See Fed. R. Civ. P. 56(c); Perdomo v, Browner, 67 F.3d 140, 144 (7thCir.1995). “In the light most
favorable” simply means that summary judgment is not appropriate if the court must make “a choice
of inferences.” See United States v. Diebold, Inc,, 369 U.S. 654, 655 (1962); First Nat’]. Bank of
Arizona v. Cities Service Co., 391 U.S. 253, 280 (1968); Wolf v. Buss (America) Inc., 77 F.3d 914,
922 (7th Cir. 1996). The choice between reasonable inferences from facts is a jury function. See
Anderson v, Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). The court has one task and one task
only: to decide, based on the evidence of record, whether there is any material dispute of fact that
requires a trial, Waldridge v. Amercian Hoechst Corp., 24 F.3d 918, 920 (7th Cir. 1994) (citing
Anderson, 477 U.S. at 249-50; 10 Charles A. Wright, Arthur R. Miller & Mary K. Kane, Federal
Practice and Procedure: Civil § 2712, at 574-78 (2d ed. 1983)). Not all factual disputes warrant the
denial of summary judgment; only disputes as to facts material to the substantive claim require
resolution by trial. Smith v. City of Chicago, 242 F.3d 737, 744 (7th Cir. 2001) (citing Anderson,
477 US, at 247-248).
B. The Mortgage, Note, and Illinois State Law Provide for The Collection of Late Charges
The Rizzos argue that late charges that are tied to overdue monthly payments cannot be
collected with respect to the period after acceleration and before reinstatement. The Rizzos
argument is based on the conclusion that “once the mortgage debt was accelerated, the borrowers’
right and obligation to make monthly installments ceased and all sums became immediately due and
payable.” (Pl. Resp. to Def.’s Mot for Partial Summ. J., pg. 5.) Pierce argues when the Rizzos’
chose to reinstate their Mortgage, they were required to tender all past due monthly payments,

interest, as well as all late fees and expenses required under their Mortgage and Note. The terms of



The Court also rejects Rizzos’ conclusory allegation in paragraph 18 of the complaint that
Pierce has made admissions that it knew that the conduct in question violated the FDCPA. In
support of this assertion, the Rizzos’ compliant attaches copies of Pierce’s newsletters that were
posted on its website. However, these newsletters have no such implication, but discuss the status
of some consumer litigation which has been filed to challenge certain late charges under certain
circumstances. One of the newsletters discusses the scenarios in which late fees could be charged:

The firm of Pierce & Associates, as well as a number of other USFN
members have reviewed the issue of collecting late charges on loans
that pay off after the loan has been accelerated. It seems to be the
opinion of most and of our firm that to do so opens up the lender and
the law firrn to potential class action lawsuits. The reasoning behind
this issue is that if the loan has been accelerated, and the entire loan
is due, there are no longer monthly payments due and therefore there
are no monthly payments due and consequently late charges are not
due. This reasoning does not apply to loans that reinstate because
when a loan reinstates the loan is no longer accelerated and monthly
payments become due again.

(See Compl., Ex. C.) This last sentence of the above paragraph specifically supports Pierce’s

argument that fees and charges may be collected for loans that reinstate,



(C) Default

If I do not pay the overdue amount by the date stated in the notice
described in (B) above, I will be in default. If I am in default, the
Note Holder may require me to pay immediately the full amount of
the principal which has not been paid and all the interest that I owe on
that amount. Even if, at the time when I am in default, the Note
Holder does not require me to pay immediately in full as described
above, the Note Holder will still have the right to do so if I am in
default at a later time.

(Def.’s Mot. for Summ. J., Ex. A.) Lastly, the Mortgage provides that the Rizzos were required to
cure all of the amounts due under their loan, as if the acceleration had never occurred, in order to
reinstate. Specifically, the Mortgage states:

18 Borrower’s Right to Reinstate. Notwithstanding lender’s
acceleration of the sum secured by this mortgage due to borrower’s
breach, borrower shall have the right to have any proceedings begun
by lender to enforce this mortgage discontinued at any time prior to
entry of a judgment enforcing this mortgage if: (a) borrower pays
lender all sums which would be then due under the mortgage and the
note had no acceleration occurred; (b) borrower cures all breaches of
any other covenants or agreements of borrower contained in this
mortgage; (c) borrower pays all reasonable expenses incurred by
lender in enforcing the covenants and agreements of borrower
contained in this mortgage and in enforcing lender’s remedies as
provided in paragraph 17 hereof, but not limited to, reasonable
attorney’s fees... .

