Illinois Official Reports

Appellate Court

McHenry Savings Bank v. Moy, 2021 IL App (2d) 200099

Appellate Court 

Caption

McHENRY SAVINGS BANK, Plaintiff-Appellee, v. PERRY MOY, 

MIRIAM MOY, THE DEPARTMENT OF REVENUE, UNKNOWN

OWNERS, and NONRECORD CLAIMANTS, Defendants (Miriam 

Moy, Defendant-Appellant).

District & No. Second District 

No. 2-20-0099

Filed January 20, 2021

Decision Under 

Review

Appeal from the Circuit Court of McHenry County, No. 2018-CH631; the Hon. Michael J. Chmiel, Judge, presiding.

Judgment Affirmed.

Counsel on

Appeal

Arthur C. Czaja, of Niles, for appellant.

Samuel G. Harrod IV, of Meltzer, Purtill & Stelle LLC, of 

Schaumberg, for appellee.

Panel JUSTICE McLAREN delivered the judgment of the court, with 

opinion.

Justices Jorgensen and Brennan concurred in the judgment and 

opinion.
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OPINION

¶ 1 In this mortgage foreclosure action, defendant,1 Miriam Moy, appeals from an order of the 

trial court that granted summary judgment to plaintiff, McHenry Savings Bank (Bank). On 

appeal, Miriam argues that the trial court erred by granting plaintiff summary judgment 

because (1) res judicata barred the Bank’s claim due to its two earlier actions and its 

acceleration of the note and (2) a genuine issue of material fact exists as to when Miriam 

defaulted on the loan. For the following reasons, we affirm.

¶ 2 I. BACKGROUND

¶ 3 On or about March 22, 2004, Miriam and Perry Moy, her husband at the time, executed a 

note in favor of the Bank in the amount of $442,000. The note was secured by a mortgage and 

the real property purchased by Miriam and Perry, commonly known as 8220 Crystal Springs 

Road, Woodstock, Illinois 60098 (property). As we detail, the Bank filed three separate 

foreclosure complaints regarding the mortgage. The first was filed on November 17, 2009, and 

Miriam prevailed in that action, following a bench trial. The second was filed on September 

14, 2017, and it was dismissed with prejudice. The third was filed on November 17, 2018, and 

it was resolved through summary judgment in the Bank’s favor, giving rise to this appeal.

¶ 4 A. The First Case

¶ 5 On November 17, 2009, the Bank filed a foreclosure complaint against Miriam, alleging 

that she defaulted on the mortgage for “failure to pay certain principal, interest, and late fees 

accruing through and beyond November 13, 2009, *** and despite demand, remained due and 

owing. As a result of said default for the mortgage, all amounts due have been accelerated.” 

The Bank sought judgment on the note and foreclosure on the property secured by the 

mortgage. In July 2016, after a bench trial, the court determined that the Bank was “entitled to 

a judgment of foreclosure *** [because] the mortgage on the property *** has been in default 

since 2008 *** [and because Miriam] signed a note and mortgage for $442,000 and failed to 

make installment payments on the loan.” Thereafter, the trial court granted Miriam’s motion 

to reconsider and entered judgment in her favor and against the Bank. The court stated that the 

Bank established the existence of a note, a mortgage, and a default on payments. But the Bank 

failed to present sufficient evidence regarding the amount of the debt owed by Miriam, and the 

evidence was insufficient to support a judgment of foreclosure.

¶ 6 B. The Second Case

¶ 7 On September 14, 2017, the Bank filed a second foreclosure complaint against Miriam, 

alleging that she failed to make “monthly payments of principal and interest for November 

2009 through the present, and had failed to pay real estate taxes on the mortgaged premises.” 

Miriam moved to dismiss based on res judicata. In January 2018, the trial court granted 

Miriam’s motion with prejudice.

