Gill v. Kaur
| Decision Date | 30 November 2021 |
| Docket Number | Civil Action 21-0999 |
| Parties | MANJIT SINGH GILL, Plaintiff, v. AVTAR KAUR, Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
In March 2021, Plaintiff Manjit Singh Gill brought a breach of contract claim against Defendant Avtar Kaur alleging Defendant's failure to repay Plaintiff pursuant to the terms of a Loan Promissory Note dated June 7, 2015 (Note). ECF No. 1 Exhibit A. Defendant Kaur denies this claim alleging the Note is a forgery and asserting two counterclaims against Mr. Gill for fraud and attorney's fees. ECF No. 4. Plaintiff's Motion for Summary Judgment as to Defendant's Counterclaims (ECF No. 35) is now before this Court. For the reasons set forth below, this Court finds that Plaintiff's Motion for Summary Judgment as to Defendants Counterclaims (ECF No. 35) is GRANTED. All other claims will proceed to a non-jury trial as agreed to by the parties on February 7 2022.
In June 2015, Mr. Gill and Ms. Kaur were involved in business together. ECF No. 47 Exhibit 4 at p. 30. Although there is some dispute as to the exact timeline, [1] at some point between May 2015 and June 2015, Mr. Gill and Ms. Kaur, along with two other individuals-Mr. Jatinder Singh and Mr. Kuljinder Singh-became shareholders in AGK Enterprises, Inc. d/b/a Ken & Chris Package Store (AGK), a Georgia Corporation. In connection with this business venture, Mr. Gill, Ms. Kaur, Mr. Jatinder Singh, and Mr. Kuljinder Singh were involved in AGK's pursuit of a U.S. Small Business Administration loan (SBA loan) from the First Intercontinental Bank (Bank) in order to fund AGK's purchase of a liquor store. ECF No. 4 Counterclaim ¶ 1.
Mr. Gill alleges that prior to providing the SBA loan to AGK, the Bank required guarantees from all shareholders who held a 20% interest or more in AGK and that in light of his 15% shareholder interest, Mr. Gill was not required to personally guarantee the SBA loan. ECF No. 6 ¶ 6. By contrast Ms. Kaur contends that Mr. Gill refused to personally guarantee the SBA loan, thus leaving the other shareholders to do so. ECF No. 4 Counterclaim ¶ 6. Nevertheless, both parties agree that only Ms. Kaur, Mr. Jatinder Singh, and Mr. Kuljinder Singh personally guaranteed the SBA loan, while Mr. Gill did not. ECF No. 6 ¶ 6.
Both parties also agree, that in June 2015, Mr. Gill wired a total of $175, 000 into AGK's bank account over the course of four separate payments on June 8, 9, and 11, 2015[2] and that around that same time Mr. Gill provided AGK a check in the amount of $70, 000 that was never cashed. ECF No. 4 ¶ 3; ECF No. 6 ¶ 6; ECF No. 6 Exhibit C. The parties starkly disagree, however, as to the circumstances surrounding these funds.
Specifically, Mr. Gill alleges that, in his personal capacity, he loaned Ms. Kaur $160, 000 to fund Ms. Kaur's personal purchase of equity in AGK and to enable her to guarantee the SBA loan. Mr. Gill maintains that the $175, 000 he wired into the AGK bank account in June 2015 included that $160, 000 personal loan and that the nature and terms of this transaction are documented in the Note dated June 7, 2015. ECF No. 1 ¶ 7; ECF No. 6 ¶ 6; ECF No. 1 ¶ 8; ECF No. 1 Exhibit A. The Note expressly identifies “Avtar Kaur” as the “Borrower” and “Manjit Singh [Mr. Gill]” as the “Lender” and contains purported signatures for both parties. ECF No. 1 Exhibit A. In relevant part the Note states:
This Loan is being used for SBA Cash Injection for the Ken & Chris Package Store. Borrower and her partners were short with required Cash injection and proof. This is a business loan transaction, not a consumer lending, funds are being transferred from Business accounts of Teg Bahadur Corp and Anoop Enterprises LLC from PA to GA into First Intercontinental bank per bank instructions, after her partner met bank officials on June 5th, 2015 meeting. Borrower acknowledges that she must pay back these funds unconditionally to Manjit Singh [Mr. Gill] (Lender) personally as they are his business funds and personal funds. Avtar Kaur claims she owns Thirty Five (35%) Shares, Out of 100, 000 shares in AGK Enterprises Inc (Ken and Chris Package Store). Closing for real estate and business scheduled for June 16th, 2015.
