Midland Funding LLC v. Hilliker , 2016 IL App (5th) 160038 ( 2017 )


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    Appellate Court                            Date: 2017.01.31
    13:20:51 -06'00'
    Midland Funding LLC v. Hilliker, 
    2016 IL App (5th) 160038
    Appellate Court          MIDLAND FUNDING LLC, Plaintiff and Counterdefendant-
    Caption                  Appellant, v. MELISSA HILLIKER, Defendant and Counterplaintiff-
    Appellee.
    District & No.           Fifth District
    Docket No. 5-16-0038
    Filed                    December 16, 2016
    Rehearing denied         January 10, 2017
    Decision Under           Appeal from the Circuit Court of St. Clair County, No. 15-L-200; the
    Review                   Hon. Christopher T. Kolker, Judge, presiding.
    Judgment                 Affirmed; cause remanded.
    Counsel on               Heather L. Kramer and Jennifer A. Warner, of Dykema Gossett
    Appeal                   PLLC, of Chicago, and Theodore W. Seitz, of Dykema Gossett PLLC,
    of Lansing, Michigan, for appellant.
    James R. Williams and Ashley P. Cook, of Williams, Caponi &
    Associates, P.C., of Belleville, for appellee.
    Panel                     JUSTICE CATES delivered the judgment of the court, with opinion.
    Presiding Justice Schwarm* and Justice Goldenhersh concurred in the
    judgment and opinion.
    OPINION
    ¶1        Plaintiff-counterdefendant, Midland Funding LLC, appeals the circuit court’s order
    denying its motion to compel arbitration of a counterclaim filed by defendant-
    counterplaintiff, Melissa Hilliker. For reasons that follow, we affirm.
    ¶2                                           BACKGROUND
    ¶3         Defendant-counterplaintiff, Melissa Hilliker, obtained a credit card from Chase Bank
    USA, N.A. (Chase Bank) in April 2001. Hilliker was provided with a specified line of credit
    for consumer purchases, wherein she agreed to make at least the minimum payment shown
    on her monthly billing statement.
    ¶4         On September 9, 2013, plaintiff-counterdefendant, Midland Funding LLC (Midland), a
    company in the business of purchasing outstanding consumer debt, filed a complaint against
    Hilliker in the circuit court of St. Clair County. Midland alleged that it was the successor in
    interest to Hilliker’s Chase Bank account; that Midland had purchased Hilliker’s credit card
    account from Chase Bank in the regular course of business in good faith and for value; that
    there was an unpaid balance of $8,809.38 due on Hilliker’s account; that because Hilliker had
    failed to make the monthly payments due on the account, Hilliker was in default on the
    account; and that Midland was entitled to a judgment for the unpaid balance, plus costs.
    ¶5         In support of its complaint, Midland attached the “Affidavit of Kory Holst In Support Of
    Judgment.” In the affidavit, Holst stated that he was a “Legal Specialist,” who had access to
    “pertinent account records for Midland Credit Management, Inc. (‘MCM’),” the entity
    servicing this account on behalf of Midland. Holst further stated that he was making the
    statements contained in his affidavit based upon personal knowledge. Holst averred he had
    reviewed MCM’s account records; that he was familiar with, and trained in, the methods by
    which MCM created and maintained its records; and that MCM’s records were kept in the
    ordinary course of its business. Based on his personal knowledge of the MCM account
    records, Holst asserted that Midland was the “current owner of, and/or successor to, the
    obligation sued upon, and was assigned all the rights, title, and interest” in Hilliker’s credit
    card account with Chase Bank. Holst stated that MCM’s records showed that Hilliker opened
    her account with Chase Bank on April 23, 2001; that her last payment was posted on January
    13, 2009; that the account was charged off on August 31, 2009; and that Hilliker owed
    $8809.38 as of July 15, 2013. Midland did not provide any records documenting the sale of
    Hilliker’s debt, or the terms of the assignment of that debt, in support of the Holst affidavit or
    the complaint. Contrary to section 2-606, Midland did not provide a copy of any written
    instrument upon which they based their claim for the debt, nor did they attach an affidavit
    *
    Presiding Justice Schwarm fully participated in the decision prior to his retirement. See Cirro
    Wrecking Co. v. Roppolo, 
    153 Ill. 2d 6
    , 
    605 N.E.2d 544
     (1992).
    -2-
    indicating that the written instrument evidencing the debt was not accessible. 735 ILCS
    5/2-606 (West 2012).
