Court of Appeals of Illinois, First District, Third Division
NANCY R. MALEK, Plaintiff-Appellee,
GOLD COAST EXOTIC IMPORTS, LLC, Defendant-Appellant.
from the Trial Court of Cook County. No. 15 L 50794 The
Honorable Ann Collins-Dole, Judge Presiding.
JUSTICE LAVIN delivered the judgment of the court, with
opinion. Presiding Justice Cobbs and Justice Fitzgerald Smith
concurred in the judgment and opinion.
1 This appeal arises out of a replevin action, seeking to
recover a 2012 BMW 650i automobile. Pursuant to an alleged
verbal agreement, the former owner of the BMW, Michel Malek,
M.D., transferred possession of the vehicle to Gold Coast
Exotic Imports, LLC (Gold Coast), in order to satisfy a debt.
At the time that the BMW was transferred to Gold Coast,
Michel and plaintiff Nancy Malek were in the midst of a
divorce action pending in Cook County.
2 After Gold Coast obtained possession of the BMW, Nancy
filed a motion to assign and transfer title to the vehicle
from Michel to her. The divorce court granted Nancy's
motion but ordered that she take the BMW subject to any liens
on the vehicle. Nancy subsequently sought possession of the
BMW from Gold Coast. Gold Coast refused Nancy's demand,
claiming it was entitled to possession of the BMW pursuant to
its agreement with Michel. Shortly thereafter, Nancy filed a
replevin action against Gold Coast in the trial court.
Following a bench trial on the matter, the trial court held
that Nancy was entitled to the BMW because Gold Coast never
recorded its lien on the vehicle.
3 Gold Coast now appeals from that judgment. Specifically,
Gold Coast asserts that it had a perfected security interest
in the form of a possessory lien on the BMW pursuant to
section 9-313(a) of the Uniform Commercial Code (UCC) (810
ILCS 5/9-313(a) (West 2016)), which preceded Nancy's
interest in the vehicle, thus defeating her replevin action.
We agree and therefore reverse the trial court's judgment
for the reasons set forth below.
5 On August 3, 2013, Gold Coast delivered the BMW to Michel
for an agreed upon value of $88, 451.81. At that
time, Michel did not pay Gold Coast for the vehicle in full,
but paid only $6551.20, which represented the sales tax and
license and title fees for the vehicle. Title to the BMW was
issued in Michel's name only. This transaction was
pursuant to a verbal agreement between Michel and Gold Coast,
involving multiple vehicles from prior transactions between
the parties, which resulted in a credit to Michel that was
applied towards the BMW. As part of their agreement, Michel
owed Gold Coast a remaining balance of $33, 294.18.
Michel would either repay that balance or, alternatively,
return the BMW to Gold Coast to be sold as satisfaction of
6 Some two years later, in September 2015, Michel's
balance remained unpaid. Consequently, pursuant to his
agreement with Gold Coast, Michel shipped the BMW back to
Gold Coast from California, where the vehicle was being used
by the couple's son at college. On October 5, 2015, the
BMW arrived at Gold Coast. At that time, Michel and Nancy
were in the midst of a divorce action, which was pending in
the circuit court of Cook County (14-D-4449).
7 On October 29, 2015, Nancy filed an emergency motion in the
divorce action, to immediately assign and transfer title of
the BMW from Michel to her. The motion was denied and shortly
thereafter, on November 3, 2015, Nancy filed a second
emergency motion to immediately assign and transfer title of
the BMW. In support, she filed an affidavit attesting that
she had visited Gold Coast and was informed that the BMW
would be sold. According to Gold Coast, it never received
notice of her emergency motions.
8 On November 3, 2015, the divorce court granted Nancy's
second motion and entered an order requiring that title to
the BMW be transferred from Michel to Nancy and that Nancy
take the vehicle subject to any liens as of that date.
Subsequently, Nancy sent a letter as well as a copy of the
title transfer order to Gold Coast and its owner, Joseph
Perillo, demanding immediate possession of the BMW.
9 Gold Coast refused and sent a letter to Nancy, stating the
terms of its agreement with Michel and claimed that the BMW
was in its possession because Michel failed to satisfy his
$33, 294.18 debt pursuant to their agreement.
10 Shortly thereafter, Nancy filed an action in replevin
against Gold Coast in the trial court (15-L-50794) pursuant
to section 19-101 of the Code of Civil Procedure (Code) (735
ILCS 5/19-101 (West 2016)). On June 21, 2016, the trial court
entered an order requiring Gold Coast to transfer possession
of the BMW to Nancy upon the presentation of a replevin bond.
Nancy subsequently obtained a replevin bond and possession of
the BMW from Gold Coast. Nancy then sold the BMW to Steve
Foley Cadillac, Incorporated, for $36, 500.
11 In February 2017, the trial court held a bench trial on
Nancy's replevin action. Nancy filed a motion in
limine to exclude certain testimony relating to the
verbal agreement between Michel and Gold Coast, arguing that
it was hearsay because Michel was unavailable to testify at
trial. The trial court denied her motion and heard testimony
from Nancy and Joseph Perillo, reflecting the above-stated
facts. At trial, Gold Coast argued that the November 3, 2015,
title transfer order was void because Gold Coast was never
served a copy of the motion. In response, Nancy claimed that
Gold Coast was never served a copy of ...