                           Illinois Official Reports

                                  Appellate Court



                  BMO Harris Bank, N.A. v. Wolverine Properties, LLC,
                              2015 IL App (2d) 140921



Appellate Court       BMO HARRIS BANK, N.A., f/k/a Harris N.A., as Assignee of
Caption               Amcore Bank N.A., Plaintiff-Appellant, v. WOLVERINE
                      PROPERTIES, LLC; RICHARD J. CALDARAZZO; KURT F.
                      BECKER; TWIN OAKS VENDING, INC.; KURICH MUSIC, INC.;
                      ARETE 3, LTD.; AMCORE INVESTMENT GROUP, N.A., as
                      Trustee u/t/a 03-14944; UNKNOWN OWNERS; and NONRECORD
                      CLAIMANTS, Defendants-Appellees.



District & No.        Second District
                      Docket No. 2-14-0921



Filed                 August 20, 2015



Decision Under        Appeal from the Circuit Court of Du Page County, No. 10-L-4819; the
Review                Hon. Bonnie M. Wheaton, Judge, presiding.



Judgment              Affirmed.



Counsel on            Kurt M. Carlson and Martin J. Wasserman, both of Carlson Dash,
Appeal                LLC, of Chicago, for appellant.

                      Robert G. Black, of Law Offices of Robert G. Black, of Naperville,
                      Frank J. DeSalvo, of Law Offices of DeSalvo & Cowden, P.C., of
                      Wheaton, and Steven B. Bashaw, of Steven B. Bashaw, P.C., of Lisle,
                      for appellees.
     Panel                    JUSTICE JORGENSEN delivered the judgment of the court, with
                              opinion.
                              Justices McLaren and Zenoff concurred in the judgment and opinion.



                                               OPINION

¶1         In August 2013, plaintiff, BMO Harris Bank, N.A., f/k/a Harris, N.A., as assignee of
       Amcore Bank N.A. (BMO), as mortgagee, sought a judgment of foreclosure in the amount of
       approximately $3.5 million. That request did not include an approximately $500,000 tax
       payment that it had made in July 2013. The trial court granted the judgment. Later, the
       property went to sale, and BMO, as purchaser, was the sole bidder, bidding an amount
       equaling the judgment amount plus subsequently accruing costs, leaving no deficiency
       (which is calculated by the sale price minus the judgment amount and minus the costs
       accruing after the judgment but before the sale). BMO, however, sought to collect a
       deficiency judgment for the prejudgment tax payment, to be collected from the
       defendant-guarantors, Richard J. Caldarazzo and Kurt F. Becker.
¶2         At a hearing to confirm the sale, pursuant to section 15-1508 of the Illinois Mortgage
       Foreclosure Law (Foreclosure Law) (735 ILCS 5/15-1508 (West 2014)), the trial court
       denied the request for the deficiency judgment. The court stated that, because BMO had not
       sought to include the tax payment in the judgment of foreclosure, it could not subsequently
       collect the payment as a deficiency against the sale proceeds. Therefore, BMO could collect
       the tax payment only by having the sale “set aside,” i.e., not confirmed, so that a new
       sale–stemming from a judgment based on an accurate accounting, including the tax
       payment–could take place. We infer that the court concluded that, had an accurate
       accounting, including the tax payment, been presented prior to the sale, the sale price likely
       would have been different.
¶3         The court performed an analysis under section 15-1508(b) of the Foreclosure Law, which
       sets forth the four circumstances under which a sale may be set aside. 735 ILCS 5/15-1508(b)
       (West 2014). The court found that none of the four circumstances, including injustice, was
       present. Therefore, it confirmed the sale and ruled that there was no deficiency. BMO
       appeals, arguing that section 15-1508(b) did not apply, because it was not seeking to set aside
       the sale. It argues that the correct analysis was a simple application of section 15-1512,
       which, in its view, states without qualification as to timing or circumstance that a mortgagee
       may recover for payment of real estate taxes. 735 ILCS 5/15-1512 (West 2014). For the
       reasons that follow, we reject BMO’s argument and affirm the trial court.