    ¶6          Midland’s complaint was automatically assigned to the St. Clair County circuit court’s
    arbitration docket because the amount in controversy was between $5000 and $50,000,
    exclusive of costs and interest. 20th Judicial Cir. Ct. Mandatory Arb. Rs. (eff. Aug. 2, 2004)
    (Civil Actions Subject to Mandatory Arbitration, describing St. Clair County provisions
    pursuant to Ill. S. Ct. R. 86 (eff. Jan. 1, 1994)). This arbitration docket is a nonbinding,
    court-annexed arbitration docket and is a part of the Illinois judicial system. See generally Ill.
    S. Ct. Rs. 86 to 95 (rules regarding arbitration). Thus, the provisions of the Illinois Code of
    Civil Procedure and the rules of the Illinois Supreme Court are applicable to the arbitration
    proceedings, except where specific arbitration rules otherwise provide. See Ill. S. Ct. R. 86.
    ¶7          On October 14, 2013, Hilliker filed an answer to Midland’s complaint, denying the main
    allegations, including the allegation that Midland was the successor in interest to the Hilliker
    account. Hilliker also filed a counterclaim. Therein, she alleged that Midland’s complaint
    violated the Illinois Collection Agency Act (Collection Agency Act) (225 ILCS 425/1 et seq.
    (West 2012)), because Midland failed to attach the proper documents, including the
    assignment documents, to its complaint. She also alleged that in violating provisions of the
    Collection Agency Act, Midland also violated the Illinois Consumer Fraud and Deceptive
    Business Practices Act (Consumer Fraud Act) (815 ILCS 505/1 et seq. (West 2012)). Hilliker
    sought damages, including filing fees, attorney fees, penalties, and punitive damages.
    ¶8          On November 4, 2013, Midland filed a motion to dismiss Hilliker’s counterclaim.
    Midland asserted that the counterclaim should be dismissed pursuant to section 2-615 of the
    Illinois Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2012)), because it failed to
    set forth sufficient factual allegations to state a legally recognized cause of action, failed to
    set forth a proper prayer for relief, and was not verified. Midland also asserted that Hilliker’s
    counterclaim should be dismissed under section 2-619 of the Code (735 ILCS 5/2-619 (West
    2012)). Midland asserted that it was the owner of Hilliker’s debt and that the assignment for
    collection criteria in section 8b of the Collection Agency Act (225 ILCS 425/8b (West 2012))
    did not apply to debt owners, such as Midland. Midland argued that the counterclaim was
    insufficient in law and should be dismissed because it was not possible for Midland to have
    violated the Collection Agency Act as alleged. Midland also filed a motion to strike
    Hilliker’s answer because it was not verified.
    ¶9          The parties appeared for a status hearing on January 16, 2014. On that date, Hilliker was
    allowed to file an amended counterclaim. In the first amended counterclaim, Hilliker alleged
    that Midland did not own Hilliker’s debt because the claimed assignment from Chase Bank
    to Midland was legally defective. Hilliker further alleged that Midland violated the
    Collection Agency Act by filing suit and attempting to collect a debt that it did not own, and
    that Midland violated the Consumer Fraud Act in that it violated the Collection Agency Act.
    ¶ 10        On February 18, 2014, Midland filed a motion for involuntary dismissal of the first
    amended counterclaim with prejudice under section 2-619 of the Code and alleged that the
    counterclaim was insufficient in law. Midland asserted that the Holst affidavit was sufficient
    verification that it owned Hilliker’s debt and was appended to verify the allegations in the
    complaint. In its motion to dismiss, Midland also attached an unverified document titled “Bill
    of Sale.” The “Bill of Sale” stated in part that “Chase Bank USA, N.A. (‘Seller’) for value
    received and pursuant to the terms and conditions of Credit Card Account Purchase
    -3-
    Agreement dated May 8, 2009[,] between Seller and Midland Funding LLC (‘Purchaser’),
    *** hereby assigns effective as of the File Creation Date of September 8, 2009, all rights,
    title and interest of Seller in and to those certain receivables, judgments or evidences of debt
    described in Exhibit 1 attached hereto and made part hereof for all purposes.” Notably,
    Midland did not attach a copy of Exhibit 1, as referenced in the Bill of Sale, and did not
    attach a copy of the Credit Card Account Purchase Agreement referenced in support of its
    motion to dismiss. In fact, Midland did not attach any documents identifying the particular
    accounts purchased or the terms of the assignment.
