Dispute over collateral leads to lawsuit
A Michigan property company is suing over allegations another company wrongfully detaining collateral it put up.
In & Out Properties of Flushing, Mich. filed a lawsuit March 11 in Cook County Circuit Court against O.P. of Chicago, alleging unlawful property seizure.
According to the complaint, In & Out signed a lease with a third party, 351 Group, to open a restaurant at 351 Hubbard St. To help the tenant build its operation, In & Out says it advanced $115,000 on July 1, 2013, acquiring furniture, fixtures and inventory as collateral.
By September 2013, In & Out Properties asserts it provided the defendant additional funds, bringing the total to $1.8 million, and was not informed the defendant terminated the lease with 351 Group in June 2014. When In & Out personnel attempted to retrieve equipment, the suit says they discovered the locks had been changed.
The plaintiff alleges the defendant intentionally seized the property and assets, that its failure to return the items was vexatious, and that the property seizure was done willfully and maliciously. The plaintiff says the tenant’s default is due to the defendant’s actions and that the combined value of fixtures, furniture and other materials exceeds $200,000.
In & Out Properties seeks that amount, as well as attorney fees and costs, and surrender of the collateral. It is represented by attorney Dan Garbis of The Garbis Law Firm in Lincolnwood.