An Illinois investor thought it had won a foreclosure auction - until the deal was vacated. Now, an appellate court has reversed the outcome
An Illinois appeals court has reinstated a real estate investor’s right to intervene in a foreclosure case after it was denied by a trial judge following a last-minute settlement between the original parties.
In a March 24, 2025 decision, the Illinois Appellate Court for the First District reversed a Cook County judge’s ruling that had barred Joe Investment L.L.C., the highest bidder at a court-ordered judicial sale, from intervening in the underlying mechanics lien foreclosure. The court found that the investor had met all statutory requirements for intervention and directed the circuit court to allow the company to pursue confirmation of the sale.
The dispute began in 2021 when M&J Asphalt Paving Company, Inc. filed a foreclosure action to enforce a mechanics lien against property located at 5933 West 115th Street in Alsip, Illinois. The property was held in a land trust by First Midwest Bank, as successor trustee to Standard Bank and Trust Company.
M&J had performed asphalt work as a subcontractor to L&L Construction Services, L.L.C., the general contractor on the project. When L&L filed for bankruptcy and failed to pay M&J, the subcontractor recorded a lien and filed suit under the Illinois Mechanics Lien Act.
In January 2022, the circuit court entered a default judgment, and in March 2022, issued a judgment of foreclosure and sale, ordering the property sold at public auction if payment was not made. Although the order erroneously listed a three-month redemption period—borrowed from mortgage foreclosure statutes—the case proceeded under the Mechanics Lien Act, which requires a six-month redemption period following a judicial sale.
Following litigation delays, the property was auctioned on March 14, 2023, and Joe Investment L.L.C. submitted the highest bid of $400,000. It received a certificate of sale and, on March 20, 2023, filed a petition to intervene and a motion to confirm the sale.
Soon after the sale, M&J Asphalt and the land trust filed a joint motion to vacate the judicial sale and voluntarily dismiss the foreclosure case, claiming that the lien had been paid in full on March 27, 2023. No documentation of the payment was provided.
The trial court denied Joe Investment’s petition to intervene, reasoning that the motion to confirm the sale was not formally filed but only included as an exhibit to the petition. The court further held that the joint dismissal motion, having been filed first, rendered the intervention request moot. It vacated the sale, dismissed the case with prejudice, and returned the $400,000 deposit to Joe Investment.
Joe Investment filed a motion to reconsider, arguing that it had a statutory right to intervene as a party whose financial interest would be directly affected by the outcome. The trial court denied the motion.
The appellate court rejected the trial court’s reasoning and held that Joe Investment was entitled to intervene as a matter of right under Section 2-408(a) of the Illinois Code of Civil Procedure. The court found that as the highest bidder and holder of the certificate of sale, Joe Investment was “so situated as to be adversely affected” by the court’s disposition of the property.
The panel emphasized that a third-party purchaser at a judicial sale has a recognized legal interest—even if contingent on confirmation—and that such interest is not adequately represented by either the plaintiff or defendant in a foreclosure proceeding.
The appellate court also held that the trial court erred in treating the motion to confirm the sale as procedurally ineffective and clarified that a motion to voluntarily dismiss a case cannot override a properly filed petition to intervene, citing long-standing precedent including Gage v. Cameron, 212 Ill. 146 (1904), and In re Marriage of Black, 133 Ill. App. 3d 59 (1985).
Because Joe Investment had demonstrated prima facie error under the Illinois Supreme Court’s decision in First Capitol Mortgage Corp. v. Talandis Construction Corp., the appellate court reversed the circuit court’s order and remanded the case with instructions to grant the petition to intervene and allow Joe Investment to formally present its motion to confirm the sale.