    ¶ 11        On October 3, 2014, Hilliker filed a motion to compel Midland to respond to
    interrogatories and a request for production that had been served by Hilliker on April 23,
    2014. Hilliker’s counsel alleged that despite counsel’s efforts to comply with Illinois
    Supreme Court Rule 201(k) (eff. July 1, 2014), including having a telephone conference with
    counsel for plaintiff-counterdefendant, Midland refused to respond to any of Hilliker’s
    discovery requests. Midland filed no response in defense of Hilliker’s motion. The motion to
    compel was heard on October 7, 2014. Following the hearing, the trial court entered an order
    granting Hilliker’s motion to compel, over Midland’s objection. The court ordered Midland
    to answer the outstanding discovery within 60 days. According to a certificate of service in
    the record, Midland sent its responses to Hilliker’s interrogatories and request for production
    on December 8, 2014, the last day allotted by the court’s order.
    ¶ 12        On December 16, 2014, Hilliker filed a second motion to compel and alleged that
    Midland had responded to the discovery requests with answers that were mostly
    nonresponsive, with the vast majority of the answers consisting of objections and “with very
    few answers to the discovery.” Following a hearing on January 8, 2015, the court entered an
    order directing Midland to answer the interrogatories and requests for production, without
    objections and within 30 days of the order. A status hearing was scheduled for March 5,
    2015.
    ¶ 13        On February 9, 2015, the thirtieth day allowed for by the court’s prior order, Midland
    filed a motion for a protective order with regard to Hilliker’s request that Midland produce
    the entire debt purchase agreement with Chase Bank. Midland argued that the agreement
    contained information which was confidential or proprietary in nature and contained other
    information that was not relevant to the issue of Midland’s ownership of the Hilliker account.
    Midland sought to produce a copy of the debt purchase agreement under seal and to redact all
    financial information and all information regarding consumers other than Hilliker. According
    to a certificate of service in the record, Midland sent responses to Hilliker’s interrogatories
    and requests for production to Hilliker on February 11, 2015.
    ¶ 14        During the status hearing on March 5, 2015, Hilliker filed a motion to amend her
    counterclaim. The motion was granted over Midland’s objection, and the second amended
    counterclaim, erroneously captioned “Third Amended Counterclaim,” was filed that day
    (hereinafter referred to as the third amended counterclaim).
    ¶ 15        In the third amended counterclaim, Hilliker again alleged that Midland did not own the
    debt sued upon because the purported assignment was defective. Hilliker further alleged that
    the debt buyers were subject to all of the requirements of the Collection Agency Act,
    including the requirement that they purchase a debt before they attempt to collect that debt,
    and that Midland violated section 9 of the Collection Agency Act (225 ILCS 425/9 (West
    2012)) by filing suit to collect a debt that it did not own. Hilliker also alleged that Midland’s
    -4-
    complaint and affidavit contained misleading statements regarding the assignment and
    ownership of accounts and that Holst’s affidavit was misleading because it was not based on
    his own personal knowledge. Hilliker claimed damages in excess of $50,000, as she sought
    to represent a class of similarly situated residents of Illinois. The third amended complaint
    also contained a count alleging violations of the Fair Debt Collection Practices Act (FDCPA)
    (
    15 U.S.C. §§ 1692
     et seq. (2012)). In support of her claim under the FDCPA, Hilliker relied
    on the same factual allegations alleging the use of misleading statements, as pled previously.
    ¶ 16       On March 26, 2015, Hilliker filed a motion for sanctions. Once again, Hilliker claimed
    that Midland had failed to comply with the court’s order of January 8, 2015. Specifically,
    Hilliker’s counsel claimed that the answers provided to Hilliker’s discovery “were
    non-responsive to the questions contained in the discovery.” Hilliker alleged that Midland
    had displayed “continued disrespect” for the court’s authority and requested sanctions.
    ¶ 17       Also on March 26, 2015, Hilliker filed a motion to compel the deposition of Kory Holst,
    the affiant who had attested to Midland’s original complaint. In this motion, Hilliker alleged
    that her counsel had made repeated calls and requests for dates to take the deposition of
    Holst, but the “calls and requests have gone unanswered.” Additionally, Hilliker filed a
    motion to transfer the case to the “L” docket, because the amount requested in her
    counterclaim exceeded the jurisdictional limit of the arbitration docket.
