## Facts

- Sellers Asadour and Elizabeth Bedian agreed to sell real property to buyer Arnold Cohn under an oral arrangement requiring a down payment and installment payments.
- The parties understood that Cohn would not be personally liable for any deficiency if foreclosure occurred; the sellers’ remedy would be limited to the property.
- At closing, the sellers delivered a deed to Cohn, and Cohn executed a note and mortgage for the unpaid balance.
- The note and mortgage expressly stated that collection was limited to the mortgaged property and that Cohn would not be personally liable for any deficiency.
- Cohn made some payments, later defaulted, and the property’s value was insufficient to satisfy the remaining balance.
- The sellers sued seeking to impose personal liability on Cohn for the unpaid balance despite the non-recourse provisions.

## Issues

1. Whether a seller may obtain a personal deficiency judgment when the purchase agreement and the note and mortgage expressly limit recovery to the mortgaged property and disclaim personal liability.
2. Whether Illinois law requires a personal promise to pay as an essential element of a valid mortgage.

## Decision

- The appellate court affirmed the chancery decree denying personal liability and limiting the sellers’ remedy to the property.
- The court held the note and mortgage were valid and enforceable as written, including their express non-recourse terms.
- The court rejected the argument that a mortgage is invalid or ineffective absent a personal obligation to pay.

## Legal Principles

- A mortgage implies the existence of a debt, but a personal promise to pay is not required for a valid mortgage under Illinois law.
- A debt may exist even where there is no personal liability and no available deficiency judgment; the creditor’s remedy may be confined to the collateral.
- Clear, unambiguous non-recourse provisions in a note and mortgage are enforceable, particularly where they reflect the parties’ agreement and no fraud or mistake is shown.

## Conclusion

The court enforced the parties’ non-recourse real-estate financing arrangement, holding that Illinois law permits a mortgage securing a debt without personal liability and that the sellers could not convert an expressly non-recourse note and mortgage into a basis for a personal deficiency judgment.


Bedian v. Cohn, 10 Ill. App. 2d 116, 134 N.E.2d 532 (Ill. App. Ct. 1956)