Vician v. Vician

64 N.E.3d 159

407 Ill.Dec. 781

Gary VICIAN and Gale Vician, Assignees of Edward Vician and Dolores Vician, Plaintiffs–Appellees,

v.Gregory L. VICIAN and Michelle Vician, Defendants–Appellants.

No. 2–16–0022.

Appellate Court of Illinois, Second District.

Sept. 27, 2016.

Rehearing Denied Oct. 28, 2016.

Carponelli Law Office, LLC, of Hoffman Estates (Ross S. Carponelli, of counsel), for appellants.

Ward Brown, of Michling Plaza & Associates, of Woodstock, and Glenn S. Vician, pro se, of Merrillville, for appellees.

OPINION

Justice McLAREN delivered the judgment of the court, with opinion.

¶ 1 Plaintiffs, Gary Vician and Gale Vician, assignees of Dolores Vician and Edward Vician on a promissory note, filed a complaint against defendants, Gregory L. Vician and Michelle Vician. After a bench trial, the trial court awarded plaintiffs $257,586.12 on the note and $51,014. 78 in attorney fees. Defendants appeal, arguing that: (1) the trial court abused its discretion when it arbitrarily disregarded evidence in favor of defendants; (2) the trial court erred by denying their motion for a directed finding; and (3) the trial court erred by awarding attorney fees. For the following reasons, we affirm.

¶ 2 I. BACKGROUND

¶ 3 Dolores and Edward are the parents of Gary, Gale, and Gregory, who is married to Michelle.

¶ 4 A. Complaint

¶ 5 On April 30, 2014, plaintiffs filed a "Complaint on Promissory Note" against defendants, alleging the following. Dolores and Edward loaned defendants $357,586.12, and, in consideration for the loan, defendants signed a promissory note executed on October 1, 2009, and delivered, for value received. Defendants "agreed to pay such Promissory Note under the terms set out therein." On August 1, 2012, Dolores and Edward assigned the promissory note to plaintiffs, "for consideration." Defendants defaulted in payments owed on the promissory note and refused to cure the default after a demand was made. The default existed for more than one year. Plaintiffs sought principal, interest, attorney fees, and costs.

¶ 6 The promissory note, attached to the complaint, provides:

"1. BORROWER'S PROMISE TO PAY

In return for a loan that I have received, I promise to pay U.S. $357,586.12 (this amount is called ‘Principal’), plus interest, to the order of the Lender. The Lender is [sic ] Edward S. Vician and Dolores M. Vician. I will make all payments under this Note in the form of cash, check or money order. $100,000 of Principal Balance is waived if Note is PAID AS AGREED.

I understand that the Lender may transfer this Note."

The promissory note contains two signature lines. Defendants' names appear under the signature lines, followed by the word "Borrower." Signatures appear above the signature lines.

¶ 7 B. Bench Trial

¶ 8 A bench trial was held on November 30, 2015. Dolores testified as follows. In 1996 Dolores and Edward loaned Gregory $125,000, as evidenced by a 1996 mortgage signed by Gregory and notarized. Dolores and Edward delivered the $125,000 to Gregory. In addition, Dolores and Edward made two loans to Gregory and Michelle: a loan for an undetermined amount and, in November 2006, a loan for $130,000.

¶ 9 Dolores further testified that on July 27, 2009, she and Edward loaned Gregory and Michelle $363,406.75, as evidenced by a mortgage signed by Gregory and Michelle and notarized by Jan Risch. On October 1, 2009, a promissory note was signed by defendants in the presence of Dolores. The promissory note was for a principal balance of $357,586.12, reduced due to payments that Gregory had made on the July 27, 2009, loan and a lower interest rate. Dolores created and kept a loan amortization schedule, and on this schedule and on a separate ledger she recorded and gave credit for all payments made by Gregory and Michelle. To make payments on the loan, Gregory or Michelle deposited money into a Harris Bank account titled in Gregory's and Gale's names. The Harris Bank account statements were mailed to the home of Dolores and Edward. Dolores used the monthly statements to keep track of Gregory and Michelle's payments. These statements contain account activity from May 23, 2008, through August 22, 2011, and were admitted into evidence as plaintiffs' exhibit No. 15.

