Appellate Law

Bank?s Petition To Vacate Default Judgment Untimely But Court Hears Appeal Anyway

By Steven R. Merican

In this confusing mortgage foreclosure case, a default judgment was entered in favor of Washington Mutual Bank against Archer Bank. About six months later, Archer asked the court to vacate the default. Archer?s motion to vacate relied on two sections of the Illinois Civil Procedure Code ? § 2-1301(e) (setting aside default judgments); § 2-1401 (relief from judgments).

The trial court denied Archer?s motion to vacate. Eventually, a final and appealable order distributing the proceeds of the sale of the property was entered. Archer appealed and argued that the default should have been vacated under § 2-1401. In the appellate court, Archer dropped its § 2-1301(e) argument.

Appeals from § 2-1401 petitions are governed by Illinois Supreme Court Rule 304(b). The rule requires an appeal to be filed within 30 days. Although Archer filed an appeal within 30 days of the final distribution order, it came long after the court ruled on the § 2-1401 petition.

We have no doubt that Archer's notice of appeal gives us jurisdiction to review the outcome of the foreclosure case. But Archer's brief complains only of the trial court's dismissal of Archer's request to vacate the default in that request's aspect as a section 2--1401 petition. Under Supreme Court Rule 304(b)(3) ? an order resolving a section 2--1401 petition is immediately appealable. When rule 304(b) makes an order immediately appealable, that appeal is not elective--any claim of error is lost if not raised then ? Indeed, because a section 2--1401 petition begins a separate action ? the resolution of the petition ends the entire action, so no other time to appeal could exist.

But Archer got another bite at the apple anyway. The appellate court ruled that Archer?s § 2-1301 petition became reviewable after the final distribution order was entered, so Archer?s appeal was timely. And although Archer did not brief its § 2-1301 argument, the Second District Illinois Appellate Court took the case on that basis anyway. In the end, the appellate court sent the case back to the trial court to consider Archer?s § 2-1301 petition.

Read the whole opinion, Washington Mutual Bank v. Archer Bank, No. 2-07-0074 (9/15/08), by clicking here.

Full post as published by Illinois Appellate Lawyer Blog on December 11, 2008 (boomark / email).