¶4                                       I. BACKGROUND
¶5         The instant case concerns three parcels of real estate, each of which is located at 657
       Wolverine Drive in Aurora. One parcel consists of 15 acres of vacant land, and the remaining
       two parcels contain a commercial building. In April 2008, the owners of the real estate,
       defendants Wolverine Properties, LLC, Twin Oaks Vending, Inc., and Kurich Music, Inc.,
       executed promissory notes in the principal amounts of $1,629,279.33, $662,301.18, and

                                                  -2-
       $463,122.07. The notes were secured by multiple mortgages on the real estate. In addition,
       Caldarazzo and Becker executed personal guaranties on the indebtedness. By April 2010, the
       loans had matured, and Wolverine, Twin Oaks, and Kurich were in default.
¶6         On February 23, 2011, BMO filed an amended foreclosure complaint against, among
       others, Wolverine, Twin Oaks, and Kurich, as well as Caldarazzo and Becker (hereinafter,
       collectively referred to as defendants), wherein it sought to foreclose on the mortgages and
       obtain a judgment on the notes and the guaranties. In the complaint, BMO alleged separate
       breach-of-contract claims against Caldarazzo and Becker. BMO argued that Caldarazzo and
       Becker had breached their contractual duties, as set forth in the guaranties, to “absolutely and
       unconditionally guarant[y] full and punctual payment and satisfaction of the Indebtedness of
       Borrower to Lender, and the performance and discharge of all Borrower’s obligations under
       the Note and the Related Documents.” Following answers and motions not at issue here, on
       January 10, 2013, BMO moved for summary judgment on all counts. The affidavits of proof
       in support of the motion sought principal, interest, and nonattorney-related charges accrued
       through October 31, 2012.
¶7         On July 15, 2013, before the trial court set the hearing date on BMO’s motion, BMO paid
       $470,341 in real estate taxes on the three parcels. However, BMO did not amend its motion
       for summary judgment or its affidavits of proof in support thereof to reflect the $470,341 tax
       payment. The tax payment and BMO’s subsequent failure to timely document it would come
       to form the central controversy in this appeal.
¶8         On July 25, 2013, the trial court set for hearing BMO’s motion for summary judgment.
       On August 9, 2013, the trial court heard and granted the motion, but, as it was not presented
       with evidence of the $470,341 tax payment, the court did not consider it. The judgment of
       foreclosure was for $3,539,797. The court, sua sponte, reserved entry of a monetary
       judgment against Caldarazzo and Becker should a sale fail to satisfy the judgment of
       foreclosure.
¶9         After the judgment of foreclosure, but prior to the judicial sale, BMO accrued and
       incurred the following entitlements and expenses: (1) $164,964.26 in interest on the debt; and
       (2) $1,800 for a presale appraisal. Thus, aside from the $470,341 tax payment, the total
       amount owed to BMO was $3,706,561.65 ($3,539,797.39 + $164,964.26 + $1,800). BMO
       sought amendment of the judgment of foreclosure so that it could conduct the sale in two
       parts, but it did not seek to amend the judgment amount to include the tax payment.
¶ 10       On February 13, 2014, pursuant to the August 9, 2013, judgment of foreclosure, the
       Du Page County sheriff conducted the judicial sale in two parts. BMO was the sole bidder, at
       a total of $3,651,097. Thus, the deficiency was $55,464.65 ($3,706,561.65 - $3,651,097). If
       the $470,341 tax payment had been counted as part of the judgment of foreclosure, the
       deficiency would have been $525,805.65 (3,706,561.65 + $470,341 - $3,651,097). This is the
       amount for which BMO would seek to be reimbursed.1


           1
            BMO appears to concede on appeal that, if it is not entitled to recover the $470,341 tax payment, it
       is not entitled to any deficiency (not even the aforementioned $55,464.65). BMO does not discuss
       every detail of the expenses sought below, and we recognize that the figures presented by the parties do
       not “square up” mathematically. As such, we concentrate on the presented question of whether BMO
       should recover its tax payment, which, henceforth, for ease, we describe as $500,000.