(Def.’s Mot. for Summ. J., Ex. A.)

The Mortgage and Note specifically provide for late charges for failure to timely pay the
monthly installments. More significantly, the Mortgage and Note provide for fees and charges after
acceleration of the Mortgage if reinstatement is sought. As a general rule, “interpretation of an
unambiguous contract is a question of law.” Bechtold v. Physicians Health Plan of N. Ind., Inc., 19

F.3d 322, 325 (7th Cir. 1994) (citing Ryan v. Chromalloy Am. Corp., 877 F.2d 598, 602 (7th Cir.



the Mortgage and Note were fully set forth and thus lawfully provide for the demand and receipt of
payment for such amounts. The court finds the argument of Pierce persuasive.

Under Section 5/15-1602 of the Illinois Mortgage Foreclosure Act, mortgagors may reinstate
their mortgage within 90 days of the date they have been served or have otherwise submitted to the
jurisdiction of the court:

In any foreclosure of a mortgage executed after July 21, 1959, which
has become due prior to the maturity date fixed in the mortgage, or in
any instrument or obligation secured by the mortgage, through
acceleration because of default under the mortgage, a mortgagor may
reinstate the mortgage as provided herein. Reinstatement is effected
by curing all defaults then existing, other than payment of such
portion of the principal which would not have been due had no
acceleration occurred and by paying all costs and expenses required
by the mortgage to be paid in the event of such defaults, provided that
such cure and payment are made prior to the expiration of 90 days
from the date the mortgagor or, if more than one, all the mortgagors
(i) have been served with summons or by publication or (ii) have
otherwise submitted to the jurisdiction of the court.

735 ILCS § 5/15-1602 (emphasis added). A review of the Mortgage and Note establish the terms
and conditions, as well as provide for the consequences in the event of failure to meet these
obligations. The Note states:

(A) Late Charge For Overdue Payments

If the Note Holder has not received the full amount of any of my
monthly payments by the end of fifteen calendar days after the date
it is due, I will pay a late charge to the Note Holder. The amount of
the charge will be 5.0% of my overdue payment, but not less than
U.S. $N/A and not more than U.S. $N/A. I will pay this late charge
only once on any late payment.

Prd



provided for in the Mortgage and the Note. Again, the Court finds the argument of Pierce
persuasive.

The FDCPA prohibits debt collectors from using “any false, deceptive, or misleading
representation or means in connection with the collection of any debt.” 15 U.S.C. § 1692(e). The
FDCPA also prohibits any “unfair or unconscionable means to collect or attempt to collect any debt.”
15 U.S.C. § 1692f(1). This includes the “collection of any amount (including any interest, fee,
charge, or expense incidental to the principal obligation) unless such amount is expressly authorized
by the agreement creating the debt or permitted by law.” Id.

Initially, the Rizzos fail to point to any specific violation of the FDCPA by Pierce. Rather,
the Rizzos make a general conclusory argument that Pierce violated the FDCPA. It is the Rizzos
burden to present these issues clearly and to support them with appropriately authority. Doherty v.
City of Chicago, 75 F.3d 318, 329 (7th Cir. 1996) (noting that it is up to the parties, not the court,
to construct the arguments); see also United States v. Jones, 224 F.3d 621, 626 (7th Cir. 2000)
(noting that an undeveloped argument speaks to its paucity, and refusing to consider the argument).
Pierce did not attempt to collect on an unlawful or unauthorized amount and did not use any unfair
or unconscionable means, nor did they make any false, deceptive, or misleading representations in
the foreclosure proceedings. The Mortgage and Note specifically provided that in order to reinstate
the Mortgage, the Rizzos were required to pay all fees and charges incurred, including post-
acceleration fees and charges. The Rizzos cannot claim a violation of the FDCPA when they
specifically contracted for payment of fees and charges in connection with late payments and default,

including post-acceleration.



¥
~

e
Min ste Oder Form (06/97)

United States District Court, Northern District of Illinois

Name of Assigned Judge
or Magistrate Judge

Charles R. Norgle, Sr.

Sitting Judge if Other
than Assigned Judge

CASE NUMBER 02 C 1992 DATE 11/6/2002
CASE Michael and Louise Rizzo vs. Pierce & Associates, P.C.
TITLE
[In the following box (a) indicate the party filing the motion, ¢.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature

MOTION: of the motion being presented.}

DOCKET ENTRY:

qa) ia} Filed motion of [ use listing in “Motion” box above.]

