Printer Friendly

Appeals panel reverses 2 rulings in bank case Rulings.

Byline: Travis DeNeal tdeneal@dailyregister.com

SOUTHERN ILLINOIS -- Two legal decisions rendered against Peoples National Bank in a case dating to 2002 were stricken in a recent 5th District Appellate Court ruling, while a third decision was reaffirmed.

According to the Feb. 19, 2019 appellate court ruling, a 2016 ruling against PNB plus a related 2015 ruling granting summary judgment both were vacated and remanded for a new trial. Another 2015 decision, which applied an Illinois Supreme Court rule to administer sanctions against the bank was upheld.

The most recent decision stems from a 2002 lawsuit filed by Dan Stevens and Neil R. Thompson against Terry Newman and Robert Newman. The Newmans had owned eight Taco John's Restaurants, and later sold them to another company. In an agreement between Stevens and Thompson and the Newmans, the Newmans had a financial responsibility to pay rent and other associated costs if the company the Newmans sold to, Amigos Food Services LLC, defaulted on rent payments to Stevens and Thompson, who owned the location of the Anna Taco John's restaurant. A Small Business Administration loan of about $230,000, made through PNB, also was a financial responsibility of the Newmans.

The Newmans, in turn, sued PNB, claiming that when Amigos defaulted on payments to Stevens and Thompson, PNB used a $150,000 letter of credit from the Newmans to pay off debt incurred by Amigos due to PNB. That money was supposed to go toward the $230,000 SBA loan, according to the Newmans' suit. The Newmans' suit also alleged that PNB didn't

notify them that Amigos had defaulted on payments; if they had known, the Newmans could have used the money from the $150,000 letter of credit to retake ownership of the Taco John's restaurants.

PNB filed a countersuit against the Newmans disputing the had any responsibility to the $230,000 loan.

The legal decision in 2016 in Jackson County Court awarded the Newmans $16,357,618.08 including both compensatory and punitive damages.

In overturning the 2015 and 2016, Appellate Court Justice Thomas M. Welch wrote that the 2015 decision granting summary judgment, along with the subsequent 2016 decision granting damages were not reached properly. That's because those decisions came from the Newmans' claim that PNB should have notified them of Amigos' default. There was nothing in any agreements between PNB and the Newmans, however, requiring PNB to make such a notification, Welch wrote.

The decision upheld by the appellate court involved PNB attempting to collect on the $230,000 loan. The U.S. Treasury became the owner of the debt, but according to the suit, PNB still tried to collect payment toward the debt for nine years after it no longer owned the debt. In the 2015 decision, the court at that time determined PNB was aware it had no legal standing to pursue repayment of that debt. Subsequently, in 2016, that court ruled to sanction PNB for plaintiff attorney fees. That ruling was upheld in Welch's ruling.

Representatives from all parties could not be reached for comment regarding the appellate court decision. A date for the remanded decisions has not been set.

COPYRIGHT 2019 Paddock Publications
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2019 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Daily Herald (Arlington Heights, IL)
Date:Mar 15, 2019
Words:524
Previous Article:LABOR OF LOVE Harrisburg man turns cars into works of art Cars.
Next Article:Up & Coming.
Topics:

Terms of use | Privacy policy | Copyright © 2020 Farlex, Inc. | Feedback | For webmasters