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Sullivan v. Chapman Plumbing, Inc.

United States District Court, Seventh Circuit

May 5, 2013

JAMES T. SULLIVAN, etc., et al., Plaintiffs,
v.
CHAPMAN PLUMBING, INC., and CHAMPION PLANNING AND CONTRACTING, INC., Defendants.

MOTION FOR ENTRY OF JUDGMENT AGAINST ROY WILSON CHAPMAN IV

VIRGINIA M. KENDALL, District Judge.

NOW COME Plaintiffs, JAMES T. SULLIVAN, etc., et al., by their attorneys, DOUGLAS A. LINDSAY, JOHN W. LOSEMAN, and BRIAN T. BEDINGHAUS, with ROETZEL & ANDRESS, LPA, of counsel, and move this Court pursuant to Fed.R.Civ.P. 69(a), Illinois Supreme Court Rule 277(h), and 735 ILCS 5/2-1402(f)(1) to enter Judgment against ROY WILSON CHAPMAN IV ("Roy Chapman"), president of Defendant, CHAPMAN PLUMBING, INC., in the amount of $10, 513.90. In support hereof, Plaintiffs states:

1. On May 26, 2009, Judgment was entered in favor of Plaintiffs and against Defendants, CHAPMAN PLUMBING, INC., and CHAMPION PLANNING AND CONTRACTING, INC., jointly and severally, in the amount of $530, 820.89.

2. On November 12, 2012, Plaintiffs served CHAPMAN PLUMBING, INC., with a Citation to Discover Assets by corporate service on its president, Roy Chapman. True and correct copies of the Citation, Citation Notice, and completed Affidavit of Service are attached hereto as Exhibit A.

3. Citation required production of certain documents on or before December 4, 2012, and appearance by Roy Chapman at Plaintiffs' attorneys' office for examination on December 11, 2012. See Exhibit A.

4. On December 3, 2012, CHAPMAN PLUMBING, INC. filed for Chapter 7 Bankruptcy in Case No. 12 B 47618.

5. On February 6, 2013, Plaintiffs served a Citation to Discover Assets on RBS CITIZENS d/b/a CHARTER ONE BANK ("Charter One").

6. Pursuant to the Citation document request, Charter One produced copies of bank account statements from an account of CHAPMAN PLUMBING, INC.

7. The Charter One checking account statements reveal that $10, 513.90 was transferred from CHAPMAN PLUMBING, INC.'s checking account after the date the Citation was served on CHAPMAN PLUMBING, INC. on November 12, 2012. True and correct copies of Charter One checking account statements for CHAPMAN PLUMBING, INC.'s checking account ending in x9473 covering the period from November 1, 2012 through February 28, 2013, and an "Affidavit of Keeper of Records, " are attached hereto as Exhibit D.

8. Specifically, the statements show following transfers occurred after service of the Citation: Debits:

Other Debits:

Checks:

See Exhibit D. True and correct copies of check numbers 2532 and 2533, supplied by Charter One, are attached hereto as Exhibit E.

9. Illinois Supreme Court Rule 277(h) provides that "[a]ny person who fails to obey a citation... may be punished for contempt."

10. 735 ILCS 5/2-1402(f)(1) provides in relevant part:

The citation may prohibit the party to whom it is directed from making or allowing any transfer or other disposition or, or interfering with, any property not exempt from the enforcement of a judgment therefrom... belonging to the judgment debtor or to which he or she may be entitled to which may thereafter be acquired by or become due to him or her... The court may punish any party who violates the restraining provision of a citation as and for a contempt...

735 ILCS 5/2-1402(f)(1).

11. The president of a corporation who transfers or permits the transfer of corporate assets in violation of the prohibitions of a citation to discover assets is personally liable for the transfers. Divane v. Sundstrand Electric Co., Inc., No. 03 C 5728, 2004 WL 1323287 at *2 (N.D.Ill. June 14, 2004) (citing City of Chicago v. Air Auto Leasing Co., 297 Ill.App.3d 873 (1988)); see also Laborers' Pension Fund v. Dominic Jr., Inc., No. 02 C 3321, 2003 WL 21310282 * 2-4 (N.D.Ill. June 5, 2003).

