Opinions

The District of Northern Illinois offers a database of opinions for the years 1999 to 2013, listed by year and judge. For a more detailed search, enter the keyword or case number in the search box above.

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Judge Carol A. Doyle

14 B 30261, 15 A 00559

Judge Jacqueline P. Cox

In re Richard Sharif
November 25, 2015

09 B 05868
In this case, the sister of the Debtor, as the purported executrix of their mother’s (Soad Wattar) testamentary estate, seeks an order vacating a five-year old order directing the turnover of property (the “2010 Motion”) alleged to be the mother’s. The movant argued that the court lacked personal jurisdiction because the mother’s estate was not served with the 2010 Motion.
The movant seeks relief from the bankruptcy court, while contending that it does not consent to the court’s jurisdiction over any state court claims.

On August 5, 2010, the court ordered two financial institutions to turn over to the Chapter 7 Trustee funds held in certain investment accounts and directed the Debtor to account for and turn over to the Trustee all interests and accounts concerning him or the Soad Wattar Revocable Living Trust (the “2010 Order”). The court also ordered the Debtor and his sisters not to interfere with and to cease any act to exercise control over property of the bankruptcy estate, including life insurance policies.

The movant now argues that the 2010 Order is void, seeking redress pursuant to Federal Rule of Civil Procedure 60(b)(4), made applicable under Federal Rule of Bankruptcy Procedure 9024.

The Court denied the motion to vacate the 2010 Order. The movant did not provide evidence that it is a party that was entitled to notice of the 2010 Motion or that the property dealt with in the 2010 Order belonged to a testamentary estate. The will submitted to the Court transferred all of the decedent’s property to a revocable living trust which was held, pursuant to a default judgment in Wellness International Network Ltd. a/k/a WIN, et al. v. Sharif, adversary proceeding no. 09-00770, in 2010, to be the alter ego of the Debtor.

The Court’s finding that the trust was the Debtor’s alter ego was appealed to the District Court, the Seventh Circuit Court of Appeals and the U.S. Supreme Court.

Judge A. Benjamin Goldgar

Judge Jack B. Schmetterer

14 B 11873

In re: Faye T. Pantazelos
October 29, 2015

15 B 08916

Judge Janet S. Baer

13 B 38329, 14 A 00034
The Plaintiff filed an adversary complaint in the bankruptcy case of the Debtor, seeking a determination that a state court judgment debt owed to the Plaintiff by the Debtor and his former law firm is not dischargeable pursuant to 11 U.S.C. §§ 523(a)(4) and (a)(6).  That judgment was based on the Debtor’s legal malpractice in connection with the preparation and execution of a will under which the Plaintiff was named as a beneficiary. Specifically, the Debtor falsely signed the name of a second witness on the signature page to the will, failed to get the will re-executed prior to the testator’s death, directed his secretary to notarize the signature page with the false signatures, and subsequently remained silent regarding his wrongful conduct while representing the Plaintiff in state court proceedings.  As to § 523(a)(4), the Court found that the Debtor owed the Plaintiff a fiduciary duty in her capacity both as an intended third-party beneficiary under the will and as the executor of the probate estate.  The Court further found that the Debtor committed both defalcation and fraud while acting as a fiduciary.  As to § 523(a)(6), the Court found that the Debtor knew that injury to the Plaintiff was substantially certain to result from his misconduct and that his actions were wrongful and intentional, caused injury to the Plaintiff, and were done without just cause or excuse.  Accordingly, the Court held that the judgment debt is nondischargeable under both §§ 523(a)(4) and (a)(6).

Judge Pamela S. Hollis

11 A 02299
Defendants were owners, managers and officers of the Debtors and various entities. The Official Committee of Unsecured Creditors alleged that Defendants breached their fiduciary duties to the Debtors, made a fraudulent transfer by settling a promissory note, and were liable for preferential transfers. After the parties gave express consent for the court to enter final judgment, a four day trial was held. Since Defendants were self-interested in the transactions at issue, they bore the burden of demonstrating that those transactions were fair and served the Debtor's best interests. The court found that Defendants met their burden, and did not breach their fiduciary duties except as to one series of payments. Further, the court found that settling the promissory note was not a fraudulent transfer under the Bankruptcy Code because the Committee did not prove a lack of reasonably equivalent value, nor was it a fraudulent transfer under Illinois law because there was no transfer of an asset. Finally, the court held that the same payments that gave rise to a breach of fiduciary duty were also preferential transfers that could be avoided and recovered.

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