Friday, May 12, 2017

Bankster's Failure To Address Chicago Tenant's Claim That She Was Entitled To $10,600 Relocation Fee As Required By Local Ordinance Sinks Foreclosure Eviction Attempt

From a recent post in The Consumer Financial Services Blog:
  • The Appellate Court of Illinois, First District, recently reversed a summary judgment ruling in favor of a mortgagee on its post-foreclosure forcible entry and detainer claim, finding genuine disputes as to material facts where the tenant presented evidence that she was a qualified tenant under the Chicago Protecting Tenants in Foreclosed Rental Property Ordinance, and that the mortgagee did not pay her the $10,600 relocation assistance fee required by the ordinance.
    Initially, the Appellate Court considered the mortgagee’s argument that compliance with the ordinance’s relocation provision is not a condition precedent to a forcible entry and detainer action.

    The mortgagee argued that failure to comply with the ordinance could not bar this action because the ordinance states: “The owner shall pay the relocation fee to the qualified tenant no later than seven days after the day of complete vacation of the rental unit by the qualified tenant.” Chicago Municipal Code § 5-14050(b) (added June 5, 2013). Thus, the mortgagee claimed that any obligation to pay the relocation fee is only triggered when a qualified tenant vacates the property.

    The Appellate Court disagreed, concluding that the mortgagee’s alleged failure to comply with the ordinance’s relocation provision is an affirmative defense to a forcible entry and detainer action.
    The Appellate Court next analyzed if a genuine issue of material fact existed regarding whether the tenant “was a qualified tenant pursuant to a bona fide rental agreement under the Ordinance.” Specifically, the Appellate Court examined whether the initial pre-foreclosure lease constituted a bona fide rental agreement.

    The Appellate Court observed that the original pre-foreclosure lease contained a valid month-to-month tenancy provision. In addition, the tenant’s affidavit averred that she had resided in the property since before the foreclosure pursuant to a rental agreement that required her to pay $950 a month to the property owner.

    Although the tenant’s affidavit did not also state that she paid the rent each month, the Court held she did not have to prove her case to withstand summary judgment. In the Court’s view, the evidence that the tenant had a rental agreement that required her to pay rent every month on the day the mortgagee became the owner of the foreclosed property was sufficient to defeat summary judgment. Chicago Municipal Code § 5-14-020.

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