PNC Bank, National Association v. Innovative Dental Group, LLC II et al

Filing 36

OPINION AND ORDER. Signed by the Honorable Sara L. Ellis on 3/13/2017. Mailed notice(rj, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
PNC BANK, NATIONAL ASSOCIATION,
Plaintiff,
v.
INNOVATIVE DENTAL GROUP, LLC II,
AJAYPAL SINGH, DIMPLE M. TEJANI,
Defendants.

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No. 16 C 5998
Judge Sara L. Ellis

OPINION AND ORDER
Plaintiff PNC Bank, National Association (“PNC”) brings this action for breach of
contract against Innovated Dental Group, LLC II (“IDG”) and for breach of a guaranty against
Ajaypal Singh and Dimple M. Tejani. PNC alleges that IDG defaulted on its loan and seeks to
recover the outstanding principal, interest, and late charges due on the loan as of October 25,
2016, totaling $464,970.40, plus additional interest accruing on a per diem basis until the date of
judgment. PNC moves for summary judgment [32] on its claims. PNC also filed a motion for
attorneys’ fees [34] seeking to recover attorneys’ fees of $37,534.00 and costs of $4,444.77.
Because PNC establishes that it is entitled to summary judgment on all of its claims, without a
response from Defendants, the Court grants PNC’s motion. Because the supporting affidavit for
PNC’s fee motion did not include sufficient information for the Court to make a determination
on the appropriateness of the fees but did include adequate detail as to costs, the Court denies the
request for attorneys’ fees without prejudice but grants the request for litigation costs.

BACKGROUND1
PNC is a bank that, in August 2010, loaned IDG, a dental practice, $875,000 pursuant to
a promissory note (the “Note”). As security for the Note, IDG executed a commercial security
agreement in favor of PNC granting PNC a security interest in its accounts receivable, deposit
accounts, inventory, equipment, and other personal property. At the time PNC made the loan,
Singh and Tejani each executed a commercial guaranty in favor of PNC, guaranteeing payment
of the Note and agreeing to pay all expenses incurred in enforcing the guaranties, including
attorneys’ fees and cost. Subsequently, PNC and IDG agreed to amend the Note on two separate
occasions, August 19, 2013 (the “First Modification”) and October 30, 2015 (the “Second
Modification”). Pursuant to the Second Modification, the loan matured on August 31, 2016, and,
beginning November 23, 2015, IDG was obligated to make monthly principal and interest
payments, monthly payments of $1,000 for past due attorneys’ fees and costs, and a one-time
$40,000 principal reduction payment on March 1, 2016.
On December 23, 2015, IDG attempted to make its required principal and interest
payment, but insufficient funds in their account resulted in a rejected payment. Therefore, on
January 13, 2016, PNC notified IDG that under the terms of the Second Modification, the failure
to pay was a default. On March 7, 2016, PNC served IDG with a second notice of default. This
notice of default was based on IDG’s failure to make its required principal and interest payments
and as well as a third-party’s foreclosure complaint on real estate in which IDG had granted PNC
a security interest pursuant to the Second Modification.

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The facts in this section are taken from the joint statement of undisputed material facts. Doc.31.
Although Defendants did not respond to PNC’s motion, they did participate in the Court’s process for
presenting facts relevant to summary judgment. All facts are taken in the light most favorable to the
Defendants as the non-movants.

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The loan matured on August 31, 2016, and, to date, IDG, Singh, and Tejani have not paid
off the loan. Under the terms of Singh’s and Tejani’s commercial guaranties, failure to pay all
amounts due to PNC under the loan is an event of default.
As of September 27, 2016, the outstanding principal on the loan was $441,904.50, the
outstanding interest was $19,721.14, and $1,090.48 in late fees had accrued, for a total
outstanding debt of $462,716.12. Additionally, since that date, the loan accrues $80.51 in daily
interest.
LEGAL STANDARD
Summary judgment obviates the need for a trial where there is no genuine issue as to any
material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56.
To determine whether a genuine issue of fact exists, the Court must pierce the pleadings and
assess the proof as presented in depositions, answers to interrogatories, admissions, and
affidavits, if any, that are part of the record. Fed. R. Civ. P. 56 & advisory committee’s notes.
The party seeking summary judgment bears the initial burden of proving that no genuine issue of
material fact exists. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 91 L. Ed. 2d
265 (1986). In response, the non-moving party cannot rest on mere pleadings alone but must use
the evidentiary tools listed above to identify specific material facts that demonstrate a genuine
issue for trial. Id. at 324; Insolia v. Philip Morris Inc., 216 F.3d 596, 598 (7th Cir. 2000).
Although a bare contention that an issue of fact exists is insufficient to create a factual dispute,
Bellaver v. Quanex Corp., 200 F.3d 485, 492 (7th Cir. 2000), the Court must construe all facts in
a light most favorable to the non-moving party and draw all reasonable inferences in that party’s
favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S. Ct. 2505, 91 L. Ed. 2d 202
(1986).