    ¶ 18       On March 26, 2015, Midland obtained new counsel, as reflected by an entry of
    appearance filed that date. Midland also filed a motion to dismiss the third amended
    counterclaim and to compel arbitration pursuant to the terms of the Chase Bank
    “Cardmember Agreement.” In its motion, Midland argued that Hilliker had drastically altered
    the scope of her claim when she filed the third amended counterclaim and sought, for the first
    time, “to certify a nationwide class for violations of the FDCPA and a statewide class action
    for violations of the [Collection Agency Act] and the [Consumer Fraud Act].” In anticipation
    of Hilliker’s arguments, Midland claimed that it had not waived its right to arbitrate, as it had
    filed the case in the “arbitration court, thereby asserting its contractual rights under the
    Arbitration Agreement.” Further, Midland argued that even if the court found that its actions
    in the trial court constituted waiver, the court should permit Midland to rescind the waiver
    because of the significant changes in the third amended counterclaim. Midland also argued
    that the third amended counterclaim should be dismissed because the allegations regarding
    the assignment and ownership of the Hilliker account fell within the scope of the arbitration
    agreement and because the arbitration agreement contained a class waiver provision. Finally,
    Midland indicated that it had sent a letter to Hilliker’s attorneys on March 25, 2015, advising
    them of Midland’s intent to arbitrate.
    ¶ 19       In support of its arguments, Midland attached the declaration of Kyle Hannan, the
    manager of operations for Midland Credit Management, who claimed that the Hilliker
    account had been properly assigned and that Midland owned that debt. A number of
    documents were attached to and referenced in Hannan’s affidavit, including an affidavit and
    a copy of a Chase Bank Cardmember Agreement. The affidavit of Christine L. Sallie, a
    “CSD Strategy Analyst” affiliated with Chase Bank, stated that Chase Bank sold off a pool of
    accounts to Midland in September 2009. Sallie did not identify the Hilliker account, or any
    other specific account, within the pool of accounts sold, and she provided no information
    regarding the specific nature of the assignment from Chase Bank to Midland. Hannan’s
    affidavit indicated that the Chase Bank Cardmember Agreement, purportedly issued with
    -5-
    Hilliker’s account, was “difficult to read due to poor copying and font size.” Hannan further
    explained that in order to clarify the terms of the Cardmember Agreement, an exemplar of
    the Cardmember Agreement, containing larger type, known as a portfolio-level Cardmember
    Agreement had to be consulted. Hannan further explained that these portfolio-level
    agreements serve as exemplars, and, when read in conjunction with the Cardmember
    Agreement, make the arbitration agreement readable. Once legible, it appeared the arbitration
    agreement contained a provision prohibiting class-action arbitration. According to the
    portfolio-level exemplar, the arbitration paragraph also contained an exception that allowed a
    party to pursue an action in small claims court on an individual basis. There were no
    documents appended to Hannan’s affidavit or Midland’s motion identifying the assignment
    or specific terms of sale from Chase Bank to Midland regarding Hilliker. There was no
    Cardmember Agreement signed by Hilliker or any document containing Hilliker’s consent to
    arbitration.
    ¶ 20        On April 6, 2015, Midland filed its opposition to the motion to transfer the case to the
    “L” docket. On April 9, 2015, the court granted the motion to transfer the case to the “L”
    docket and continued all pending motions until reassignment of the case.
    ¶ 21        On July 10, 2015, Midland filed a motion to stay discovery pending resolution of its
    March 26, 2015, motion to dismiss and compel arbitration. Two months later, on September
    4, 2015, Midland filed responses in opposition to Hilliker’s motion to compel the deposition
    of Kory Holst and her motion for sanctions.
    ¶ 22        On September 8, 2015, Hilliker filed a response in opposition to Midland’s motion to
    compel arbitration. Hilliker argued that Midland had waived its right to arbitrate when it
    elected to file its original complaint in a judicial forum and thereafter participated in
    litigation of the case in that forum. Hilliker claimed that Midland’s demand for arbitration
    was untimely. She pointed out that Midland’s first notice of intent to arbitrate was made to
    Hilliker’s counsel on March 25, 2015, approximately 18 months after it filed its original
    complaint and only after Hilliker filed her third amended counterclaim. Hilliker argued that
    Midland’s actions in the court were inconsistent with a party seeking to arbitrate its claim
    and that Midland had not overcome the rebuttable presumption that attaches when a party
    chooses to proceed in a judicial forum. Specifically, Hilliker argued that Midland’s choice of
    the St. Clair County circuit court raised a rebuttable presumption that Midland had waived its
    right to arbitrate, and Midland had not overcome that presumption. Hilliker further argued
    that the court should not allow Midland to change its mind and arbitrate, after months of
    “dragging its heels.” Hilliker also claimed that Midland’s untimely delay in demanding
    arbitration and filing a motion to stay discovery caused her prejudice, as she had expended
    significant time and effort litigating Midland’s motions to dismiss and her motions to compel
    discovery, and that she incurred significant costs associated with filing fees and attorney fees.
