Real Estate Roundup
No. 162 Perspectives on Developments in the Law from Sharp-Hundley, P.C. January 2019
No Five-Day Notice Doesn’t Mean No Jurisdiction
Just as decades of apparently settled law governing post-judgment collection methods were turned on their heads by a decision of the Appellate Court in Chicago last fall (see Sharp Thinking No. 160 (Oct. 2018)), decades of apparently settled law governing eviction jurisdiction were upended by that same court just as fall turned to winter last month.
In both cases (MI Mgmt., LLC v. Proteus Holdings, LLC, 2018 IL App (1st) 160972, in the case of collection practice; Goodwin v. Matthews, 2018 IL App (1st) 172141, in the case of evictions), the court dealt with the impact of Belleville Toyota, Inc. v. Toyota Motor Sales, U.S.A., Inc., 199 Ill.2d 325 (2002), upon courts’ jurisdiction over statutory causes of action.
In MI, the court held that defects in a garnishment affidavit did not deny the court subject matter jurisdiction because of changes to the judicial article to the Illinois Constitution made in 1964. In Goodwin, the court held that alleged non-receipt of a five-day notice did not deprive the court of subject matter jurisdiction because of the same changes. After those changes, so long as the suit is of the sort usually handled by the court, i.e., a “justiciable mat-ter,” the court has jurisdiction even if prerequisite steps formerly thought jurisdictional have not occurred.
Moreover, the court said the alleged failure of the five-day notice did not mean that the eviction order had to be reversed, because the record did not show that the appellant was a tenant.
Damage Counterclaim Not Germane In Eviction Action
A trial judge erred in awarding damages to a tenant who was wrongfully dispossessed of rental property through the self-help action of a landlord who also sued for possession under the Forcible Entry & Detainer (now Eviction) Statute, 735 ILCS 5/9-101 et seq.
So held a panel of the Appellate Court in Chicago recently. Milton v. Therra, 2018 IL App (1st) 171392.
Moreover, the Appellate Court said, the trial court acted beyond its authority in granting damages on the counterclaim, necessitating vacation of that award even though the panel plainly thought the award substantively meritorious.
In Milton, a new owner sought to dispossess tenants of a commercial property. He filed an action under the forcible act based on non-payment of rent, a claim the court found without merit. The new owner simultaneously changed locks and discarded some of the tenant’s personal property. The tenant counterclaimed for costs of repair and for lost profits due to being unable to conduct business due to the dispossession.
The panel affirmed the trial court’s judgment against the landlord on the forcible claim. However, it vacated the award on the counterclaim, ruling that although the counterclaim was premised on the right of possession, it was “outside the scope of the Forcible Entry & Detainer Act because it seeks monetary damages.”
“If forcible proceedings are to retain their summary nature, they cannot be burdened by issues that typically would entail motion practice, discovery, and perhaps expert testimony,” the panel said.
New Landlord Can’t Evict For Previous Nonpayment Of Rent
A new landlord is not entitled to bring suit for rent that accrued before it owned the property, nor is it entitled to sue for eviction because of nonpayment of that rent, a panel of the Illinois Appellate Court in Chicago held recently.
Ruling in 1002 E. 87th St. LLC v. Midway Broadcasting Corp., 2018 IL App (1st) 171691, the panel dealt with a situation where the lease said that upon sale of the property the tenant would “attorn” to the new owner. The new owner interpreted the situation as involving an assignment to it, but the court said the new owner lacked standing to invoke the tenant’s prior defaults and seemed to say that that was the law regardless of assignment theory.
The panel said that under prior holdings, past due rent owed to the previous owner would not pass to the new owner upon conveyance of the property because “Illinois courts routinely hold that rent in arrears is not assignable.”
Service Rules Strictly Enforced In Eviction Cases
Section 9-107 of the Eviction Statute, not § 2-203.1 of the Civil Practice Law, governs constructive service of process in eviction actions, a panel of the Appellate Court in Chicago ruled recently.
Moreover, the court held that strict compliance with § 9-107 (735 ILCS 5/9-107) is mandatory. Corlis v. Edelberg, 2018 IL App (1st) 170049.
In Corlis, plaintiff sought possession and a money judgment under the Eviction Statute (735 ILCS 5/9-101 et seq.). After two failed attempts at service, he moved for alternate service under § 2-203.1 of the Civil Practice Law (735 ILCS 5/2-203.1). The court ordered that defendant could be served by mail or overnight delivery plus posting on the door. Defendant moved to quash, but the court denied the motion and entered judgment of possession and a money judgment.
The appellate panel held that the more flexible provisions of § 2-203.1 could not be invoked because § 9-107, being the more specific statute, “governs constructive service of process in eviction actions.” Since the service methods approved by the trial judge did not comply with § 9-107, the panel reversed the judgment.
– John Hundley, firstname.lastname@example.org, 618-242-0200
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