                                                       -3-
¶ 11       On March 4, 2014, BMO moved to have the sale confirmed pursuant to section 15-1508.
       735 ILCS 5/15-1508 (West 2014). In addition to confirmation of the sale, BMO sought a
       deficiency judgment for $525,805.65, which included the tax payment. (It also sought
       $81,408.61 in additional attorney fees and costs not at issue on appeal.) This was the first
       time that BMO requested recovery for the tax payment. BMO argued that it was entitled to
       recover the tax payment, because section 15-1512 states that proceeds and surpluses from
       judicial sales “shall” be distributed in a certain order, the second of which is reimbursement
       for “the reasonable expenses of securing possession before sale” including “payment of
       taxes.” 735 ILCS 5/15-1512(b) (West 2014). BMO noted that section 15-1512 did not
       differentiate between taxes paid prior to the judgment of foreclosure and taxes paid after the
       judgment of foreclosure but still before the judicial sale. Finally, BMO reminded the court
       that it retained jurisdiction to amend any previous order (i.e., including the judgment of
       foreclosure) to include the taxes. BMO requested that the deficiency judgment be entered
       against Caldarazzo and Becker.
¶ 12       Defendants responded that, in section 15-1508 proceedings to confirm a sale and assign a
       deficiency against the judgment (if any), only costs incurred between the judgment of
       foreclosure and the sale are recoverable. 735 ILCS 5/15-1508 (West 2014). Because BMO
       paid the taxes before the judgment of foreclosure, the tax payments were not recoverable.2
       Defendants also argued that they had relied on the accuracy of the judgment amount at the
       sale and that altering the amount of indebtedness after the sale would be unfair. Specifically,
       defendants stated that Caldarazzo had been present at the sale and that, when he saw that the
       bid equaled the judgment amount plus interest, he knew that there would be no deficiency
       and, therefore, did not bid.
¶ 13       The trial court confirmed the sale and ruled that BMO was not entitled to recover for the
       tax payment. It found that there was no deficiency and that, therefore, nothing was owed on
       the guaranties. In explaining its ruling, the court stated that the instant fact pattern presented
       an issue of first impression. However, citing to the broad principles set forth in Wells Fargo
       Bank, N.A. v. McCluskey, 2013 IL 115469, it stated that “the deficiency has to be decided on
       the judgment amount that went to the foreclosure sale.” The tax payment was not included in
       the judgment of foreclosure, and the judgment of foreclosure dictated the terms of the sale.
       The inference to be drawn from the court’s statements is that, in order for BMO to recover
       for the tax payment, the judgment of foreclosure would need to be amended to include the
       tax payment, and, because the judgment of foreclosure dictated the terms of the sale, the sale
       based on the original judgment of foreclosure would have to be set aside. However, in the
       court’s view, none of the four circumstances set forth in section 15-1508 that would justify
       setting aside a sale was present. 735 ILCS 5/15-1508 (West 2014) (the court shall confirm
       the sale unless (1) notice was not given; (2) the terms were unconscionable; (3) the sale was
       fraudulently conducted; or (4) justice was otherwise not done). As to Caldarazzo and Becker,
       the court stated that they could be liable only for the amount of the deficiency, which, by the
       court’s calculation, was zero. They could not be separately liable for the tax payment.
           2
            Defendants would later argue that, pursuant to Bank of America, N.A. v. Higgin, 2014 IL App (2d)
       131302, even real estate taxes paid between the judgment of foreclosure and the sale are not
       recoverable. We need not reach this issue to resolve this appeal. We do note, however, that Higgin
       involved the post-sale payment of back taxes by the purchaser, not the presale payment of taxes by the
       mortgagee.

                                                     -4-
       Although an order confirming a sale is considered final and appealable (U.S. Bank National
       Ass’n v. Prabhakaran, 2013 IL App (1st) 111224, ¶ 21), the court also ensured appellate
       jurisdiction with a written finding pursuant to Illinois Supreme Court Rule 304(a) (eff. Feb.
       26, 2010). This appeal followed.

¶ 14                                           II. ANALYSIS
¶ 15                                            A. Overview
¶ 16       On appeal, BMO argues that the trial court did not perform the correct analysis. In its
       view, the section 15-1508(b) analysis to determine whether the sale could be set aside bore
       no application to this case, because BMO did not seek to set aside the sale. Rather, it sought a
       deficiency judgment. We acknowledge that, ordinarily, it is a borrower who seeks to “set
       aside” a not-yet-official sale, i.e., to prevent confirmation. See, e.g., McCluskey, 2013 IL
       115469, ¶¶ 24-25. Here, by contrast, the trial court considered whether the judgment should
       be set aside on behalf of the lender/purchaser, which has made an irrevocable offer to
       purchase the property at a certain price. See, e.g., Household Bank, FSB v. Lewis, 229 Ill. 2d
       173, 181 (2008). In this respect, the trial court’s section 15-1508(b) analysis was unusual.
       Nevertheless, for the reasons that follow, we agree that the trial court’s analysis under section
       15-1508(b) was correct and that BMO suffered no injustice.
¶ 17       BMO posits that the correct analysis would have been a simple application of section
       15-1512, which, in its view, states without qualification as to timing or circumstance that a
       mortgagee may recover for payment of real estate taxes. 735 ILCS 5/15-1512 (West 2014).
       Although our section 15-1508 discussion is dispositive of the case, we will briefly explain
       why section 15-1512 does not apply here. Id.
¶ 18       Finally, BMO argues that, although it cannot obtain a $500,000 deficiency judgment
       against the borrowers, it should be able to do so against the guarantors. We reject this
       argument, because BMO has presented no authority for its assertion that the guarantors can
       be liable for a different amount than the borrowers.

