Court Opinion

ID: 2759508
Source: CourtListenerOpinion
Date Created: 2014-12-10 23:03:55.951268+00
Date Added: 2024-06-11T11:26:11.777243
License: Public Domain

2014 IL App (1st) 132384
                                                 No. 1-13-2384
                                        Opinion filed December 10, 2014
                                                                                        Third Division

                                                   IN THE

                                   APPELLATE COURT OF ILLINOIS

                                              FIRST DISTRICT

     CHARLES AUSTIN, Ltd., an Illinois Corporation, )
                                                                 Appeal from the Circuit Court
                                                    )
                                                                 of Cook County.
           Plaintiff-Appellee,                      )
                                                    )
     v.                                             )
                                                                 No. 12 L 396
                                                    )
     A-1 FOOD SERVICES, INC., an Illinois           )
     Corporation, JIAN BIN ZHENG, HUA LIN, and      )
                                                                 The Honorable
     FOREVER GREEN FOOD GROUP, INC.,                )
                                                                 Margaret Brennan,
                                                    )
                                                                 Judge, presiding.
           Defendants-Appellants.                   )

            JUSTICE HYMAN delivered the judgment of the court, with opinion.
            Presiding Justice Pucinski and Justice Lavin concurred in the judgment and opinion.

                                                    OPINION

¶1          In the midst of litigation over a debt owed it plaintiff, Charles Austin Limited, defendant

     A-1 Food Services, Inc., sold all of its assets to Forever Green Food Group, Inc. Once Charles

     Austin learned of the transaction, it added Forever Green as a defendant to the ongoing lawsuit.

     Forever Green, however, did not appear or otherwise respond, and Charles Austin then secured

     entry of a default judgment against Forever Green in the amount of $186,688.72. Forever Green

     sought to vacate the judgment three months later, only after its bank account was frozen in a

     third-party citation proceeding.
     1-13-2384

¶2          Thereafter, Forever Green filed for relief from the judgment under section 2-1401 of the

     Illinois Code of Civil Procedure (735 ILCS 5/2-1401 (West 2012)), attacking the service on the

     grounds that its registered agent did not recollect receiving a copy of the summons or complaint

     from the Cook County sheriff. Forever Green further argued it (i) had a meritorious defense to

     the underlying lawsuit because, generally, a successor corporation is not liable for the debts of

     the transferor corporation, (ii) was diligent in defending itself in the original lawsuit, and (iii)

     was diligent in filing the section 2-1401 petition. The trial court denied Forever Green's section

     2-1401 petition, rejecting all of its arguments and determining that its affidavits were untruthful

     to the point of appearing "almost embarrassing."

¶3          We agree with the trial court that service on Forever Green was proper and that Forever

     Green failed to establish the elements necessary under section 2-1401. Accordingly, we affirm.

¶4                                           BACKGROUND

¶5          Plaintiff, Charles Austin Limited, an Illinois corporation, distributes food and food-

     related products. On August 26, 2005, Charles Austin entered into a business loan agreement

     with A-1 Food Services, Inc. Charles Austin agreed to provide A-1 Food with a credit line.

     Defendants Jian Bin Zheng and Hua Lin guaranteed the loan. The business loan agreement

     continued without incident until late 2011 when A-1 Food failed to pay invoices to Charles

     Austin. By the end of 2011, A-1 Food owed Charles Austin nearly $185,000.

¶6          In January 2012, Charles Austin filed a breach of contract complaint against A-1 Food,

     Zheng, and Lin. Although served, none of them appeared or responded to the complaint. After

     Charles Austin filed a written motion for default, the three defendants moved to vacate the

     defaults, which the trial court granted. At about this time, A-1 Food agreed to sell all of its assets

     to Forever Green. Philip Chow, an Illinois attorney and Forever Green's then-registered agent,

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       acted as attorney for Forever Green in the transaction. On May 7, 2012, Zheng, the president of

       A-1 Food, certified that A-1 had no creditors at the time of sale.

