Appeal from the Circuit Court of the 12th Judicial Circuit, Will County, Illinois, Honorable Michael J. Powers, Judge, Presiding.
The opinion of the court was delivered by: Justice Lytton
JUSTICE LYTTON delivered the judgment of the court, with opinion.
Justice O'Brien concurred in the judgment and opinion. Justice Schmidt dissented, with opinion.
Jarred Newell filed a complaint against his mother, Ruth Newell, and First Midwest Bancorp Inc. (FMB), alleging conversion and breach of contract involving Ruth's unauthorized withdrawal of funds from a saving account in his name. The trial court ruled that Jarred's complaint was barred by the three-year statute of limitations in section 4-111 of the Uniform Commercial Code, Bank Deposits and Collections (UCC) (810 ILCS 5/4-111 (West 2006)) and granted FMB's motion for summary judgment. We reverse and remand for further proceedings.
In 1989, Ruth and Jarred were involved in an automobile accident. At the time of the accident, Jarred was six years old. Ruth filed a lawsuit, individually and as the mother and next friend of Jarred, against various defendants involved in the accident.
Several defendants eventually agreed to settle the case. On December 29, 1993, the trial court approved the settlement and dismissed the complaint as to those parties involved in the agreement. In addition to ordering the payment of medical expenses and awarding fees and costs, the order required that the funds awarded to Jarred be deposited in an account at FMB or some other federally insured depository. The order further stated: "No funds shall be withdrawn from the minor's account without prior court order."
On January 14, 1994, Ruth opened a guardianship account at FMB for Jarred's benefit. Ruth used Jarred's social security number to open the account. The terms of the account included a signature card, which was signed by Ruth "as guardian for Jarred Newel, a minor." In accordance with the trial court's order, the signature card included the following statement: "Minor account. No minor withdraw until 18 years old on 5-18-00 per court order - See Louise McLaren." Ruth's attorney, Thomas Cowgill, gave bank personnel a copy of the court order when Ruth opened the account.
Between January 14, 1994, and May 23, 1994, Ruth deposited a total of $210,050.11 into the account. She subsequently removed funds from the account without a court order. By June 30, 1997, the account was substantially reduced to a balance of $46. Ruth's last withdrawal from the account was on September 30, 2001. She claimed that she used the money for her son's health and welfare. She did not keep any records of the withdrawals.
In his discovery deposition, Jarred explained that he became aware of the FMB account during his teens; he was told that he would be able to withdraw the funds when he turned 18 years of age. When Jarred was 16 or 17 years old, he asked Ruth about the funds, and she told him that she changed the age to obtain the funds from 18 to 21. Jarred did not ask his mother how much money was in the account.
When he was almost 21, Jarred again asked Ruth about the account. Ruth told him that he had to wait until he was 23 years old to withdraw the money. At that point, Jarred became "curious" and "wondered what was going on." However, he trusted Ruth and decided to wait until he turned 23 to withdraw the money because that was when he graduated from college.
In May 2005, Jarred graduated from college and turned 23 years old. He asked his mother for the money. Once again, she was evasive and said the funds were not available. Jarred then began to investigate the status of the funds on his own.
In late 2005 or early 2006, Ruth told Jarred that there was no money left in the FMB account. In October or November of 2006, Jarred contacted Attorney Cowgill. Cowgill told Jarred that he helped Ruth deposit the settlement money into a bank account in 1994. In March 2007, Jarred's attorney confirmed that the FMB account had been depleted.
On April 11, 2007, Jarred filed a four-count complaint against Ruth and FMB. Counts I through III alleged that Ruth committed conversion and sought a petition for rule to show cause against her for failing to obtain a court order prior to the withdrawal of funds from his FMB account. Count IV claimed that FMB breached its ...