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Am. Nat. Bk. & T. Co. v. Scenic Stage Lines

DECEMBER 7, 1971.

AMERICAN NATIONAL BANK & TRUST COMPANY OF CHICAGO, PLAINTIFF-APPELLEE,

v.

SCENIC STAGE LINES OF SAVANNA, INC., A/K/A SCENIC STAGE LINES OF IOWA, INC. ET AL., DEFENDANTS-APPELLANTS.



APPEAL from the Circuit Court of Jo Daviess County; the Hon. L. MELVIN GUNDRY, Judge, presiding.

MR. JUSTICE VAN DEUSEN DELIVERED THE OPINION OF THE COURT:

On May 12, 1970, defendants-appellants Scenic Stage Lines of Savanna, Inc. and Roger J. Crow executed and delivered to Hausman Bus Sales, Inc. their confession note for $80,000.00 made payable in one installment on June 26, 1970, to secure the purchase of certain used buses. The note bore the following printed words on the reverse side thereof, with the exception of the signature of "Eugene Tarkoff, Sec-Treas.", which was handwritten:

ENDORSEMENT

Pay To the Order of

American National Bank and Trust Company of Chicago

___________________________________ (Endorser)

___________________________________ (Endorser)

___________________________________ (Seller)

By /s/ Eugene Tarkoff Sec-Treas. (Title)

The note was placed in judgment on July 24, 1970, by appellee-plaintiff American National Bank & Trust Company of Chicago who alleged in their complaint ownership of said note.

On August 7, 1970, defendants filed their motion to vacate alleging that the face of the complaint and the note disclosed that Hausman Bus Sales, Inc. did not endorse said note and that plaintiff was not the legal holder at the time judgment was taken. They further alleged that defendants had a meritorious defense and supported their allegations by the affidavits of Lawrence A. Smith, Jr., their attorney, and by the defendant, Roger J. Crow, President of Scenic Stage Lines of Savanna, Inc. The alleged defense was a claimed breach of an agreement to make certain repairs and to guarantee the working condition of the buses and to deliver and keep said buses in operating condition. The affidavit of Roger Crow also asserts that plaintiff Bank had at all times known of said claims. Plaintiff filed the counter-affidavit of Eugene Tarkoff, Secretary-Treasurer of Hausman Bus Sales, Inc., stating, among other matters, that the note in question had, on May 13, 1970, been assigned, endorsed and delivered to plaintiff and that on June 28, 1970, Hausman Bus Sales, Inc. had received a letter dated June 27, 1970, from Scenic Stage Lines of Savanna, Inc. indicating the presence of certain problems with reference to functioning of the buses.

The trial judge found that defendants' affidavits and motion did not disclose a prima facie defense and denied the motion to vacate, and confirmed the judgment.

On appeal the defendants claim that the trial judge abused his discretion in refusing to open the judgment by confession in that (1) defendants had shown by their affidavits a meritorious defense to plaintiff's demand, (2) in the alternative, the defendants had a counterclaim against plaintiff's demands, and (3) that plaintiff was not the legal holder of the note in question in that the purported endorsement was legally insufficient.

• 1 In its reply brief plaintiff also claimed that the note in question was not a negotiable instrument because it allegedly authorized confession of judgment before maturity. This point was not raised at the trial court level or in appellant's initial brief; it has, therefore, been waived. Crane ...


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