Illinois Appellate Court holds that circuit court has no discretion to deny a deficiency judgment where the legal requirements have been met

The Third District Appellate Court has upset a longstanding practice of circuit courts to deny a mortgagee the right to a deficiency even where the mortgagee has established its right to same. In U.S. Bank Trust, N.A. v. Atchley, 2015 IL App (3d) 150144 (Nov. 17, 2015) the mortgagee filed for foreclosure, personally served the mortgagor, and was subsequently granted a judgment for foreclosure and sale. Following the sale, mortgagee moved to confirm the sale. The court confirmed the sale, but denied the mortgagee’s request for an in personam deficiency judgment. In the confirmation order, the court wrote: ’Plaintiff [sic ] request for an in personam judgment is denied without further documentation.’ Mortgagee’s appealed contending that the trial court erred in denying its request for an in personam deficiency judgment. Mortgagee asserted that it fulfilled each of the criteria required to receive an in personam deficiency judgment under the Illinois foreclosure rules. Turning to those rules, the court construed the specific statutory rule on deficiency judgments. It provides that [i]n any order confirming a sale pursuant to the judgment of foreclosure, the court shall also enter a personal judgment for deficiency against any party (i) if otherwise authorized and (ii) to the extent requested in the complaint and proven upon presentation of the report of sale in accordance with Section 15-1508. The word shall, as used in the rules, means mandatory, rather than permissive. Accordingly, a trial court must grant an in personam deficiency judgment in favor of a mortgagee under the foreclosure law when the requirements are otherwise met. The mortgagee met the requirements in this case: the complaint listed the mortgagor as the person personally liable for any deficiency, and the mortgagee attached the note and mortgage, both signed by the mortgagor. Additionally, the mortgagor was personally served in the case, vesting the trial court with in personam jurisdiction. It was error to deny the mortgagee’s request.

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