Hoffman Estates sues bank over Devonshire Woods project

The village of Hoffman Estates filed suit in Cook County Circuit Court Thursday against Oak Brook-based Oxford Bank & Trust for alleged breach of contract on an irrevocable letter of credit involving Dartmoor Homes' Devonshire Woods project.

According to the suit, the letter of credit - originally set at almost $2.9 million, but amended this year to just under $1.1 million - provides "funds shall be available to the village to remedy any deficiencies related to the development that are not addressed by the developer."

After Dartmoor ceased work on the project, Hoffman Estates submitted a call for the funds in March, but Oxford Bank rejected it, stating the demand was "materially fraudulent."

The suit asks the agreement be honored, plus prejudgment interest, costs, expenses and a 15 percent administrative charge as stipulated in the original letter of credit, in addition to attorney fees.

Hoffman Estates Mayor William McLeod called the lawsuit routine, as a way to ensure that improvements to the subdivision, including gutter work, were made. He said the letter to the creditor was a way to protect the homeowners at Devonshire, which is on the village's west side off Shoe Factory Road.

• Daily Herald staff writer Ashok Selvam contributed to this report.