d-5) The foreclosure proceeding may be reopened as to the |
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| 1 | | defendant only if the defendant: (i) was a named party in the | 2 | | foreclosure action over which the court lacked personal | 3 | | jurisdiction due to defective service of process; and (ii) has | 4 | | a meritorious defense to the foreclosure action. After the | 5 | | foreclosure proceeding is reopened, if the defendant is | 6 | | unsuccessful in defeating the foreclosure action, then the | 7 | | defendant shall have the option to redeem pursuant to | 8 | | subsection (e) of this Section. Nothing contained in this | 9 | | Section affects any existing right that the holder of the | 10 | | certificate of sale or any person who acquired title pursuant | 11 | | to Section 15-1509 or any subsequent successor, assignee, | 12 | | transferee, or grantee of such a person may have against the | 13 | | defendant or the real estate. | 14 | | (e) The amount required to redeem shall be the sum bid at | 15 | | the prior foreclosure sale plus any costs and fees incurred | 16 | | subsequent to the sale for the payment of taxes, preservation | 17 | | of the property, or any other actions taken by the holder of | 18 | | the certificate of sale to protect its interest in the | 19 | | property. The amount required to redeem shall not include any | 20 | | costs or fees incurred by the plaintiff in the strict | 21 | | foreclosure case filed under this Section. | 22 | | Notwithstanding any provision of Sections 15-1602, | 23 | | 15-1603, or 15-1604 to the contrary, the redemption period | 24 | | shall extend 30 days after the entry of the order if the | 25 | | defendant has not been in possession of the real estate for a | 26 | | period of 6 months prior to the entry of the order. The order |
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| 1 | | shall state that upon payment of the redemption amount within | 2 | | the redemption period, which shall extend 30 days after the | 3 | | entry of the order, title to the real estate shall vest in the | 4 | | defendant who redeems pursuant to this Section. If the | 5 | | defendant subject to the order has not paid the amount required | 6 | | to redeem within the 30-day redemption period, the interest of | 7 | | the defendant in the property is terminated. | 8 | | (f) A person whose omitted subordinate interest was not | 9 | | terminated by a prior foreclosure action does not have a right | 10 | | to file a strict foreclosure action. | 11 | | (g) Notwithstanding that the person's omitted subordinate | 12 | | interest in the real estate has been terminated pursuant to | 13 | | this Section, nothing in this Section shall be construed to | 14 | | extinguish or impair any claim of such person in the surplus | 15 | | proceeds of a sale held or distributed pursuant to subsection | 16 | | (d) of Section 15-1512 of this Code after the confirmation of | 17 | | the sale of the real estate for which such person had an | 18 | | omitted subordinate interest.
| 19 | | (Source: P.A. 98-1099, eff. 8-26-14.)
| 20 | | (735 ILCS 5/15-1701) (from Ch. 110, par. 15-1701)
| 21 | | Sec. 15-1701. Right to possession.
| 22 | | (a) General. The provisions of
this Article shall govern | 23 | | the right to possession of the mortgaged real
estate during | 24 | | foreclosure. Possession under this Article includes physical
| 25 | | possession of the mortgaged real estate to the same extent to |
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| 1 | | which the
mortgagor, absent the foreclosure, would have been | 2 | | entitled to physical
possession. For the purposes of Part 17, | 3 | | real estate is residential real estate
only if it is | 4 | | residential real estate at the time the foreclosure is | 5 | | commenced.
| 6 | | (b) Pre-Judgment. Prior to the entry of a judgment of | 7 | | foreclosure:
| 8 | | (1) In the case of residential real estate, the | 9 | | mortgagor shall be
entitled to possession of the real | 10 | | estate except if (i) the mortgagee shall
object and show | 11 | | good cause, (ii) the mortgagee is so authorized by the | 12 | | terms of
the mortgage or other written instrument, and | 13 | | (iii) the court is satisfied that
there is a reasonable | 14 | | probability that the mortgagee will prevail on a final
| 15 | | hearing of the cause, the court shall upon request place | 16 | | the mortgagee in
possession. If the residential real estate | 17 | | consists of more than one dwelling
unit, then for the | 18 | | purpose of this Part residential real estate shall mean | 19 | | only
that dwelling unit or units occupied by persons | 20 | | described in clauses (i), (ii)
and (iii) of Section | 21 | | 15-1219.
| 22 | | (2) In all other cases, if (i) the mortgagee is so | 23 | | authorized by the
terms of the mortgage or other written | 24 | | instrument, and (ii) the court is
satisfied that there is a | 25 | | reasonable probability that the mortgagee will
prevail on a | 26 | | final hearing of the cause, the mortgagee shall
upon |
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| 1 | | request be placed in possession of the real estate, except | 2 | | that if the
mortgagor shall object and show good cause, the | 3 | | court shall allow the
mortgagor to remain in possession.