12. Roy Chapman violated the restraining provisions of the Citation by transferring and permitting the transfer of $33, 389.99 from the Charter One checking account of CHAPMAN PLUMBING, INC., after the date he was served with the Citation.

13. Plaintiffs request judgment be entered against ROY WILSON CHAPMAN IV in the amount of $10, 513.90, which is the amount of the transfers made after service of the Citation.

14. As of May 3, 2013, after all payments have been applied, a total amount of $540, 895.71 remains due to Plaintiffs, which amount includes $530, 820.89 in judgment principal and $10, 074.82 in judgment interest.

WHEREFORE, Plaintiffs, JAMES T. SULLIVAN, etc., et al., request the Court to enter judgment in favor of Plaintiffs and against ROY WILSON CHAPMAN IV in the amount of $10, 513.90, and to award additional relief in favor of Plaintiffs as the Court deems appropriate.

EXHIBIT A

YOUR FAILURE TO APPEAR AS HEREIN DIRECTED MAY CAUSE YOU TO BE ARRESTED AND BROUGHT BEFORE THE COURT TO ANSWER TO A CHARGE OF CONTEMPT OF COURT, WHICH MAY BE PUNISHABLE BY IMPRISONMENT IN THE COUNTY JAIL.

YOU ARE REQUIRED TO DO THE FOLLOWING UPON RECEIVING THIS CITATION UNTIL FURTHER ORDER OF THE COURT IN ACCORDANCE WITH ILLINOIS SUPREME COURT RULE 277(f), OR UNTIL THIS CITATION IS DISMISSED BY THE COURT OR BY STIPULATION:

YOU ARE REQUIRED TO APPEAR at the offices of Roetzel & Andress, 20 South Clark Street, Suite 300, Chicago, Illinois, on December 11, 2012, at 2:00 p.m., to be examined under oath concerning the property or income of, or indebtedness due or owed to CHAPMAN PLUMBING, INC., and CHAMPION PLANNING AND CONTRACTING, INC. ("Judgment Debtors"). This Citation examination shall be conducted by deposition as provided by the rules of this Court for depositions.

YOU ARE REQUIRED TO PRODUCE at the offices of Roetzel & Andress, 20 South Clark Street, Suite 300, Chicago, Illinois, on or before December 4, 2012, all documents of every nature containing information concerning any assets, property, income of, or any indebtedness due or owed to the Judgment Debtors, including without limitation, documents reflecting the following (for the period from July 1, 2010, to the present, unless indicated otherwise):