(2) a Brief in support of motion due

GB) a Answer brief to motion due, . Reply to answer brief due

(4) a Ruling/Hearing on __ set for at

(5) Oo Status hearing[held/continued to] [set for/re-set for} on set for at

(6) a Pretrial conference[held/continued to] [set for/re-set for] on set for at +

(o) oO Trial[set for/re-set for] on at

(8) ia} [Bench/Jury trial] [Hearing] held/continued to at

(9) o This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to}

OOFRCP4(m) ClLocal Rule 41.1 COFRCP4I(aX(1) CI FRCP41(a}(2).

(10) Ml [Otherdocketentry] Before the Court is the Defendant’s motion for partial summary judgment [18-
1], as well as Plaintiff's cross-motion for summary judgment [27-1]. The Court grants Defendant’s
motion for partial summary judgment [18-1]. The Court denies Plaintiff's cross-motion for summary
judgment [27-1]. , eogt

(i) ff [For further detail see order attached to the original minute order.]

No notices required, advised in open court.

No notices required.

Notices mailed by judge's staff.

Notified counsel by telephone.

NOV,.0.2.2002

Vs)

date mailed notice

X_ | Docketing to mail notices.

Mail AO 450 form.

Copy to judge/magistrate judge.

aiyisia’s'n
yuneo sod

courtroom
deputy’s
initials

pzth Hd 9- AON 20
ductig Gada NS

cruiling deputy iniials



III. CONCLUSION

It is undisputed that the Rizzos did not make certain monthly payments and incurred fees and
charges. It is also undisputed that the Mortgage and the Note provide for the imposition of fees and
charges where the Rizzos failed to make timely monthly installments. The Illinois Mortgage
Foreclosure Act specifically provides, in order to properly reinstate a mortgage, a lender can require
the payment of fees and charges if provided for in the subject mortgage and note. The Rizzos agreed
to both the Mortgage and the Note when they contracted to obtain a mortgage, and thus agreed to
fees and charges for late payments or default, even post-acceleration.

For the reasons set forth above, Defendant is entitled to partial summary judgment as a matter

of law.
IT IS SO ORDERED
ENTER:
Lyell.
CHARLES RONALD NORGLE, Judge
United States District Court
DATED:

10



1989)). “If the language of the contract unambiguously provides an answer to the question at hand,
the inquiry is over.” LaSalle Nat’! Bank v. Service Merchandise Co., 827 F.2d 74, 78 (7th Cir.
1987). A fundamental principle of contract interpretation that courts read language to make business
sense whenever possible. See Beanstalk Group, Inc, v. AM General Corp., 283 F.3d 856, 860-862
(7th Cir. 2002). It is undisputed that the Rizzos did not make certain monthly payments. Asa result
of their failure to make these monthly payments, fees and charges were incurred pursuant to the
Mortgage and Note and foreclosure was sought. To avoid foreclosure, the Rizzos reinstated the
Mortgage. In order to properly reinstate the Mortgage, the Rizzos were required to pay all fees and
charges accrued pre and post-acceleration.

More significantly, Illinois law allows for the imposition of fees and charges post-
acceleration. Section 5/15-1602 of the Illinois Mortgage Foreclosure Act states that reinstatement
is affected “by paying all costs and expenses required by the mortgage to be paid in event of such
defaults.” 735 ILCS § 5/15-1602. It is self-evident that the Illinois Mortgage Foreclosure Act
allows for the assessment of late fees and charges even after acceleration. See Crown Life Insurance
Co. vy. American National Band and Trust Co. of Chicago, No. 96 C 917, 1996 WL 4323299, at *3
(N.D. Ill. July 29, 1996); Moore v. Lomas Mortgage, USA Inc, 814 F.Supp. 741, 743-744 (N.D. Ill.
1993). Here, in seeking reimbursement for the fees and charges accrued, Pierce, sought an amount
it was legally entilted to request under Illinois law as well as the Mortgage agreement, namely the
missed monthly payments and the related contractual expenses.

C. No False or Misleading Acts Were Committed in Violation of the FDCPA
The Rizzos argue that Pierce violated the FDCPA by attempting to collect post-acceleration

late charges. Pierce counters it did not violate the FDCPA because the fees and charges were