1

The trial court entered an order of default as to defendants Perry Moy, the Department of Revenue, 

unknown owners, and nonrecord claimants. These defendants are not part of this appeal.
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¶ 8 C. The Third Case (This Case)

¶ 9 On November 17, 2018, the Bank filed a third foreclosure complaint against Miriam, 

alleging the following. On August 24, 2018, the Bank declared Miriam to be in default under 

the note and the mortgage for failure to pay the monthly payments of principal and interest for 

the months of July and August 2018 and for failure to pay the first installment of real estate 

taxes due on June 4, 2018. The Bank provided Miriam notice of default and the past-due 

amount. As of August 24, 2018, the amount due under the note was $44,863.46. Miriam failed 

to cure the default within 30 days of the date of the notice of default, and the Bank, thereafter, 

accelerated all amounts due and owing under the note and demanded payment in full. As of 

September 26, 2018, the accelerated amount due on the note was $418,919.78. Interest, costs, 

late fees, advances, and attorney fees continued to accrue.

¶ 10 Miriam, pro se, filed a motion to dismiss based on res judicata. The Bank responded, 

arguing that res judicata did not apply because its complaint was a new cause of action in that 

it alleged a new default date. The trial court denied Miriam’s motion to dismiss.

¶ 11 In April 2019, Miriam filed her answer to the Bank’s complaint, again arguing that the 

complaint was barred by res judicata. Miriam also disagreed that she was in default under the 

note and the mortgage for failure to pay principal and interest because there was no amount 

due under the note as of December 7, 2016. Miriam noted that in the first foreclosure case, in 

2016, the trial court found that the Bank failed to prove any amounts owed, and she contended 

that it cannot now claim these same amounts owed. Miriam did not address the Bank’s 

allegation that Miriam was in default for failure to pay property taxes due June 4, 2018.

¶ 12 In May 2019, the Bank filed a motion for summary judgment, arguing that the first case 

did not impact this case because Miriam’s failure to make installment payments for July and 

August 2018 are new defaults.

¶ 13 Miriam filed a response to the Bank’s motion, and the Bank filed a reply. Thereafter, 

counsel filed an appearance and an amended response on Miriam’s behalf. The Bank filed an 

amended reply.

¶ 14 On August 15, 2019, the trial court heard the arguments on the Bank’s motion for summary 

judgment and took the matter under advisement.

¶ 15 On September 20, 2019, Miriam moved for leave to file a supplement to her amended 

response. The Bank filed a response. The court heard arguments on Miriam’s motion for leave 

and took the matter under advisement with the Bank’s motion for summary judgment.

¶ 16 On October 10, 2019, in a written order, the trial court granted the Bank summary 

judgment, stating,

“In summary analysis, the Court agrees with the [Bank] with regard to both 

motions.

The Motion for Leave concerns a case argued on appeal, involving malpractice 

claims against previous counsel for the [Bank]. Other than referencing the proceedings 

before the other judges of this Circuit, that case has little else to do with the proceedings 

here. As such, the Motion for Leave should be denied.

The Motion for Summary Judgment is properly brought. Following the briefing, 

and with the arguments of the parties, the Court finds there is no genuine issue of fact 

or law with regard to the allegations against [Miriam]. As such, judgment in summary 

fashion should enter against her. 
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Accordingly, [the Bank’s attorney] is requested to submit the draft of an Order for 

summary judgment in accordance with the findings of this Court.” (Emphasis in 

original.)

¶ 17 On October 15, 2019, the court entered a judgment of foreclosure and sale of the property. 

The Bank filed its certificate of service of the notice of a January 16, 2020, sheriff’s foreclosure 

sale of the property. A certificate of sale for the property was filed, indicating that the sale took 

place, as scheduled, on January 16, 2020. The Bank filed a motion to confirm the sheriff’s sale 

and award possession. On January 30, 2020, the trial court entered an order approving the 

report of sale and distribution, confirming the sale, entering an in rem deficiency judgment, 

and awarding possession. The same day, Miriam filed a notice of appeal. The following day, 

Miriam filed a motion to stay enforcement of the court’s order awarding possession, pending 

appeal. On February 10, 2020, the court granted Miriam’s motion.

