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Corinne Hawkins v. Dennis Nalick

September 5, 2012

CORINNE HAWKINS,
PLAINTIFF-APPELLANT,
v.
DENNIS NALICK,
DEFENDANT, AND
NATIONAL CITY BANK, N.A., DEFENDANT-APPELLEE.



Appeal from the Circuit Court of Madison County. No. 10-L-451 Honorable David A. Hylla, Judge, presiding.

The opinion of the court was delivered by: Justices: Honorable Bruce D. Stewart, J.

NOTICE

The text of this decision may be changed or corrected prior to the filing of a Petition for Rehearing or the disposition of the same.

JUSTICE STEWART delivered the judgment of the court, with opinion. Presiding Justice Donovan and Justice Wexstten concurred in the judgment and opinion.

OPINION

¶ 1 The plaintiff, Corinne Hawkins, brought an action against her attorney, Dennis

Nalick, and against his bank, National City Bank, N.A., seeking to recover funds she lost when her attorney forged her name to a check payable to her, deposited the funds into his checking account with the bank, and converted the funds to his own use. The circuit court dismissed the plaintiff's claim against the bank based on the three-year statute of limitations on actions for conversion of negotiable instruments contained in section 3-118(g) of the Uniform Commercial Code (the UCC) (810 ILCS 5/3-118(g) (West 2010)). For the following reasons, we affirm.

¶ 2 BACKGROUND

¶ 3 The plaintiff's mother died in Cleveland, Ohio, in January 2004. The plaintiff hired defendant Dennis Nalick, a lawyer, to assist her with her inheritance from the Ohio probate proceeding. After corresponding with the estate's lawyers in Cleveland, Nalick received a check payable to the plaintiff in the amount of $137,826.43, representing her distribution from her mother's estate. Sometime between July 30, 2006, and August 23, 2006, Nalick forged the plaintiff's endorsement on the check and deposited the funds into his law office checking account with the defendant bank. Nalick subsequently converted the funds to his own use.

¶ 4 After forging the plaintiff's endorsement and depositing the funds into his law firm bank account, Nalick made repeated misrepresentations to the plaintiff concerning the delay in payment of her inheritance. Nalick's misrepresentations included false correspondence purporting to be from him to the estate's attorneys.

¶ 5 The plaintiff subsequently hired a new attorney. On or about March 29, 2010, the plaintiff learned through her new attorney that her mother's estate had distributed the funds by a check delivered to Nalick and that Nalick had forged her endorsement and converted the funds. On April 23, 2010, the plaintiff filed suit against Nalick and the bank to recover her inheritance funds. Count I of the plaintiff's complaint against Nalick has been resolved by a summary judgment against the special representative of the estate of Dennis Nalick, deceased.

¶ 6 The remaining counts of the plaintiff's complaint, counts II, III, and IV, allege claims against the bank under theories of conversion and negligence. On November 10, 2011, the bank filed a motion for a summary judgment, arguing that the plaintiff's claims were time-barred by the three-year statute of limitations contained in section 3-118(g) of the UCC (810 ILCS 5/3-118(g) (West 2010)). In support of its motion for a summary judgment, the bank argued that the discovery rule does not apply to claims for check conversion. Instead, the bank argued, the only way to toll the statute of limitations contained in section 3-118(g) is for the plaintiff to prove that the bank fraudulently concealed the conversion of her funds. The bank's motion for summary judgment included the affidavit of its loss prevention manager and excerpts from the plaintiff's deposition that established that the bank did not fraudulently conceal Nalick's forgery and conversion of funds from the plaintiff. The plaintiff was never a customer of the bank, the bank was not aware of the forged endorsement, and the bank never made any representations to the plaintiff regarding the check.

¶ 7 In response to the bank's motion for summary judgment, the plaintiff admitted that she had no evidence to support the assertion that the bank fraudulently concealed the conversion of the check which gave rise to the claim. However, the plaintiff argued that the running of the statute of limitations should be tolled under the discovery rule.

ΒΆ 8 On November 18, 2011, the circuit court entered a summary judgment in favor of the bank based on the statute of limitations. The court held that the plaintiff's claims were time-barred under section 3-118(g) of the UCC and that the discovery rule did not apply to claims of conversion of a negotiable instrument. The court also noted that the only exception would be if the bank fraudulently concealed the conversion from the plaintiff, but the undisputed ...


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