| 4 | | (c) Judgment Through 30 Days After Sale Confirmation. After | 5 | | the entry
of a judgment of foreclosure and through the 30th day | 6 | | after a foreclosure
sale is confirmed:
| 7 | | (1) Subsection (b) of Section 15-1701 shall be | 8 | | applicable, regardless of
the provisions of the mortgage or | 9 | | other instrument, except that after a
sale pursuant to the | 10 | | judgment the holder of the certificate of sale
(or, if | 11 | | none, the purchaser at the sale) shall have the mortgagee's | 12 | | right to be
placed in possession, with all rights and | 13 | | duties of a mortgagee in possession
under this Article.
| 14 | | (2) Notwithstanding paragraph (1) of subsection (b) | 15 | | and paragraph (1) of
subsection (c) of Section 15-1701, | 16 | | upon request of the mortgagee, a mortgagor
of residential | 17 | | real estate shall not be allowed to remain in possession | 18 | | between
the expiration of the redemption period and through | 19 | | the 30th day after sale
confirmation unless (i) the | 20 | | mortgagor pays to the mortgagee or such holder or
| 21 | | purchaser, whichever is applicable, monthly the lesser of | 22 | | the interest due
under the mortgage calculated at the | 23 | | mortgage rate of interest applicable as if
no default had | 24 | | occurred or the fair rental value of the real estate, or | 25 | | (ii)
the mortgagor otherwise shows good cause. Any amounts | 26 | | paid by the mortgagor
pursuant to this subsection shall be |
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| 1 | | credited against the amounts due from the
mortgagor.
| 2 | | (d) After 30 Days After Sale Confirmation. The holder of
| 3 | | the certificate of sale or deed issued pursuant to that | 4 | | certificate or, if
no certificate or deed was issued, the | 5 | | purchaser, except to the extent the
holder or purchaser may | 6 | | consent otherwise, shall be entitled to possession of
the | 7 | | mortgaged real estate, as of the date 30 days after the order | 8 | | confirming
the sale is entered, against those parties to the | 9 | | foreclosure whose interests
the court has ordered terminated, | 10 | | without further notice to any party, further
order of the | 11 | | court, or resort to proceedings under any other statute other | 12 | | than
this Article.
This right to possession shall be limited by | 13 | | the provisions
governing entering and enforcing orders of | 14 | | possession under subsection (g) of
Section
15-1508.
If the | 15 | | holder or purchaser determines that there are occupants
of the | 16 | | mortgaged real estate who have not been made parties to the | 17 | | foreclosure
and had their interests terminated therein, the | 18 | | holder or purchaser may bring a
proceeding under subsection (h) | 19 | | of this Section, if applicable, or under Article IX of this | 20 | | Code
to terminate the rights of possession of any such | 21 | | occupants. The holder or
purchaser shall not be entitled to | 22 | | proceed against any such occupant under
Article IX of this Code | 23 | | until after 30 days after the order confirming the sale
is | 24 | | entered.
| 25 | | (e) Termination of Leases. A lease of all or any part of | 26 | | the mortgaged
real estate shall not be terminated automatically |
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| 1 | | solely by virtue of the entry
into possession by (i) a | 2 | | mortgagee or receiver prior to the entry of an order
confirming | 3 | | the sale, (ii) the holder of the certificate of sale, (iii) the
| 4 | | holder of the deed issued pursuant to that certificate, or (iv) | 5 | | if no
certificate or deed was issued, the purchaser at the | 6 | | sale.
| 7 | | (f) Other Statutes; Instruments. The provisions of this | 8 | | Article
providing for possession of mortgaged real estate shall | 9 | | supersede any other
inconsistent statutory provisions. In | 10 | | particular, and without limitation,
whenever a receiver is | 11 | | sought to be appointed in any action in which a
foreclosure is | 12 | | also pending, a receiver shall be appointed only in
accordance | 13 | | with this Article. Except as may be authorized by this Article,
| 14 | | no mortgage or other instrument may modify or supersede the | 15 | | provisions of this
Article.
| 16 | | (g) Certain Leases. Leases of the mortgaged real estate | 17 | | entered into by
a mortgagee in possession or a receiver and | 18 | | approved by the court in a
foreclosure shall be binding on all | 19 | | parties, including the mortgagor after
redemption, the | 20 | | purchaser at a sale pursuant to a judgment of foreclosure
and | 21 | | any person acquiring an interest in the mortgaged real estate | 22 | | after
entry of a judgment of foreclosure in accordance with | 23 | | Sections 15-1402 and
15-1403.
| 24 | | (h) Proceedings Against Certain Occupants.
