Comerica Bank-Illinois v. Harris Bank

15 Citing cases

  1. U.S. Bank v. Randhurst Crossing LLC

    2018 Ill. App. 170348 (Ill. App. Ct. 2018)   Cited 11 times

    "At common law, it was strictly held that the mortgagee must take actual possession before he was entitled to rents." Comerica Bank–Illinois v. Harris Bank Hinsdale , 284 Ill. App. 3d 1030, 1033, 220 Ill.Dec. 468, 673 N.E.2d 380 (1996). "The possession requirement reflects the public policy in Illinois that seeks to prevent mortgagees from stripping the rents from the property and leaving the mortgagor and the tenants without resources for maintenance or repair."

  2. BMO Harris Bank N.A. v. Joe Contarino, Inc.

    2017 Ill. App. 2d 160371 (Ill. App. Ct. 2017)   Cited 7 times

    The court noted that the forbearance agreement did not run afoul of the rents-and-profit doctrine, because the contract dictated that all management expenses were to be deducted before any net rents were transmitted to Rockford. See Comerica Bank-Illinois v. Harris Bank Hinsdale , 284 Ill.App.3d 1030, 1034-35, 220 Ill.Dec. 468, 673 N.E.2d 380 (1996) (rent assignment unenforceable absent actual or constructive possession by lender, the latter of which must include court authorization; public policy seeks to prevent mortgagee from leaving the mortgagor and tenants without resources for maintenance or repair). Finally, the court rejected BMO's assertion that the forbearance agreement violated the restraining provisions of the JCI and Briargate citations, distinguishing case law BMO cited that addressed rent assignments. See Comerica , 284 Ill.App.3d at 1034-35, 220 Ill.Dec. 468, 673 N.E.2d 380 ; In re Wheaton Oaks Office Partners Limited Partnership , 27 F.3d 1234, 1241, 1245 (7th Cir. 1994) (lender seeking to enforce rent assignment will usually have to obtain preforeclosure possession by being placed in actual possession or through appointment of receiver; mortgagee must take certain steps to enforce lien; "failure to enforce an assignment of rents does not destroy the legal existence of an effective, enforceable security interest

  3. Bank Fin. v. Brandwein

    2015 Ill. App. 143956 (Ill. App. Ct. 2015)   Cited 27 times

    Plaintiff also states that defendant has not provided a lease proving otherwise. However, we need not make a finding on whether defendant has standing to assert tortious interference, because his claim fails for other reasons. ¶ 45 Defendant's claim of tortious interference relies on Comerica Bank-Illinois v. Harris Bank Hinsdale, 284 Ill. App. 3d 1030 (1996). In Comerica Bank-Illinois, a mortgagor defaulted on its mortgage and the mortgagee, Comerica, began to exercise its assignment of rents, granted by the mortgagor as security for the loan, without foreclosing the mortgage, seeking the appointment of a receiver, or seeking approval from a court.

  4. 1030 W. N. Ave. Bldg., LLC v. The Firm, LLC

    2022 Ill. App. 200588 (Ill. App. Ct. 2022)   Cited 2 times

    ¶ 26 Illinois requires mortgagees to take possession of the property before collecting rents, which reflects the public policy that "seeks to prevent mortgagees from stripping the rents from the property and leaving the mortgagor and tenants without resources for maintenance or repair." Comerica Bank-Illinois v. Harris Bank Hinsdale, 284 Ill.App.3d 1030, 1033 (1996). Possession may be actual or constructive.

  5. In re Callas

    Case No. 13 B 43900 (Bankr. N.D. Ill. Apr. 23, 2015)   Cited 2 times
    Reviewing case law and noting that, "under Illinois law, a security interest in rents arising under an assignment of rents, while perfected against third parties upon recordation, does not grant an interest in particular amounts, paid after default and constituting rents from the property, until affirmative steps are taken by the mortgagee to acquire possession of the property through either foreclosure or the appointment of a receiver pending foreclosure"

    Under Illinois law, an assignment of rents creates a lien upon rents of the land that may be enforced upon default by taking affirmative steps to acquire possession of the land by the mortgagee or a receiver appointed on the mortgagee's behalf. Id. at 1241-42; Comerica Bank-Ill. v. Harris Bank Hinsdale, 673 N.E.2d 380, 382-83 (Ill. App. Ct. 1996). This interest is perfected upon recordation in the real estate records in the county in which the property is located, granting the mortgagee priority "against all parties whose claims or interests arise or are perfected thereafter."

