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2 1401 Petition
2 1401 Petition
Pursuant to the Illinois Code of Civil Procedure, a litigant is allowed the proverbial two bites at
the apple to vacate a default order or other final order or judgment. Practitioners should be aware
of the distinctions among the two statutes which allow such relief, as well as a cautionary
instruction regarding the statute of limitations.
The first opportunity to vacate a default order, final order or judgment is described in 735 ILCS
5/2-1301. Section 1301 is a discretionary rule allowing the court to set aside a default order
before final order or judgment. Additionally, Section 1301 allows the court to vacate a final
order or judgment upon motion filed within 30 days after its entry, and "upon any terms and
conditions that shall be reasonable.,,1 In essence, so long as the moving party provides the Court
with a reasonable justification for vacating the order or judgment, the Court will likely exercise
its discretion and grant the motion.2 In granting such a motion, however, the Court is not
obligated to set aside the final order or judgment as to all parties; in the event the Court limits its
order vacating to the moving party, the final order or judgment remains binding as to the other
parties.3
If the final order or judgment was entered more than 30 days prior to the filing of any motion to
vacate, the Illinois legislature affords a litigant a second chance for relief under 735 ILCS 5/2-
1401. In order to seek relief from a final Order or Judgment that is entered after 30 days, a
petition must be filed pursuant to 735 ILCS 5/2-1401. Courts have long noted that the purpose of
the 1401 petition is to make the court aware of those facts which do not appear in the record that,
if known, would have prevented entry of the final order or judgment. See. e.g. Prenam No. 2,
Inc. v. Village of Schiller Park, 2006 WL 2381564 (1st Dist. 2006).
The time limitation on the filing of the petition is two years from the date of the final order or
judgment. The only exceptions to the two-year filing period are when the person seeking relief is
under legal disability or duress, or when the ground for the relief is fraudulently concealed.4 A
petition to vacate filed under Section 1401 must be filed in the same proceeding and must be
supported by affidavit "or other appropriate showing as to matters not of record.,,5
According to the statute, the petitioner must show, based upon a preponderance of the evidence,
(1) the existence of a meritorious defense or claim; (2) due diligence in presenting the defense or
claim in the original action; and (3) due diligence in filing the petition. See, ~ Smith v. Airoom,
499 N.E.2d 1381 (III. 1986); Juszcyzk v. Flores, 777 N.E.2d 454 (1st Dist. 2002). The decision
regarding whether to grant or deny a petition to vacate lies within the sound discretion of the
court and depends upon the equities involved and the facts presented. Pirman v. A&M Cartage,
Inc., 215 III. App. 3d 993, 674 N.E.2d 874 (1st Dist. 1996). As the Illinois Supreme Court
recently noted, such an equitable power should be exercised" for the prevention of injury and for
the furtherance of justice." Paul v. Gerald Adelman & Associates, Ltd., 223 1I1.2d 85, 858
N.E.2d 1 (III. 2006).
According to the rule, "All relief heretofore obtainable and the grounds for such relief heretofore
available, whether by any of the foregoing remedies or otherwise, shall be available in every
case, by proceedings hereunder, regardless of the nature of the order or judgment from which the
relief is sought or the proceedings in which it was entered." (Emphasis added.) These petitions
do not affect the Order or judgment or suspend its operations, such as collection procedures
initiated after the judgment.
Requirement Number 1:
Meritorious Claim/Defense
The first requirement, that the petitioner show the existence of a meritorious defense or claim, is
self-explanatory and easy to meet.
Requirement Number 2:
A petitioner must show the Court that his failure to prosecute or defend a lawsuit was the result
of an excusable mistake and that, under the circumstances, she acted reasonably and not
negligently in failing to resist the judgment. Id. It is within the sound discretion of the Circuit
Court, depending upon the facts and equities presented by the petitioner, as to whether or not
such a petition should be granted. Ostendorf v. International Harvester Co., 433 N.E.2d 253
(1982) (emphasis added). There is no bright line rule for judging due diligence. Paul v. Gerald
Adelman & Associates, Ltd., 233 III. 2d 85, 306 III. Dec. 556 (III. 2006) (noting that a six-month
delay in filing a Section 1401 petition "does not, ipso facto, demonstrate a fatal lack of
diligence.") ~ at 100.