¶7            On May 10, 2012, A-1 Food, Zheng, and Lin answered the complaint. About three

       months later, Charles Austin issued a subpoena to Forever Green seeking documents pertaining

       to the sale of assets. Forever Green responded through an attorney from Indiana. During this

       time, Zheng and Lin filed for bankruptcy.

¶8            In October 2012, Charles Austin filed an amended complaint, naming Forever Green a

       defendant under a successor liability theory. Charles Austin alleged that Forever Green assumed

       A-1 Food’s liabilities under contract for the sale of assets and that the sale was a fraudulent

       transaction made to avoid A-1 Food's liabilities to Charles Austin. On October 29, 2012, the

       Cook County sheriff served Forever Green with a copy of the amended complaint and summons.

       The sheriff's affidavit of service stated that the sheriff served Chow as registered agent. Forever

       Green never appeared or responded to the amended complaint.

¶9            On January 10, 2013, Charles Austin orally moved for default and prove-up of damages

       against Forever Green. The trial court entered and continued the motion until February 22, 2013.

       On February 15, 2013, Charles Austin mailed to Chow a copy of the January 10 order, a notice

       of the motion for default judgment, and a copy of the written motion. Although the exact date is

       disputed, between January 10 and February 15, 2013, Forever Green changed its registered agent

       from Chow to Ke Y. Wang. On February 22, 2013, the trial court entered a default judgment

       against Forever Green.

¶ 10          Charles Austin began third-party citation proceedings to collect on the judgment and gave

       notice of the citation to Chow on May 9, 2013. Forever Green thereafter appeared and moved to

       vacate the default judgment under section 2-1401. 735 ILCS 5/2-1401 (West 2012). In its

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       motion, Forever Green argued: (1) justice and equity required vacating the default judgment, it

       had a meritorious defense, and met the diligence requirements; (2) Charles Austin gave notice of

       the default motion to Chow and not its registered agent, Wang, or its Indiana counsel; and (3)

       lack of personal jurisdiction. In support, Forever Green attached affidavits of Chow and Wang.

       Chow claimed "not [to] recall ever receiving a copy of the Amended Complaint" and if he had,

       he "would have notified Forever Green, or its counsel, and ensured that it timely appeared and

       filed a responsive pleading." Wang claimed that he replaced Chow as registered agent "on or

       about February 15, 2013," was never served with a copy of the amended complaint, and had no

       knowledge of Charles Austin's motion for default until Forever Green’s bank notified him that its

       account had been frozen.

¶ 11            The trial court denied Forever Green's motion to vacate the default judgment, concluding

       that service on Forever Green was proper. In doing so, the trial court rejected Forever Green's

       diligence arguments as well as its contention that it only became aware of the lawsuit from the

       citation proceedings. Finally, as to the two affidavits, the trial court noted that they "were almost

       embarrassing to be presented to the Court. These people are putting a spin on things that's not

       appropriate *** you have to remember that you have a responsibility to tell your client *** you

       have to be truthful with the Court, and this was not truthful."

¶ 12                                               ANALYSIS

¶ 13            On appeal, Forever Green asserts: (i) lack of personal jurisdiction; and (ii) error by the

       trial court in denying the motion to vacate the default judgment. 735 ILCS 5/2-1401 (West

       2012).

¶ 14                                           Personal Jurisdiction

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¶ 15          Without valid jurisdiction, a court cannot proceed or act over a case or its parties. BAC

       Home Loans Servicing, LP v. Mitchell, 2014 IL 116311, ¶ 17. An appellate court reviews issues

       of personal jurisdiction de novo. Id.

¶ 16          A party can serve a private corporation by leaving a copy of the summons and complaint

       with the registered agent or any officer or agent of the corporation found anywhere in the State.

