Category Archives: Creditor’s Rights

Express Trusts and Bankruptcy Discharge: some Quick Hits

Adas v. Rutkowski, 2013 WL 6865417 (N.D.Ill. 2013), illustrates the confluence of Federal bankruptcy law and state law fiduciary duty and express trust principles in a case involving a failed construction partnership. The plaintiff and bankrupt debtor (defendant) formed a partnership to buy real estate, build a house  on it and split the profits once the house was sold. …

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Law Firm’s Negligence Suit Against Bank Defeated By Account Agreement and UCC Article 4 (IL Law))

  In July 2013, the Third District appeals court affirmed dismissal of a law firm’s (Firm) negligence suit against a bank that charged back the firm’s account after a $350,000 check deposited by the Firm turned out to be counterfeit.  Rejecting the Firm’s negligence claim, the Court found that the terms of the parties’ account agreement and the specific …

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Defendant Bank Not Liable for Permitting Judgment Debtor to Transfer Over $700,000 from Accounts

The Citation to Discover Assets to a Third Party or “third-party citation”  allows a judgment creditor to serve a citation on a third-party –  a bank, for instance – who holds property of the judgment debtor and attach that property until the court orders the property released.  See 735 ILCS 5/2-1402(f)(1).  The third-party citation prohibits the citation …

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