In this key element of the petition, the petitioner must set forth in detail the "facts and equities"
which support petitioners efforts to diligently prosecute or defend the underlying case via
Affidavit and relevant documentation. This documentation could consist of letters to opposing
counsel, service attempts, compliance with the Courts orders, appearance in court, and the like.
It is key to remember that a petitioner may not rely upon conclusions when fashioning her
petition. She must submit a factual affidavit and should include documentation supporting
petitioners diligence.
If the respondent to the petition believes that the petitioner lacked diligence in the underlying
action, it would behoove her to apprise the court of this via respondents own affidavit and
documents (e.g., Rule 201 (k) letters, copies of court orders concerning discovery, DWP orders,
etc. that illustrate petitioners lack of diligence in the underlying case(s)). Inclusion of
evidentiary documentation and material in either sides pleadings assures that, in the event the
matter is appealed, the appellate court would have the benefit of reviewing a more
comprehensive record.
The Illinois Supreme Court in its decision in Smith v. Airoom, Inc., 114 1I1.2d 209 (1986), stated
that a party relying on a Section 1401 petition must show that he failed to appear because of an
excusable mistake and not because of his own fault or negligence. In determining the
reasonableness of the excuse offered by the petitioner, all of the circumstances intended upon the
entry of a judgment must be considered, including the conduct of the litigants and their attorneys.
In 2005, the First District noted that "the current trend in Illinois ... [has] been to relax the due
diligence standard where necessary to prevent the unjust entry of default judgments and to effect
substantial justice." Coleman v. Caliendo, 361 III. App. 3d 850, 838 N.E.2d 155, 159 (1st Dist.
2005), citing In re County Treasurer, 347 III.App.3d at 774,283 III. Dec. 201, 807 N.E.2d 1042,
quoting Pirman v. A&M Cartage, Inc., 285 III. App. 3d 993, 1003, 674 N.E.2d 874 (1996).
In evaluating the diligence of the petitioner, Courts have considered the principals of justice and
clean hands. For example, a party opposing a petition to vacate may not benefit from his
conduct, or lack thereof, in notifying the petitioner of the action taken by the Court in the
underlying case. In Halle v. Robertson, 219 III. App. 3d 564, 579 N.E.2d 1243 (2d Dist. 1991),
the court specifically noted the fact that "plaintiff failed to notify defendant of the entry of the
default judgment in a timely manner, [and] failed to place the garnishment summons for service
in a timely manner" as "clearly sufficient grounds" to vacate the default. Likewise, in Pirman v.
A&M Cartage, Inc., 285 III. App. 3d 993,1003-4,674 N.S.2d 874 (1st Dist. 1996), the court held
that the plaintiffs failure to provide notice of entry of default preventing the defendant from
discovering a default until citation proceedings required vacating the default "even absent due
diligence".!Q. As Halle noted, "all of the circumstances ... including the conduct of the litigants
and their attorneys" factor into reasonableness. Halle v. Robertson, 219 III. App. 3d 564, 569,
579 .E.2d 1243 (2d Dist. 1991).
Likewise, in Cunningham v. Millers General Insurance Company, 188 III.App.3d 689, 554
N.E.2d 441 (4th Dist. 1989), the Fourth District determined that a reasonable and excusable
mistake for failing to file an answer and defenses was the "breakdown in defendants customary
procedure for processing legal documents." 1st. at 694-5. In Cunningham, the defendant was
served with the complaint, forwarded it to counsel in Chicago who prepared an answer and then
arranged for local counsel in Decatur to file the answer after delivery by a service. 1st., at 691.
However, the answer "never arrived." 1st. "The first anyone knew of the problem was when
plaintiffs garnisheed defendants bank account." Id. When an excusable mistake is not noticed
and petitioners counsel acted properly to answer the complaint, petitioner should be allowed to
have its day in court. Cunningham, 188 III.App.3d at 694-5.