(i) All accounts with any banking institution, savings and loan association, or credit union, certificates of deposit, money market and mutual fund accounts, trust accounts and funds, checking accounts, savings accounts, money market accounts, pension plans, and retirement accounts, whether held in the name of a Judgment Debtor or in any Judgment Debtor's name with another person or company, including without limitation, all cancelled checks, all deposited checks, and a copy of each detailed account statement;
(ii) All loans and promissory notes; loan or other financing applications; financial statements and reports;
(iii) All purchase or sale contracts, property listings, deeds, mortgages, trust agreements or assignments, leases, sale/leaseback contracts, and management contracts, made or executed by any Judgment Debtor pertaining to any real estate in which any Judgment Debtor has an interest or has had any interest since July 1, 2010;
(iv) Evidence of all monies owed to any Judgment Debtor, whether due, overdue, or to become due to a Judgment Debtor, including but not limited to commissions and accounts receivable;
(v) All minutes, books, and records reflecting or pertaining to the transfer of any real estate between any Judgment Debtor and any persons affiliated with or employed by a Judgment Debtor;
(vi) All financial statements, including but not limited to all balance sheets, income statements, statements of cash flow, statements of changes in owners' equity; invoices, check registers, schedule of assets or items, equipment and materials lists, and records reflecting the sale or other disposition of assets by any Judgment Debtor;
(vii) Ownership or investment interests of any Judgment Debtor in any other business, real property, or other investment;
(viii) All articles of incorporation and any and all amendments made thereto; All articles of dissolution; All Annual Reports filed in any State for the years 2010, 2011, and 2012;
(ix) Certificates of Title or other evidence of ownership or right to use any motor vehicle, marine vessel or other equipment or vehicle required to be titled under the laws of Illinois or any other state in the USA, together with any copies of any documentary evidence of any loans which are secured by said property, including loan applications, and status of any said loans as of the date of the service of this citation and as of the date of the entry of judgment herein; all vehicle title and registration documents; all documents and contracts reflecting the sale or lease of any vehicle owned by any Judgment Debtor or used by any Judgment Debtor in the course of its business since July 1, 2010;
(x) Copies of Judgment Debtors' business income tax returns, federal and state, including all schedules, for the years 2010, and 2011;
(xi) Copies of Judgment Debtors' payroll tax returns and state unemployment tax returns for the years 2010, 2011, and 2012; All Illinois Employer's Contribution and Wage Reports filed in the years 2010, 2011, and 2012.
(xii) Mortgages and/or deeds to real estate; interests in any trust, including land trusts; leases, rentals, properties, installment agreements or plans for any real estate or premises; contracts regarding, or interests in, real estate; insurance policies, including schedules of insured property or items;
(xiii) Quarterly reports and filings for estimated employment, unemployment, sales, and/or use taxes; W-2 and 1099 forms; correspondence to or from the IRS or Illinois Department of Revenue or their agents;
(xiv) All cash disbursement records, including check disbursement journals, ledgers, and registers for the years 2010, 2011, and 2012; All customer lists and accounts receivable for the years 2010, 2011, and 2012; and
(xv) Contracts, invoices, sales orders, work permits, permit applications, licenses, license applications, bonds, insurance policies, waivers, progress reports payment requests, and receipts for all work in progress, work under contract, planned work, and work or projects performed since January 1, 2011.
(xvi) All credit card statements, including purchase detail, used to make purchases for any Judgment Debtor, whether the account is in the corporate name or otherwise;

The undersigned attorney certifies that judgment was entered in favor of Plaintiffs and against CHAPMAN PLUMBING, INC., and CHAMPION PLANNING AND CONTRACTING, INC., jointly and severally on May 26, 2009, in the principal amount of $530, 820.89. The entire balance plus post-judgment interest at the rate of 0.47% per annum remains unsatisfied. As of November 2, 2012, after all credits and set-offs are given, the balance due is $539, 405.94, consisting of (1) principal of $530, 820.89 and (2) interest of $8, 585.05. Interest continues to accrue at a rate of $6.84 per day while the judgment remains unsatisfied.

YOU ARE PROHIBITED from making or allowing any transfer or other disposition of, or from interfering with: (i) any property not exempt from the enforcement of a judgment therefrom, a deduction order or garnishment belonging to Judgment Debtors; (ii) any such property to which Judgment Debtors may be entitled; and (iii) any such property that may be acquired by Judgment Debtors, until further order of the Court or termination of the proceeding.

YOU ARE PROHIBITED from paying over or otherwise disposing of any monies not so exempt which currently are due or owed to, or which are to become due or owed to, Judgment Debtors until further order of the Court or termination of the proceeding.

THE COURT MAY PUNISH YOU FOR CONTEMPT OF COURT if you violate the foregoing restraining provisions.

Judgment was entered on May 26, 2009, in the amount of $530, 820.89. Interest accrues at the annual rate of 0.47%. As of November 2, 2012, a principal balance of $530, 820.89 plus accrued interest remains unsatisfied.