¶ 19                          B. The Trial Court’s Section 15-1508 Analysis
¶ 20       We begin by setting forth the statutory and black-letter law concerning the recovery of
       real estate taxes, the foreclosure process, and the award of a deficiency judgment. “All
       monies advanced by the mortgagee in accordance with the terms of a mortgage to ***
       preserve or restore the mortgaged real estate *** shall be a lien from the time the mortgage is
       recorded.” 735 ILCS 5/15-1302(b)(5) (West 2014). “During a foreclosure, and any time prior
       to sale, a mortgagee or any other lienor may pay *** (ii) when due[,] installments of real
       estate taxes ***.” 735 ILCS 5/15-1505 (West 2014). In its complaint for foreclosure, a
       plaintiff-mortgagee may request a judgment for attorney fees, costs, and expenses. 735 ILCS
       5/15-1504(a)(3)(T)(vi) (West 2014). Indeed, a request for foreclosure is deemed to mean that
       the plaintiff requests an accounting of the amounts due and owing. 735 ILCS 5/15-1504(e)(1)
       (West 2014). When a plaintiff seeks the inclusion of fees, costs, and expenses in the
       judgment of foreclosure, its complaint is deemed to include allegations that, “in order to
       protect the lien of the mortgage, it may become necessary for plaintiff to pay taxes and
       assessments which have been or may be levied upon the mortgaged real estate” and that,
       “under the terms of the mortgage, any money so paid or expended will become an additional


                                                   -5-
       indebtedness secured by the mortgage [with interest].” 735 ILCS 5/15-1504(d)(4), (d)(6)
       (West 2014). If the defendant-mortgagor does not pay the amount set forth in the foreclosure
       judgment, the mortgaged real estate will be sold as directed by the court, to satisfy the
       amount due to the plaintiff as set forth in the judgment (with interest). 735 ILCS
       5/15-1504(e)(3) (West 2014). “Upon the entry of the judgment of foreclosure, all rights of a
       party in foreclosure against the mortgagor provided for in the judgment of foreclosure ***
       shall be secured by a lien on the mortgaged real estate, which lien shall have the same
       priority as the claim to which the judgment relates and shall be terminated upon confirmation
       of [the] judicial sale.” 735 ILCS 5/15-1506(i)(1) (West 2014). Also upon the entry of the
       judgment of foreclosure, the rights in the real estate subject to the judgment shall be solely as
       provided for in the judgment. 735 ILCS 5/15-1506(i)(2) (West 2014). The real estate shall be
       sold at a sale on such terms and conditions as shall be specified in the judgment of
       foreclosure. 735 ILCS 5/15-1507(b) (West 2014).
¶ 21       Following the sale, upon motion, the court shall conduct a hearing to confirm the sale and
       enter a deficiency judgment, if necessary. 735 ILCS 5/15-1508(b), (e) (West 2014). “Unless
       the court finds that (i) a notice required in accordance with subsection (c) of Section 15-1507
       was not given, (ii) the terms of sale were unconscionable, (iii) the sale was conducted
       fraudulently, or (iv) justice was otherwise not done, the court shall then enter an order
       confirming the sale.” 735 ILCS 5/15-1508(b) (West 2014). Additionally, the confirmation
       order may “approve the mortgagee’s fees and costs arising between the entry of the judgment
       of foreclosure and the confirmation hearing, those costs and fees to be allowable to the same
       extent provided in the note and mortgage and in Section 15-1504.” (Emphasis added.)
       735 ILCS 5/15-1508(b)(1) (West 2014). “In any order confirming a sale pursuant to the
       judgment of foreclosure, the court shall also enter a personal judgment for deficiency against
       any party ***.” 735 ILCS 5/15-1508(e) (West 2014). “Except as otherwise provided in [the
       Foreclosure Law], a judgment may be entered for any balance of money that may be found
       due to the plaintiff, over and above the proceeds of the sale or sales ***.” Id. “[T]he
       judgment stands satisfied to the extent of the sales price less expenses and costs.” 735 ILCS
       5/15-1508(f) (West 2014). “[I]f the sale of the mortgaged real estate fails to produce a
       sufficient amount to pay the amount found due, the plaintiff may have a personal judgment
       against any party in the foreclosure indicated as being personally liable therefor ***.” 735
       ILCS 5/15-1504(f) (West 2014).
¶ 22       Turning back to the instant case, defendants’ position, and the position taken by the trial
       court, is as follows. BMO could have sought to include the tax payment, made prior to the
       judgment of foreclosure, as part of the amount due in the judgment. See, e.g., 735 ILCS
       5/15-1302(b)(5), 15-1504(d)(4), 15-1505 (West 2014). Although we cannot be certain, BMO
       most likely would have succeeded in showing that the payment was necessary to protect the
       lien on the mortgage and that the terms of the mortgage allowed for the payment to become
       an additional indebtedness on the property. 735 ILCS 5/1504(d)(4), (d)(6) (West 2014).
       However, BMO did not seek to include the tax payment in the judgment of foreclosure.
¶ 23       Although the alleged error by omission was made early on–at the time of the judgment of
       foreclosure–the trial court focused its analysis on a later stage, analyzing the circumstances
       under which a trial court may refuse to confirm a sale. In support of this leap, defendants
       stress that the sheriff conducted the sale according to the judgment of foreclosure. 735 ILCS
       5/15-1507(b) (West 2014). The notice regarding the upcoming sale set forth a judgment


