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Laborers Pension Fund v. Garces Contractors, LLC

United States District Court, N.D. Illinois, Eastern Division

June 26, 2018

LABORERS' PENSION FUND and LABORERS' WELFARE FUND OF THE HEALTH AND WELFARE DEPARTMENT OF THE CONSTRUCTION AND GENERAL LABORERS' DISTRICT COUNCIL OF CHICAGO AND VICINITY, THE CHICAGO LABORERS' DISTRICT COUNCIL RETIREE HEALTH AND WELFARE FUND and JAMES S. JORGENSEN, Administrator of the Funds,, Plaintiffs,
v.
GARCES CONTRACTORS, LLC, an Illinois limited liability company, and ELDA MANNION, individually. Defendants.

          MOTION TO REINSTATE AND CONFESS JUDGMENT

         NOW COME Plaintiffs Laborers' Pension Fund and Laborers' Welfare Fund of the Health and Welfare Department of the Construction and General Laborers' District Council of Chicago and Vicinity and James Jorgensen, Administrator of the Funds (hereinafter collectively "Funds"), by and through their attorney, G. Ryan Liska, and hereby move this Court to Reinstate and Confess Judgment on the settlement Installment Note entered into by the parties in the above referenced matter. In support of this Motion, Plaintiffs state as follows:

         1. On October 7, 2016 the Funds filed a Complaint against Garces Contractors, LLC and Elda Mannion (collectively "Defendants") as a result of the Defendants failure to submit fringe benefit reports and contributions.

         2. On June 30, 2017 the Funds and Defendants resolved this matter when the parties entered into an Installment Note and Guaranty of Payment Indemnification wherein the Defendants agreed to pay $92, 311.00 pursuant to the terms of a Settlement Agreement and Installment Note. A true and accurate copy of the Installment Note is attached as Exhibit 1 and Guaranty of Payment Indemnification is attached hereto as Exhibit 2, 3. As a result of the Parties settlement, the Parties entered into an Agreed Stipulation to Dismiss and the Court subsequently entered a Minute Order in which the Court retained jurisdiction through September 15, 2018 to enforce the Installment Note and Guaranty, (A true and accurate copy of the Agreed Stipulation to Dismiss and this Court's July 12, 2017 Minute Order are attached hereto as Exhibit 3.

         4. The Installment Note and Guaranty required the Defendants to pay $26, 100.03 to the Funds over the course of thirteen (13) months with the first payment commencing on September 1, 2017 and the final payment coming due on September 1, 2018. In addition to making timely payments, the Installment Note was conditioned upon Defendants remaining current on its obligations to the Funds and Union including the timely submission and payment of monthly fringe benefit reports. (See Exhibit 1 Installment Note, Paragraph 9 and Exhibit 2 Guaranty, Paragraph 1).

         4. The terms of the Collective Bargaining Agreement and Trust Agreements required Defendants to submit contributions and to forward the appropriate Union dues by the 10t!l day following the month in which the work was performed. The Collective Bargaining Agreement also provides a thirty (30) day grace period which allows employers additional time to submit reports before it will be assessed a liquidated damages penalty.

         5. Under the terms and conditions of the Installment Note, Collective Bargaining Agreement and Trust Agreements, Defendants were to submit its March 2018 monthly reports on or before May 10, 2018 and its April 2018 monthly report and contributions on or before June 10, 2018. However, Defendants failed to do so and as a result have defaulted on the terms of the Installment Note and Guaranty. (See Joseph Gilleran Affidavit attached as Exhibit 4).

         7. Defendants' late payment of its December 2017, January 2018 and February 2018 monthly reports also resulted in the assessment of liquidated damages totaling $3, 623.42. The liquidated damages are assessed at 10% of the Defendants monthly report amount for that given month. The accumulative liquidated damages are itemized as follows: December 2017: $ 1, 726.08; January 2018: $973.62; and February 2018: $923.72. (See Gilleran Affidavit, ¶ 4).

         8. Paragraph 8 of the Installment Note provides "in the event the Company fails to timely make any payments described in this Note, all amounts described in paragraph 1 [of the Note] herein shall immediately become due on the 10th day following the date on which payment should have been received by the Funds under the terms of this Note."

         9. Likewise, paragraph 6 of the Guaranty provides as follows: "In the event that payments under the Note shall be accelerated, the Guarantor's obligations hereunder shall also be accelerated without further notice from the Funds." The Guaranty also provides at paragraph 13: "The Guarantor hereby authorizes irrevocably any attorney of any court of record to appear for him/her in such court, at any time after ten (10) days' notice after default of any payment due under this Guaranty, and to confess judgment against Guarantor, after service of notice of the claimed default, in favor of the Funds for such amount to be unpaid thereon .... including reasonable attorney fees."

         10. On June 11, 2018 the Funds provided a written notice of default to the Defendants which set forth the reason for the default and further requested that the defaulted be cured within 10 business day of the written notice of default. (A true and accurate copy of the written notice of default which was sent via email and U.S. Mail is attached hereto as Exhibit 5). As of the date of this Motion, Defendants failed to cure all defaults. (See Gilleran Affidavit, ¶ 3).

         11. By virtue of not remaining current on its monthly obligations and failing to cure the default, Defendants are in default of the terms and conditions of the Installment Note and Guaranty. Allowing for all just due credits, Defendants owe $5, 833.17. (An itemized payment worksheet showing the balance due is attached as Exhibit 6); (See Gilleran Affidavit, ¶ 5), WHEREFORE, the Funds respectfully request that this Court grant its Motion to Reinstate and Confess Judgment and:

         A. Enter judgment jointly and severely in favor of the Funds and against Defendants Garces Contractors, LLC and Elda Mannion, jointly and severally, in the amount of $ 5, 833.17 plus $500.00 which represents Funds' attorney fees and expenses in enforcing Note and moving to reinstate this case;

         B. Order Defendants to pay post judgment interest on the judgment amount ...


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