Gale v. Transamerica Corp., 77-119

Decision Date05 October 1978
Docket NumberNo. 77-119,77-119
Citation382 N.E.2d 412,65 Ill.App.3d 553,22 Ill.Dec. 92
Parties, 22 Ill.Dec. 92 James GALE, Plaintiff-Appellant, v. TRANSAMERICA CORPORATION, a Foreign Corporation, a/k/a Transamerica Insurance Company, Defendant-Appellee, and Albert Sadacca, a/k/a Tico Sadacca and Robin Sadacca, Defendants.
CourtUnited States Appellate Court of Illinois

Jerome Feldman, Chicago, for plaintiff-appellant; Judith A. Halprin, Chicago, of counsel.

Terence M. Heuel, Gilmartin, Wisner & Hallenbeck, Ltd., Chicago, for defendant-appellee.

LINN, Justice:

In the prior litigation underlying this case, Albert and Robin Sadacca (the Sadaccas) filed a complaint against James Gale (Gale) contending Gale owed them $31,200.00. To effectuate collection of the claimed indebtedness, the Sadaccas obtained the issuance of a writ of attachment and caused the seizure of certain Indian Jewelry in Gale's possession. Transamerica Corporation (Transamerica) acted as surety on the Sadaccas' attachment bond. The trial court, in that underlying action, eventually quashed the Sadaccas' attachment writ, dismissed the Sadaccas' law suit, and, over Gale's objection, released Transamerica's attachment bond.

Gale subsequently filed this separate action in the circuit court of Cook County against Transamerica and the Sadaccas seeking damages incurred in consequence of the allegedly inappropriate and improper attachment proceeding by virtue of which Gale's property was wrongfully seized. The trial court, in this case, granted Transamerica's motion to dismiss, finding: (1) that the release of Transamerica's attachment bond in the prior litigation was a judicial determination that the attachment proceeding was not inappropriate, improper nor wrongful; and (2) that the aforesaid determination is Res judicata and precludes Gale from maintaining an action for damages against Transamerica on its attachment bond.

Gale appeals, contending: (1) that the dismissal of the Sadaccas' case seeking payment of an alleged indebtedness and the quashing of the attachment writ in the prior action establishes that the attachment proceeding was wrongfully brought; and (2) that the release of the attachment bond, in that prior proceeding, is not a bar to Gale's present action against Transamerica for damages Gale incurred as a result of the attachment action.

We agree with Gale and, therefore, reverse and remand this case for further proceedings.

The pertinent facts disclose that in 1974 the Sadaccas filed a complaint in the circuit court of Cook County against James Gale, Sr., James Gale, Jr., and Gale Indian Arts. In connection with that proceeding the Sadaccas obtained the issuance of a writ of attachment, pursuant to the terms of which the sheriff seized certain Indian jewelry in the possession of James Gale, Jr.

In accordance with Chapter 11, section 4a of the Illinois Attachment Act (Ill.Rev.Stat.1977, ch. 11, par. 4a), the Sadaccas filed an attachment bond on which Transamerica acted as surety. The attachment bond ensured that in the event it was later determined that the writ of attachment was wrongfully issued, the damages and costs incurred by Gale would be satisfied by the surety.

On January 31, 1975, the trial court in that underlying litigation: (1) dismissed the Sadaccas' complaint but granted them leave to file an amended complaint; (2) quashed the attachment writ; and (3) ordered that the seized property remain in the sheriff's possession pending further proceedings.

Following the filing of an amended complaint by the Sadaccas, a trial was held on the merits. On March 4, 1975, at the close of the Sadaccas' case, the trial court granted Gale's motion for a directed finding and ordered that the seized property be returned to Gale. Further, the trial court denied Gale's request that the attachment bond stand pending further proceedings. Instead, the trial judge ordered that the bond "be released instanter." The order does not explain why the bond was released. Gale's motion to have the bond reinstated was denied. The record in this case and the briefs of the parties fail to disclose both the basis upon which the attachment bond was released in the underlying litigation and the effect the trial court intended the "release" to have.

