Before Boltz entered into this loan transaction, Chapman showed him a notarized document dated June 6, 1985, which on its face authorized the use of these negotiable instruments as collateral. The document also provided that Trevor Corporation "would be responsible for the repayment of any loans derived as a result of the use of the aforestated bonds as collateral." The signature on the document was that of Willis Requa Bryant, the owner of the bonds. At the time of the transaction, Bryant had not been adjudicated a disabled person.
APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, FOURTH DIVISION
530 N.E.2d 985, 175 Ill. App. 3d 1056, 125 Ill. Dec. 576 1988.IL.1353
Appeal from the Circuit Court of Cook County; the Hon. Michael F. Czaja, Judge, presiding.
JUSTICE LINN delivered the opinion of the court. JIGANTI, P.J., and JOHNSON, J., concur.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE LINN
Howard Boltz, petitioner, brought an action to recover damages for wrongful issuance of an injunction pursuant to section 11-110 of the Code of Civil Procedure (Code) (Ill. Rev. Stat. 1985, ch. 110, par. 11-110). In addition, he seeks an award of attorney fees as sanctions under section 2-611 of the Code because of the respondent guardian's allegedly wasteful and frivolous litigation.
The instant appeal arises out of a transaction in 1985 in which Boltz loaned money to Karl Chapman, who was the nurse of Willis Requa Bryant, now deceased. As collateral for the loan, Chapman gave Boltz certain bearer coupons that were owned by Bryant. Bryant had given written authorization to Chapman to use the interest coupons as collateral for the loan.
The guardian of Bryant's estate obtained a temporary restraining order, without notice. This effectively froze the bearer coupons, which had been deposited with a bank. The guardian also obtained a preliminary injunction, without notice to Boltz, which prevented Boltz from possessing the coupons as he was entitled to under the loan transaction. Boltz moved in the trial court to dissolve or vacate the injunction, and the guardian filed a citation against Boltz to recover the coupons as assets of the estate. Upon the stipulation of the parties, the court granted the motion to dissolve the injunction before the trial on the citation. The trial court ultimately found that Boltz was entitled to possession of the coupons and ordered their release to him. The court denied, however, Boltz' requests for damages under section 11 -- 110 and for attorney fees under section 2 -- 611.
On appeal, Boltz contends that the trial court erred because the injunction was improperly issued and it was dissolved upon his application before trial on the merits. Accordingly, he contends he satisfied the requisites of section 11 -- 110 of the Code of Civil Procedure. He claims attorney fee sanctions were improperly denied because the guardian made false statements and raised spurious defenses, knowing that they were false and lacking in legal foundation.
We reverse in part, affirm in part, and remand for a hearing on Boltz' damages.
In June 1985 a business acquaintance of Boltz asked him to lend money to Karl Winston Chapman, a/k/a Trevor Stuart Hamilton (Chapman). At the time, Chapman was employed by a nursing service that was responsible for the daily care of Willis Bryant, then 88 years old. Bryant owned a number of bearer bonds with attached interest coupons.
Chapman told Boltz that he would use the proceeds from Boltz' loan as earnest money for an option to purchase real estate for the Trevor Corporation. As collateral for the loan, Boltz was to receive 184 interest coupons with an aggregate redemption value of over $37,000. These coupons were detached from Bryant's bearer bonds issued by the Illinois Housing Development Authority and the Puerto Rico Water Resources Authority. The coupons were redeemable in four groups of varying amounts, coming due July 1, 1985, January 1, 1986, July 1, 1987, and January 1, 1988. According to the terms of Boltz' loan to Chapman, Boltz would redeem the coupons on their due dates if the loan was not repaid on schedule.
On June 7, R. Ford Dallmeyer was appointed temporary guardian of Bryant's estate and person, based on his discovery of a $20,000 check issued to Chapman and entries made to Bryant's safe deposit box in the spring of 1985, which indicated that a ...