| 25 | | (1) The mortgagee-in-possession of the mortgaged real | 26 | | estate under Section
15-1703, a receiver appointed under |
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| 1 | | Section 15-1704, a holder of the
certificate of sale or | 2 | | deed, or the purchaser may, at any time during the
pendency | 3 | | of the foreclosure and up to 90 days after the date of the | 4 | | order
confirming the sale,
file a supplemental petition for | 5 | | possession against a person not personally
named as a party
| 6 | | to the foreclosure. This subsection (h) does not apply to | 7 | | any lessee with a bona fide lease of a dwelling unit in | 8 | | residential real estate in foreclosure. | 9 | | (2) The supplemental petition for possession shall | 10 | | name each such
occupant against whom possession is sought | 11 | | and state the facts upon which the
claim for relief is | 12 | | premised.
| 13 | | (3) The petitioner shall serve upon each named occupant | 14 | | the petition,
a notice of hearing on the petition, and, if | 15 | | any, a copy of the certificate of
sale or deed. The | 16 | | proceeding for the termination of such occupant's | 17 | | possessory
interest, including service of the notice of the | 18 | | hearing and the petition,
shall in all respects comport | 19 | | with the requirements of Article IX of this Code,
except as | 20 | | otherwise specified in this Section. The hearing shall be | 21 | | no less
than 21 days from the date of service of the | 22 | | notice.
| 23 | | (4) The supplemental petition shall be heard as part of | 24 | | the foreclosure
proceeding and without the payment of | 25 | | additional filing fees. An order for
possession obtained | 26 | | under this Section shall name each occupant whose interest
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| 1 | | has been terminated, shall recite that it is only effective | 2 | | as to the occupant
so named and those holding under them, | 3 | | and shall be enforceable for no more
than 120 days after | 4 | | its entry, except that the 120-day period may be extended | 5 | | to
the extent and in the manner provided in Section 9-117 | 6 | | of Article IX and except as provided in item (5) of this | 7 | | subsection (h). | 8 | | (5) In a case of foreclosure where the occupant is | 9 | | current on his or her rent, or where timely written notice | 10 | | of to whom and where the rent is to be paid has not been | 11 | | provided to the occupant, or where the occupant has made | 12 | | good-faith efforts to make rental payments in order to keep | 13 | | current, any order of possession must allow the occupant to | 14 | | retain possession of the property covered in his or her | 15 | | rental agreement (i) for 120 days following the notice of | 16 | | the hearing on the supplemental petition that has been | 17 | | properly served upon the occupant, or (ii) through the | 18 | | duration of his or her lease, whichever is shorter, | 19 | | provided that if the duration of his or her lease is less | 20 | | than 30 days from the date of the order, the order shall | 21 | | allow the occupant to retain possession for 30 days from | 22 | | the date of the order. A mortgagee in possession, receiver, | 23 | | holder of a certificate of sale or deed, or purchaser at | 24 | | the judicial sale, who asserts that the occupant is not | 25 | | current in rent, shall file an affidavit to that effect in | 26 | | the supplemental petition proceeding. If the occupant has |
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| 1 | | been given timely written notice of to whom and where the | 2 | | rent is to be paid, this item (5) shall only apply if the | 3 | | occupant continues to pay his or her rent in full during | 4 | | the 120-day period or has made good-faith efforts to pay | 5 | | the rent in full during that period.
| 6 | | (6) The court records relating to a supplemental | 7 | | petition for possession filed under this subsection (h) | 8 | | against an occupant who is entitled to notice under item | 9 | | (5) of this subsection (h), or relating to a forcible entry | 10 | | and detainer action brought against an occupant who would | 11 | | have lawful possession of the premises but for the | 12 | | foreclosure of a mortgage on the property, shall be ordered | 13 | | sealed and shall not be disclosed to any person, other than | 14 | | a law enforcement officer or any other representative of a | 15 | | governmental entity, except upon further order of the | 16 | | court.
| 17 | | (i) Termination of bona fide leases. The holder of the | 18 | | certificate of sale, the holder of the deed issued pursuant to | 19 | | that certificate, or, if no certificate or deed was issued, the | 20 | | purchaser at the sale shall not terminate a bona fide lease of | 21 | | a dwelling unit in residential real estate in foreclosure | 22 | | except pursuant to Article IX of this Code. | 23 | | (j) If an omitted subordinate interest, as defined in | 24 | | Section 15-1603.5, asserts a challenge to the jurisdiction of | 25 | | the trial court following confirmation of the sale and transfer | 26 | | of title to the mortgaged real estate to a non-party to the |
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| 1 | | underlying foreclosure action who acquired title for value, the | 2 | | trial court shall permit the non-party to retain possession of | 3 | | the mortgaged real estate pending entry of a final order | 4 | | relative to the jurisdiction challenge and any subsequent | 5 | | proceedings in the foreclosure action if the non-party provides | 6 | | adequate security for any loss of use or occupancy by the | 7 | | person who has the omitted subordinate interest. For purposes | 8 | | of this Section, a bond presented to, approved by, and filed | 9 | | with the court shall be deemed to provide adequate security. | 10 | | (Source: P.A. 98-514, eff. 11-19-13.)
| 11 | | Section 99. Effective date. This Act takes effect upon | 12 | | becoming law.".
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