       735 ILCS 5/2-204 (West 2012). An affidavit of service constitutes prima facie evidence of

       proper service. Paul v. Ware, 258 Ill. App. 3d 614, 617 (1994). Courts entertain every reasonable

       presumption in favor of the return of service. MB Financial Bank, N.A. v. Ted & Paul, LLC,

       2013 IL App (1st) 122077, ¶ 24. To attack a default judgment for lack of personal jurisdiction,

       the challenging party must produce evidence impeaching the return of service by clear and

       convincing evidence. Paul, 258 Ill. App. 3d at 617. An uncorroborated affidavit merely saying

       that the defendant had not been personally served is not enough to refute the return of service. Id.

¶ 17          Forever Green claims its registered agent never received the complaint and summons

       from Charles Austin. In his affidavit, Forever Green's then-registered agent, Chow, attempts to

       rebut the Cook County sheriff's return by claiming he did "not recall ever receiving a copy of the

       Amended Complaint," and if he had been served, he would have "notified Forever Green, or its

       counsel, and ensured that it timely appeared and filed a responsive pleading."

¶ 18          Chow's affidavit is woefully deficient. Neither decision on which Forever Green relies,

       Ellman v. De Ruiter, 412 Ill. 285 (1952), and Schnable v. Tuma, 351 Ill. App. 486 (1953),

       warrants a contrary result. In Ellman, the supreme court vacated a default judgment on the basis

       of the court's equitable powers to prevent an injustice—the plaintiff's attorney's representations

       misled the defendant on status, which caused the defendant to refrain from filing a timely motion

       to vacate. Ellman, 412 Ill. at 293-94. In Schnable, a case largely confined to its facts, the

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       defendant established no proper service of process through clear and convincing evidence.

       Schnable, 351 Ill. App. at 488-89, 491.

¶ 19          Forever Green's circumstances differ significantly from the facts in these cases. Unlike in

       Ellman, nothing in the record suggests that Charles Austin intended to or actually misled Forever

       Green or otherwise kept Forever Green in ignorance about the case's status. As the Ellman court

       explained, the plaintiff has no duty to notify the defendant of the default judgment unless the

       question arose. Ellman, 412 Ill. at 293. Forever Green contacted Charles Austin only after the

       beginning of third-party citation proceedings, nearly three months after the trial court's February

       22, 2013, entry of default judgment. And, unlike in Schnable, the only evidence Forever Green

       presented to impeach the return came from the Chow's and Wang's affidavits, which the trial

       court considered, at best, dubious. In the words of the trial court, "[t]hese affidavits [Chow's and

       Wang's] were almost embarrassing to be presented to the Court. These people are putting a spin

       on things that's not appropriate[.] *** [Y]ou have to remember that you have a responsibility to

       tell your client *** you have to be truthful with the Court, and this was not truthful." Even

       putting the trial judge's comments aside, Chow's assertion that he did "not recall ever receiving a

       copy of the Amended Complaint" offers nothing that approaches the kind of substantial and

       competent evidence necessary to impeach the return of service, as addressed in Pineschi v. Rock

       River Water Reclamation District, 346 Ill. App. 3d 719 (2004), a case quite similar to this one.

¶ 20          In Pineschi, a deputy sheriff served a copy of the complaint and summons on the

       defendant. Pineschi, 346 Ill. App. 3d at 721. The defendant failed to answer or appear. Id. The

       trial court awarded the plaintiff a default judgment, and 22 days later, the plaintiff mailed a copy

       of the judgment to the defendant. Id. The defendant then filed a motion to vacate the default

       judgment arguing the trial court lacked jurisdiction to enter the judgment because it had not been

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       properly served. Id. Alternatively, the defendant sought discretionary relief under section 2-1401,

       attaching an affidavit from its registered agent in support. Id. The registered agent in an affidavit

       stated that she "did not recall receiving a summons or complaint," and, if she had, she would

       have followed normal business procedures to ensure the complaint would have been forwarded

       to the defendant's claims company. Id. The trial court denied the defendant's motion to vacate the

       default judgment. Id. at 722.