    ¶ 23        On September 18, 2015, Midland filed a reply in support of its motion to compel
    arbitration. Midland argued that it did not substantially invoke the judicial process by filing
    the original collection action seeking limited relief in the trial court. Midland claimed that its
    participation in the litigation was “minimal,” noting that it only filed a complaint and two
    motions to dismiss, and that it only answered discovery after being compelled to do so.
    Midland concluded that its decision to pursue a summary action for limited relief in the court,
    coupled with its limited participation in the proceedings, did not amount to a waiver of its
    right to arbitrate. Midland claimed that its demand for arbitration was timely and that there
    -6-
    was no prejudice to Hilliker. Midland further argued that that even if the court found waiver,
    the court should permit it to resuscitate its right to arbitrate because Hilliker dramatically
    changed the nature of the litigation by filing the third amended complaint, which exposed it
    to substantial liability. Midland also reasserted its claims that Chase Bank properly assigned
    the Hilliker account and that the arbitration agreement was enforceable.
    ¶ 24       Midland’s motion to dismiss the counterclaim and to compel arbitration was called for
    hearing on December 14, 2015. After considering the arguments of counsel, the trial court
    denied the motion. In a written order entered December 30, 2015, the court determined that
    Midland waived its right to arbitrate due to its substantial participation in the litigation. The
    court also determined that provisions in the arbitration agreement were unconscionable and
    that the agreement was unenforceable. Finally, the court denied Midland’s motion to dismiss
    the counterclaim on grounds of legal insufficiency. The court found that Midland had not
    presented sufficient evidence to show that it owned the Hilliker account and debt. Midland
    appealed.
    ¶ 25                                             DISCUSSION
    ¶ 26       This appeal is taken from the denial of a motion to compel arbitration. Ill. S. Ct. R.
    307(a)(1) (eff. July 6, 2000). Where an interlocutory appeal is taken pursuant to Illinois
    Supreme Rule 307(a)(1), controverted facts or the merits of the case are not decided. Woods
    v. Patterson Law Firm, P.C., 
    381 Ill. App. 3d 989
    , 993, 
    886 N.E.2d 1080
    , 1084 (2008). The
    only question is whether there was a sufficient showing to affirm the trial court’s decision to
    deny the motion to compel arbitration. Woods, 381 Ill. App. 3d at 993, 886 N.E.2d at 1084.
    The standard of review is dictated by the nature of the question presented to the trial court.
    LAS, Inc. v. Mini-Tankers, USA, Inc., 
    342 Ill. App. 3d 997
    , 1001, 
    796 N.E.2d 633
    , 636
    (2003). In this case, the trial court was called upon to determine as a matter of law whether
    Midland’s participation in the litigation constituted a waiver of the right to arbitrate. This
    presents a legal question that is subject to de novo review. LAS, Inc., 
    342 Ill. App. 3d at 1001
    ,
    
    796 N.E.2d at 636
    .
    ¶ 27       Generally, Illinois considers arbitration to be a favored method of settling disputes.
    Kostakos v. KSN Joint Venture No. 1, 
    142 Ill. App. 3d 533
    , 536, 
    491 N.E.2d 1322
    , 1325
    (1986). That said, the right to arbitrate a dispute, like all other contract rights, is subject to
    waiver. Woods, 381 Ill. App. 3d at 994, 886 N.E.2d at 1085. A party may waive the right to
    arbitrate when its conduct is inconsistent with the arbitration clause, thereby demonstrating
    that it has abandoned the right to arbitrate. Kostakos, 
    142 Ill. App. 3d at 536
    , 
    491 N.E.2d at 1325
    . Thus, waiver will be found where the party seeking to compel arbitration invokes the
    judicial process and substantially participates in the litigation to a point inconsistent with an
    intent to arbitrate, to the detriment or prejudice of the other party. Woods, 381 Ill. App. 3d at
    994, 886 N.E.2d at 1085; LAS, Inc., 
    342 Ill. App. 3d at 1002
    , 
    796 N.E.2d at 637
    . Whether a
    party’s conduct results in waiver depends on the unique facts and circumstances present in a
    particular case. LAS, Inc., 
    342 Ill. App. 3d at 1002
    , 
    796 N.E.2d at 637
    .
