Thursday, May 12, 2016

A Nonparty’s Motion to Reconsider a Judgment Is Not a Final and Appealable Order

By Stephen Soltanzadeh
Associate, Ancel Glink

The First District Appellate Court recently held that the circuit court’s denial of a nonparty’s motion to reconsider a judgment was not a final and appealable order, leaving the appellate court without jurisdiction over the nonparty’s appeal of the denial of the motion to reconsider. The appellate court held that an order denying a nonparty’s postjudgment motion is not final and appealable because it does not terminate the litigation or dispose of the rights of the parties. Rejecting the appellant’s alternative argument that she was appealing the underlying judgment, the court further determined that a postjudgment motion filed by a nonparty does not toll the time for filing a notice of appeal from the judgment.

In MidFirst Bank v. McNeal, 2016 IL App (1st) 150465, MidFirst Bank filed a complaint to foreclose a mortgage that became delinquent after the homeowner died. The complaint named the homeowner’s daughter, Devita McNeal, as the defendant, but only in her capacity as the executor of the estate. With the foreclosure action pending, the probate case was filed and McNeal was named as the estate’s independent executor. MidFirst Bank later prevailed in the foreclosure action on a summary judgment motion.

In her capacity as executor, McNeal moved to set aside the judgment of foreclosure, and her motion was denied on January 7, 2014. On February 14, 2014, again in her capacity as executor, McNeal filed a motion to reconsider the judgment, arguing that MidFirst Bank failed to comply with mortgage foreclosure laws because the property had been left to McNeal in her mother’s will and the bank had failed to serve her in her individual capacity. The property was sold and the court entered an order confirming the sale on October 25, 2014.

Just two days prior to the order confirming the sale, on October 23, 2014, McNeal, in her individual capacity, filed a motion to set aside a void judgment of foreclosure pursuant to section 2-1203 of the Code of Civil Procedure (735 ILCS 5/2-1203 (West 2012)), again arguing that MidFirst Bank violated foreclosure laws by failing to serve her in her individual capacity. The circuit court denied the motion because McNeal never sought to intervene in her individual capacity and the foreclosure case had proceeded before McNeal gained interest in the property.

McNeal appealed on the grounds that the foreclosure proceedings were improper because she was a known heir and never served. MidFirst Bank argued that McNeal lacked standing in the appeal because she was not, and had never been, a party to the case.

The appellate court agreed that, because McNeal never moved to intervene, she was not a party to the case. For this reason, the court determined, the circuit court should not have considered the postjudgment motion she filed in her individual capacity. The appellate court further determined that McNeal remained a nonparty in the appeal, but declined to dismiss the appeal on standing grounds.

Setting the standing issue to one side, the appellate court held that it lacked jurisdiction over the appeal because the order from which McNeal appealed — the circuit court’s denial of the postjudgment motion she filed in her individual capacity — was not final and appealable. The court concluded that because McNeal did not intervene in her individual capacity, the order denying her postjudgment motion did not terminate the litigation or otherwise dispose of the rights between the parties, as an order must do to be final or appealable. In so holding, the court described McNeal’s motion as a “nullity” that lacked “all the necessary prerequisites of a final judgment.” MidFirst Bank, 2016 IL App (1st) 150465, ¶ 24.

The court further rejected McNeal's alternative arguments that the appellate court should have construed her appeal as interlocutory under subsection (a) or (b) of Illinois Supreme Court Rule 304, explaining that McNeal had not demonstrated how the appeal fit within either provision and that neither could be applied. The appellate court also rejected her argument that she was actually appealing the order confirming the sale of the property, which concluded the foreclosure process. In doing so, the court explained that McNeal’s notice of appeal was filed well over 30 days after entry of that underlying judgment, and that her section 2-1203 motion did not toll her time to file a notice of appeal from that judgment because, by the statute’s express terms, only a “party” may file a section 2-1203 postjudgment motion. Id. at ¶ 31 (citing 735 ILCS 5/2-1203 (West 2012)). Accordingly, the court dismissed McNeal’s appeal for lack of jurisdiction.

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