  6. 1030 W. N. Ave. Bldg., LLC v. Firm, LLC

    2018 Ill. App. 163221 (Ill. App. Ct. 2018)   Cited 1 times

    In addition to Illinois cases, our review included federal decisions that interpret Illinois law, which are persuasive authority. See Asset Exchange II, LLC v. First Choice Bank, 2011 IL App (1st) 103718, ¶ 19 (lower federal court decisions are not binding, but may be considered persuasive authority); Comerica Bank-Illinois v. Harris Bank Hinsdale, 284 Ill. App. 3d 1030, 1033 (1996) (in analyzing assignment of rents issue, court relied on Illinois law, bankruptcy decisions, and federal case law). Having thoroughly reviewed the certified question and the parties' arguments, we conclude that we cannot provide an answer because the question is worded incorrectly and requires resolving matters that are beyond the scope of a Rule 308 appeal.¶ 13 The certified question confuses the perfection and enforcement of a lien.

  7. West Bend Mutual Insurance Co. v. Belmont State Corp.

    Case No. 09 C 354 (N.D. Ill. Dec. 23, 2010)   Cited 12 times
    Finding that a motion for turnover made nine days before the citation expired would be timely even if the court had not extended the citation date

    It is also settled Illinois law that under an Assignment of Rents — the agreement that Gizynski and Banco Popular entered into with respect to the property at 4944 W. Belmont — the mortgagor (in this case, Gizynski) is entitled to keep the rents until the mortgagee (here, Banco Popular) obtains possession of the property. See id. at 1242; see also Comerica Bank-Illinois v. Harris Bank Hinsdale, 284 Ill. App. 3d 1030, 1035, 673 N.E.2d 280, 220 Ill. Dec. 468 (1996) (affirming the trial court's ruling that "the rents collected properly belong to the mortgagor" because they were "collected during the time that the mortgagor was in possession of the property"). Therefore, although Banco Popular has a lien on the rental payments at 4944 W. Belmont under the Assignment of Rents, the cash Gizynski deposited with Banco Popular was technically personal property possessed by Gizynski that was subject to the Banco Citation and the Gizynski Citation.

  8. In re Randall Plaza Center Associates, L.P.

    326 B.R. 133 (Bankr. N.D. Ill. 2005)   Cited 7 times
    Applying Illinois law

    Rather, the modern trend is to permit a "mortgagee to collect rents once it has taken constructive, as opposed to actual, possession of the property."Comerica Bank-Illinois v. Harris Bank Hinsdale, 284 Ill. App. 3d 1030, 1034, 673 N.E.2d 380, 382 (1996). For example, courts have allowed mortgagees to collect rents after the mortgagees have taken affirmative action to take possession of the property, by obtaining an injunction or by having a receiver appointed.Comerica Bank, 284 Ill. App. 3d at 1034, 673 N.E.2d at 382-83;see also De Kalb Bank v. Purdy, 166 Ill. App. 3d 709, 716, 520 N.E.2d 957, 962 (1988).

  9. W. Bend Mut. Ins. Co. v. Belmont State Corp.

    712 F.3d 1030 (7th Cir. 2013)   Cited 10 times
    Describing assignment of rents versus citation lien rights over account funds

    To take full advantage of an assignment, a creditor must arrange for the tenants to pay it directly through a lockbox, or for a third party such as a receiver to take possession for the lender's benefit. See Comerica Bank–Illinois v. Harris Bank Hinsdale, 284 Ill.App.3d 1030, 1035, 220 Ill.Dec. 468, 673 N.E.2d 380 (1996). When as in Bloomfield State Bank the dispute concerns the priority of interests in rent not yet due, the status of rentals in the debtor's possession is unimportant; but here the only sums in dispute are those that found their way into Gizynski's hands before being applied to his loans at the Bank.

  10. Jefferson-Pilot Invs., Inc. v. Capital First Realty, Inc.

    Case No. 10 C 7633 (N.D. Ill. May. 29, 2012)   Cited 1 times

    This indicates that a court order, not just initiation of a lawsuit, is necessary for constructive possession. See Comerica Bank-Ill. v. Harris Bank Hinsdale, 284 Ill. App. 3d 1030, 1034, 673 N.E.2d 380, 382-83 (1996) ("Courts have recently allowed mortgagees to collect rents after taking some affirmative action . . . such as obtaining judicial intervention by way of injunctive relief [and] once a receiver has been appointed."); Matter of Wheaton Oaks Office Partners Ltd. P'ship, 27 F.3d 1234, 1242 (7th Cir. 1994) ("[To] allow creditors the opportunity to reach the rents sooner than the completion of foreclosure proceedings, Illinois allows mortgagees . . . to authorize the appointment of a receiver through whom the mortgagee can begin collecting rents."). The other cases that Jefferson-Pilot cites similarly concern mortgagees that had actually obtained judicial relief. See DeKalb Bank v. Purdy, 166 Ill. App. 3d 709, 716, 520 N.E.2d 957, 961 (1988) (defendant was "ordered to pay into the court future rent received"); State Bank & Trust Co. v. Massion, 279 Ill. App. 234, 236 (1935).