Supreme Court Rules 113 And 114

Illinois Supreme Court Rules 113 and 114, which were originally slated to go into effect March 1, 2013, but were pushed back to May 1, 2013, alter the mortgage foreclosure process in several substantive ways.

First, Rule 113 requires that the plaintiff attach to the complaint a copy of the Note as it currently exists, including indorsements and allonges as it exists at the time the complaint is filed. The plaintiff is still not required to attach copies of any assignments at the time of filing the complaint, however. Second, Sup. Ct. R. 113 also codified the holding of ABN AMRO Mortgage Group, Inc. v. McGahan, 237 Ill. 2d 526, 931 N.E.2d 1190 (2010) by providing that when a mortgagor is deceased, and no estate has been opened, the court shall appoint a special representative to stand in the place of the deceased mortgagor upon the motion of a party.

Third, the new rules also make significant changes to the affidavit of indebtedness, or prove-up affidavit. The Supreme Court supplied the form the affidavit must follow. The affidavit must contain, at a minimum, (i) an explanation of whether the affiant is a custodian of the records or a person familiar with the business and its mode of operation, and an explanation for how the affiant is familiar with the business and its mode of operation; (ii) the identification of the books, records, and/or other documents that the affiant reviewed and/or relied upon in drafting the affidavit, including any records transferred from a previous lender or servicer (Note that the new rule reads that the payment history need not be attached to the affidavit if the defendant has not filed an appearance or responsive pleading and (iii) the identification of any computer program or computer software that the entity relies on to record and track mortgage payments. The statement identifying the computer program or computer software must also include the source of the information, the method and time of preparation of the record to establish that the computer program produces an accurate payment history, and an explanation as to why the records should be considered business records within the meaning of the law. Sup. Ct. R. 113(c)(2). The affidavit need not be notarized but only certified in accordance with Section 1-109 of the Civil Practice Act. 735 ILCS 5/1-109. Also, the affidavit may not have a stand-alone signature page if formatting allows the signature to begin on the last page of the affiant’s statements.

Fourth, Rule 114 requires that where a mortgagor has appeared or filed an answer or other responsive pleading, the mortgagee must also submit a loss mitigation affidavit, in a form the Supreme Court provided, prior to moving for a judgment of foreclosure. The loss mitigation affidavit must specify each of the following: (1) any type of loss mitigation which applies to the subject mortgage; (2) what steps were taken to offer each type of loss mitigation to the mortgagor(s and (3) the status of any such loss mitigation efforts. S. Ct. R. 114. Failure to provide this affidavit may result in the court denying the mortgagee’s request for judgment.

Fifth, where the borrower is defaulted, the new rules also require the plaintiff’s attorney to prepare and deliver to the Clerk of the Circuit Court, within two business days after the entry of default, a notice of default and entry of judgment of foreclosure in the form provided by the Supreme Court. Sup. Ct. R. 113(d). The court clerk must mail that notice within five business days after the entry of default to the address(es) provided by the plaintiff’s attorney in an envelope bearing the return address of the Clerk of the Circuit Court. It then has to file proof of that mailing in the court file.

Sixth, the new Rule 113 changes the law so that the plaintiff must now send a separate notice of the foreclosure sale date, time, and location not fewer than 10 business days before the sale to all defendants, including the defendants in default. Sup. Ct. R. 113(f). Previously, the notice of sale had to be mailed no less than 7 days before the sale. 35 ILCS 5/15-1508(c)(3).

Seventh, in response to recent actions by some counties and county sheriff departments which have disallowed the plaintiff from selecting the selling officer instead mandating that the county sheriff be used, the Supreme Court has stepped in and confirmed the right of the plaintiff to choose the selling officer, subject to approval by the court. S.Ct. R. 113(f)(2). In the comments to the new rule, the Court noted that restricting foreclosure sales to the county sheriff has resulted in significant delays in completing foreclosures due, in some cases, to the failure of the sheriff to promptly obey the court order commanding him to sell the property at auction. See, Comments to Rule 113.

Finally, in the event the foreclosure sale produces a surplus, the person conducting the sale must send written notice that there is a surplus to all parties. Id. New Supreme Court Rule 114 also requires that the attorney for the plaintiff send a special notice to the mortgagors advising them of the surplus funds and enclose a form for the mortgagors use in presenting a motion to the court for the funds. Sup. Ct. R. 113(f)(3). The Supreme Court has also supplied the form the attorney must use as well as the turnover form. Sup. Ct. R. 113(g), (h).

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