Commercial Banking, Collections, and Bankruptcy

Land of Lincoln Goodwill Industries, Inc. v. The PNC Financial Services Group, Inc.

Federal 7th Circuit Court
Land of Lincoln Goodwill Industries, Inc. v. The PNC Financial Services Group, Inc.
Civil Court
Contracts
Citation
Case Number: 
No. 13-2860
Decision Date: 
August 12, 2014
Federal District: 
C.D. Ill.
Holding: 
Affirmed
In action seeking declaration that plaintiff did not owe prepayment charge pursuant to terms of loan agreement with defendant, Dist. Ct. did not err in finding that plaintiff owed prepayment fee where agreement called for said payment where, as here, plaintiff notified defendant of desire to prepay loan at time where terms of loan called for payment of interest at fixed rate. Ct. rejected plaintiff’s claim that no prepayment fee was required where loan agreement called for one-time adjustment of interest rate ten years into 20-year loan period, since: (1) contrary to plaintiff’s claim, one time adjustment of rate did not transform instant agreement into variable rate agreement that would preclude prepayment fee; and (2) plaintiff’s interpretation would render meaningless clause in agreement detailing circumstances for payment of said prepayment fee.

Public Act 98-821

Topic: 
Transfer on death instrument
(Barickman, R-Bloomington; Sims, D-Chicago) makes several changes to the Illinois Transfer on Death Instrument Act. (1) Makes the recording of a notice of death affidavit a permissive action that can be taken by the beneficiary to confirm title to the residential real estate but is not a mandatory requirement to perfect title. (2) Allows a bona fide purchaser for value and without notice before the recordation of a lis pendens for an action to set aside or contest the transfer on death instrument ("TODI") to take free and clear of any such action or contest. (3) Clarifies that acceptance of the TODI by the beneficiary during the owner's lifetime is not a requirement. (4) Eliminates the right of an agent acting under a durable power of attorney from creating or revoking a TODI. But it doesn't affect the agent's right or power to sell, transfer, or encumber the residential real estate if so authorized under the POA. (5) Clarifies that only substantial compliance with the execution formalities is required. Effective January 1, 2015.
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Public Act 98-836

Topic: 
Small estate affidavit
(Bivins, R-Dixon; Demmer, R-Dixon) expands the small estate affidavit (SEA) statute to include much more detailed information about the known debts of the decedent. Requires the affiant to sign under a notary public to aid in the enforcement of the civil and criminal penalties for misusing a SEA. Syncs up the SEA and the Safety Deposit Act. It applies to estates in which the decedent's date of death is on or after January 1, 2015.
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Public Act 98-764 (corrected)

Topic: 
Mechanics Lien Act
(Mulroe, D-Chicago; Kelly Burke, D-Oak Lawn) provides that language barring certain agreements does not prohibit an agreement to subordinate a mechanics lien to a mortgage lien that secures a construction loan if that agreement is made after more than 50% of the loan has been disbursed to fund improvements to the property. Allows contractual provisions to be binding between the owner and contractor or a contractor and subcontractor that no lien or claim may be filed or maintained or that a contractor’s lien must be subordinated to the interests of any other party as long as it is not otherwise prohibited by this Act. Deletes language providing that the only admissible evidence of specified conditions of a contract as against a subcontractor or material supplier shall be proof of actual notice thereof to him or her before his or her contract is entered into. Deletes language providing that certain subordination provisions of contracts is not binding on the subcontractor unless set forth in its entirety in writing in the contract between the contractor and subcontractor or material supplier. Effective July 16, 2014.
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Burzlaff v. Thoroughbred Motorsports, Inc.

Federal 7th Circuit Court
Burzlaff v. Thoroughbred Motorsports, Inc.
Civil Court
Jury Instructions
Citation
Case Number: 
No. 13-2520
Decision Date: 
July 10, 2014
Federal District: 
E.D. Wisc.
Holding: 
Affirmed
In action under Wisc. Lemon Law in which plaintiff demanded that defendant-manufacturer of motorized tricycle either replace tricycle or refund purchase price after said tricycle had been out of service for repairs for 71 days during first year, Dist. Ct. did not err in modifying Wisc. Pattern Jury Instructions for Lemon Law claims by informing jury that plaintiff could recover if he gave authorized repair facility opportunity to repair tricycle, as opposed to giving defendant itself same opportunity, as set forth in standard jury instruction. Said instruction modification reflected intent of Lemon Law, and record showed that plaintiff had followed defendant’s instruction to take tricyle to defendant’s authorized repair shop. Ct. rejected defendant’s contention that plaintiff could only recover if he had tendered tricyle to defendant to make said repairs.

Suesz v. Med-1 Solutions, LLC

Federal 7th Circuit Court
Suesz v. Med-1 Solutions, LLC
Civil Court
Fair Debt Collection Practices Act
Citation
Case Number: 
No. 13-1821
Decision Date: 
July 2, 2014
Federal District: 
S.D. Ind., Indianapolis, Div.
Holding: 
Reversed and remanded
Dist. Ct. erred in dismissing plaintiff-debtor’s lawsuit alleging that defendant-creditor violated section 1629i of FDCPA by filing debt collection claim in Indiana township small claims court, even though contract that formed basis of debt was not signed in said township and plaintiff did not live there. While Dist. Ct. found that relevant “judicial district” included all township small claims courts within county that plaintiff lived so as to give defendant wide choice of venues, Ct. of Appeals, in overturning Newsom, 76 F.3d 813, found that “judicial district or similar legal entity” as contemplated in section 1692i of FDCPA is smallest geographic area that is relevant for determining venue in court system in which case is filed. As such, for cases brought in Indiana, defendant was required to bring its debt collection action in plaintiff’s township small claims court. This en banc opinion replaced earlier panel opinion that had upheld Dist. Ct.’s dismissal of plaintiff’s action.

Gambino v. Koonce

Federal 7th Circuit Court
Gambino v. Koonce
Civil Court
Collateral Estoppel
Citation
Case Number: 
No. 13-2756
Decision Date: 
July 2, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
Bankruptcy Ct. did not err in granting plaintiff-creditor’s requested relief in adversary proceeding seeking declaration that debt established in prior state court judgment, in which creditor had prevailed in action alleging that debtor used forged documents to gain title to creditor’s properties, was non-dischargeable pursuant to 11 USC section 523(a)(2)(A), after finding that debtor was collaterally estopped from re-litigating issue of his intent in obtaining creditor’s properties. Ct. rejected debtor’s contention that collateral estoppel did not apply because his fraudulent intent was not actually litigated in prior state court action, where Ct. observed that state court could not have rendered judgment in favor of creditor without deciding that debtor obtained said properties in fraudulent manner. Moreover, state court’s finding of fraudulent intent was necessary to its judgment in creditor's favor.

House Bill 5322

Topic: 
Condominiums and common-interest communities
(Burke, D-Evergreen Park; Raoul, D-Chicago) amends the two acts that govern condos and common-interest communities so that communication may include “electronic transmission” for differing purposes under the two Acts. It creates procedures to do this that also require consent of the unit owner. It also prohibits secret ballots in elections for common-interest communities. Sent to the Governor.
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Property Tax Sales and Bankruptcy after Alexandrov v. LaMont

By Andrew J. Hawes
July
2014
Article
, Page 346
The seventh circuit recently held that a homeowner debtor can extend the deadline to redeem property sold at a tax sale by declaring Chapter 13 bankruptcy. Find out what it means.