United States District Court, N.D. Illinois, Eastern Division
FOX VALLEY LABORERS' HEALTH AND WELFARE FUND, THE FOX VALLEY LABORERS' PENSION FUND, and PAT SHALES, Administrator of the Funds, Judgment Creditors,
HUGH HENRY CONSTRUCTION INC., an Illinois corporation, TRACEY BIESTERFELDT, and MICHAEL GALLAGHER, individuals, Judgment Debtors, and CENTAUR CONSTRUCTION CO., INC., Third-party Citation Respondent.
Honorable Judge Manish S. Shah
JUDGMENT CREDITORS FOX VALLEY LABORERS'
FUNDS' REPLY IN OPPOSITION TO JUDGMENT CREDITOR STEVEN D.
BLANC, LTD'S OBJECTION TO TURNOVER ORDER DIRECTED AT
CENTAUR CONSTRUCTION CO., INC.
Background Two creditors have judgments against Hugh Henry
Construction, Inc. The Fox Valley Laborers' Health and
Welfare Fund, the Fox Valley Laborers' Pension Fund, and
Pat Shales (collectively, “the Funds”), obtained
their judgment in this case and are filing this reply. The
Funds' judgment has an outstanding principal balance of
$301, 121.83 as of the date of this filing. Judgment debtor
Steven D. Blanc., Ltd. (“Blanc”) has a judgment
for $14, 184.55 in a state court case in Cook County Circuit
Henry is owed $20, 257.13 by Centaur Construction Company,
Inc. (“Centaur”). Both the Funds and Blanc served
third-party citations to discover assets on Centaur. The
Funds and Blanc now dispute who is entitled to that money
held by Centaur.
Blanc's Response to Judgment Creditor Fox Valley's
Motion for Turnover Order Directed at Centaur Construction,
Co., Inc. (“Response” [Docket No. 121]), Blanc
asserts that on January 12 (all dates 2018 except as noted),
Centaur “accept[ed] service of the Third Party Citation
to Discover Assets” through Centaur's president,
Peter Alexopoulos(Response ¶6). Blanc does not provide
any details on how service was achieved, but an email Blanc
provided shows that, on January 12, Blanc's lawyer sent a
copy of the third-party citation to discover assets to
Alexopoulos by email. Alexopoulos responded that day,
“I will review and respond over the weekend as I am out
in the field today.” Later, on February 8, Alexopoulos
responded, “I accept service of the Citation and have
also received the Citation via Certified Mail.” (A copy
of this email exchange is attached as Exhibit A.) On February
8, Blanc obtained a turnover order to Centaur for the total
balance of his judgment, issued by the Circuit Court of Cook
County, based on Centaur's answer dated February 6 that
it was holding $20, 257.13 (answer attached as Exhibit B).
Funds served their third party citation by certified mail,
return receipt requested, to Centaur's registered agent,
which received it on February 1. (A copy of the certified
mail return receipt showing tracking No. 7017 1450 0002 1167
6220 is attached as Exhibit C. A copy of the USPS tracking
information is attached as Exhibit D.)
Funds also assert a lien through the Uniform Commercial Code,
filed with the Illinois Secretary of State on June 20, 2017.
(Relevant filings were attached as Exhibits G and H to the
Funds' original Motion for Turnover Order Directed at
Centaur [Docket No. 107-1]).
Funds have priority over Blanc in two respects. First, the
Funds have priority back to June 20, 2017, based on their UCC
Financing Statement. Second, the Funds have priority based on
service of their citation through certified mail, which
created a judgment lien on February 1. The January 12 emails
between Blanc's counsel and Alexopoulos do not establish
service of the third-party citation to discover assets for
purposes of creating a judgment lien.
this, Blanc contends that this Court must defer to his
February 8 turnover order from the Circuit Court of Cook
County under the Rooker-Feldman doctrine. But that doctrine
only prevents state court losers from appealing their losses
into federal district courts. Here, Blanc is the winner in
the state court and the Funds are not challenging his
victory. The Rooker-Feldman doctrine does not apply to
post-judgment proceedings. Blanc has no other arguments so
the Centaur money should be turned over to the Funds.
Funds Have a Priority Judgment Lien Over Blanc's Judgment
Lien Based on The Funds' UCC Filing of June 20, 2017.
Response does not address the Funds' UCC filing of June
20, 2017. Lien priorities between citation-created judgment
liens and UCC liens are resolved by looking to the date a
Financing Statement was filed in connection with the UCC
lien. Laborers' Pension Fund v. A & C Envtl.,
Inc., 2005 U.S. Dist. LEXIS 7892, *7-8 (N.D.Ill. 2005)
(Schenkier, Magistrate J.). Thus, there should be no question
that the Funds have a priority lien over Blanc by several
months due to this UCC financing statement.
Emailing a Citation to Discover Assets Does Not Create a
and the Funds both contend they have judgment liens based on
their service of a citation to discover assets on Centaur.
“The judgment or balance due on the judgment becomes a
lien when a citation is served in accordance with subsection
(a) of this Section.” 735 ILCS 5/2-1402(m). Where there
are two citations served, the earlier-served citation creates
the higher-priority judgment lien. Pontikes v.
Perazic, 295 Ill.App.3d 478, 485 (2d Dist. 1998).
has not presented proof that he served his citation on
Centaur “in accordance with subsection (a) of this
Section [735 ILCS 5/2-1402]” prior to the Funds'
service of their lien, because the only form of service Blanc
undertook prior to February 1 was service by ...