Courts have consistently held that in order for a judgment to be vacated, the party seeking relief
must diligently pursue a petition to vacate. Smith v. Airoom, 1387. Due diligence requires that
the petitioner have and present to the Court evidence by a preponderance of reasonable excuse(s)
for failing to act within the appropriate time. Smith, 499 N.E.2d 198. Diligence requires that the
petitioner possess "reasonable excuse" for failing to act within the appropriate time and that
when he failed to object to the judgment, he acted reasonably and not negligently. Id. at 1387.
Further, in order to grant a petition to vacate, the petitioner must prove that entry of the order
was not known to the petitioner and could not have been discovered utilizing reasonable
diligence. See Jusczyk v. Flores, 334 III. App. 3d 122, 128, 777 N.E.2d 454 (1st Dist. 2002).
Numerous courts have held that a mere failure to receive notice of the order or judgment by the
petitioner in the underlying case is not a circumstance sufficient to grant a Section 1401 petition
to vacate. See, e.Q. Fiallo v. Lee, 205 WL 659122 (III. App. 1st Dist. 2005) (holding that
plaintiffs sole excuse for not moving to vacate a default judgment sooner consisted of a lack of
notice and that such claim did not amount to "evidence of her due diligence" since she failed to
apprise herself of the status of the case; thus her petition to vacate should have been denied);
Jusczyk v. Flores, 334 III. App. 3d 122, 777 N.E.2d 454 (1st Dist. 2002) (holding that two and a
half-month delay in filing petition to vacate judgment on an arbitration award where defendant
claimed he received notice of the arbitration hearing was not diligent); Gall v. Flash Cab Co.,
100 III. App. 2d 64, 41 N.E.2d 673 (1st Dist. 1968).
According to Section 1401, service of the petition to vacate must be had in accordance with
Supreme Court Rule 106, which directs that service shall be given by the methods provided in
Supreme Court Rule 105. Service must be had on the opposing party, and not her attorney in the
underlying action, since that party may no longer be represented by the same attorney. Public
Taxi Service, Inc. v. Ayrton, 15 III. App. 3d, 304 N.E.2d 733 (1st Dist. 1973). As such, service of
the Section 1401 petition must be given by (1) summons to the person or member of household;
(2) by prepaid certified or registered mail to the opposing party; or by publication with
affidavit.8 Invalid notice results in a lack of jurisdiction, rendering subsequent orders invalid.
Welfelt v. Schultz Transit Co., 144 III. App. 3d 767,772,494 N.E.2d 699 (1st Dist. 1986).
An examination of Illinois case law reveals that there are two general exceptions to the service
rule. First, a party waives the jurisdictional defect and is deemed to have entered a general
appearance when she appears and argues the merits of the petition. Welfelt v. Schultz Transit Co.,
144 III. App. 3d 767, 772, 494 N.E.2d 699 (1st Dist. 1986). The second, and more narrow
exception, allows for service of the petition upon the partys attorney of record in the original
proceeding where the attorney is representing the same party in court in a matter "ancillary to the
original judgment." lQ.
In addition to the jurisdictional issues discussed above, the responding party may object to the
substance of the Section 1401 petition to vacate. Initially, if the petition is insufficient in any
way, the respondent must initially file a motion to strike the petition; otherwise, she waives the
objection. Selvaggio v. Kickert School Bus Line, Inc., 46 III. App. 2d 398, 197 N.E.2d 128 (1st
Dist. 1964). A Section 1401 petition is a new cause of action subject to civil practice rules, is
considered in the same manner as a civil complaint, and is subject to dismissal if it "fails to state
a cause of action or shows on its face that the petitioner is not entitled to relief." Ostendorf v.
International Harvester Co., 433 N.E.2d 253 (1982).
