Cook County Sheriff Tom Dart, like his counterparts across the nation, has been evicting people from their homes in ever increasing numbers. In 2008 the Chicago Democrat and his deputies conducted 4,487 court-ordered mortgage foreclosure evictions, an increase of 153 percent over the office's 2006 numbers. But on October 8 Dart stood before TV cameras and said he'd had enough. Criticizing banks and mortgage companies as heartless, careless and taking advantage of taxpayers, he suspended all mortgage foreclosure evictions. Suddenly Dart appeared to be the kind of lawman Tom Joad might have clapped on the back.
In a recent interview Dart said that over the summer he'd become aware that the eviction orders increasingly lacked evidence of the due diligence the banks were supposed to perform. In one instance, he said, his deputies arrived to evict residents from a building that no longer existed, and in other cases they found residents had documents showing they were rightfully in the house. "It was a disaster," he said. "Just complete chaos out there."
The tipping point came with the crisis at 4914-16 North Spaulding, an apartment building full of Hispanic immigrant families in Chicago's Albany Park neighborhood. Mihail Stancu, a Romanian immigrant, had purchased the building in October 2006 under the guise of MKST Enterprises, and he'd gone on to become the kind of owner Tom Joad might have clapped on the head with a shovel. According to City of Chicago senior assistant corporation counsel Steven McKenzie, Stancu's corporation sold the seven units as seven condos, the buyer being Stancu himself, who'd borrowed from seven lenders. Stancu was then in possession of a lot of cash and a lot of debt, and according to McKenzie the Romanian simply abandoned the latter, pocketing as much as $1.2 million, after which he disappeared. McKenzie, who has filed charges against Stancu, reports that the fugitive has been spotted in Spain and Romania.
Stancu had regularly collected rents from his tenants, but the collections stopped after about a year. Unable to reach the owner, tenant Esteban Cruz, an immigrant landscaper and gardener, began collecting the rents, paying for repairs and utilities, and depositing the remainder into a bank account belonging to Stancu. None of the tenants were particularly worried until May 28 of last year, when what seemed to be an eviction notice was posted on the front door and on the mailboxes of all the units. A second threatening notice followed shortly thereafter. Cruz brought the paperwork to the offices of the Albany Park Neighborhood Council. APNC recognized the notices as bank-generated, not court-generated, discovered the condominium ruse and laid out the problem before a housing court judge. The judge recognized that the best course was to put the building into receivership and try to find a single buyer who would convert the condos back into affordable rental housing. Armed with that decision, the tenants should have been safe.
But the eviction threats continued. A locksmith arrived and told one family they had thirty minutes to vacate. APNC organizer Emily Burns fended him off. Not long thereafter, Sheriff Dart's deputies pounded on the door of apartment 1A, demanding entry, armed with eviction papers. They left after finding the family was not listed on their papers, but according to Burns, they said they'd be back in a week to put the family out. Alma Aquino, who works as a cashier at a restaurant in the Loop, says she went to work every morning afraid that her family's possessions would be at the curb when she got home. Her parents, visiting from Mexico, asked what they should do if the deputies came back. "I say, 'Just don't open the door, and call the police.' But my father said, 'They are the police.'"
The APNC decided the sheriff was the problem, and on August 13 the council staged a protest rally in Daley Plaza, denouncing the sheriff, after which APNC board member Diane Limas and six of the Spaulding tenants, including two children, walked into Dart's office asking for a meeting. Three of Dart's aides sat down with the delegates and promised to investigate. Sheriff's spokesman Steve Patterson recalls that within about two days of the protest, Dart said, "You know, these people are right."
On October 8, with the APNC's Burns and Limas in attendance, Dart announced he was suspending mortgage foreclosure evictions.
"These mortgage companies only see pieces of paper, not people, and don't care who's in the building," Dart said. "They simply want their money and don't care who gets hurt along the way. On top of it all, they want taxpayers to fund their investigative work for them. We're not going to do their jobs for them anymore. We're just not going to evict innocent tenants. It stops today."
There was some furor in response, particularly from the banking industry; one prominent member denounced Dart as a vigilante. But Richard Gottlieb, a lawyer who chairs the legislative committee of the Illinois Mortgage Bankers Association, says the policy wasn't so radical at all. "It was all about being more humane to the people who had no idea that there was even a foreclosure action against the property. And it was the right thing to do, because people weren't doing it right." Gottlieb points out that for more than a decade, Illinois law has required the listing of all residents on motions for eviction and eviction orders, and it is likely that for years, sheriffs have been breaking the law by evicting people whose names have not been listed. "Dart basically did this to force the hand of the courts and the foreclosure lawyers to get it right.... In the end result, there was nothing terribly troubling about what occurred."
In the wake of his announcement, Dart sat down with the chief judge of the Chancery Court and worked out new procedures; the suspension ended ten days after it began. Dart, however, is still receiving paperwork filed before the new procedures were imposed, so he has continued to reject orders. Between October 20 and January 13, he received 232 requests for eviction, and he performed twenty-four. Part of his slow pace can be explained by the annual holiday moratorium on evictions and by cold weather (if it's fifteen degrees or colder at 6 am at O'Hare Airport, no evictions take place). But it also appears that Dart, enjoying the camaraderie of the Joad camp, has no great enthusiasm for getting back up to speed. He and APNC housing leaders met in mid-January to work on proposed legislation that would require eviction orders to list each occupant's birth date. Dart's intention is to have a social worker present if children or seniors are being evicted so they can be informed of available social services.
In the meantime, the Spaulding tenants have continued to receive threatening notices from banks and their agents. By mid-January, eleven such notices had been posted. But Jack Markowski, president of the Community Investment Corporation and the receiver appointed to administer the building, thinks the residents will be able to stay for years to come. Markowski says the CIC has discovered more than 200 buildings in the city, an estimated 2,000 units, where the same scheme has played out, usually with a very different outcome: after the landlord/condo developer absconds, no one pays the building's utilities; shutoffs result and tenants leave; squatters and/or drug dealers move in; and finally mortgage bankers from different institutions, successful with their foreclosure motions, discover that each owns one unit in a vacant, trashed building. According to Markowski, such buildings have no value in part because no lender is in charge, and reassembling it as a single entity is not the province of a loan officer in a single bank and too much work for the possible return in a depressed market. So the building is boarded up, taxing the police, the patience of the neighbors and the value of surrounding property.
Thus the Spaulding Luxury Condominiums are more than the site of impressive fraud and more than the impetus for reform in the county's eviction process. They are also the site of a small urban miracle, performed by an immigrant landscaper and his fellow tenants, who decided to save a building they didn't own.