Business Wins $320,000 Judgement from Bank
Two local businessmen this week were awarded a $320,000 judgement by a Madison County Circuit Court Jury that decided First Alabama Bank breached a confidence with them, court records said.
Jeff Hamm and Richard Pierce, owners of RV’s Recreational Sales, Inc., in Madison, filed suit against First Alabama Bank last year after they applied for a plan to purchase the lot between their business and the bank’s Madison branch, records said.
According to Richard Chesnut, an attorney for the two businessmen, the bank called a building committee meeting two days after the loan request and purchased the property itself three days later. Although the bank had been interested in the property for expansion purposes, it did not buy the property until Hamm and Pierce asked for a loan to purchase it to expand their own business, Chesnut said.
The jury hearing the case in Circuit Judge S.A. Watson’s court found that the bank breached a confidential relationship in purchasing the land, according to Chesnut.
According to the judgment entered Tuesday, $100,000 in compensatory damages was awarded, and $220,192.16, or the amount paid for the piece of property, was awarded in punitive damages.
The suit, filed shortly after the land transaction in May 1985, claimed intentional interference with a business relationship, and fraud.
Chesnut said the bank “concealed the fact that it was going to buy” the property after it had done so.
“Their (First Alabama’s) interest in the land wasn’t fully made known to our clients until the three-day wait required for approval of a loan.” Chesnut said. “By that time, the bank was buying the property and our clients received a 90-day notice to get off the lot.”
Hamm and Pierce had rented the property for a period of time and were using it at the time of the land purchase.
Repeated attepts to reach bank attorneys for comment Wednesday were unsuccessful.