If the non-moving party responds to the allegations contained in the petition, an evidentiary
hearing must be held where the petitioner must prove the factual allegations in her petition by a
preponderance of the evidence, based upon all of the circumstances of the underlying case. .!s:L
If a plaintiff is attempting to vacate a DWP order in a case that was previously voluntarily
dismissed, the defendant may have a statute of limitations defense to the Section 1401 petition.
In the event a lawsuit was previously dismissed pursuant to 735 ILCS 5/2-1009, the Illinois Code
of Civil Procedure allows for re-filing of said action within one year from date of entry of said
dismissal order (or within the remaining period of limitation). 735 ILCS 5/13-217. This statute
affords, essentially, a one-time re-filing. After the second opportunity to file a lawsuit following
a voluntary dismissal, a plaintiff cannot file any additional suits against the same defendant
arising out of the same occurrence. Rodgers-Orduno v. Cecil-Genrer, 728 N.E.2d 62 (2d Dist.
2000).
A petition to vacate pursuant to 735 ILCS 5/2-1401 "must be filed in the same proceeding in
which the order or judgment was entered but is not a continuation thereof." 735 ILCS 5/2-1401
(b) (emphasis added); Kulhavy v. Burlington Northern Santa Fe Railroad, 785 N.E.2d 928, 933
(1st Dist. 2003). As such, if a Section 1401 petition to vacate is filed after expiration of the
statute of limitations, the petition should be denied. Kulhavyat 394 (involving a FELA statute of
limitations).
In Kulhavy, plaintiff filed his Section 1401 petition nine months after expiration of the applicable
statute of limitations. Plaintiff claimed that he never received notice of the Court date which
plaintiff did not attend and when plaintiffs case was dismissed for want of prosecution. In
denying plaintiffs petition to vacate, the First District held that a Section 1401 petition is
considered a "new action" and not a continuation of the underlying case; since the federal statute
of limitations for plaintiffs claims had expired prior to plaintiff filing his "new action", plaintiff
was not entitled to relief. Id.
Although Kulhavy involved a federal statute that essentially pre-empted the one year re-filing
rule and potential tolling of the statute of limitations following a notice of voluntary dismissal,
this case provides practitioners with a stern warning that diligent prosecution of a case could
prove fatal in a future Section 1401 petition to vacate. For example, a plaintiff is injured on
January 1, 2002; the statute of limitations for a bodily injury is two years (January 1, 2004). Suit
is timely filed on June 1, 2003, but is voluntarily dismissed 18 months from the date of filing on
December 1, 2004 (thus allowing for re-filing of the lawsuit within one year and tolling the
statute of limitations from January 1, 2004 to December 1, 2005). Plaintiff waits until 11 months
following the voluntary dismissal to file a new suit on November 1, 2005. That suit is dismissed
for want of prosecution two months later on January 1, 2006. Plaintiff files her Section 1401
petition 60 days later on March 1, 2006. Since the filing of the petition (March 1, 2006) is a "new
action", the filing occurs after expiration of the statute of limitations (December 1, 2005) and
should be dismissed with prejudice pursuant to Kulhavy.
However, if the petitioner was dilatory in prosecuting or defending the underlying case(s), then
respondent must bring these "additional facts" to the attention to the Court to defeat the petition.
Conclusion
The general rule is that Section 1401 petitions for relief must affirmatively set forth specific
factual allegations supporting each of the following elements:
2 Due diligence in presenting this defense or claim to Circuit Court in the original action; and
In opposing such a petition, a practitioner must be mindful to not waive a clients rights by
submitting to the jurisdiction of the court and/or failing to preserve her clients right to
substantively object to the petition in writing and at hearing by first moving to strike the petition.
While there is no bright line for judging due diligence, attorneys are urged to monitor the
progress of their cases to avoid the effort associated with seeking relief from a final order or
judgment.
2 Id.
7 Service is not complete until the notice and petition are received by the opposing party and the
registry receipt serves as prima facie evidence thereof. S.C.R. 1 05(b).
