Prairie State Bank v. Universal Bonding Insurance

Lewis, J.:

Prairie State Bank (Bank) instituted this declaratory judgment action against Universal Bonding Insurance Company (Universal Bonding). The Bank’s purpose in filing this action was to obtain an order that the Bank was not required to honor a demand made by Universal Bonding on a letter of credit issued by the Bank. The trial court granted summary judgment in favor of the Bank, and Universal Bonding appeals.

Bauer Floor Covering, Inc., was a long-time customer of the Bank. By the order of Bauer Floor Covering, Inc., the Bank issued an irrevocable letter of credit in the amount of…