Name of person receiving Citation: Chapman Plumbing, Inc., c/o Roy W. Chapman IV - president, 665 Forest Ave., Elgin, IL 60120

NOTICE: The Court has issued a Citation against the person named above. The Citation directs that person to appear in Court or at a deposition at the offices of the judgment creditors' attorney to be examined for the purpose of allowing the judgment creditor to discover income and assets belonging to the judgment debtor or in which the judgment debtor has an interest. The Citation was issued on the basis of a judgment against the judgment debtor in favor of the judgment creditor in the amount stated above. On or after the Court or deposition date shown above, the Court may compel the application of any discovered income or assets toward payment on the judgment. The amount of income or assets that may be applied toward the judgment is limited by federal and Illinois law.

THE JUDGMENT DEBTORS HAVE THE RIGHT TO ASSERT STATUTORY EXEMPTIONS AGAINST CERTAIN INCOME OR ASSETS OF THE JUDGMENT DEBTOR WHICH MAY NOT BE USED TO SATISFY THE JUDGMENT IN THE AMOUNT STATED ABOVE:

(1) Under Illinois or federal law, the exemptions of personal property owned by the debtor include the debtor's equity interest, not to exceed $4, 000 in value, in any personal property as chosen by the debtor; Social Security and SSI benefits; public assistance benefits; unemployment compensation benefits; worker's compensation benefits; veteran's benefits; circuit breaker property tax relief benefits; the debtor's equity interest, not to exceed $2, 400 in value, in any one motor vehicle, and the debtor's equity interest, not to exceed $1, 500 in value, in any implements, professional books, or tools of the trade of the debtor. (2) Under Illinois law, every person is entitled to an estate in homestead, when it is owned and occupied as a residence, to the extent in value of $15, 000, which homestead is exempt from judgment. (3) Under Illinois law, the amount of wages that may be applied toward a judgment is limited to the lesser of (i) 15% of gross weekly wages or (ii) the amount by which disposable earnings for a week exceed the total of 45 times the federal minimum hourly wage or, under a wage deduction summons served on or after January 1, 2006, the Illinois minimum hourly wage, whichever is greater.

(4) Under federal law, the amount of wages that may be applied toward a judgment is limited to the lesser of (i) 25% of disposable earnings for a week or (ii) the amount by which disposable earnings for a week exceed 30 times the federal minimum hourly wage.

(5) Pension and retirement benefits and refunds may be claimed as exempt under Illinois law. The judgment debtors may have other possible exemptions under the law. THE JUDGMENT DEBTORS HAVE THE RIGHT AT THE CITATION HEARING TO DECLARE EXEMPT CERTAIN INCOME OR ASSETS OR BOTH. The judgment debtors also have the right to seek a declaration at an earlier date, by notifying the clerk in writing at the office of the Clerk of the U.S. District Court, Room 2000, 219 South Dearborn Street, Chicago, Illinois 60604. When so notified, the Clerk of the Court will obtain a prompt hearing date from the court and will provide the necessary forms that must be prepared by the judgment debtors or the attorney for the judgment debtors and sent to the judgment creditors and the judgment creditors' attorney regarding the time and location of the hearing. This notice may be sent by regular first class mail.

All-Pro Process & Investigations Inc. Agency License No. 117-001222

AFFIDAVIT OF SPECIAL PROCESS SERVER

Joe Sanfratello, a special appointed process server, an agent of All-Pro Process & Investigations

Department of Professional Regulation number XXX-XXXXXX on oath states

1. That he/she served the within Citation to Discover Assets, and Citation Notice on the within named defendant,

Chapman Plumbing, Inc., President - Roy chapman by leaving a copy of each with the said defendant personally on November 12, 2012 at 4:50 P.M.

11. (a) That the sex, race and approximate age of the defendant or other person with whom he left the

(b) That the place where (if possible in terms of an exact street address) when the Process was left with the defendant is as follows:

Place: 665 Forest Ave, Elgin

Comments.

EXHIBIT B

***NOTE TO PUBLIC ACCESS USERS*** Judicial Conference of the United States policy permits attorneys of record and parties in a case (including pro se litigants) to receive one free electronic copy of all documents filed electronically, if receipt is required by law or directed by the filer. PACER access fees apply to all other users. To avoid later charges, download a copy of each document during this first viewing. However, if the referenced document is a transcript, the free copy and 30-page limit do not apply.