                                                   -6-
       amount that did not include the tax payment. We note that, upon receiving such notice,
       defendants, as the debtors, could have redeemed the property by paying the amount set forth
       in the foreclosure judgment, which did not include the tax payment. Therefore, defendants’,
       and the trial court’s, view seems to be that, because the judgment of foreclosure influenced
       the outcome of the sale, then, hypothetically, an amended judgment of foreclosure that
       included the tax payment would lead to different sale results. Ergo, one cannot amend the
       judgment of foreclosure without setting aside the sale.
¶ 24       There is authority to support the trial court’s reasoning beyond defendants’ citation to
       section 15-1507(b), which states that the sheriff relies upon the terms set forth in the
       judgment of foreclosure in conducting the sale. Id. Again, section 15-1504(e)(3) states that
       the amount due to the plaintiff is as set forth in the judgment (with interest). 735 ILCS
       5/15-1504(e)(3) (West 2014). Further, section 15-1506(i)(2) states that the rights in the real
       estate subject to the judgment of foreclosure shall be solely as provided for in the judgment
       of foreclosure. 735 ILCS 5/15-1506(i)(2) (West 2014). Moreover, under common law, the
       party conducting the sale has a duty to secure the highest possible bid so that the debt is
       satisfied as far as possible. Davison v. Krejci, 307 Ill. App. 514, 518-19 (1940). The party
       conducting the sale may prevent a sale at a grossly inadequate price by fixing the reasonable
       price in advance. Levy v. Broadway-Carmen Building Corp., 366 Ill. 279, 290-91 (1937).
       Even though one may first assume that a reasonable minimum bid protects the interests of the
       lender, such that the debt is satisfied, it also protects the interests of the debtor, such that
       there is no deficiency judgment. Id.; see Members Equity Credit Union v. Duefel, 295 Ill.
       App. 3d 336, 339 (1998). This common law authority is relevant because the entity
       conducting the sale relies upon the judgment of foreclosure in gauging whether its
       procedures and guidelines in conducting the sale are likely to secure a bid that will satisfy the
       court-determined debt, i.e., the judgment amount. All of this authority, both statutory and
       common law, comes together to establish that, generally, the amount set forth in the
       judgment of foreclosure influences the sale process and, thus, the ultimate sale price.
¶ 25       Here, without the benefit of hindsight, it is impossible to know with certainty whether a
       different judgment amount would have led to a different sale price. The notice of sale did not
       include minimum- or opening-bid guidelines. We do not see that information anywhere in the
       record or know whether it was ever presented to the trial court, but this informational
       shortfall weighs against BMO, because BMO has the burden to show that it is entitled to a
       deficiency judgment. 735 ILCS 5/15-1508 (West 2014). The foregoing authority and practice
       trends, as well as BMO’s failure to produce any evidence to show that the (approximate) $3.5
       million judgment amount did not influence the (approximate) $3.5 million sale price, leaves
       intact the causal link between the judgment amount and the sale price such that the trial court
       stood on firm ground when reasoning that one cannot be manipulated without impacting the
       other.
¶ 26       Having established that the trial court applied the correct analysis, we now evaluate
       whether the outcome of that analysis constituted an abuse of discretion. The trial court’s
       decision regarding whether a sale should be confirmed or set aside is reviewed for an abuse
       of the limited discretion granted to it by section 15-1508. McCluskey, 2013 IL 115469, ¶ 19.
       The trial court is not given boundless discretion to set aside a sale. Id. Rather, it may set aside
       a sale only in the presence of one of the four circumstances set forth in section 15-1508. Id.
       The fourth circumstance, justice not otherwise done, is at issue here. It is a codification of the