On February 24, 1976, Gale filed this separate action against Transamerica and the Sadaccas seeking damages allegedly incurred as a result of the aforementioned attachment proceedings. Transamerica's motion to dismiss was granted. Gale has taken this appeal. OPINION:

A proper understanding of the issue posed by this case necessitates a brief review of the law concerning wrongful attachments.

The Illinois Attachment Act (Ill.Rev.Stat.1977, ch. 11, pars. 1 Et seq.) authorizes a creditor to attach the assets of an alleged debtor pending the outcome of the creditor's lawsuit against the debtor on an alleged money claim. The writ of attachment may be obtained by the creditor through a summary, Ex parte application. 1

If an alleged creditor procures a writ of attachment but does not prevail on either the ground(s) assigned for the attachment (Ill.Rev.Stat.1977, ch. 11, par. 1) or the merits of his alleged money claim, the quashing of the attachment and/or the dismissal of the complaint conclusively establishes that the attachment was wrongful. (Gilbert v. Estate of Yunk (1905), 214 Ill. 237, 73 N.E. 335; English Canning & Manufacturing Co. v. John Sexton & Co. (1921), 222 Ill.App. 110; Damron v. Sweetser, Caldwell & Co. (1885), 16 Ill.App. 339; Stelk, A Guide to the Attachment & Garnishment Law of Illinois § 4, at 14 (1916); 7 C.J.S. Attachment, § 517, at p. 664 (1937).) This is true even though the attachment was obtained in good faith and with probable cause. Churchill v. Abraham (1859), 22 Ill. 456; First State Bank of Pond Creek v. Clark (1916), 202 Ill.App. 283.

The attachment debtor has the right to maintain an independent tort action against the attachment creditor (Baird v. Liepelt (1965), 62 Ill.App.2d 154, 210 N.E.2d 1) and an independent contract action against the surety on its attachment bond (Churchill v. Abraham (1859), 22 Ill. 456; Damron v. Sweetser, Caldwell & Co. (1885), 16 Ill.App. 339; Silverman v. City Engineering Construction Co. (1930), 338 Ill. 154, 170 N.E. 250; but see Wilson v. Isom (1878), 3 Ill.App. 246) for damages incurred as a result of the wrongful attachment. 2

The attachment debtor may also have an action against the attachment creditor for maliciously suing out the writ of attachment. (2 Nichols, Illinois Civil Practice § 1772, at 184 (1961).) While the quashing of the attachment and/or the dismissal of the attachment creditor's complaint conclusively establishes that the attachment was wrongful, it leaves open the question of whether the attachment was effected with malice and without probable cause. Waples on Attachment & Garnishment § 1023, at 693 (1895); see Barrett v Spaids (1873), 70 Ill. 408; Davis v. Baker (1899), 88 Ill.App. 251. 3

In the prior litigation underlying this case, Gale, the attachment debtor, not only succeeded in quashing the Sadaccas' attachment writ but he also prevailed on the merits of their alleged money claim. In light of the above principles, it is beyond dispute that the Sadaccas' attachment was wrongful and that Gale acquired the right to proceed against the Sadaccas and Transamerica, their surety, for the damages he incurred as a result of that attachment. The issue presented here is whether the release of the attachment bond in the prior litigation precludes this separate action by Gale against Transamerica. Transamerica, of course, contends that it does. We disagree.

Under the doctrine of estoppel by judgment (generally termed Res judicata ), a final judgment on the merits rendered by a court of competent jurisdiction will estop the same parties and their privies, in a subsequent proceeding on the Same cause of action, from relitigating all matters which were or should have been disposed of in the prior action. (Bland v. Lowery (1976), 43 Ill.App.3d 413, 2 Ill.Dec. 31, 356 N.E.2d 1318.) It is apparent that Gale's instant cause of action against the Sadaccas and Transamerica for wrongful attachment is distinct from the Sadaccas' prior cause of action against Gale based on an alleged claim of indebtedness. Therefore,...

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