Denis F. McKenna Co. v. Smith

704 N.E.2d 826, 235 Ill. Dec. 253, 302 Ill. App. 3d 28
CourtAppellate Court of Illinois
DecidedDecember 7, 1998
Docket1-98-1049
StatusPublished
Cited by16 cases

This text of 704 N.E.2d 826 (Denis F. McKenna Co. v. Smith) 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
Denis F. McKenna Co. v. Smith, 704 N.E.2d 826, 235 Ill. Dec. 253, 302 Ill. App. 3d 28 (Ill. Ct. App. 1998).

Opinion

JUSTICE TULLY

delivered the opinion of the court:

Plaintiff, The Denis F. McKenna Co. (McKenna), filed a complaint against defendants, Mary Ann Kenny Smith, David Drew, and Drew Holdings, Inc. (Drew). Plaintiff sought a declaratory judgment to enforce an alleged real estate contract between plaintiff and Smith and a preliminary injunction to prevent Smith from selling the property to Drew pursuant to defendants’ real estate contract. Defendants filed a motion for a directed finding. On March 19, 1998, the trial court granted defendants’ motion for a directed finding and denied plaintiffs request for a preliminary injunction. Plaintiff filed this interlocutory appeal pursuant to Supreme Court Rule 307(a)(1) (155 Ill. 2d R. 307(a)(1)).

For the reasons that follow, we affirm.

FACTUAL BACKGROUND

The record sets forth the following relevant facts. Defendant Smith owned residential property located at 2600 Blackhawk in Wilmette, Illinois. Smith placed the property up for sale for $459,000. On November 18, 1997, at approximately 10:30 a.m., Denis McKenna, president of The Denis F. McKenna Co., made an offer to buy the property through Peg Spengler, his real estate agent. The offer was for $435,000 and it expired at noon that day.

When Smith saw the offer at about 11 or 11:30 a.m., she told Mary Jane Kraus, her real estate agent, that she wanted to consult with her attorney, Eugene Callahan, and her brother before entering into a contract. Just before noon, although Smith still wanted to speak with Callahan, she made a counteroffer, which included a new price of $450,000 and was subject to Callahan’s approval. McKenna responded by agreeing to each term of the counteroffer, except for the price. McKenna then offered $442,500 and imposed a deadline of 2 p.m. that afternoon. Smith responded that she wanted to speak with Callahan before either accepting or rejecting the offer and requested that McKenna extend the deadline until 3 p.m. When McKenna was informed of this, he raised his offer to $450,000. Kraus informed Spengler that Smith was likely to agree to McKenna’s offer, but that Smith still wanted to speak with her attorney. Spengler then asked Kraus for permission to deliver the offer to Smith personally. Kraus agreed but reiterated that Smith wanted to speak with her attorney before signing any contract.

At approximately 1:30 p.m., Spengler brought the offer to Smith’s home. The offer expired at 2 p.m. and included an attorney approval clause. While Spengler waited, Smith continued her attempts to reach Callahan, but was unsuccessful. Callahan’s secretary told Smith that as long as the contract included an attorney approval clause she could sign it because Callahan could reject the offer upon his later review. Spengler told Smith that there was “no deal” and McKenna “would walk” if she did not sign the contract by 2 p.m. As a result, Smith signed the contract before reaching Callahan. Spengler then sent a copy of the contract by facsimile to Callahan’s office.

The contract was a standardized real estate contract which is distributed by the North Shore Board of Realtors and widely used in the Chicago area. It includes a nonnegotiation attorney approval clause which states:

“This contract is contingent upon the approval hereof as to form by the attorneys for Purchaser and Seller within 5 business days after Seller’s acceptance of this contract. Notices shall be given pursuant to Paragraph 14 on the reverse side hereof.”

The notice provision stated, in pertinent part:

“All notices or other communications which may be required or made under the terms of this Contract shall be in writing and shall be made to the parties hereto at the addresses which appear after their names, or such address or to such person as each may by written notice to the other designate, by personal delivery, certified or registered mail, or by facsimile transmission.
For the purposes of Paragraphs 8 and 9 of this contract, if written notice of disapproval is given within the time period specified, this contract shall be null and void and the earnest money shall be returned to Purchaser.”

On November 18, 1997, Kraus received an offer to buy Smith’s property from defendant Drew for $480,000. On November 19, 1997, Callahan sent written notice by facsimile and first class mail to Spengler that Smith was rejecting the McKenna contract pursuant to the attorney approval clause, and Coldwell Banker returned the $2,000 earnest money check that McKenna had submitted. Spengler immediately faxed Callahan’s rejection notice to Marguerite McKenna, McKenna’s attorney and Denis’ wife. That same day, Marguerite showed the rejection letter to Denis and recorded the contract at the recorder’s office. She stated that she recorded the contract in order to provide “constructive notice” to subsequent purchasers and creditors.

Smith accepted the Drew offer on November 25, 1997. According to Callahan, the Drew contract was not relevant to his rejection of the McKenna contract. Callahan testified that he specifically objected to paragraph 1 of the contract, which only gave Smith a maximum of three hours to accept the contract.

On March 19, 1998, the trial court granted defendants’ motion for a directed finding and denied plaintiff’s request for a preliminary injunction. The trial court found that McKenna received actual notice of the rejection, which was sufficient. Additionally, the court found that Callahan’s rejection was in good faith because of the time pressure McKenna and Spengler had placed on Smith.

ISSUES PRESENTED FOR REVIEW

On appeal, plaintiff argues that the trial court erred in granting defendants’ motion for a directed finding on the bad faith and notice counts. Plaintiff also contends that the trial court erred in denying its request for preliminary injunctive relief.

OPINION

We begin our discussion by addressing plaintiffs contention that the trial court erred in granting defendants’ motion for a directed finding on plaintiffs bad-faith claim. At the end of the plaintiffs evidence, the trial court may grant the defendant a directed finding if: (1) as a matter of law the plaintiff has not made a prima facie case; or (2) after weighing the evidence, the court concludes that the prima facie case has been negated. Kokinis v. Kotrich, 81 Ill. 2d 151, 407 N.E.2d 43 (1980). A prima facie case is one in which the plaintiff has presented at least some evidence on every element essential to his cause of action. Kokinis, 81 Ill. 2d 151, 407 N.E.2d 43. The trial court’s decision on a motion for a directed finding will not be reversed on appeal unless it is contrary to the manifest weight of the evidence. Kokinis, 81 Ill. 2d 151, 407 N.E.2d 43. A trial judge’s finding is against the manifest weight of the evidence if the opposite conclusion is clearly evident. Villa v. Crown Cork & Seal Co., 202 Ill. App. 3d 1082, 560 N.E.2d 969 (1990).

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Cite This Page — Counsel Stack

Bluebook (online)
704 N.E.2d 826, 235 Ill. Dec. 253, 302 Ill. App. 3d 28, Counsel Stack Legal Research, https://law.counselstack.com/opinion/denis-f-mckenna-co-v-smith-illappct-1998.