¶ 18 At the outset of the appeal, we note that Miriam requests that we strike certain statements 

contained in the Bank’s brief for being inaccurate. Although we decline to strike any portion 

of the brief, we will nonetheless disregard any inaccurate statements.

¶ 19 II. ANALYSIS

¶ 20 A. Standard of Review

¶ 21 Summary judgment is appropriate where the pleadings, depositions, and admissions on 

file, together with the affidavits, if any, show that there is no genuine issue as to any material 

fact and that the moving party is entitled to judgment as a matter of law. 735 ILCS 5/2-1005(c) 

(West 2018). While a plaintiff need not prove her case to survive a motion for summary 

judgment, she must present a factual basis arguably entitling her to judgment in her favor. 

Bruns v. City of Centralia, 2014 IL 116998, ¶ 12. We review de novo the propriety of a trial 

court’s grant of summary judgment. JPMorgan Chase Bank, N.A. v. Earth Foods, Inc., 238 Ill. 

2d 455, 461 (2010). Also, whether an action is barred by res judicata is a question of law, 

which this court reviews de novo. A&R Janitorial v. Pepper Construction Co., 2018 IL 123220, 

¶ 16.

¶ 22 B. Res Judicata

¶ 23 The central issue is whether res judicata prohibits this lawsuit. “Res judicata is a judicially 

created doctrine resulting from the practical necessity that there be an end to litigation and that 

controversies once decided on their merits shall remain in repose.” Village of Bartonville v. 

Lopez, 2017 IL 120643, ¶ 49. Under the doctrine of res judicata, “a final judgment on the 

merits rendered by a court of competent jurisdiction bars a subsequent action between the same 

parties or their privies involving the same cause of action.” Richter v. Prairie Farms Dairy, 

Inc., 2016 IL 119518, ¶ 21. The bar extends not only to what was decided in the first action 

but also includes those matters that could have been decided in the initial action. Lopez, 2017 

IL 120643, ¶ 49.

¶ 24 For res judicata to apply, three requirements must be met: “(1) a final judgment on the 

merits rendered by a court of competent jurisdiction; (2) identity of cause of action; and 

(3) identity of parties or their privies.” Wilson v. Edwards Hospital, 2012 IL 112898, ¶ 9. The 

party invoking the doctrine bears the burden of showing its applicability. Hayashi v. Illinois 

Department of Financial & Professional Regulation, 2014 IL 116023, ¶ 45.
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¶ 25 Here, as the parties acknowledge, the dispute centers on whether the second requirement, 

identity of cause of action, was met. Illinois law uses the “transactional test” to determine 

whether two causes of action are identical for res judicata purposes. River Park, Inc. v. City of 

Highland Park, 184 Ill. 2d 290, 310-11 (1998). The transactional test considers whether the 

claims arise from a common core of operative facts. Id. at 311. This depends in turn on a 

pragmatic consideration of whether the facts are related in time, space, origin, or motivation 

and form a convenient trial unit. Id. at 311-12.

“The rule in Illinois is that res judicata extends only to the facts and conditions as they 

were at the time a judgment was rendered. When new facts or conditions intervene 

before a second action, establishing a new basis for the claims and defenses of the 

parties respectfully, the issues are no longer the same, and the former judgment cannot 

be pleaded as a bar in a subsequent action.” (Emphasis added and internal quotation 

marks omitted.) Hayashi, 2014 IL 116023, ¶ 46.

¶ 26 The transactional test is also used to determine if claims are the same for purposes of the 

single-refiling rule under section 13-217 of the Code of Civil Procedure (735 ILCS 5/13-217 

(West 1994)).2 The single refiling rule permits one, and only one, refiling of a claim. First 

Midwest Bank v. Cobo, 2018 IL 123038, ¶ 17.

¶ 27 Initially, we note that the parties cite conflicting cases from our sister states. However, 

these cases are not binding here and are not persuasive to the extent that they conflict with 

established Illinois law. See AAA Disposal Systems, Inc. v. Aetna Casualty & Surety Co., 355 

Ill. App. 3d 275, 284 (2005).

