Eta Trust v. Recht

574 N.E.2d 4, 214 Ill. App. 3d 827, 158 Ill. Dec. 210, 1991 Ill. App. LEXIS 577
CourtAppellate Court of Illinois
DecidedApril 5, 1991
Docket1-90-1245
StatusPublished
Cited by14 cases

This text of 574 N.E.2d 4 (Eta Trust v. Recht) 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
Eta Trust v. Recht, 574 N.E.2d 4, 214 Ill. App. 3d 827, 158 Ill. Dec. 210, 1991 Ill. App. LEXIS 577 (Ill. Ct. App. 1991).

Opinion

JUSTICE LaPORTA

delivered the opinion of the court:

Plaintiff appeals a court order granting defendant’s motion to dismiss plaintiff’s petition to register a foreign judgment. Plaintiff raises as issues on appeal: (1) whether the trial court erred in ruling that the Massachusetts court lacked jurisdiction to enter judgment against a nonresident defendant where the lease agreement contained a forum selection clause designating Massachusetts as the forum State which would have jurisdiction over disputes, where the lease agreement provided an agreed method of permissible service and where the judgment was entered against defendant in the designated forum State upon a showing that the agreed upon provisions for service had been met; and (2) whether the trial court erred in interpreting the lease agreement’s provisions for forum selection and method of service as excluding and therefore as inapplicable to defendant-guarantor.

On November 9, 1989, plaintiff petitioned the first municipal district of the circuit court of Cook County, Illinois, for registration of a foreign judgment entered against defendant as guarantor on a lease for his son, then a student in Cambridge, Massachusetts, as lessee. The petition stated that a judgment for $3,229.29 was entered by the Massachusetts court on September 17, 1982, and that the judgment remained unsatisfied. The petition sought an additional amount for post-judgment interest at the annual rate of 12% as provided in the Massachusetts statute.

On November 17, 1989, the court registered the foreign judgment entered in Massachusetts against defendant for the original judgment amount together with post-judgment interest, all in the total amount of $7,138.92. Defendant was served with summons, and thereafter entered a limited and special appearance and moved to dismiss plaintiff’s petition for registration of foreign judgment. Defendant argued that the foreign judgment was not “conclusive” as required by the Illinois statute because the Massachusetts court had no personal jurisdiction over defendant and he was not properly served with summons prior to entry of the judgment. (Ill. Rev. Stat. 1989, ch. 110, pars. 12—621(a)(2), (b)(1).) Defendant contended that for those reasons the plaintiff was not entitled to register the foreign judgment in Illinois and that the court should quash the summons issued in this cause. Defendant’s motion was supported by his affidavit, which denied receipt of notice or service in the Massachusetts action and denied knowledge of the entry of the judgment against him.

On December 15, 1989, the court entered an order dismissing the petition for registration of foreign judgment and quashed the service of summons on defendant. The court expressly stated that it found defendant’s case similar to another Massachusetts case, Spunt v. Kapral (Mass. Dist. Ct. 1976), No. 1597, wherein a Massachusetts trial court in its memorandum decision found it had no jurisdiction over that defendant. Kapral was a resident of New York and had also signed as a guarantor on the lease that is the subject of this appeal. That decision was entered by a different trial judge than the judge who entered judgment against Recht.

Plaintiff filed a motion to vacate the dismissal order here, contending that defendant’s motion to dismiss contained several misrepresentations of law and facts which plaintiff did not have an opportunity to rebut. On January 9, 1990, the trial court granted plaintiff’s motion to vacate the dismissal order, heard additional arguments of the parties and again ruled in defendant’s favor. The court granted the motion to dismiss the petition for registration of foreign judgment with prejudice and quashed the summons.

On February 7, 1990, plaintiff filed a motion to reconsider with supporting documents. Plaintiff alleged that the Massachusetts court had jurisdiction over defendant because of paragraph 36 in a rider attached to the lease, which stated: “As guarantors’ signatures are being executed outside Massachusetts, provisions for acknowledgements have been made below. The parties all acknowledge jurisdiction involving any matters in connection with this lease to the Courts of Middlesex County of Massachusetts and any notices given or services made shall be deemed to be valid and appropriate if given by certified mail prepaid to the respective party (addressee), at their last and usual address according to Lessor’s records or as provided on the rental application forms, whether or not actually received.” Plaintiff also filed a certificate of judgment from the Massachusetts court and an affidavit from plaintiff’s attorney to establish that plaintiff sent notice of the proceeding by certified mail to defendant at the time the suit was filed but that defendant refused to accept the certified mail in two attempted deliveries by the United States Postal Service.

Defendant filed a response to the motion to reconsider in which he raised three arguments. He contended that the purported consent in the contract agreement to the jurisdiction of the Massachusetts court found in paragraph 36 of the rider was invalid because it recited no consideration, was not signed by the plaintiff and therefore lacked mutual assent. He also contended that defendant signed the guarantee outside Massachusetts and lacked the minimum contacts with the State required for in personam jurisdiction. Finally, defendant contended that he did not receive actual notice of the pending litigation in Massachusetts as required by the laws of that State for due process.

On March 9, 1990, the trial court denied plaintiff’s motion to reconsider, finding that the guarantors were not “parties” to terms and conditions of the lease but were only guarantors of the lessees’ performance. In addition, the court found “the guarantors’ contacts were too minimal to confer jurisdiction of the Illinois resident on Massachusetts.” The trial court adopted the reasoning of the Massachusetts trial court decision in Kapral, which held that the Massachusetts court had no jurisdiction over that defendant. In the memorandum decision, the Massachusetts trial court relied on International Shoe Co. v. Washington (1945), 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154, which held that, in order to subject a nonresident defendant to in personam jurisdiction, the defendant must have minimum contacts with a State so that an action against him would not offend the “traditional notions of fair play and substantial justice.” In dismissing the suit against Kapral, the trial court held that because the contract between plaintiff and defendant was made outside Massachusetts, and defendant had never resided in Massachusetts nor did he transact business in the State nor have any interest in or use or possession of realty in Massachusetts, that defendant did not have the requisite minimum contacts with the State for in personam jurisdiction. Our search indicates that the Kapral decision was not appealed.

Initially we note that the judge erred in granting defendant’s motion to quash service of summons on plaintiff’s petition to register the Massachusetts judgment in Illinois. Defendant filed a special and limited appearance pursuant to section 2—301 of the Code of Civil Procedure (Ill. Rev. Stat. 1987, ch. 110, par. 2-301).

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Bluebook (online)
574 N.E.2d 4, 214 Ill. App. 3d 827, 158 Ill. Dec. 210, 1991 Ill. App. LEXIS 577, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eta-trust-v-recht-illappct-1991.