¶ 21          The appellate court affirmed, initially noting, "[i]f service was satisfactory, then there is

       no reason to conclude that defendant was diligent in handling plaintiff's lawsuit." Id. at 723. The

       court concluded that the agent's assertion that she could not recall receiving the complaint or

       summons did not meet the clear and convincing evidence standard to overcome the presumption

       of service. Id. at 724. Thus, service was proper, and "defendant did not show that its failure to

       appear or answer resulted from anything other than a lack of due diligence." Id.

¶ 22          Chow's affidavit bears close resemblance to the affidavit in Pineschi. That Chow does

       "not recall ever receiving a copy of the Amended Complaint" does not impeach the sheriff's

       return of service. Thus, the trial court had personal jurisdiction.

¶ 23                                         Section 2-401 Petition

¶ 24          Forever Green next argues that the trial court erred in denying its section 2-1401 petition

       by: (1) failing to consider Forever Green's meritorious defense, (2) finding that Forever Green

       lacked diligence in defending the original action, and (3) failing to consider Forever Green's

       diligence in presenting the section 2-1401 petition.

¶ 25          A petitioner is entitled to relief under section 2-1401 when it sets out specific factual

       allegations, by a preponderance of the evidence, of each of three elements: (1) the existence of a

       meritorious defense or claim; (2) due diligence in presenting the defense or claim to the trial

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       court in the original action; and (3) due diligence in filing the section 2-1401 petition. People v.

       Vincent, 226 Ill. 2d 1, 7-8 (2007).

¶ 26           The parties suggest we apply the abuse of discretion standard of review. But, a section 2-

       1401 analysis is two-tiered: (1) the issue of a meritorious defense is a question of law subject to

       de novo review and (2) if a meritorious defense exists, the issue of due diligence is subject to

       abuse of discretion review. See Cavalry Portfolio Services v. Rocha, 2012 IL App (1st) 111690,

       ¶ 10; Rockford Financial Systems, Inc. v. Borgetti, 403 Ill. App. 3d 321, 327-28 (2010); Blazyk v.

       Daman Express, Inc., 406 Ill. App. 3d 203, 206 (2010). We will apply the de novo standard in

       determining whether Forever Green presented a meritorious defense, and apply the abuse of

       discretion standard in reviewing whether it complied with the due diligence requirements.

¶ 27                                            Meritorious Defense

¶ 28           The amended complaint asserts Forever Green's liability under a successor liability

       theory. Specifically, Charles Austin claims that Forever Green purchased the business of A-1

       Food subject to its known creditors and the claims of the present lawsuit, and that Forever Green

       and A-1 Food fraudulently entered the sale of assets to avoid liability for Charles Austin's claim.

¶ 29           As a general rule, a corporation that purchases the assets of another corporation is not

       liable for the debts or liabilities of the transferor corporation. Vernon v. Schuster, 179 Ill. 2d 338,

       344-45 (1997). This rule protects bona fide purchasers from unassumed liability. Id. at 345.

       There are, however, four exceptions: (1) an express or implied agreement of assumption; (2) the

       transaction amounts to a merger or consolidation of the purchaser or seller corporation; (3) the

       purchaser is a mere continuation of the seller; or (4) the transaction is for the fraudulent purpose

       of escaping liability for the seller's obligations. Id.

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¶ 30           Besides the general rule regarding a purchaser corporation's liability for the transferor

       corporation's debts, Forever Green claims there is no express or implied agreement of

       assumption because the contract for the sale of assets between does not identify Charles Austin

       as a creditor.

¶ 31           Under the contract, A-1 Food agreed to sell all of its business assets "free and clear of

       any debts, mortgages, security interests or other liens or encumbrances except as herein stated."

       The contract required A-1 Food furnish Forever Green with a list of existing creditors at the time

       of sale and any persons asserting claims against A-1 Food, even if those claims were disputed.