¶ 10 Dolores also testified as follows. The Harris Bank statements indicated that Gregory withdrew $16,908.71 from the account on August 3, 2011. From September 2011 through March 2012, Gregory made payments on the loan by mailing checks to his parents' home. Dolores deposited the checks and recorded the payments on her ledger and loan amortization schedule. After March 2012, neither Gregory nor Michelle made any payments on the loan. The $16,908.71 that was withdrawn was never replaced. Because of Gregory's withdrawal, the principal amount owed on the promissory note was the original amount, $357,586.12. Dolores was willing to waive her right to interest on the promissory note from October 2009 to the date of judgment, but she was not willing to waive her right to postjudgment interest. Dolores testified that she and Edward assigned the promissory note to Gary and Gale.

¶ 11 Gale testified as follows. Gale recognized Gregory's signature on the promissory note. Dolores and Edward assigned the promissory note to Gale and Gary for $10. Gale identified the written assignment and recognized her signature on the document. The assignment indicated that it was executed on August 1, 2012. Gale testified that, after that date, defendants made no payments to her.

¶ 12 Risch testified that she witnessed defendants sign the July 2009 mortgage.

¶ 13 Plaintiffs' attorney, Ward Brown, testified regarding his fees. The trial court admitted his affidavit and attached time ledger.

¶ 14 At the conclusion of plaintiffs' case-in-chief, defendants moved for a directed finding.¹ Defendants argued that plaintiffs failed to establish a prima facie case, because they failed to establish, inter alia, that defendants received consideration for the promissory note. Defendants also argued that plaintiffs failed to prove that the signatures on the promissory note were valid. Defendants concluded that "the Court cannot conclude that an enforceable promissory note exists."

¶ 15 The trial court denied defendants' motion for a directed finding,² explaining that "the Plaintiffs have adequately established a prima facie case." The trial court stated that Dolores's testimony was sufficient to establish that defendants received consideration. The trial court also stated that Dolores's testimony that she personally witnessed Gregory sign the promissory note was sufficient to meet "the burden of proof."

¶ 16 Warren Spencer, an expert forensic handwriting and document examiner, testified on behalf of defendants as follows. Spencer compared Gregory's and Michelle's signatures on other documents to the signatures on the promissory note. Spencer opined that the signatures on the promissory note were not those of Gregory and Michelle.

¶ 17 Michelle testified as follows. Michelle never received a loan from Dolores or Edward. Michelle never signed any document stating that she would pay money to Dolores or Edward. Michelle did not sign the promissory note. Michelle testified that the signature on the July 2009 mortgage was hers but that she did not sign the mortgage.

¶ 18 Gregory testified as follows. Gregory did "not believe [he] signed" the July 2009 mortgage, because there were no witnesses. Gregory testified that, although the signature looked like his, he did not sign the mortgage. Gregory did not receive $363,406 as indicated on the mortgage. Gregory testified that he did not sign the promissory note. Although "they had given [him] money," he never received $357,000. Gregory received "disbursements, and then they tried to turn around and make up a sum." Gregory did not bring any cancelled checks with him to court. When asked how much money he had paid back over time, Gregory replied:

"I could only go back seven years since 2012. So, it's 2005, and by that account, that Harris Bank account, I paid over $250,000 into that account. There was still nine years missing that I couldn't get to because the bank would only go back seven years."

Gregory testified that "they're missing" payments that he had made from 1996 through 2005. Gregory testified that he continued to make payments even after plaintiffs filed their complaint. Gregory testified that in August 2011 he withdrew $16,900 from the Harris Bank account.

¶ 19 During cross-examination, plaintiffs' counsel asked Gregory, "How many records did you bring to court to show the payments you made?" Gregory replied:

"You have the Harris Bank statements which is where I made—according to my mom's testimony, where I made my payments into, and those payments, I went back—[t]hose have seven years of statements there, and those show over $250,000 of just seven years of statements, not including the later payments that I continued paying, and not including nine years prior to, from '96 to 2005."

¶ 20 After considering the evidence, the trial court found in favor of plaintiffs and against defendants and entered judgment in the amount of $308,627.90. In rendering its judgment, the trial court found "that the witnesses for the plaintiff[s] were credible and consistent in their testimony." The trial court made the following findings. Dolores's testimony established that she entered into an agreement with defendants to lend them money. The agreement was memorialized by the promissory note, the mortgage, communications between the parties, and payments made by Gregory. Dolores testified that she saw defendants sign the promissory note and that she delivered the funds pursuant to "the agreement." Dolores's testimony was supported by the testimony of Risch, an independent witness.

¶ 21 The trial court concluded as follows:

"[T]he court finds that there was an agreement and the delivery of $357,586.12, as memorialized by the note. The defendants failed to make payments on the note and,

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