    ¶ 28       In this particular case, it is the plaintiff who, after filing suit and pursuing its claim in the
    circuit court for 18 months, now seeks to arbitrate. Midland filed the original complaint,
    together with a supporting affidavit, and sought a judgment against Hilliker without
    demanding binding arbitration. Hilliker then filed an answer denying the allegations in
    Midland’s complaint. Additionally, she filed a counterclaim challenging Midland’s claim that
    -7-
    Hilliker’s account was among those sold and assigned to it by Chase Bank. Midland
    responded with a motion to dismiss Hilliker’s counterclaim with prejudice, alleging it was
    legally insufficient, and a motion to strike Hilliker’s answer and to enter a judgment in its
    favor. Midland did not demand that the court stay the proceedings to allow Midland to
    arbitrate the counterclaim. When Hilliker filed her first amended counterclaim, Midland
    again responded with a motion to dismiss on grounds of legal insufficiency and sought a
    judgment in its favor. Again, it did not move to stay the proceedings or demand arbitration
    pursuant to any Cardmember Agreement. In fact, Midland did not even raise the existence of
    the agreement until it filed its motion to compel arbitration, 1½ years after Midland filed its
    complaint in the circuit court. Moreover, on two separate occasions, Midland was ordered to
    respond to discovery. Despite these court orders, Midland did not move to stay the discovery
    or request arbitration. Instead, after months of foot dragging, it engaged the trial court, asking
    for a judicial order of protection.
    ¶ 29       The record shows that Midland actively and substantially participated in the proceedings
    in the circuit court, including the filing of dispositive motions in an attempt to defeat the
    counterclaims and to secure a judgment on the pleadings, without ever requesting arbitration
    or a stay of the proceedings. Midland even took advantage of its right under the rules of civil
    procedure to request a change of judge after the case was transferred to the “L” division over
    Midland’s objection. Midland repeatedly sought a substantive judicial determination of a
    disputed issue and a judicial termination of the litigation.
    ¶ 30       Midland argues that its intent was to pursue a summary action for limited relief in the
    circuit court, but does not explain how such relief could be granted in summary fashion.
    Further, Midland claims that its intent to arbitrate was illustrated by having filed its
    complaint in the “arbitration court” of St. Clair County. These arguments are disingenuous, at
    best. As noted previously, St. Clair County has a nonbinding arbitration court that was
    approved by the Illinois Supreme Court. A case is assigned to the arbitration docket based
    upon the value of the claim asserted. The parties to the litigation are required to participate in
    arbitration whether there was an agreement to do so or not. Therefore, Midland’s claim that it
    did not waive its right to arbitrate based upon its participation in the St. Clair County
    arbitration court is without merit. The record supports the trial court’s determination that
    Midland’s actions in the judicial forum were inconsistent with those of a party intent on
    asserting its right to arbitrate and evidenced a clear abandonment of that right.
    ¶ 31       Midland contends that even if the trial court found a waiver of a right to arbitrate, the
    court should have permitted it to rescind the waiver because the third amended counterclaim
    significantly altered the nature of the litigation. We do not agree. In this case, the original
    action filed by Midland and the counterclaims filed by Hilliker, including the third amended
    counterclaim, arose out of the same dispute and required consideration of many of the same
    issues regarding the assignment of Chase Bank’s customer accounts and debts to Midland.
    Additionally, the factual allegations and issues raised in the third amended counterclaim were
    similar to those asserted in the original and first amended counterclaim. The count alleging a
    violation of the FDCPA involved the same, basic factual allegations as the counts alleging
    violations of the Collection Agency Act and Consumer Fraud Act. While the request for class
    status was new, the basic factual allegations and claims made in third amended counterclaim
    were not.
