Court Opinion

ID: 3146038
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:12:39.766049+00
Date Added: 2024-06-11T15:07:34.336465
License: Public Domain

ILLINOIS OFFICIAL REPORTS
                                        Appellate Court

          National City Mortgage v. Hillside Lumber, Inc., 2012 IL App (2d) 101292

Appellate Court            NATIONAL CITY MORTGAGE, Plaintiff and Counterdefendant-
Caption                    Appellee, v. HILLSIDE LUMBER, INC., Defendant and
                           Counterplaintiff-Appellant (Roman Jakimow, Elizabeth Jakimow,
                           National City Bank, Jaroslaw Prus, Prime City Construction, Inc., New
                           Stone Design, Inc., The Title Shop, L.L.C., and Top Quality Flooring,
                           Inc., Defendants).

District & No.             Second District
                           Docket No. 2-10-1292

Rule 23 Order filed        September 29, 2011
Rule 23 Order
withdrawn                  March 8, 2012
Opinion filed              March 8, 2012

Held                       In a mortgage foreclosure action where the mortgagee joined defendant
(Note: This syllabus       lumber company, which had a mechanic’s lien for the materials it
constitutes no part of     supplied for the improvements to the property, and both the mortgagee
the opinion of the court   and the lumber company filed cross-motions for summary judgment, the
but has been prepared      trial court properly entered summary judgment for the mortgagee, since
by the Reporter of         the mortgagee asserted that it never received notice of the mechanic’s lien
Decisions for the          and the lumber company had the burden of proving that the mortgagee
convenience of the         actually received notice, but it admitted it could not produce
reader.)
                           documentation that notice was even sent.

Decision Under             Appeal from the Circuit Court of Du Page County, No. 08-CH-3454; the
Review                     Hon. Robert G. Gibson, Judge, presiding.
Judgment                    Affirmed.

Counsel on                  Eric D. Kaplan and Christopher S. Wunder, both of Kaplan, Papadakis &
Appeal                      Gournis, P.C., of Chicago, for appellant.

                            Frank P. Andreano, of Brumund, Jacobs, Hammel, Davidson &
                            Andreano, LLC, of Joliet, for appellee.

Panel                       JUSTICE ZENOFF delivered the judgment of the court, with opinion.
                            Justices Bowman and Birkett concurred in the judgment and opinion.

                                              OPINION

¶1          Defendant Hillside Lumber, Inc. (Hillside), appeals from an order of the circuit court of
        Du Page County granting summary judgment against it and in favor of plaintiff, National
        City Mortgage. For the reasons that follow, we affirm.
¶2          On September 14, 2006, Roman and Elizabeth Jakimow gave plaintiff a mortgage on
        their property to secure a construction loan. The Jakimows defaulted, and plaintiff filed suit
        to foreclose its mortgage on September 8, 2008. Plaintiff joined Hillside as a defendant in
        the foreclosure suit because Hillside recorded a mechanic’s lien against the property on
        March 5, 2008. The lien recited that Hillside furnished $141,188.10 worth of materials to
        improve the property and that $65,821.93 was still owed. The lien was signed by Ewa
        Kulaga. There was no accompanying proof of mailing or service list. On December 19, 2008,
        Hillside filed a counterclaim to foreclose its mechanic’s lien.
¶3          Plaintiff and Hillside filed cross-motions for summary judgment. Plaintiff’s motion was
        based, in part, on Hillside’s failure to serve it with notice of the lien. Hillside filed Ewa
        Kulaga’s affidavit in which Kulaga, president of Hillside, averred that on March 5, 2008,
        Hillside sent the lien by certified mail, with return receipt requested and delivery limited to
        addressee only, to the owners of the property, the contractor, and plaintiff at its address in
        Miamisburg, Ohio. Plaintiff then filed a counteraffidavit in which its asset manager declared
        that plaintiff’s records did not disclose that plaintiff had received the lien. At the hearing on
        the cross-motions for summary judgment, Hillside admitted that it did not have either the
        white card evidencing a certified mailing with a tracking number, a copy of the envelope
        addressed to plaintiff, or a green card evidencing receipt of the lien by plaintiff. On
        November 15, 2010, the trial court granted plaintiff’s motion for summary judgment and
        denied Hillside’s cross-motion. The trial court granted a finding pursuant to Illinois Supreme
        Court Rule 304(a) (eff. Feb. 26, 2010), and this timely appeal followed.
¶4          Hillside contends that Kulaga’s affidavit creates a genuine issue of material fact sufficient

