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Pinsker v. Kansas State Bank

OPINION FILED APRIL 3, 1986.

JAMES L. PINSKER, PLAINTIFF-APPELLANT,

v.

KANSAS STATE BANK, DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Coles County; the Hon. William J. Sunderman, Judge, presiding.

PRESIDING JUSTICE MCCULLOUGH DELIVERED THE OPINION OF THE COURT:

Rehearing denied May 1, 1986.

The plaintiff, James Pinsker, brought this action against the defendant, the Kansas State Bank, alleging interference with contract, fraud, abuse of process, malicious abuse of process, and malicious use of process. The plaintiff appeals from the trial court's order granting summary judgment in the defendant's favor.

The plaintiff owned and published several small newspapers, including the Kansas Journal and the Oakland Ledger-Messenger. The plaintiff financed the purchase of these newspapers through the defendant. The plaintiff and his wife executed mortgages on their real estate as security. The plaintiff also executed an agreement, giving the defendant a security interest in all office equipment, fixtures, furniture, inventory, and subscription lists. The plaintiff obtained subsequent financing from the defendant in varying amounts for which the defendant was given a security interest in all assets, real and personal, of the Kansas Journal, Oakland Ledger-Messenger, and Brocton-Hume Recorder-Review.

On January 18, 1980, the defendant filed a complaint and confession of judgment note for the sum of $43,625.29. Judgment by confession was entered against the plaintiff but was later vacated. On February 2, 1981, the defendant and Ryan executed documents relating to the interest under the mortgage and security agreement that the defendant had obtained from the plaintiff. The first document stated:

"THIS INDENTURE WITNESSETH, That the Assignor, KANSAS STATE BANK, * * * for good and valuable consideration, the receipt whereof is hereby acknowledged, do hereby assign, transfer, and set over unto STEVE RYAN all right, title and interest we may hold in said Security Agreement together with a Note and Claim secured thereby, to have and to hold the same unto Steve Ryan, his heirs and assigns, and we do hereby make, constitute and appoint STEVE RYAN, our true and lawful attorney, irrevocable, in our name or otherwise, but at the proper costs and charges of STEVE RYAN, to have, use and take all lawful ways and means for the recovery of the said money and interest; and in case of payment, to discharge the same as fully as we might or could do if these presents were not made.

And we do for ourselves, our successors and assigns, covenant with STEVE RYAN, his heirs, executors, administrators, and assigns, that said Corporation has good right to assign the same."

In two similar instruments, the defendant assigned the mortgages and notes along with its interest in the judgment against Pinsker to Ryan. Both contained identical language appointing Ryan as the defendant's attorney.

Ryan instituted a suit to foreclose the Oakland mortgage. He also obtained a temporary restraining order against the plaintiff prohibiting him from coming onto the premises or otherwise interfering with the operation of the newspapers. The restraining order was subsequently dissolved as having been improperly issued against the plaintiff. On February 24, 1981, the plaintiff moved to dismiss the defendant's action on the notes. The judgment of confession had already been vacated. On March 10, 1981, the court dismissed the defendant's action, holding that the defendant had no interest to pursue by virtue of its assignment.

On January 26, 1982, the plaintiff filed a five-count complaint against the defendant. Count I alleged Ryan had been the plaintiff's employee prior to February 2, 1981. The plaintiff alleged the defendant had interfered with his contractual relationship with Ryan and induced Ryan to breach his duty of loyalty by appointing Ryan its agent and having him file suit against the plaintiff. Count II alleged the defendant had committed a fraud in employing Ryan to collect money and seize the plaintiff's property. Counts III and V allege the bank, through its agent, Ryan, had committed the torts of abuse of process, malicious abuse of process, and malicious use of process.

The defendant filed a motion for summary judgment, arguing that as a matter of law, there was no principal-agent relationship between it and Ryan. The defendant filed depositions of Leonard Wilkinson, its former president; Michael Kern, the current president; Jack Asher, an attorney and member of the defendant's board of directors; and Allen Bell, the defendant's attorney. Each of these officials stated they intended the agreements to be assignments of the defendant's interest to Ryan. The defendant never intended to have Ryan act as its agent, and Ryan never did so. In his deposition, Ryan agreed that the parties intended to create an assignment and not an agency relationship. In return for the assignment, Ryan executed a note for $35,000. Ryan stated he never acted on behalf of the defendant, and the defendant had no control over him except to foreclose on his note. Ryan also testified he was never the plaintiff's employee. He and the plaintiff had agreed that Ryan would do the physical layouts for the papers for $15 a page. Ryan considered himself to be an independent contractor. In his deposition, the plaintiff stated he hired Ryan to manage his newspapers. He also stated neither Ryan nor the defendant ever told him that Ryan was the defendant's agent. The plaintiff also filed an affidavit of Linda Conover, one of his employees. She stated the plaintiff had hired Ryan to manage the newspapers. She had heard Ryan say that he and Wilkinson had made a deal and that he had obtained a power of attorney from the defendant. The trial court found no agency relationship had been created and granted summary judgment in the defendant's favor.

• 1 Summary judgment should be granted only when the pleadings, depositions, and admissions, together with any affidavits, show there is no genuine issue as to a material fact, and that the movant is entitled to judgment as a matter of law. (McBride v. Commercial Bank (1981), 101 Ill. App.3d 760, 764, 428 N.E.2d 739, 741.) While the nature and extent of an agency relationship are facts to be proved, these questions become one of law where the evidence is not disputed. Wargel v. First National Bank (1984), 121 Ill. App.3d 730, 460 N.E.2d 331.

The plaintiff maintains that under the plain language of the agreements, the defendant gave Ryan a power of attorney. The plaintiff asserts the instruments must be construed as transferring legal title over the defendant's interest to Ryan as its agent but retaining beneficial interest in the defendant. Under the plaintiff's interpretation, the defendant merely appointed Ryan its agent for collection. The plaintiff's entire argument focuses on the phrase "appoint STEVE RYAN, our true and lawful attorney," contained in each of the instruments.

• 2 Whether an agreement creates an agency relationship, at least insofar as a relationship affects a stranger to the agreement, depends upon the intent of the parties and the accompanying circumstances. The declaration of the parties in the agreement with respect to the nature of their relationship is not controlling, and, as with all other contracts, the writings must be considered as a whole. (Slates v. International House of Pancakes, Inc. (1980), 90 Ill. App.3d 716, 413 N.E.2d 457.) The intent of the parties should not be gathered from detached portions of a contract or by reference to particular words or phrases. (La Throp v. Bell Federal Savings & Loan Association (1977), 68 Ill.2d 375, 370 N.E.2d 188, cert. denied (1978), 436 U.S. 925, 56 L.Ed.2d 768, 98 S.Ct. 2818; ...


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