In re Estate of Nardoni | Illinois appellate court - The creditor who hesitates may be lost: Illinois court denies deficiency to creditor who did not sell collateral in a timely manner
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IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT
In re ESTATE OF DENNIS NARDONI, Deceased (Standard Bank and Trust Company, Petitioner-Appellant, v. Michael D. Hughes, Independent Executor of the Estate of Dennis Nardoni, deceased, Respondent-Appellee). PRESIDING JUSTICE PALMER delivered the judgment of the court. Justices McBride and Gordon concurred in the judgment. ORDER ¶ 1 Held: Trial court's order granting summary judgment to guarantor's estate and denying summary judgment to bank seeking payment from the estate under guaranties given for loans made by the bank is affirmed. The bank's conduct in holding collateral for over three years and refusing to cooperate with the estate in using the collateral to settle one of the loans was commercially unreasonable. The bank's issuance of a third loan after the guarantor's death was a novation of two earlier loans and extinguished the estate's liability under guaranties given for the earlier loans. ¶ 2 Petitioner Standard Bank and Trust Company (Standard Bank) filed two claims against Michael D. Hughes, as the independent executor of the estate of Dennis Nardoni, deceased, (the estate). Standard Bank sought to enforce two guaranties Nardoni had executed for loans Standard Bank made to Cap Estate Corp. (Cap) and Auster Acquisitions LLC (Auster). The trial court denied Standard Bank's motions for summary judgment, granted the estate's cross-motions for summary judgment and denied Standard Bank's motions to reconsider. Standard Bank argues on appeal that the court erred in denying its motions for summary judgment and granting the estate's cross-motions for summary judgment on (1) the Cap claim, asserting the court erred in (a) finding that Standard Bank had impaired collateral and discharging Nardoni as guarantor and (b) finding that Nardoni's guaranty was dependant on other guarantors and limiting Nardoni's liability under the guaranty based on a lost right of contribution; and (2) the Auster claim, asserting the court erred in (a) finding that the loan made to Auster after Nardoni's death was a novation, a new loan not subject to Nardoni's guaranties for two earlier loans to Auster and (b) finding that death revoked Nardoni's guaranty and that no new liability could be created after his death. We affirm. [...]