319 South La Salle Corp. v. Lopin

311 N.E.2d 288, 19 Ill. App. 3d 285, 1974 Ill. App. LEXIS 2610
CourtAppellate Court of Illinois
DecidedApril 18, 1974
Docket58144
StatusPublished
Cited by17 cases

This text of 311 N.E.2d 288 (319 South La Salle Corp. v. Lopin) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
319 South La Salle Corp. v. Lopin, 311 N.E.2d 288, 19 Ill. App. 3d 285, 1974 Ill. App. LEXIS 2610 (Ill. Ct. App. 1974).

Opinion

Mr. PRESIDING JUSTICE McNAMARA

delivered the opinion of the court:

Plaintiff lessee and its officers and shareholders brought suit in the circuit court of Cook County against defendant lessors for reformation of a lease. On July 31, 1972, the trial court, after a trial without a jury, entered an order against the original lessors directing that the lease be reformed by the deletion of paragraph 21(e). The original lessors appeal from that order. At the same time, the tidal court denied reformation of the lease as to the original lessors’ purchaser, General Parking Corporation, and plaintiff lessees have filed a cross-appeal from that portion of the order.

Plaintiffs John Daros and Hugh Gillespie were the sole shareholders and officers of lessee. Defendants Julius Lopin and Henry Mann were beneficiaries of a certain trust and were authorized to direct the original lessors’ actions. Gordon Prussian was president of General Parking, which purchased the property from the original lessors.

In May 1968 plaintiffs leased all the restaurant and tavern facilities in the Atlantic Hotel located in downtown Chicago. The lease was for 10 years at a total rental of $420,000, payable in equal installments at $3,500 per month. Plaintiffs also agreed to expend a minimum of $100,000 in remodeling and refurbishing the facilities during the first year of the lease.

Plaintiffs’ amended complaint in pertinent part charged as follows: that, during lease negotiations, Daros on behalf of plaintiffs refused to execute a lease because it contained paragraph 21(e) permitting lessors to terminate the lease on 90 days’ notice if lessors decided to sell or demolish the building; that defendants Lopin and Mann agreed to delete paragraph 21(e) from the lease and that plaintiffs relied on these misrepresentations; that by mutual mistake of Daros, Gillespie, Lopin and Mann, or by the mistake of said plaintiffs and by the fraud of said lessors, paragraph 21(e) was not deleted from the lease, and the lease therefore did not embody the parties’ agreement; that in December 1969 lessors sold the property to General Parking; and that on December 42, 1969, General Parking wrongfully terminated the lease. (The amended complaint also sought to reform the lease by deletion of paragraph 6. The trial court in its order did not delete paragraph 6, and plaintiffs apparently have abandoned that request.)

Defendants’ answer denied mutual mistake, denied fraud and concealment, and stated that the lease as executed contained the intent and actual agreement of the parties. The answer also contained certain affirmative defenses: that plaintiffs had affirmed the existing lease through an amendment of September 4, 1968; that in three separate judicial proceedings plaintiffs asserted their rights under the lease as executed; that plaintiffs were barred by laches; and that since plaintiffs were in default in the payment of rent, they were legally barred from seeking relief against defendants.

At trial the following pertinent evidence was adduced. Plaintiffs Daros and Gillespie testified that in May 1968 they had a conference with defendants Lopin and Mann regarding the proposed lease. The plaintiffs were represented by attorney Andrew Cardaras, while defendants were represented by attorney Howard C. Goode. When Cardaras informed plaintiffs that the lease contained a 90-day cancellation clause in the event of sale or demolition, Daros, an experienced restaurant owner, refused to execute the lease. After discussion Lopin and Mann agreed to remove the clause, paragraph 21(e). The two plaintiffs further testified that Goode said he would draft another lease and bring it to Cardaras. On the following Saturday, May 11, 1968, Daros and Gillespie went to Cardaras’ office and signed the lease, Plaintiffs’ Exhibit 2. After the signing, Daros stated that he never saw the lease again until the notice of eviction was served in December 1969. It was then that he first learned that paragraph 21(e), the cancellation clause, had not been deleted from the lease.

Andrew Cardaras, the lawyer representing plaintiffs in May 1968, testified that after Daros refused to sign a lease containing a cancellation clause, defendant Mann said that he would not sign a lease without such-.a clause. Mann then suggested that the clause remain in the lease, but that he would give plaintiffs a letter that in the event the cancellation clause was exercised defendants would reimburse plaintiffs for their expenditures on a sliding scale. Cardaras advised plaintiffs that such a letter would be adequate security. Howard Goode, defendants’ attorney, agreed to redraft the lease to remove certain other objectionable items. Goode returned with the lease and, according to Cardaras, stated that the letter suggested by Mann would be forthcoming after the lease was executed, the lease being conditioned upon the delivery of the letter. Daros and Gillespie executed the lease, Plaintiffs’ Exhibit 2, on May 11, 1968, in Cardaras’ office. Cardaras further testified that he knew at the time paragraph 21(e) was contained in the lease. After the following Monday, May 13, Cardaras no longer represented plaintiffs. On the date plaintiffs signed the lease, Cardaras made a few written notes on the lease.

Defendants Julius Lopin and Henry Mann and their attorney Howard C. Goode testified at trial that there was no conversation with Daros, Gillespie and Cardaras concerning the striking of paragraph 21(e) from the lease. The subject was not discussed at any meeting. The witnesses also testified that neither Mann nor any of them talked of delivering a letter to plaintiffs regarding reimbursement of plaintiffs’ expenditures in the event of lease cancellation. The subject was never discussed.

Gordon Prussian, president of General Parking, testified that his company purchased the property from the original lessors in June 1969 for $1,250,000. Prior to purchasing the property, he exámined the subject lease and observed the cancellation clause. Prussian was not aware of any claim by plaintiffs that paragraph 21(e) was to have been deleted until the filing of the present suit. During the summer of 1969, he observed remodeling in the coffee shop area of the hotel. Prussian was told by Lopin and Mann that the work was being done by the tenants, and that a restaurant would be open in the near future. The restaurant was operating in the fall of 1969, but closed, in mid-November. Rent was not paid in December 1969. General Parking was the largest auto-parking company in Chicago, but at the time of this purchase, it intended to lease the premises back to Lopin and operate a successful hotel with a restaurant. It decided to demolish the building when it received notice of cancellation from Lopin and Mann. After a drug store lease expired in April 1970, the premises were demolished and the property presently was being used for surface auto parking.

At trial Gillespie produced Plaintiffs’ Exhibit 4, purporting to be the lease of the property. He testified that it had been delivered to his office sometime before September 1968, but he did not know or remember who delivered it. Various paragraphs, including 21, are deleted from Plaintiffs’ Exhibit 4. However, the document appears to be incomplete. Portions of page one are missing, so that it does not show either the date of the instrument or the lessors’ names. Certain paragraphs are deleted in mid-sentence.

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Bluebook (online)
311 N.E.2d 288, 19 Ill. App. 3d 285, 1974 Ill. App. LEXIS 2610, Counsel Stack Legal Research, https://law.counselstack.com/opinion/319-south-la-salle-corp-v-lopin-illappct-1974.