Appeal Order Denying Motion to To Appoint a Receiver to Manage the Mortgaged Property
In Mellon Bank. N.A. v. Midwest Bank & Trust Co., 265 Ill. App. 3d 859, 867, 638 N.E.2d 640, 202 Ill. Dec. 772 (1993), the mortgagee appealed from an order of the trial court denying its motion to appoint a receiver to manage the mortgaged property, a high-rise apartment complex in Chicago. Mellon Bank, 265 Ill. App. 3d at 861.
To establish good cause for permitting it to retain possession, the mortgagor asserted that:
(1) the mortgage lacked consideration;
(2) the mortgagee induced the mortgagor to enter into the mortgage using "maneuvers and sham transactions";
(3) the mortgagee previously accepted late payments and, therefore, was estopped from foreclosing. Mellon, 265 Ill. App. 3d at 869.
In reversing the trial court, this court found that defendant's "'good cause' arguments fail entirely." Mellon, 265 Ill. App. 3d at 872.
First, this court found the mortgagor's attempts to portray the mortgagee as an unscrupulous bank taking advantage of an unsophisticated owner unconvincing because the mortgage was executed by sophisticated businessmen who were represented by a prominent law firm. Mellon, 265 Ill. App. 3d at 870.
This court also rejected the mortgagor's argument that there was no consideration, noting that the mortgage was executed in exchange for the mortgagee agreeing to increase its letter of credit. Mellon, 265 Ill. App. 3d at 871.
Lastly, this court found that the mortgagee's previous acceptance of late payments did not prohibit it from ever seeking to foreclose the mortgage. Mellon, 265 Ill. App. 3d at 872.