    -8-
    ¶ 32        The significant change in the third amended complaint was not in the nature of the factual
    allegations, but rather, as Midland candidly acknowledged, with its potential exposure in a
    class action suit. Midland has not suggested that the request for class certification was
    unexpected or unforeseeable. As noted by the trial court, Midland is not an unsophisticated
    litigant. The record shows that Midland continued to attack the legal sufficiency of the
    allegations in the third amended complaint and seek a judgment in its favor, even after it
    moved to compel arbitration. Midland’s actions did not constitute limited legal
    maneuverings. After reviewing the record, we do not find that the third amended
    counterclaim so drastically altered the nature of the litigation or raised complex claims that
    could not have been foreseen when Midland filed its complaint. Cabinetree of Wisconsin, Inc.
    v. Kraftmaid Cabinetry, Inc., 
    50 F.3d 388
     (7th Cir. 1995). The procedural history of this case
    indicates that Midland was quite content to proceed with a judicial determination of the
    issues until it decided that it would be better off in arbitration. Selection of a forum in which
    to resolve a legal dispute should be made at the earliest opportunity. The failure of a party to
    move promptly for arbitration is compelling evidence of its election against arbitration and
    that election should be binding, except in the case of extraordinary circumstances.
    Cabinetree, 
    50 F.3d at 391
    . This case does not present such extraordinary circumstances. The
    trial court did not err in denying that portion of Midland’s motion seeking rescission of its
    waiver of arbitration.
    ¶ 33        Where the court considers a party’s waiver of its right to seek arbitration, Illinois law
    requires that the court next consider whether the delay in seeking arbitration caused any
    prejudice to the party opposing arbitration. Kostakos, 
    142 Ill. App. 3d at 537
    , 
    491 N.E.2d at 1325
    . Therefore, we consider whether Hilliker was prejudiced by the belated demand for
    arbitration. The record shows that Hilliker filed several pleadings, including an answer,
    counterclaims, and motions to compel discovery. Her counsel made repeated attempts under
    the rules to persuade Midland to comply with discovery, but it outright refused. When doing
    so, it did not respond with a motion to stay discovery. Midland simply offered no excuse for
    its failure to answer discovery until Hilliker filed a motion for sanctions. Even then, Midland
    did not file a motion to stay discovery but sought protection from the court by filing a motion
    for a protective order. Additionally, the court continued to hold status conferences and
    hearings, all of which were attended by Midland and Hilliker’s counsel. The record on appeal
    demonstrates that Hilliker’s counsel expended considerable resources in terms of time and
    attorney fees. Hilliker also incurred filing fees and costs. Very few of these resources would
    have been expended in arbitration had Midland not delayed in its quest to seek an arbitral
    forum. Therefore, we believe that the record supports a finding that Hilliker was prejudiced
    by Midland’s substantial participation in the litigation and its delay in demanding arbitration.
    Finally, we find there is no basis upon which the trial court should resuscitate Midland’s right
    to seek arbitration. The allegations made in the third amended counterclaim were not
    significantly different than those raised by Hilliker’s original and first amended counterclaim.
    There was simply no sea change that allowed Midland the right to rescind its waiver of
    arbitration.
    ¶ 34                                         CONCLUSION
    ¶ 35        After reviewing the record, we find that Midland waived its right to compel arbitration by
    filing the original action and subsequently filing pleadings that presented substantive issues
    -9-
    for a determination by the trial court. Midland’s extensive participation in the litigation
    process, coupled with its delay in raising the existence of the Chase Bank Cardmember
    Agreement and its demand for arbitration and the resulting prejudice to Hilliker, amount to a
    waiver of arbitration. Midland’s conduct was inconsistent with the actions of a party seeking
    to compel arbitration and demonstrated a clear abandonment of any claimed right to
    arbitration. The trial court did not err in denying Midland’s motion to compel arbitration.
    Because our resolution of the waiver issue is dispositive, we need not address the remaining
    claims of error regarding the validity, unconscionability, and enforceabililty of the arbitration
    agreement in the Chase Bank Cardmember Agreement. Finally, we will not address the
    propriety of the trial court’s order denying Midland’s section 2-619 motion to dismiss the
    third amended counterclaim for legal insufficiency, as it is not a final and appealable order.
    Cabinet Service Tile, Inc. v. Schroeder, 
    255 Ill. App. 3d 865
    , 
    627 N.E.2d 253
     (1993).
    ¶ 36       Accordingly, the order of the circuit court denying Midland’s motion to compel
    arbitration is affirmed, and the cause is remanded for further proceedings.
    ¶ 37      Affirmed; cause remanded.
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