Chapter 7 Trustee's Report of No Distribution: I, Joseph Voiland, having been appointed trustee of the estate of the above-named debtor(s), report that I have neither received any property nor paid any money on accountof this estate; that I have made a diligent inquiry into the financial affairs of the debtor(s) and the location of the property belonging to the estate; and that there is no property available for distribution from the estate over and above that exempted by law. Pursuant to Fed R Bank P 5009, I hereby certify that the estate of the above-named debtor(s) has been fully administered. I request that I be discharged from any further duties as trustee. Key information about this case as reported in schedules filed by the debtor(s) or otherwise found in the case record: This case was pending for 2 months. Assets Abandoned (without deducting any secured claims): $6000.00, Assets Exempt: Not Available, Claims Scheduled: $547636.94, Claims Asserted: Not Applicable, Claims scheduled to be discharged without payment (without deducting the value of collateral or debts excepted from discharge): $547636.94. (Voiland, Joseph)

The following document(s) are associated with this transaction:

12-47618 Notice will be electronically mailed to:

Brian T Bedinghaus on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Plumbers' Pension Fund, Local 130, U. A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor The Plumbing Council of Chicagoland bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Stephen J Costello on behalf of Debtor Chapman Plumbing, Inc. steve@costellolaw. com

Patrick S Layng USTPRegion11.ES.ECF@usdoj.gov

Douglas A. Lindsay on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Plumbers' Pension Fund, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor The Plumbing Council of Chicagoland dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

John W. Loseman on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Plumbers' Pension Fund, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor The Plumbing Council of Chicagoland jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

Joseph Voiland jrvoiland@sbcglobal.net, j voiland@ecf.epiqsystems.com

12-47618 Notice will not be electronically mailed to:

EXHIBIT C

***NOTE TO PUBLIC ACCESS USERS*** Judicial Conference of the United States policy permits attorneys of record and parties in a case (including pro se litigants) to receive one free electronic copy of all documents filed electronically, if receipt is required by law or directed by the filer. PACER access fees apply to all other users. To avoid later charges, download a copy of each document during this first viewing. However, if the referenced document is a transcript, the free copy and 30-page limit do not apply.

Bankruptcy Case Closed and Trustee Discharged. (Ramey, Dorothy)

The following document(s) are associated with this transaction:

12-47618 Notice will be electronically mailed to:

Brian T Bedinghaus on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Plumbers' Pension Fund, Local 130, U.A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor The Plumbing Council of Chicagoland bbedinghaus@ralaw.com, casedocket@ralaw.com

Brian T Bedinghaus on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. bbedinghaus@ralaw.com, casedocket@ralaw.com

Stephen J Costello on behalf of Debtor Chapman Plumbing, Inc. steve@costellolaw. com

Patrick S Layng USTPRegion11.ES.ECF@usdoj.gov

Douglas A. Lindsay on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Plumbers' Pension Fund, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor The Plumbing Council of Chicagoland dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

Douglas A. Lindsay on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. dlindsay@ralaw.com, rparizek@ralaw.com, skoutsis@ralaw.com, casedocket@ralaw.com

John W. Loseman on behalf of Creditor Chicago Journeymen Plumbers' Local Union 130, U.A., Group Legal Services Plan Fund jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Plumbers' Pension Fund, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Plumbers' Welfare Fund, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor The Plumbing Council of Chicagoland jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

John W. Loseman on behalf of Creditor Trust Fund for Apprentice and Journeymen Education and Training, Local 130, U.A. jloseman@ralaw.com, skoutsis@ralaw.com;casedocket@ralaw.com

Joseph Voiland jrvoiland@sbcglobal.net, j voiland@ecf.epiqsystems.com

12-47618 Notice will not be electronically mailed to:

EXHIBIT D


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