¶ 28 We first address Miriam’s argument that the claim at issue here is based on the same set of 

operative facts as the Bank’s two prior claims because the Bank accelerated the note. Miriam 

contends that she defaulted only once—November 2009—after which the Bank accelerated 

the note and made the entire principal amount due. Miriam asserts that she never made another 

payment on the loan after her default in November 2009 and that the loan was never reinstated 

or modified.

¶ 29 The Bank counters that this claim is not based on the same set of operative facts as its first 

two claims because this claim alleges different default dates that occurred after the two prior 

suits were resolved on the merits in Miriam’s favor. Because Miriam prevailed in the two prior 

suits, she had a continuing contractual obligation to the Bank to make monthly installment 

payments under the note, and her failure to do such resulted in a new default.3 We agree with 

the Bank.

2

The currently effective version of section 13-217 is the one codified in the Illinois Compiled 

Statutes of 1994: that version precedes the amendments to the Code by Public Act 89-7 (eff. Mar. 9, 

1995), an act that our supreme court found unconstitutional in its entirety. E.g., C. Szabo Contracting, 

Inc. v. Lorig Construction Co., 2014 IL App (2d) 131328, ¶ 43 & n.4.

3

The Bank, in its surreply brief, argues a second basis for affirming summary judgment: a second 

new default—Miriam’s failure to pay property taxes due in June 2018. While this second new default 

was alleged in the Bank’s complaint in this case, the Bank did not raise this issue in its motion for 

summary judgment, and the Bank cites nothing in the record that establishes Miriam’s failure to pay 

property taxes due in June 2018. Thus, it is not a proper basis for summary judgment. Miriam did not 

address this issue because the Bank raised it for the first time in its surreply brief. Accordingly, the 

argument is forfeited.
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¶ 30 “Generally, *** where a money obligation is payable in installments, a separate cause of 

action arises on each installment.” Brown v. Charlestowne Group, Ltd., 221 Ill. App. 3d 44, 46 

(1991). In Brown, we held that res judicata did not bar a second cause of action to recover 

payments the defendant failed to make on an installment contract that came due after the 

judgment for the plaintiff in the first action. Id. We reasoned, “[a]n action for installments due 

on a contract will not bar a later action to collect installments which subsequently [come] due.” 

Id.

¶ 31 Similarly, we recently stated in Wilmington Savings Fund Society, FSB v. Barrera, 2020 

IL App (2d) 190883, ¶ 19, “res judicata does not bar suits for defaults on installment payments 

whose due dates occur after the filings of the prior complaints.” In Wilmington, the plaintiff’s 

predecessor in interest, Wells Fargo, filed two complaints—in 2012 and 2014—against the 

defendant, alleging default “ ‘for the monthly payments for September 2011 through the 

present’ ” and seeking a judgment of foreclosure, the balance due on the note and the mortgage, 

and a deficiency judgment. Id. ¶ 6. The court dismissed the 2012 complaint without prejudice. 

Id. Wells Fargo voluntarily dismissed its 2014 complaint. Id. In October 2017, the plaintiff, as 

Wells Fargo’s successor in interest, filed a third complaint, alleging that the defendant 

defaulted on the note by failing to make installment payments of principal and interest due on 

June 1, 2012. Id. The court dismissed this third complaint, ruling that it was barred because the 

default dates alleged in the third complaint were at issue in the two earlier complaints. Id. In 

2018, the plaintiff brought a fourth complaint against the defendant, seeking foreclosure and 

alleging defaults for failure to (1) reimburse the plaintiff for payments it made for insurance 

on the property, (2) reimburse the plaintiff for property taxes it paid on the property, (3) pay 

for insurance on the property directly, and (4) pay the property taxes on the property directly. 

