Illinois Court holds that complaint inferred acceleration notice was provided and for a monetary default acceleration was not required

The mortgagor, in U.S. Bank, Nat’l Ass’n as Tr. for Truman 2016 SC Title Tr. v. Reinish, 2020 IL App (2d) 190175 (April 21, 2020), asserted as a defense to a judgment of foreclosure that the mortgagee did not provide her with a notice of acceleration prior to foreclosing. The appellate court affirmed the ruling of the trial court that the issue was forfeited because the mortgagor did not raise it in her pleadings and because under the terms of the mortgage notice of acceleration was not required.

The first issue was whether the mortgagor waived the defense that the mortgagee did not satisfy a condition precedent by not raising that defense in her answer, but only on summary judgment. The court noted that the mortgagor’s complaint followed the statutory form set forth in the Illinois Mortgage Foreclosure Act. Where the complaint follows the form, the statute provides that the complaint is “deemed and construed” to include certain allegations, among them that all notices of default or acceleration were provided. Because the complaint was deemed to include that allegation, by not expressly denying it or raising it as an affirmative defense, the mortgagor judicially admitted she received notice of acceleration. She could not assert a contrary position in opposition to the motion for summary judgment.

Forfeiture aside, the court also found that under the clear language of the mortgage notice of acceleration was not required. One paragraph of the mortgage provided that the mortgagee was obligated to provide a notice of acceleration as a condition precedent where the mortgagor sold the property. That did not happen here. Rather, the mortgagor failed to make payments which was addressed by another section of the mortgage captioned “Rights of the Lender if There is a Breach of Duty”. A breach includes the failure to make a payment. It contains no requirement to provide a notice of acceleration. Rather, it reads that “If there is a Breach of Duty by me, Lender may demand an immediate payment of all sums secured.”

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