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Where a party does not respond to a motion for summary judgment, their failure to do so
does not automatically entitle the moving party to judgment on its claims, as the Court must still
ensure that the moving party is entitled to judgment as a matter of law. Keeton v. Morningstar,
Inc., 667 F.3d 877, 884 (7th Cir. 2012).
ANALYSIS
I.

Breach of Contract Against IDG
PNC moves for summary judgment on its breach of contract claim against IDG for

failure to repay the Note. To succeed on a breach of contract claim in Illinois, a plaintiff must
establish “(1) offer and acceptance, (2) consideration, (3) definite and certain terms, (4)
performance by the plaintiff of all required conditions, (5) breach, and (6) damages.” Ass’n
Benefit Servs, Inc. v. Caremark Rx, Inc., 493 F.3d 841, 849 (7th Cir. 2007) (citations omitted).
The elements of PNC’s breach of contract claim against IDG are undisputed. IDG entered into a
valid enforceable debt contract in August 2010, pursuant to which PNC loaned IDG $875,000.
By mutual agreement they subsequently modified the agreement twice. Pursuant to the Second
Modification, the loan matured on August 31, 2016 and beginning November 23, 2015, IDG was
obligated to make monthly principal and interest payments, make monthly payments of $1,000
for past due attorneys’ fees and costs, and make a one-time $40,000 principal reduction payment
on March 1, 2016. IDG failed to make its required monthly payment in December 2015. IDG
also failed to make the one-time $40,000 principal payment in March 2016. The failure to make
these payments constitutes a breach under the terms of the Second Modification and the Note.
As a result of IDG’s breach, PNC is to collect all amounts owed under the Note. PNC notified
IDG of the breach and requested payment. To date, IDG had not paid the balance of the loan and
the outstanding balance of the loan remains at $441,904.50 plus interest and fees. Because IDG

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has not responded to the motion for summary judgement and PNC has established all of the
requisite elements to collect on the Note, the Court grants PNC’s motion for summary judgement
on the breach of contract claim against IDG.
II.

Breach of Guaranties
At the same time IDG entered in to the loan agreement with PNC, Tijani and Singh

personally guaranteed, in writing, all of IDG’s obligations under the Note. As discussed above,
PNC has fully performed under the agreement, and IDG has failed to pay down the balance of
the loan, interest, and fees. Therefore Tijani and Singh each are liable under their guaranty for
the full amount owed by IDG to PNC. The Court therefore grants PNC’s motion for summary
judgment on its claims against Tijani and Singh.
III.

Attorneys’ Fees and Litigation Costs
Under the loan agreement and its modifications, PNC is entitled to recover its attorneys’

fees and costs associated with enforcing the Note. PNC seeks these fees and costs, and although
it is entitled to judgement, it has not adequately detailed the legal services it performed in this
matter to enable the Court to make a determination on the appropriateness of the fees. See
Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983). (“The party
seeking an award of fees should submit evidence supporting the hours worked and rates claimed.
Where the documentation of hours is inadequate, the district court may reduce the award
accordingly.”).
PNC requests $37,534.00 in attorneys’ fees, but the only support offered for this figure is
the hourly billing rates of several attorneys and paralegals of PNC’s attorneys. Using the $170
hourly billing rate for the attorneys and the $90 hourly billing rate for the paralegals, it appears
PNC requests compensation for over 200 hours of legal work. This case was exceedingly

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straightforward and involved only the filing of a complaint, review of Defendants answer,
drafting of an initial status report, drafting of motions for default, drafting of a motion for
summary judgment, and attendance at three status hearings. Additionally, there appears to have
been little, if any, discovery conducted in this matter. The Court questions the necessity of over
200 hours of legal work to accomplish these tasks, but the Court defers ruling until PNC
adequately supplements the limited documentation presently before the Court. Therefore the
request for attorneys’ fees is denied without prejudice to refile a detailed request.
PNC also requests $4,444.77 in other litigations costs. In the motion for fees and costs,
PNC presents sufficient detail for the Court to determine that all of the costs are reasonable and
related to this matter. Therefore, the Court grants the request for costs.
CONCLUSION
For the foregoing reasons, the Court grants PNC’s motion for summary judgment and
orders IDG, Tijani, and Singh to pay PNC the full amount outstanding on the Note as of
September 26, 2016, $462,716.12, plus the daily interest of $80.51 that has accrued since that
date until the date of the date of judgment. Additionally, the Court grants in part and denies in
part PNC’s motion for attorneys’ fees and litigation costs ordering IDG, Tijani, and Singh to pay
PNC $4,444.77 for PNC litigation costs and denying without prejudice PNC’s motion for
attorneys’ fees.

Dated: March 13, 2017

______________________
SARA L. ELLIS
United States District Judge

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