Id. ¶ 3. The defendant moved to dismiss, arguing that the plaintiff’s fourth complaint was 

barred by the single-refiling rule. Id. ¶ 6. The trial court dismissed the fourth complaint because 

it arose “ ‘from the same single group of operative facts’ ” as the three prior lawsuits. Id. ¶ 8. 

The court also denied the plaintiff’s motion for leave to file an amended complaint. Id. ¶ 9.

¶ 32 Applying the transactional test derived from res judicata cases (id. ¶ 17), we held that the 

plaintiff’s fourth foreclosure action was not barred by the prior actions because the defendant’s 

“alleged new failures to pay taxes and insurance are new defaults” (emphasis omitted) (id.

¶ 14). We reasoned, “res judicata does not bar suits for defaults on installment payments whose 

due dates occur after the filings of the prior complaints.” Id. ¶ 19. This “new-default rule,” a 

“specific instance of the transactional test,” is necessary to provide remedies for contracts that 

require performance over a number of years. Id. ¶¶ 19-21. Thus, we determined that the 

defendant’s new defaults were not part of the core of operative facts that formed the bases of 

the prior complaints because the defendant “allegedly continued to default on her obligation to 

make tax and insurance payments after those complaints were dismissed.” Id. ¶ 14.

¶ 33 Applying the reasoning in Wilmington here, we determine that res judicata does not apply 

in the circumstances presented by the Bank because the facts, conditions, and issues involved 

in the first two cases were different from those in this case. The current action does not arise 

from the same set of operative facts as the first two actions. In the first two complaints, filed 

in 2009 and 2017, the Bank alleged that Miriam was in default on the note and the mortgage 

for failure to pay monthly installments for November 2009. These facts were entirely unrelated 

to the facts underlying the current action based on Miriam’s default for failure to pay 

installment payments owed in July and August 2018. In the first two cases, the Bank could not 
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have alleged that Miriam had defaulted in August 2018 because those events had not yet 

occurred. Indeed, the Bank could not have raised the instant claim, based on Miriam’s most 

recent failures to pay the installment payments, in its earlier complaints because potential 

future defaults are generally not justiciable. Id. ¶ 21. Because this action and the prior actions 

were not predicated on a single group of operative facts, the doctrine of res judicata did not 

bar the Bank’s foreclosure action at issue.

¶ 34 Miriam argues that the claim at issue is based on the same set of operative facts as the 

Bank’s two prior claims because the Bank accelerated the note. Miriam cites Deutsche Bank 

Trust Co. Americas v. Sigler, 2020 IL App (1st) 191006, to support her argument.

¶ 35 In Sigler, the bank brought a fourth foreclosure action against the same mortgagors after 

the first three actions were voluntarily dismissed. Id. ¶¶ 7-19. The trial court dismissed the 

fourth complaint, finding that the second, third, and fourth complaints all arose out of the same 

operative set of facts and that, therefore, the fourth complaint violated the single-refiling rule. 

Id. ¶ 26. The first complaint was brought by a different plaintiff. Id. ¶ 53. On appeal, the 

appellate court affirmed, holding that the fourth complaint arose from the same set of operative 

facts as the second and third claims because the bank accelerated the note. The court reasoned 

that “the contract became indivisible, and the obligations to pay each installment merged into 

one obligation to pay the entire balance on the note.” Id. However, important to this case, the 

court stated:

“When a mortgagor prevails in a foreclosure action by demonstrating that she was not 

in default on the payments alleged to be in default, or by a dismissal with prejudice, the 

result is to place the mortgagor and mortgagee back in the same contractual relationship 

with the same continuing obligations. As a result, a subsequent default by the 

mortgagor would result in a separate cause of action.” (Emphasis added.) Id. ¶ 54.

