APPEAL from the Circuit Court of Cook County; the Hon. DANIEL
A. COVELLI, Judge, presiding.
MR. PRESIDING JUSTICE DIERINGER DELIVERED THE OPINION OF THE COURT:
This is an appeal from a judgment by the circuit court of Cook County. Daniel B. Nelsen, Jr. and D. Nelsen & Sons, Incorporated, (hereinafter "plaintiffs") brought the action in the circuit court to obtain a temporary and permanent injunction restraining defendants General American Development Corporation (hereinafter "GADC") and First California Company (hereinafter "First California") from obtaining payment on a $300,000 nonnegotiable certificate of deposit, and restraining defendant Suburban Trust & Savings Bank (hereinafter "Suburban Trust") from making payment thereon to said parties. Plaintiffs also sought an adjudication that Suburban Trust retain those funds in trust for plaintiffs. After a bench trial, judgment was entered for plaintiffs and against defendants GADC and First California, and judgment was entered for defendant Suburban Trust against the plaintiffs. Plaintiffs appeal only from the judgment order in favor of Suburban Trust.
The issues submitted for review are (1) whether Suburban Trust breached a duty to the plaintiffs; and (2) whether Suburban Trust's actions were the proximate cause of the plaintiffs' loss.
In late 1969 plaintiff Daniel Nelsen was approached by an agent of GADC and was asked whether he would be interested in a business transaction which involved a sale and buy-back of certain property owned by GADC. Mr. Nelsen was informed he would receive a profit of $300,000 should he participate. Thereafter, from late November 1969 to March 1970, Mr. Nelsen and representatives of GADC participated in 10 or 12 meetings to formulate the details of the transaction.
In order for Mr. Nelsen to participate, it was necessary for him or his company, D. Nelsen & Sons, Incorporated, to obtain a loan in the sum of $300,000 as down payment on the land in question, which was given a sale price of $2,000,000. Mr. Nelsen borrowed the $300,000 from the Suburban Trust.
The sale and buy-back arrangement called for Mr. Nelsen to obtain a cashier's check from Suburban Trust in the sum of $300,000 and to endorse it to GADC. At Suburban Trust's request, in order to stabilize funds, GADC was to reendorse the same check to Suburban Trust and obtain a one-year nonnegotiable certificate of deposit.
Mr. Nelsen informed Suburban Trust that when the certificate of deposit matured GADC would use the funds to buy back the property from Nelsen, and Nelsen would use the funds to pay off his loan with Suburban Trust. The buy-back portion of the arrangement, however, was never consummated. GADC, instead, assigned the nonnegotiable certificate of deposit to First California and Suburban Trust acknowledged the assignment over the protest of Nelsen.
According to Mr. Nelsen's testimony, Suburban Trust's president, Mr. Lagergren, during negotiations, indicated the certificate of deposit would not be assignable. The testimony of Mr. Lagergren, however, is there never was any encumbrance whatsoever on the assignability of the certificate of deposit. Furthermore, nothing in writing exists showing any encumbrance on the assignability of the certificate.
Entered as an exhibit at trial, the certificate of deposit issued to GADC shows no limitation of assignability on its face. The certificate provides, inter alia:
"Certificate of deposit Suburban Trust & Savings Bank March 30, 1970
GENERAL AMERICAN DEVELOPMENT CORP. has deposited in this bank $300,000.
This certificate shall be payable to the registered holder(s), or to the survivor(s), in current funds 12 months after date on return of this certificate properly endorsed with interest at the rate of six per cent per annum.
This deposit will not be paid in whole or in part before maturity and will not bear interest after maturity.
This certificate is nonnegotiable and no assignment shall affect the rights or liabilities of the bank unless and until notice thereof, signed by the assignor(s), and the assignee(s), is received and acknowledged by the bank. ...