                                                    -7-
       court’s power to vacate a sale “where unfairness is shown that is prejudicial to an interested
       party.” Id. A court should not refuse to confirm a sale merely to protect an interested party
       “ ‘against the result of his own negligence.’ ” Id. (quoting Shultz v. Milburn, 366 Ill. 400, 405
       (1937)). The injustice must be great enough to outweigh the need to establish stability in the
       sale process. Id. ¶ 25.
¶ 27        Here, the alleged prejudice to BMO is that BMO will not be reimbursed for the tax
       payment unless it is allowed to amend the judgment of foreclosure to include the tax
       payment. However, BMO presents no reason, other than its own inadvertence or mistake,
       why it could not have sought to include the tax payment in the original judgment of
       foreclosure. BMO contends that it is defendants that acted in a dilatory manner and that, if
       defendants had not filed a series of fruitless motions in defending against the foreclosure
       action, then BMO would have been able to secure the judgment of foreclosure well before it
       made the tax payment. We are not compelled by BMO’s contention. Even if defendants’
       actions were dilatory, a foreclosure defendant’s dilatory behavior is not an unusual obstacle.
       More tellingly, BMO had multiple opportunities to include the taxes in the judgment of
       foreclosure. BMO was granted leave to amend the judgment before the sale, and it again
       failed to include the tax payment. For these reasons, we cannot say that the trial court abused
       its discretion in determining that justice did not warrant setting aside the sale.
¶ 28        Having found that the trial court did not abuse its discretion, we discuss some of the
       fairness concerns raised at oral argument and explain why applying the Foreclosure Law as
       BMO wishes would lead to unpredictable sale processes and potentially absurd results. See,
       e.g., Sycamore Community Unit School District No. 427 v. Illinois Property Tax Appeal
       Board, 2014 IL App (2d) 130055, ¶ 28 (a court should not interpret a statute in a manner that
       would lead to absurd or unjust results). In BMO’s view, a mortgagee may ask for expenses,
       including tax payments, for the first time at the confirmation hearing so long as those
       expenses were incurred prior to the sale. BMO argues that there is no back-end time
       limitation for recovery and that it makes no difference whether a mortgagee incurs the
       expenses before or after the judgment of foreclosure. BMO further notes that section 15-1505
       references taxes paid prior to the sale but makes no reference to a back-end time limitation
       for recovery of those tax payments. 735 ILCS 5/15-1505 (West 2014) (“any time prior to
       sale, a mortgagee *** may pay *** (ii) when due[,] installments of real estate taxes”).
¶ 29        BMO’s interpretation of the Foreclosure Law presents many difficulties. First, we note
       that, although section 15-1505 does not reference a back-end time limitation for recovery, it
       does not reference recovery at all. It merely states that a mortgagee may pay the taxes. As we
       have already discussed, recovery must be governed by the amount sought in the foreclosure
       judgment and by those costs incurred between the judgment and the sale. 735 ILCS
       5/15-1504(e)(1), 15-1508(b) (West 2014). To hold otherwise would lead to absurd results.
       For example, in BMO’s view, a mortgagee could obtain a $10,000 judgment (or another
       comparatively nominal amount) based on a default that occurred 20 years prior. After the
       sale, the mortgagee could then seek a deficiency judgment for all the expenses it had incurred
       in the 20-year span preceding the sale, even though the expenses were not included in the
       judgment amount. A mortgagee would have no incentive to seek a judgment amount that
       accurately reflects the amount of recovery it would ultimately seek. This is simply untenable.
       A request for a foreclosure judgment is a request for “an accounting [to] be taken under the
       direction of the court of the amounts due and owing to the plaintiff.” (Emphasis added.) 735