II. DISCUSSION

A. Standards for Summary Judgment

Summary judgment is permissible when "there is no genuine issue as to any material fact and
... the moving party is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c). The
nonmoving party cannot rest on the pleadings alone, but must identify specific facts, see Cornfield
vy. Consolidated High School District No, 230, 991 F.2d 1316, 1320 (7th Cir. 1993), that raise more
than a mere scintilla of evidence to show a genuine triable issue of material fact. See Murphy v. ITT
Technical Services, Inc., 176 F.3d 934, 936 (7th Cir. 1999); see also Shank v. William R. Hague,
Inc., 192 F.3d 675, 682 (7th Cir. 1999) (stating that a party opposing summary judgment must
present “what evidence it has that would convince a trier of fact to accept its version of events”).
A defendant is entitled to put the plaintiff to his proofs and demand a showing of the evidence. See
e.g, Navarro v. Fuji Heavy Industries. Ltd., 117 F.3d 1027, 1030 (7thCir. 1997). Ifthe plaintiff fails
to come up with the required proof, the defendant is entitled to summary judgment. See id. It bears
repeating that the plaintiff must present evidence, rather than speculation and conclusions without
factual support. See Rand v. CF Industries, Inc., 42 F.3d 1139, 1146-47 (7th Cir, 1994). Cases
involving contract interpretation are “particularly suited to disposition by summary judgment.”
United States v. 4500 Audek Model No. 5601 AM/FM Clock Radios, 220 F.3d 539, 542 (7th Cir.
2000).

In deciding a motion for summary judgment, the court can only consider evidence that would
be admissible at. trial under the Federal Rules of Evidence. See Bombard v. Fort Wayne
Newspapers, Inc., 92 F.3d 560, 562 (7th Cir. 1996). The court views the record and all reasonable

inferences drawn therefrom in the light most favorable to the party opposing summary judgment.



by the end of fifteen (15) days after the date it was due they would pay a late charge to the Note
holder in the amount of 5% of the overdue payment.

Starting in or about July 2000, the Rizzos failed to make their monthly mortgage payments,
and missed their next three monthly payments. On November 3, 2000 Defendant, Pierce &
Associates (“Pierce”), acting on behalf of Decision One Mortgage Company, filed a mortgage
foreclosure action on the Rizzos’ mortgage in DuPage County. On May 30, 2001, a judgment was
entered in the foreclosure case directing the sale of the property.

On January 22, 2002, the Rizzos exercised their right to reinstate the Mortgage. In doing so,
the Rizzos were required to cure all of the defaulted payments and late charges. Subsequently, on
January 22 and 25, 2002 the Rizzos tendered $12,000 to Fairbanks Capital to reinstate their
Mortgage. On January 28, 2002, the Rizzos moved to dismiss the foreclosure action based upon
fulfillment and payment of any default or late charges, as well as the eventually reinstatement of the
mortgage. On March 4, 2002 the DuPage Circuit Court entered an order dismissing the foreclosure
action due to the reinstatement of the subject mortgage.

Two weeks after the foreclosure was dismissed, on March 18, 2002, the Rizzos filed this
action. The Rizzos allege that Pierce violated the FDCPA in July of 2001 when it purportedly
attempted to collect what the Rizzos call unauthorized post-acceleration late charges. The Rizzos
contend that once the loan was accelerated, there are no monthly payments due unless and until the
loan is reinstated. The Rizzos also allege that Pierce knew that the post-acceleration late charges
were unauthorized.

Pierce has now moved for partial summary judgment. The motion is fully briefed and and

ripe for ruling.



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

MICHAEL RIZZO AND LOUISE
RIZZO,

Plaintiffs,

Case No. 02 C 1992
HONORABLE CHARLES R. NORGLE

)

)

)

)

)

v. )
)

PIERCE & ASSOCIATES, P.C., )
)
)

Defendant DOCKEVED
ORDER AND OPINION NOV 0 v4 2002

CHARLES R. NORGLE, District Judge:

Before the court is Defendant’s motion for partial summary judgment pursuant to Federal
Rule of Civil Procedure 56. For the following the reasons, Defendant’s motion is granted.

I. BACKGROUND!

This case is brought pursuant to the Fair Debt Collections Practices Act (“FDCPA”), 15
U.S.C. § 1692, et seq. On or about August 19, 1997 Plaintiffs, Michael and Louise Rizzo (“The
Rizzos”) entered into a second mortgage (“Mortgage”) with Decision One Mortgage Company to
borrow $46,850.00. The Mortgage was secured by the Rizzos’ home. “The Rizzos also signed a
promissory note (“Note”) making them personally liable for the repayment of the money.

Pursuant to the signed Mortgage and Note, the Rizzos agreed to pay the lender principal and

interest on the loan in monthly payments in the amount of $674.88. According to the Note, the

Rizzos agreed that if the Note holder did not receive the full amount of any of the monthly payments

' The court takes the facts from the parties Local Rule 56.1 statements and accompanying

briefs. Disputed facts are noted in the text.