Commercial Banking, Collections, and Bankruptcy

Senate Bill 1098

Topic: 
Business Corporation Act
(Harmon, D-Oak Park) provides that the dissolution of a corporation does not impair a civil remedy available to or against the corporation for any liability accrued or incurred (rather than incurred) either before, at the time of, or after (rather than before) the dissolution. Provides that this provision does not extend any applicable statute of limitations. Awaiting passage in the Senate.
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Senate Bill 1048

Topic: 
Presumptively void transfers in probate
(Harmon, D-Oak Park) creates a new section in the Probate Act entitled “presumptively void transfers.” It applies to caregivers who, either as a result of family relationship, voluntarily, or in exchange for compensation, have assumed responsibility for all or a portion of the care of another person who needs assistance with activities of daily living. It applies to “transfer instruments” that includes a will, trust, deed, form designated as payable on death, contract, or other beneficiary designation form. It presumes, with some exceptions, that a transfer instrument is presumed to be void if the transferee is a caregiver, or a person related to a caregiver, and the fair market value of the transferred property exceeds $20,000. It has some exceptions, which are as follows: (1) if the transferee establishes by clear and convincing evidence that the transfer was not the product of fraud, duress, or undue influence. But it prohibits the court from making that determination solely upon the testimony of the caregiver. (2) If the transfer instrument was reviewed by an “independent attorney” who signs and delivers a statutory certificate of review. (3) If the transferee’s share under the transfer instrument is less than the share the transferee was entitled to under the transferor’s testamentary plan in effect before the transferee became a caregiver. If the caregiver attempts and fails to overcome the presumption under this section, the caregiver must bear the cost of the proceedings, including, without limitation, reasonable attorney’s fees. Assigned to Senate Judiciary Committee.
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VLM Food Trading International Inc. v. Ill. Trading Co.

Federal 7th Circuit Court
VLM Food Trading International Inc. v. Ill. Trading Co.
Civil Court
Contract
Citation
Case Number: 
Nos. 13-1799 & 13-1697 Cons.
Decision Date: 
April 10, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed and remanded
Dist. Ct. erred in applying Illinois law to find that attorney fee provisions contained only in plaintiff’s invoices constituted part of parties’ contract calling for purchase of frozen potatoes, since applicable law that covered instant dispute was United Nations Convention on Contracts for International Sale of Goods, due to defendant’s status as Canadian entity that conducted most of its business in Canada. Fact that defendant had New Jersey office did not require different result. Moreover, provisions of Convention placed into doubt whether instant attorney fee provisions could be enforced upon defendant’s breach of contract, where Article 19 of Convention suggested that attorney fee provisions in plaintiff’s invoices were material provisions that did not automatically become part of contract.

TABFG, LLC v. Pfeil

Federal 7th Circuit Court
TABFG, LLC v. Pfeil
Civil Court
Tortious Interference
Citation
Case Number: 
No. 12-3557
Decision Date: 
March 20, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
Dist. Ct. did not err in entering judgment in favor of plaintiff in action alleging that defendant tortiously interfered with contract that plaintiff had with third-party limited liability company, where plaintiff alleged that defendant caused third-party to disburse funds to himself and others in contravention with contract that plaintiff had with third-party. While defendant argued that he was entitled to conditional privilege arising out of said distribution, defendant was not entitled to said privilege where defendant was not manager or director of third-party, and where instant distribution essentially benefited defendant and was made in clear contravention to terms of subject contract.

Grede v. FCStone, LLC

Federal 7th Circuit Court
Grede v. FCStone, LLC
Civil Court
Bankruptcy
Citation
Case Number: 
Nos. 13-1232 & 13-1278 Cons.
Decision Date: 
March 19, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed and remanded
Dist. Ct. erred in granting summary judgment in favor of plaintiff-Bankruptcy Trustee in action seeking to avoid pre-bankruptcy petition transfer made by debtor-investment management firm to defendant-debtor’s customer, as well as post-bankruptcy petition transfer of assets to said customer, where post-bankruptcy petition transfer had been approved by Bankruptcy Ct. Under 11 USC section 546(e), instant pre-petition transfer was exempted from avoidance provisions where: (1) defendant was commodity broker; and (2) instant transfer was “settlement payment” made in connection with securities contract, where transfer was essentially swap of customer’s securities for money pursuant to contract for purchase and sale of securities. Moreover, Trustee could not avoid post-bankruptcy petition transfer, since 11 USC section 549 precludes said avoidance, where Bankruptcy Ct. had originally approved said transfer. Fact that Bankruptcy Ct. had “clarified” said approval one year after original order by indicating that it had not actually authorized said transfer did not require different result.

In re: Mississippi Valley Livestock, Inc.

Federal 7th Circuit Court
In re: Mississippi Valley Livestock, Inc.
Civil Court
Bankruptcy
Citation
Case Number: 
No. 13-1377
Decision Date: 
March 12, 2014
Federal District: 
N.D. Ill., W. Div.
Holding: 
Reversed and remanded
In bankruptcy proceeding in which trustee sought to recover preferential-transfer payments debtor made to one creditor, Dist. Ct. erred in finding that creditor was entitled to said payments, even though: (1) debtor was merely giving creditor cash payments for creditor’s property that was sold to third-party; and (2) debtor never had any equitable or legal interest in said property. While debtor had held creditor’s property in bailment so as to potentially allow creditor to receive said payments, Bankruptcy Ct. failed to make requisite findings as to any potential defenses available to bankruptcy estate. Moreover, remand was required because debtor had commingled proceeds of sale of creditor’s property with other cash in debtor’s account, such that creditor was only entitled to return of lowest intermediate balance of said account following deposit of proceeds into said account.

In re: Archdiocese of Milwaukee

Federal 7th Circuit Court
In re: Archdiocese of Milwaukee
Civil Court
Bankruptcy
Citation
Case Number: 
No. 12-3689
Decision Date: 
February 25, 2014
Federal District: 
E.D. Wisc.
Holding: 
Affirmed
In instant Chapter 11 proceeding, Bankruptcy Ct. did not err in disallowing claim against debtor-Archdiocese stemming from allegations of sexual abuse by priest, where claimant had previously signed release of said claim in exchange for $100,000 payment. While claimant, in attempting to set aside release, asserted that he had been fraudulently induced to sign release where representative of debtor gave him false information that no other individual had been abused by said priest, Bankruptcy Ct. could properly find that release was binding on claimant where, although claimant stated that information provided by representative was important emotionally, claimant never explained how such information actually factored into his decision to accept $100,000 settlement offer. Moreover, Bankruptcy Ct. could conclude that other factors led to claimant’s acceptance of settlement offer since, at time of settlement, it was questionable under Wisconsin law whether, because of statute of limitations problems, claimant had any cause of action against debtor for either negligent supervision or fraud.

House Bill 5453

Topic: 
Increased court fees
(Brauer, R-Springfield) lifts the cap on the $25 court-services fee that a county may charge civil litigants and convicted defendants for courthouse security if there is an acceptable cost study prepared that justifies it. Scheduled for House Judiciary Committee Wednesday morning.
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Senate Bill 3169

Topic: 
Funding of litigation
(Haine, D-Alton) creates the Non-Recourse Civil Litigation Funding Act that regulates lending to consumers in litigation in which the consumer assigns to the lender a contingent right to receive a portion of the potential proceeds of the consumer's legal claim. Just introduced.
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