¶ 36 While it is not entirely clear how Sigler adjudicated the status of the acceleration clause for 

future proceedings, we need not reach this question here. Sigler determined that a new default 

was not a part of the operative facts where the bank had given notice of the acceleration of the 

loan in the prior nonsuited action. Id. ¶ 53. It further suggests a different conclusion where the 

mortgagor, upon trial, prevails on the claim for reasons not related to the validity of the note 

and/or the mortgage in the earlier foreclosure action. Id. ¶ 54. As Sigler correctly observes, 

where the mortgagor prevails in a foreclosure action, the notice of the acceleration is 

effectively ruled upon and denied, and the mortgage is reinstated. Id. Indeed, the reinstatement 

does not relate to the contract, per se, but to the mortgagor’s good standing with regard to 

compliance with the terms of the contract.

¶ 37 Here, Miriam prevailed in the first action, and the second action was dismissed with 

prejudice. Thus, Miriam and the Bank remained in the same status that they were in prior to 

the litigation, with the same contractual relationship and the same continuing obligations. See

id. It follows that when Miriam subsequently defaulted in July and August 2018, this new 

default constituted the basis for a new cause of action. See id.

¶ 38 Moreover, even if we were to determine that an identity of causes of action exists in this 

case and the two prior causes of action and that the threshold requirements of res judicata were 

therefore met, it is well settled that res judicata is an equitable doctrine that should be applied 

only as fairness and justice require. Murneigh v. Gainer, 177 Ill. 2d 287, 299 (1997). Equity 

dictates that the doctrine of res judicata should not be technically applied if to do so would be 

fundamentally unfair or would create inequitable or unjust results. Nowak v. St. Rita High 
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School, 197 Ill. 2d 381, 390 (2001). It is intended to be used as a shield, not a sword. Federal 

Signal Corp. v. SLC Technologies, Inc., 318 Ill. App. 3d 1101, 1116 (2001). “ ‘Although it is 

recommended that the doctrine receive a liberal construction and should be applied without 

technical restrictions, it has also been recommended that the doctrine should not be applied so 

rigidly as to defeat the ends of justice. [Citation.]’ ” Id. (quoting Thornton v. Williams, 89 Ill. 

App. 3d 544, 546 (1980)).

¶ 39 To apply res judicata here and grant Miriam the relief she seeks would be fundamentally 

unfair. Miriam urges us to reverse the court’s order of summary judgment in the Bank’s favor 

and enter judgment in her favor. This would reward Miriam for disregarding the note and the 

mortgage she signed and then failed to pay on for almost nine years. The Bank, reasonably 

expecting compliance with the mortgage and the note, would be left with nothing, and Miriam 

would retain the property that secured the repayment of the loan that enabled her to obtain said 

property. Because this would be fundamentally unfair and unjust, we would decline to apply 

res judicata here even were its applicability apparent.

¶ 40 Miriam also urges us to vacate the trial court’s order granting the Bank summary judgment 

and to remand the case for further proceedings, arguing that a genuine issue of material fact 

exists as to when she defaulted on the loan by failing to pay monthly installments of principal 

and interest. We disagree.

¶ 41 In Miriam’s affidavit attached to her response to the Bank’s motion for summary judgment, 

she attested that she made no “payments to the [Bank] since the default” alleged in the first 

action—failure to pay principal, interest, and late fees, in November 2009. As stated earlier, 

Miriam prevailed in the first foreclosure action, and the Bank’s second foreclosure action was 

dismissed with prejudice. Thus, Miriam and the Bank remained in the same contractual 

relationship with the same continuing obligations. See Sigler, 2020 IL App (1st) 191006, ¶ 54. 

As such, Miriam had a continuing obligation to pay each monthly installment payment of 

principal and interest as required by the note and secured by the mortgage. Miriam’s affidavit 

leaves no doubt that she failed to make installment payments in July and August 2018, and 

therefore, the affidavit established a new default. Thus, there is no genuine issue of material 

fact, and the Bank is entitled to judgment as a matter of law. Accordingly, the trial court 

properly granted the Bank summary judgment.

¶ 42 For the foregoing reasons, the judgment of the trial court is affirmed.

¶ 43 III. CONCLUSION

¶ 44 The judgment of the circuit court of McHenry County is affirmed, and the stay of the 

court’s order awarding possession is vacated.

¶ 45 Affirmed.