       A-1 Food, by Jian Bin Zheng, certified that it had no creditors at the time of closing. Chow,

       Forever Green's attorney and then-registered agent, notarized the document at the sale. Based on

       a literal reading of the contract, Forever Green is liable only to those creditors listed by A-1

       Food, which were "none at closing."

¶ 32           The creditor certification that A-1 Food had no creditors at closing was untruthful, and

       Forever Green had the capability and opportunity to perform its own due diligence to inquire

       whether any claims existed that could potentially affect its business and financial condition.

       Indeed, this lawsuit was on file nearly four months before the sale of assets. The record also

       shows that A-1 Food Services was involved in another lawsuit on similar grounds in the United

       States District Court for the Northern District of Illinois. Forever Green merely asserts, without

       citation, that "[y]ou cannot imply assumption of liabilities, where there are grounds to expressly

       provide for it, and A-1 Food affirmatively stated none." In light of the litigation surrounding A-1

       Food, Forever Green's blind acceptance of A-1 Food's certification does not invalidate or nullify

       the falsity of the certification.

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¶ 33             Forever Green further argues that it could bring a motion to dismiss for failure to state a

       cause of action by claiming Charles Austin failed to plead sufficient facts to suggest that the

       transaction was fraudulent, i.e., actual intent to hinder, delay, or defraud any creditor of the

       debtor.

¶ 34             A fraudulent transfer occurs when the transfer is made with actual intent to hinder, delay,

       or defraud any creditor of the debtor. 740 ILCS 160/5(a)(1) (West 2012). The factors to

       determine intent to hinder, delay, or defraud include: (1) transfer or obligation was to an insider;

       (2) debtor retained possession or control of the property transferred after the transfer; (3) transfer

       or obligation was disclosed or concealed; (4) before the transfer was made or obligation was

       incurred, the debtor had been sued or threatened with suit; (5) transfer was of substantially all the

       debtor's assets; (6) debtor absconded; (7) debtor removed or concealed assets; (8) value of the

       consideration received by the debtor was reasonably equivalent to the value of the asset

       transferred or the amount of the obligation incurred; (9) debtor was insolvent or became

       insolvent shortly after the transfer was made or the obligation was incurred; (10) transfer

       occurred shortly before or shortly after a substantial debt was incurred; and (11) debtor

       transferred the essential assets of the business to a lienor who transferred the assets to an insider

       of the debtor. 740 ILCS 160/5(b) (West 2012).

¶ 35             In a fact-pleading jurisdiction, like Illinois, a plaintiff must allege sufficient facts to bring

       its claim within the scope of the cause of action asserted. Vernon, 179 Ill. 2d at 344. "A

       complaint must allege, with specificity and particularity, facts from which fraud is the necessary

       or probable inference, including what representations were made, who made them, and to

       whom." Addison v. Distinctive Homes, Ltd., 359 Ill. App. 3d 997, 1000 (2005).

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¶ 36          Charles Austin alleged in the amended complaint that A-1 Food sold its assets to Forever

       Green on May 1, 2012; the present action was pending at the time of sale; the contract implies

       that Forever Green purchased A-1 Food subject to its known creditors; Forever Green purchased

       the business subject to the present action; and, in the alternative, A-1 Food made the transaction

       for the purpose of escaping liability to Charles Austin. Viewing these allegations in light most

       favorable to Charles Austin, the fourth exception to the rule of successor liability, fraud, is a

       probable inference. From the amended complaint, it follows that A-1 Food was indebted to

       Charles Austin; A-1 Food sold the business and its assets to Forever Green; Forever Green

       impliedly assumed the debts; A-1 Food sold its business assets to escape a potential judgment

       against it in favor of Charles Austin; and Forever Green was a party to the fraudulent transaction.

       Without addressing the merits of the exception, it can reasonably be inferred that Charles Austin

       properly pled the fourth exception to the general rule of successor nonliability.

