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 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

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.
 

[…]

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