2026 IL App (1st) 250666-U No. 1-25-0666 First Division June 30, 2026
NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1). ____________________________________________________________________________
IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT __________________________________________________________________________
MATTHEW FRANKENFELD, ) Appeal from the ) Circuit Court of Plaintiff-Appellant, ) Cook County. ) v. ) ) No. 24 CH 07335 THRIVE PHYSICAL THERAPY ) PARTNERS, LLC, THRIVE PHYSICAL ) THERAPY PARTNERS HOLDINGS, LLC ) and TYREE & D’ANGELO PARTNERS, ) Honorable LLC, ) Caroline Kate Moreland ) Judge, Presiding. Defendants-Appellees. ) ) ____________________________________________________________________________
JUSTICE COBBS delivered the judgment of the court. Presiding Justice Fitzgerald Smith and Justice Howse concurred in the judgment. ORDER
¶1 Held: We affirm the circuit court’s dismissal of plaintiff’s complaint for declaratory judgment and specific performance where plaintiff’s signature on the proposed agreement, alone, was insufficient for contract formation. No. 1-25-0666
¶2 This action stems from plaintiff-appellant Matthew Frankenfeld’s employment with
defendant-appellee Thrive Physical Therapy Partners, LLC. In 2023, plaintiff entered into an
employment agreement to serve as Chief Development Officer (CDO) with Thrive, which included
the potential for equity compensation through a separate Incentive Award Agreement (Incentive
Agreement) that defendant never countersigned. Plaintiff’s employment ended in May 2024
without the Incentive Agreement ever being finalized. Plaintiff subsequently filed a complaint
against defendants-appellees Thrive Physical Therapy Partners, LLC, Thrive Physical Therapy
Partners Holdings, LLC, and Tyree & D’Angelo Partners, LLC, seeking declaratory judgment and
specific performance based on the alleged enforceability of the Incentive Agreement. On October
3, 2024, the circuit court granted defendants’ motion to dismiss the complaint pursuant to section
2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 2022)) (Code), finding that no
enforceable contract existed because the Incentive Agreement was never executed by both parties
and thus, the condition precedent to its formation was not satisfied.
¶3 Plaintiff now appeals, arguing that (1) the circuit court erred in holding that the
employment offer that he accepted and acted upon did not result in a binding agreement; (2) his
complaint stated a legally sufficient claim based on the written Incentive Agreement, performance,
and investment; and (3) the circuit court abused its discretion in dismissing the complaint without
oral argument or leave to amend. For the reasons that follow, we affirm.
¶4 I. BACKGROUND
¶5 A. Complaint for Declaratory Judgment
¶6 On August 5, 2024, plaintiff filed a two-count complaint against defendants. Count I sought
a declaratory judgment that (1) the Incentive Agreement constituted a valid and enforceable
contract, and (2) he was entitled to receive 223,000 Class C units representing the time-vesting
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tranche because he was terminated without cause. Plaintiff sought specific performance requiring
defendants to issue those units. Count II alleged a violation of the Illinois Wage Payment and
Collection Act (820 ILCS 115/1 et seq. (West 2022)) for unpaid wages. Attached as an exhibit to
the complaint was a copy of the unexecuted Incentive Agreement. The “Offer Letter,” referenced
in the complaint, was later filed, with leave of court, as impounded.
¶7 The complaint generally alleged that, on April 7, 2023, defendants extended an offer of
employment to plaintiff for the position of CDO, which included a yearly salary of $250,000,
bonus eligibility, and various employment benefits. The offer also included an opportunity for
plaintiff to participate in an equity incentive program. Plaintiff accepted the offer the same day
and began employment on May 23, 2023.
¶8 On June 15, 2023, defendants provided plaintiff with an initial draft of an Incentive
Agreement governing the issuance of Class C equity units, which consist of shares that vest over
a specified period of continued employment. The parties thereafter engaged in extensive
negotiations regarding both the Incentive Agreement and plaintiff’s potential purchase of Class B
units. The parties agreed that plaintiff would invest $40,000 toward the Class B units.
¶9 On December 10, 2023, plaintiff requested modifications to the Incentive Agreement with
respect to the Class C units. Specifically, plaintiff requested that the Class C units relating to the
time-vesting tranche would immediately vest if he were terminated without cause. Defendants
agreed to these changes and, on January 30, 2024, sent plaintiff a revised version of the Incentive
Agreement reflecting those terms. The revised Incentive Agreement provided that plaintiff would
receive 446,000 Class C units, with half subject to time-based vesting and half subject to
performance-based vesting.