8 S.C.R. 1 05(b)
During argument of the plaintiff's section 2-615 motions to dismiss the banks' respective
amended petitions to vacate the $800,000 defaults, Judge Varga commented:
"You need a wherefore clause to say who you want to collect against. You didn't do it. It is not
there * * *. So that judgment is void as to these two defendants. It's simple, it's clear, and it's
black and white to me ***. They were never notified, told that a dime was going to come from
them ***. If you want to tag some[one] for dollars, you have to put the person or entity's name in
the wherefore clause."
Use this At A Glance Guide to learn the statewide rules of civil procedure (Illinois Compiled
Statutes and Illinois Supreme Court Rules) applicable to counterclaims in Illinois Circuit Court.
For a more detailed treatment, including local rules and general pleading rules, please see the
Illinois Circuit Court SmartRules Guide: Counterclaim.
Deadlines:
The counterclaim must be made as part of the answer. 735 ILCS 5/2-608(b). In actions where a
specific appearance date is not required by statute, local rule or Supreme Court rule, the
summons should require each defendant to file his answer/counterclaim or otherwise appear in
the action within 30 days. IL Supreme Court R. 101(d).
The Illinois courts are liberal in exercising the discretion granted them to extend the time to
answer or otherwise plead for good cause shown. Such extensions may be granted to allow for
the filing of motions for involuntary dismissal, motions to transfer, requests for more particular
statement, or otherwise. IL Supreme Court R. 183.
A party who appears in an action without having been served with a summons is required to
plead within the same time as if the summons had been served on the appearance date. IL
Supreme Court R. 13(b).
Answers by parties already before the court to counterclaims must be filed within twenty-one
(21) days after the last day for filing the counterclaim. IL Supreme Court R. 182(b). An answer
to a counterclaim and pleadings subsequent thereto must be filed as in the case of a complaint
and with like designation and effect. 735 ILCS 5/2-608(d).
Under the Illinois rules, the term counterclaim includes any claim brought by one or more
defendants against one or more plaintiffs, or against one or more codefendants. 735 ILCS 5/2-
608(a). While the Federal Rules reserve the term counterclaim for a claim brought against a
plaintiff, and use the term cross-claim to refer to a claim brought against a codefendant, the
Illinois rules use the term counterclaim to refer to both types of claims.
There is no compulsory counterclaim rule in Illinois. In contrast to the Federal Rules, the Illinois
rules provide only for permissive counterclaims. See 735 ILCS 5/2-608(a).
Any claim by one or more defendants against one or more plaintiffs or against one or more co-
defendants, whether in the nature of setoff, recoupment, cross claim, or otherwise, and whether
in tort or contract, or for liquidated or un-liquidated damages, or any other relief, may be brought
as a counterclaim. 735 ILCS 5/2-608(a).
Counterclaims must be pled in the same manner and with the same particularity as the complaint
and other pleadings. The counterclaim must be complete in itself, but may incorporate by
specific reference allegations set forth in the answer. 735 ILCS 5/2-608(c).
The plaintiff may at any time before trial or hearing begins, upon notice to each party who has
appeared or each such partys attorney, and upon payment of costs, dismiss his or her action or
any part thereof as to any defendant, without prejudice, by order filed in the cause. 735 ILCS
5/2-1009(a). Such a voluntary dismissal does not dismiss a pending counterclaim or third party
complaint. 735 ILCS 5/2-1009(d).
The authorities cited in this At A Glance Guide are current as of the publication date. For
authorities updated in real time, please see the SmartRules Guide for the litigation document you
are drafting.
On April 10, 2008, RBM filed a motion to vacate the default judgment and for leave to
intervene and file a counterclaim instanter. A copy of RBMs proposed counterclaim was
attached to the motion. In the answer and counterclaim attached to the motion, RBM alleged
it provided materials, equipment, services and labor in the amount of $428,500 to the owners
of the Lincolnwood property. RBM completed the work under the contract on June 14, 2006,
and subsequently recorded a mechanics lien on the property for unpaid work. RBM claimed
its lien is prior and superior to the mortgage owed to BONY.
Sarkissian v.
Chicago Board of Education, 201 Ill. 2d 95, 102 (2002).
The two cases could have been consolidated so there
would be no duplication.