¶ 37          Moreover, Forever Green presents no evidence or cogent legal arguments that counter the

       inference of a fraudulent transfer of corporate assets. The circumstances surrounding this

       transaction are suspect at best since A-1 Food sold all of its corporate assets after Charles Austin

       filed suit and kept the transfer from Charles Austin. In addition, it is unusual that a corporation

       attempting to purchase all of the assets of another corporation would not independently

       investigate the financials of the transferring corporation. Based on the scant evidence in the

       record, we cannot say that Forever Green established, by a preponderance of the evidence, that

       the transaction was not fraudulent. Hence, Forever Green does not have a meritorious defense to

       the original action brought against it by Charles Austin.

¶ 38                     Diligence in Presenting Defense or Claim in Original Action

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¶ 39          Forever Green argues that the trial court erred by determining that Forever Green was not

       diligent in presenting its defense in the original action.

¶ 40          A party relying on section 2-1401 must have a reasonable excuse for failing to act within

       the appropriate time. Smith v. Airoom, Inc., 114 Ill. 2d 209, 222 (1986). Section 2-1401 does not

       relieve a party of the consequences of its own mistakes or negligence. Id. A party relying on

       section 2-1401 must show that its "failure to defend against the lawsuit was the result of an

       excusable mistake and that under the circumstances [it] acted reasonably, and not negligently,

       when [it] failed to initially resist the judgment." Id. In determining the reasonableness of the

       offered excuse, all of the circumstances surrounding the entry of the judgment are considered,

       including the conduct of the litigants and their attorneys. Id. As mentioned, we review the trial

       court's determination of due diligence under an abuse of discretion standard.

¶ 41          Forever Green claims that Charles Austin did not effectuate proper service of the

       summons and complaint. We have already rejected this argument. Forever Green also claims that

       Charles Austin failed to provide sufficient notice of the motion for default. Specifically, Forever

       Green claims that Charles Austin's notice of motion for default, filed on February 15, 2013, went

       to Chow, who was no longer Forever Green's registered agent. Forever Green also alleges that

       "common sense and professional courtesy" obliged Charles Austin to inform the new registered

       agent, Wang, or Forever Green's Indiana counsel who responded to the September 2012

       subpoena, regarding the default.

¶ 42          Smith v. Airoom, Inc., 114 Ill. 2d 209 (1986), rejects Forever Green's argument. In

       Airoom, plaintiffs sued Airoom for breach of contract, and Airoom's sales manager was served

       with summons and a copy of the complaint at its place of business. Airoom, 114 Ill. 2d at 215.

       Airoom failed to answer or appear within 30 days. Id. Without providing notice to Airoom, the

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       trial court entered plaintiffs' motion for a default judgment and continued the case for a hearing

       on damages. Id. Plaintiffs did not give Airoom notice of the hearing on damages, and the

       judgment was entered against Airoom. Id. at 216. Plaintiffs then initiated non-wage-garnishment

       proceedings against Airoom's bank to satisfy the judgment, after which Airoom filed a section 2-

       1401 petition. The trial court denied the petition on the basis that Airoom had not shown

       diligence. Id. at 220. The Illinois Supreme Court affirmed. Id. at 231.

¶ 43          The supreme court reasoned that Airoom had ample opportunity to avoid the default

       judgment by filing an answer or appearance, but, instead, relied on out-of-court negotiations with

       plaintiffs to settle the dispute which "did not establish any acceptable excuse for [Airoom's]

       failure to appear in court after summons was duly served on its agent." Id. at 224-25. The court

       further noted that, because Airoom never filed an appearance, plaintiffs were not required to

       provide notice of their intention to seek a default or of the default judgment. Id. at 226. As to the

       alleged breach of professional courtesy by failing to provide notice, the court determined such

       conduct "does not justify this court's easing the due-diligence requirement." Id. Once a court

       acquires jurisdiction over a party, the litigant has a duty to track the progress of his or her case.