                                                   -8-
       ILCS 5/15-1504(e)(1) (West 2014). A plaintiff must seek to include in the judgment of
       foreclosure all debts sought; that is a definitive purpose of the judgment of foreclosure. Id.
¶ 30       BMO argues that, in practice, it can be very difficult to compartmentalize each stray
       expense as occurring before or after the judgment. That might be true in some cases, and, if
       warranted, parties can find a remedy in the general justice provision of section 15-1508.
       However, it is not true here. This case involves a significant prejudgment tax payment,
       wiping out five-plus years of back taxes and removing a tax lien on the property in an
       amount equal to nearly 15% of the judgment amount.
¶ 31       We are also confident in the fairness of the trial court’s ruling. At first blush, the court’s
       ruling might appear to favor the technicalities of section 15-1508 at the expense of BMO’s
       full reimbursement, but this is not necessarily the case. Again, we can never know how the
       sale would have played out if the tax payment had been included in the judgment amount. If,
       however, the sale price again would have equaled the judgment amount plus interest, as, in
       practice, sale prices often do, the fairness of the court’s ruling becomes more apparent. In
       that case, BMO, as purchaser, would have bid approximately $4 million, and BMO, as
       mortgagee, would not be in a position to seek a deficiency judgment for the $500,000 tax
       payment; the tax payment would already be covered in the $4 million purchase price. In
       contrast, if BMO were allowed to recover the $500,000 tax payment from a debtor or
       guarantor–without setting aside the $3.5 million sale, amending the judgment of foreclosure,
       and conducting a new sale based on the amended judgment of foreclosure–then BMO, by
       wearing the two hats of mortgagee and purchaser, would potentially gain an extra $500,000
       as compared to the first scenario. It would receive the benefit of the “low” purchase price and
       the benefit of recovery of the tax payment.
¶ 32       We do not by this opinion imply that BMO’s exclusion of the tax payment from the
       foreclosure judgment was intentional. We recognize that the omission was likely a simple
       oversight. We do not doubt that BMO sincerely feels prejudiced by the trial court’s refusal to
       allow for recovery of the tax payment. However, because the trial court considered the justice
       and fairness of this case, we have herein aimed to explain why BMO has not necessarily been
       prejudiced. Again, because the judgment influences the sale, it is not an option to both keep
       the property for the $3.5 million sale price and receive the $500,000 tax reimbursement.

¶ 33                               C. Section 15-1512 Does Not Apply
¶ 34       Although our rationale regarding section 15-1508 is dispositive, we note that section
       15-1512 has no application to this case. Again, BMO contends that the court should have
       applied section 15-1512, which, in its view, states without qualification as to timing or
       circumstance that a mortgagee may recover for payment of real estate taxes. 735 ILCS
       5/15-1512 (West 2014). Section 15-1512 states:
              “Application of Proceeds of Sale and Surplus. The proceeds resulting from a sale of
              real estate under this Article shall be applied in the following order:
                  (a) the reasonable expenses of sale;
                  (b) the reasonable expenses of securing possession before sale, holding,
              maintaining, and preparing the real estate for sale, including payment of taxes and
              other governmental charges ***;