ECF No. 1 Exhibit A.
The terms of the Note required Ms. Kaur to repay Mr. Gill the principal amount of $160, 000, plus 15% compound per annum interest on that amount, for a total sum of $321, 817.15 on or before July 31, 2020 and set a default rate of 20% per annum. ECF No. 1 Exhibit A. Both parties agree that Ms. Kaur has never paid Mr. Gill in connection with the Note. ECF No. 1 ¶ 10; ECF No. 4 ¶ 10. Pursuant to the terms of the Note, Mr. Gill alleges that Ms. Kaur owes him the unpaid principal plus all unpaid interest, as well as the default on the principal sum, which at the time of filing this case equaled $357, 930.12. ECF No. 1 ¶ 15.
With respect to the $70, 000 check, Mr. Gill claims that he provided this check to AGK on the condition that AGK only deposit it if AGK needed the funds for startup costs. ECF No. 6 ¶ 3. According to Mr. Gill, since AGK did not need the $70, 000, AGK did not deposit the $70, 000 check within the 180-day expiration period. Id.
Ms. Kaur provides a factually different story with regard to the funds at issue. Specifically, Ms. Kaur avers that Mr. Gill agreed to purchase a 15% shareholder interest in AGK for $245, 000, and that the $175, 000 wire payment to AGK was partial payment for these shares. ECF No. 4 Counter Claim ¶ 2, 3. Ms. Kaur also maintains that the never-cashed $70, 000 check was intended to be the remaining payment for Mr. Gill's shares, and that Mr. Gill told Ms. Kaur he would “make good, ” the check “shortly” but never did. ECF No. 4 Counter Claim ¶¶ 2, 3.
In response to these allegations, Mr. Gill contends that he purchased his 15% interest in AGK for $60, 750, and in support of this assertion Mr. Gill has provided a copy of a May 2015 email from the Bank, which he argues shows that the Bank processed the SBA Loan transaction with Mr. Gill having a 15% shareholder interest in AGK worth $60, 750. ECF No. 6 Answer to Counter Claim ¶ 2; ECF No. 6 Exhibit B.
On June 16, 2015, AGK successfully acquired the SBA loan. ECF No. 48 at p. 2.
More than five years later, on March 2, 2021, Mr. Gill filed suit against Ms. Kaur for breach of contract alleging Ms. Kaur's failure to repay him pursuant to the terms of the Note. ECF No. 1 Exhibit A. Ms. Kaur maintains that her signature on the Note was forged by Mr. Gill and that the first time she ever saw the Note was when it was filed as an exhibit in this case. ECF No. 35 Exhibit A, Defendant Avtar Kaur's Responses to Plaintiff's First Interrogatries [sic] No. 9. On August 12, 2021 Ms. Kaur testified in her deposition that she never signed the Note, and in support of her Response to Plaintiff's Motion for Summary Judgment she has provided an expert report opining that the signature on the Note is forged. ECF No. 35 Exhibit A, Defendant Avtar Kaur's Responses to Plaintiff's First Interrogatries [sic] No. 9; ECF No. 41 Exhibit A.
With regard to the $70, 000 never-cashed check, Ms. Kaur argues that AGK has made multiple demands for the $70, 000, but that Mr. Gill never paid the remaining $70, 000 to AGK. ECF No. 4 Counterclaim ¶¶ 7, 9. Ms. Kaur proposes that the breach of contract claim was brought against her in this case to “possibly… offset the claims AGK is making upon [] [Mr. Gill] for his repayment of the unpaid check for Seventy Thousand ($70, 000) dollars.” ECF No. 4 Counterclaim ¶ 11.
(ECF 6 Exhibit A).
Mr Gill has provided AGK board minutes documenting the sale of Mr. Gill's 15% interest in AGK to Mr. Kuljinder Singh that also appear to be signed by Mr. Gill, Ms. Kaur, ...
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