       Id. at 227. The court finally noted that, although plaintiffs were silent about the entry of the

       default judgment, no evidence existed that the attorney fraudulently concealed the entry of the

       judgment or otherwise prevented Airoom from knowing of it by "trick or contrivance." (Internal

       quotation marks omitted.) Id. at 228.

¶ 44          The chronological development of this case demonstrates that Forever Green, like

       Airoom, lacked diligence in presenting its defense to the trial court in the original action. Forever

       Green's then-registered agent was served with summons and a copy of the complaint on October

       29, 2012; Forever Green failed to appear and answer; the trial court entered a default judgment

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       on February 22, 2013; Charles Austin initiated third-party citation proceedings against Forever

       Green's bank on May 9, 2013; and Forever Green filed its section 2-1401 petition on June 5,

       2013, only after the bank froze its bank account. Forever Green had ample opportunity to avoid

       the default judgment by filing its appearance or answer. The fact Chow did "not recall" being

       served is a meaningless excuse. Forever Green cannot escape its own negligence or indifference

       to this lawsuit. Airoom, 114 Ill. 2d at 224-25. Once the sheriff properly served Chow on October

       29, 2012, Forever Green had to appear and either answer or otherwise plead, and, in addition,

       stay informed of the lawsuit's progress.

¶ 45          The trial court determined that Forever Green lacked diligence in presenting its defense

       in the original action. On January 10, 2013, before transfer of Forever Green's registered agent,

       the trial court entered and granted default and continued the matter for prove-up. Regarding

       Forever Green's diligence, the trial court said, "there is no diligence shown ***. There's a history

       here of ignoring the Court's orders, and ignoring the summons that was served on it. Then from

       February until May when we wait until citation proceedings and that's the first the client

       purportedly has heard about this, I find that not worthy of my trust or belief." We have read the

       record and agree with the trial court's conclusion.

¶ 46          Forever Green claims equity demands the court vacate the judgment. The Illinois

       Supreme Court, however, has explained, "[w]hen the legislature abolished the writs in favor of

       today's statutory remedy, it became inaccurate to continue to view the relief in strictly equitable

       terms. Moreover, this court's application of civil practice rules and precedent factored out any

       notions about a trial court's 'discretion' to do justice." Vincent, 226 Ill. 2d at 16. Thus, this court

       is not bound to reverse the trial court on equitable grounds. Regardless, the trial court observed

       that Forever Green failed to show diligence, ignored the summons properly served on it, and

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       failed to appear or defend itself until after third-party citation proceedings began. No evidence

       indicates Forever Green's failure to appear and defend itself resulted from anything other than its

       own negligence.

¶ 47                              Diligence in Filing Section 2-1401 Petition

¶ 48          Lastly, Forever Green argues the trial court erred in finding it failed to exercise due

       diligence in filing the petition to vacate the default judgment. No bright-line rule exists for

       determining whether a petitioner acted diligently. Paul v. Gerald Adelman & Associates, Ltd.,

       223 Ill. 2d 85, 99-100 (2006). "[D]ue diligence is judged by the reasonableness of the petitioner's

       conduct under all of the circumstances." Id.

¶ 49          Forever Green filed its petition only after its bank account was frozen. Even if we were to

       find diligence, this conclusion would not be dispositive—a petitioner must establish all three

       elements to warrant relief under section 2-1401. Vincent, 226 Ill. 2d at 7-8. Because we conclude

       that Forever Green did not have a meritorious defense and was not diligent in defending the

       original action, we need not discuss this final element.

¶ 50                        Failure to Comply With Trial Court's Standing Orders

¶ 51          Finally, Forever Green contends that Charles Austin violated the trial court's standing

       order and checklist. Forever Green, however, never raised this contention before the trial court

       and thus, waived it and cannot bring it for the first time on appeal. Village of Roselle v.

       Commonwealth Edison Co., 368 Ill. App. 3d 1097, 1109 (2006).

¶ 52                                            CONCLUSION

¶ 53          We affirm the judgment of the circuit court.

¶ 54          Affirmed

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