APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, FIFTH DIVISION
507 N.E.2d 92, 154 Ill. App. 3d 587, 107 Ill. Dec. 428 1987.IL.380
Appeal from the Circuit Court of Cook County; the Hon. Richard L. Curry, Judge, presiding.
JUSTICE PINCHAM delivered the opinion of the court. LORENZ and MURRAY, JJ., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE PINCHAM
Plaintiff, Standard Federal Savings and Loan Association of Chicago (Standard Federal), filed a complaint against defendants Joseph Rocco and his wife, Helen Rocco (Roccos), for the foreclosure of a mortgage on their property and against defendant, Peninsular Fire Insurance Company (Peninsular Fire Insurance), the insurer of the property. Summary judgment was entered for Standard Federal against the Roccos and Peninsular Fire Insurance. Peninsular Fire Insurance appeals from the summary judgment entered against it.
In a subsequent action, Peninsular Fire Insurance filed a complaint against American National Bank. Summary judgment was entered for Peninsular Fire Insurance. American National Bank appeals from that summary judgment. The two cases have been consolidated on appeal.
The uncontroverted facts are as follows: The Roccos were owners of the property at 3447-51 West Montrose Avenue, Chicago. Standard Federal was the mortgagee of the property, which was insured by defendant, Peninsular Fire Insurance. Standard Federal initiated mortgage foreclosure proceedings on the property against the Roccos. While the mortgage foreclosure proceedings were pending, a fire occurred at the premises. The Roccos hired Lazarus-Willis & Associates to adjust the fire loss. Peninsular Fire Insurance issued its draft in the amount of $41,378 payable to Standard Federal, the mortgagee; Joseph and Helen Rocco, the owners; and Lazarus-Willis & Associates in settlement of the fire loss. The Roccos and Lazarus-Willis & Associates endorsed the draft, after which the Roccos delivered it to their attorneys, DeJong, Poltrock and Giampetro, who placed the following endorsement on the draft:
"Pay to the order of American National Bank & Trust Company of Chicago, Illinois 60690, For Deposit Only, DeJong, Poltrock and Giampetro, Clients Fund Account 00209 724."
The draft was deposited in DeJong, Poltrock and Giampetro's clients' fund account at American National Bank. American National forwarded the draft to Southeast First Bank of Jacksonville, Florida (Southeast Bank), for collection. Southeast Bank submitted the draft to Peninsular Fire Insurance for approval. An accounting clerk employed by Peninsular Fire Insurance noted that the endorsement of Standard Federal was missing from the draft. The clerk circled Standard Federal's name as payee on the front of the draft and returned it to Southeast Bank. Southeast Bank stamped "ENDORSEMENT MISSING" on the front upper right-hand corner of the draft and returned it through banking channels to American National. Upon receipt of the draft, American National stamped the following on the back of the draft:
"Credited to the account of the within named payee. Absence of endorsement guaranteed. American National Bank & Trust Company of Chicago, Illinois." (Emphasis added.)
American National Bank again submitted the draft to Southeast Bank for collection. Upon receipt of the draft, Southeast Bank transferred the funds for the draft to American National. Standard Federal did not endorse the draft or receive any proceeds therefrom. Standard Federal alleged that Peninsular Fire Insurance had breached its contractual obligations as the maker and drawer of the draft and was negligent in permitting payment of the draft.
Summary judgment for Standard Federal against Peninsular Fire Insurance was granted.
Summary judgment will lie where there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Whether there is any material issue to present to the trier of fact, is, in the first instance, a question of law to be determined by the court. (Alexander v. Standard Oil Co. (1981), 97 Ill. App. 3d 809, 814, 423 N.E.2d 578.) The facts in the case at bar are uncontroverted ...