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                   (c) if the sale was pursuant to judicial foreclosure, satisfaction of claims in the
               order of priority adjudicated in the judgment of foreclosure or order confirming the
               sale; and
                   (d) remittance of any surplus to be held by the person appointed by the court to
               conduct the sale until further order of the court. If there is a surplus, such person
               conducting the sale shall send written notice to all parties to the proceeding advising
               them of the amount of the surplus, and that the surplus shall be held until a party
               obtains a court order for its distribution or until, in the absence of an order, the
               surplus is forfeited to the State.” (Emphases added.) Id.
¶ 35       As such, contrary to BMO’s reading, section 15-1512 does not state that a mortgagee is
       always entitled to reimbursement for prejudgment payments of real estate taxes. Rather,
       section 15-1512 discusses the order in which the proceeds of the sale will be applied. The
       distribution of any surplus requires further direction by the court. Here, there was no surplus.
       The sale price was approximately $3.5 million. That was the size of the pot. Nowhere does
       section 15-1512 state that an entitlement to recover prejudgment tax payments, if such a right
       did exist, can increase the size of the pot to $4 million such that BMO could, hypothetically,
       receive $3.5 million for the loan and another $500,000 for the taxes. For that reason, section
       15-1512 provides no relief for BMO.

¶ 36                          D. Alternative Recovery From the Guarantors
¶ 37       Finally, BMO argues that, although it is not entitled to obtain a $500,000 deficiency
       judgment against the borrowers, it may still do so against the guarantors. BMO cites
       authority standing for the proposition that a mortgagee may pursue satisfaction of a debt from
       either the borrowers or the guarantors. See, e.g., LP XXVI, LLC, v. Goldstein, 349 Ill. App.
       3d 237, 241-42 (2004) (after the mortgagee had obtained a foreclosure judgment, it was
       entitled to pursue a deficiency judgment against the guarantors). In this vein, BMO asserted
       at oral argument that section 15-1504(f) allows for recovery from the guarantors. 735 ILCS
       5/15-1504(f) (West 2014). Again, that section states: “[I]f the sale of the mortgaged real
       estate fails to produce a sufficient amount to pay the amount found due, the plaintiff may
       have a personal judgment against any party in the foreclosure indicated as being personally
       liable therefor ***.” Id. Finally, BMO asserts that the indebtedness for which the guarantors
       will be liable is determined by the terms of the guaranties. See, e.g., McHenry Savings Bank
       v. Autoworks of Wauconda, Inc., 399 Ill. App. 3d 104, 111-12 (2010).
¶ 38       We reject BMO’s argument. Neither LP XXVI nor section 15-1504(f) states that BMO
       may pursue satisfaction of a debt in a different amount than that found due by the court. To
       the contrary, section 15-1504 states that the mortgagee may pursue a judgment against any
       party personally liable, such as a guarantor, for “the amount found due.” 735 ILCS
       5/15-1504(f) (West 2014). Section 15-1504 specifies that the amount found due is to be
       based on a deficiency from the sale. Id. (“if the sale of the mortgaged real estate fails to
       produce a sufficient amount to pay the amount found due”). Here, the court found no
       deficiency when subtracting the judgment amount from the sale price, i.e., it found no
       amount due.
¶ 39       Additionally, BMO does not cite any special privileges set forth in the guaranties that
       would entitle it to collect from the guarantors a different amount than it would be entitled to
       collect from the borrowers. BMO quotes provisions of the guaranties that fall in the sections

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       entitled “miscellaneous provisions.” These provisions state: “Guarantor agrees to pay upon
       demand all of Lender’s costs and expenses, including Lender’s attorneys’ fees and Lender’s
       legal expenses, incurred in connection with the enforcement of this Guaranty.” (Emphasis
       added.) BMO takes these provisions out of context. These provisions do not impute
       unqualified liability for all BMO’s expenses. The provisions do not change the scope of the
       guaranties; rather, they merely state that BMO may be reimbursed for costs associated with
       enforcing its rights under the guaranties.
¶ 40       As BMO aptly noted in its breach-of-contract claims against Caldarazzo and Becker, the
       guaranties state that the guarantors will be liable for the same amount as the borrowers.
       Specifically, the guaranties state that the guarantors are obligated to “absolutely and
       unconditionally guarant[y] full and punctual payment and satisfaction of the Indebtedness of
       Borrower to Lender, and the performance and discharge of all Borrower’s obligations under
       the Note and the Related Documents.” (Emphases added.) Under our plain reading, the
       guaranties state that the amount of the indebtedness under the guaranties is the amount that
       the borrowers owe or will owe the lender. BMO was not entitled to recover the $500,000 tax
       payment from the borrowers, and, therefore, it cannot recover that amount from the
       guarantors.

¶ 41                                    III. CONCLUSION
¶ 42      For the aforementioned reasons, we affirm the trial court’s judgment.

¶ 43      Affirmed.




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