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     to defeat plaintiff’s motion for summary judgment and that the trial court misconstrued
     section 24 of the Mechanics Lien Act (Act) (770 ILCS 60/24 (West 2008)) when it ruled that
     Hillside had to prove plaintiff’s actual receipt of the lien. In order not to run afoul of the
     forfeiture rule, Hillside also raises issues with respect to the timeliness and priority of its lien.
     Because of our resolution of the notice issue, we will not address the remaining issues.
¶5        Summary judgment is appropriate when the pleadings, depositions, and admissions on
     file, together with any affidavits, 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. Falcon Funding, LLC
     v. City of Elgin, 399 Ill. App. 3d 142, 146 (2010). “The nonmovant need not prove his case
     at the summary judgment stage; he must, however, show a factual basis to support the
     elements of his claim.” Wilson v. Bell Fuels, Inc., 214 Ill. App. 3d 868, 872 (1991). Where
     the evidence before the court on summary judgment shows that a verdict would have to be
     directed at trial, summary judgment is proper. Wilson, 214 Ill. App. 3d at 872. We review de
     novo a ruling on summary judgment. Falcon, 399 Ill. App. 3d at 146.
¶6        The purpose of the Act is to protect contractors and subcontractors who provide labor and
     materials for the benefit of an owner’s property by permitting them a lien on the property.
     Parkway Bank & Trust Co. v. Meseljevic, 406 Ill. App. 3d 435, 446 (2010). Rights under the
     Act are in derogation of the common law, and the steps necessary to invoke those rights must
     be strictly construed. Parkway, 406 Ill. App. 3d at 446. “However, once the contractor or
     subcontractor has strictly complied with the requirements and the lien has properly attached,
     then the Act should be liberally construed to accomplish its remedial purpose.” Parkway, 406
Ill. App. 3d at 446.
¶7        Section 24(a) of the Act requires a lien claimant to send notice of the claim by registered
     or certified mail, with return receipt requested and delivery limited to addressee only, to the
     owner of record or his agent or architect, or to the superintendent having charge of the
     building or improvement, and to the lending agency, if known. 770 ILCS 60/24(a) (West
     2008); Cordeck Sales, Inc. v. Construction Systems, Inc., 382 Ill. App. 3d 334, 398 (2008).
     Section 24(a) in pertinent part provides:
          “Sub-contractors, or parties furnishing labor, materials, fixtures, apparatus, machinery,
          or services, may at any time after making his or her contract with the contractor, and shall
          within 90 days after the completion thereof, or, if extra or additional work or material is
          delivered thereafter, within 90 days after the date of completion of such extra or
          additional work or final delivery of such extra additional material, cause a written notice
          of his or her claim and the amount due or to become due thereunder, to be sent by
          registered or certified mail, with return receipt requested, and delivery limited to
          addressee only, to or personally served on the owner of record or his agent or architect,
          or the superintendent having charge of the building or improvement and to the lending
          agency, if known ***. For purposes of this Section, notice by registered or certified mail
          is considered served at the time of its mailing.” 770 ILCS 60/24(a) (West 2008).
¶8        Hillside first argues that plaintiff’s counteraffidavit alleged only that plaintiff did not
     have a record of having received the notice of lien, and the counteraffidavit at most created
     an inference that Hillside may not have complied with section 24(a). Hillside contends that

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       the trial court could not try the case on its merits at the summary judgment stage, but had to
       conclude that there was a genuine issue of material fact regarding Hillside’s compliance with
       notice because of the Kulaga affidavit. This issue cannot be addressed without first
       addressing Hillside’s argument that section 24(a) requires proof only that the notice was sent,
       not that it was received. If Hillside is incorrect in its construction of section 24(a), then the
       Kulaga affidavit does not create a genuine issue of material fact. Hillside maintains that the
       plain language of section 24(a) requires that the notice of lien be sent by certified or
       registered mail, with return receipt requested and delivery limited to addressee, and also
       provides that notice is considered served at the time of its mailing. Hillside argues that we
       cannot read any other conditions, such as delivery, into the statute.
¶9          Hillside relies on one case, People ex rel. Devine v. $30,700.00 United States Currency,
       199 Ill. 2d 142 (2002), which involved the notice provision in the Drug Asset Forfeiture
       Procedure Act (725 ILCS 150/1 et seq. (West 2000)). In Devine, the issue was whether the
       State had complied with the notice provision, which required the State to give notice either
       by personal service or by mailing a copy of the notice by certified mail, with return receipt
       requested, to the owner’s or interest-holder’s address. Devine, 199 Ill. 2d at 150. Our
       supreme court held that, in light of the express language contained in the notice provision,
       service of notice by mailing is perfected when the notice is deposited in the mail, provided
       the State complies with the mailing procedures set forth in the statute. Devine, 199 Ill. 2d at
       151. The court rejected the argument that notice would not be perfected unless and until the
       State received the return receipt. Devine, 199 Ill. 2d at 151. Hillside argues that the notice
       provision in the Drug Asset Forfeiture Procedure Act is analogous to section 24 of the Act,
       so that they must be construed the same way. What Hillside overlooks in the Devine analysis
       is that the record in that case contained the certified mailing receipt proving that the State
       actually mailed notice in compliance with the statute. Devine, 199 Ill. 2d at 153. Here,
       Hillside admitted that it had no documentation of any kind of mailing.
¶ 10        Devine is inapposite for another reason. Illinois courts have interpreted the strict
       requirements of notice under the Act by examining how effectively a party did in fact notify
       the other side, rather than simply basing rights solely on whether every phrase of the statute
       was followed in exact detail. Matthews Roofing Co. v. Community Bank & Trust of
       Edgewater, 194 Ill. App. 3d 200, 205 (1990). Defects in the notice are not a deprivation of
       notice where notice was actually received. Watson v. Auburn Iron Works, Inc., 23 Ill. App.
3d 265, 272-73 (1974). It is incumbent on a party to assert that it did not receive actual
       notice. J&B Steel Contractors, Inc. v. C. Iber & Sons, Inc., 246 Ill. App. 3d 523, 527 (1993).
       At the summary judgment stage of proceedings, it can be conclusively determined whether
       notice was received. J&B, 246 Ill. App. 3d at 527. Consequently, pursuant to J&B, once
       plaintiff asserted its lack of notice at the summary judgment stage, Hillside had to prove that
       plaintiff actually received notice. Hillside admitted that it could not produce documentation
       that it even sent notice, let alone documentation that notice was received. Consequently, the
       trial court did not err in granting summary judgment in plaintiff’s favor. Accordingly, the
       judgment of the circuit court of Du Page County is affirmed.

¶ 11       Affirmed.

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