Sahadi v. Continental Illinois National Bank & Trust Co. of Chicago

Fred and Helen Sahadi (plaintiffs) personally guaranteed a $3 million loan their shipping company took from Continental Illinois National Bank & Trust Company (the Bank) (defendant); as the relationship soured, the parties agreed the Bank would transfer the loan to another lender once outstanding interest was paid, with a provision letting the Bank demand full repayment if an interest payment wasn't made by the 15th of each month. When plaintiffs missed the deadline, the Bank demanded full payment, and plaintiffs sued for release from their guarantees, arguing their late payment was not a material breach; the district court granted the Bank partial summary judgment, finding a material breach, and plaintiffs appealed.