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¶ 10 Plaintiff signed the revised Incentive Agreement on February 6, 2024, and returned it to
defendants via e-mail. Defendants’ representative acknowledged receipt of the signed Incentive
Agreement and responded that a countersigned copy would be provided but never returned an
executed version.
¶ 11 The complaint further alleged that between February 5, 2024, and May 7, 2024, the parties
had several meetings regarding plaintiff’s purchase of the Class B units previously agreed upon.
Defendants informed plaintiff that the previously agreed-upon $40,000 investment was
insufficient. They demanded that he instead invest $175,000 in the Class B units by the following
week, or they would be reneging on the signed version of the agreement that plaintiff had
previously sent to defendants.
¶ 12 The following day, plaintiff declined to agree to the revised terms, and defendants indicated
that they would not continue working with him and would not honor the Incentive Agreement.
¶ 13 Plaintiff continued working through May 14, 2024, however, by the time of his return home
that evening, his access to the company e-mail and computer had been deactivated, and his final
paycheck was prorated. Plaintiff further alleged that he had not resigned from his position and had
not previously been disciplined or given a negative performance review.
¶ 14 As plaintiff later consented to the dismissal of Count II of his complaint (wage claim), we
need not summarize its substance here.
¶ 15 B. Motion to Dismiss
¶ 16 On October 3, 2024, defendants filed a combined motion to dismiss plaintiff’s complaint
pursuant to section 2-619.1 of the Code. Relevant here, defendants sought dismissal of count I
under section 2-615, arguing that the Incentive Agreement was not a valid and enforceable
contract.
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¶ 17 Defendants first argued that execution of the Incentive Agreement by both parties was a
condition precedent to contract formation. In support, defendants relied on the offer letter, a copy
of which was attached as an exhibit to the motion. Included in the letter is a provision for “Incentive
Equity Units,” which provided that plaintiff’s participation in the equity incentive program was
“subject to the execution and delivery of the necessary agreements,” and that the issuance of equity
units was “subject to the execution and delivery of customary equity award agreements in form
approved by Thrive.”
¶ 18 Defendants also pointed to the Incentive Agreement itself, which contained signature
blocks for both parties and execution language stating, “IN WITNESS WHEREOF, the parties
hereto have executed this Incentive Award Agreement.” According to defendants, these provisions
showed that the parties did not intend for the Incentive Agreement to become binding unless and
until it was executed by both sides.
¶ 19 Defendants further argued that plaintiff’s own allegations established that this condition
was not satisfied. Defendants noted specifically plaintiff’s allegation that he signed and returned
the Incentive Agreement, but that defendants’ representative never returned a countersigned copy.
Thus, defendants contended that plaintiff pleaded himself out of court by acknowledging that the
event required for contract formation, namely, mutual execution of the Incentive Agreement, never
occurred.
¶ 20 Defendants also argued that the Incentive Agreement was unenforceable for a second,
independent reason. Section 1(b) of the Agreement provided that, “[a]s a condition precedent to
the issuance of the Incentive Units,” plaintiff was required to be bound by the LLC Agreement and
to “simultaneously execute a Joinder to the LLC Agreement.” Defendants asserted that the
complaint did not allege that plaintiff executed the joinder or otherwise satisfied this requirement.
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Accordingly, defendants argued that, even apart from the company’s failure to execute the
Incentive Agreement, plaintiff was not entitled to the issuance of the incentive units because he
failed to satisfy an express condition precedent to receiving them.
¶ 21 Based on these arguments, defendants maintained that plaintiff failed to state a claim for
declaratory judgment or specific performance because the undisputed failure of these conditions
precedent precluded the existence of a valid contract as a matter of law, warranting dismissal of
count I.
¶ 22 With respect to their motion to dismiss Count II of the complaint pursuant to section 2-
619, defendants recounted that plaintiff’s claim alleged non-payment of interest owed as a part of
his compensation. However, defendants had paid the interest owed. Accordingly, defendants
argued that Count II of plaintiff’s complaint was moot and should be dismissed.
¶ 23 C. Plaintiff’s Response to Defendants’ Motion to Dismiss
¶ 24 In response to defendants’ motion to dismiss, plaintiff argued that neither defendants’
signature nor his execution of a joinder were conditions precedent because defendants prevented
them from occurring and demonstrated their intent to be bound by the Incentive Agreement in
several other ways. Plaintiff contended that the provisions cited by defendants related only to
performance, not to formation or enforceability, and that defendants improperly relied on the offer
letter to impose additional conditions barred by the Incentive Agreement’s integration clause.
Plaintiff additionally argued that if defendants intended for both parties’ signatures to be a
condition precedent to the formation of the Incentive Agreement, then defendants could have
included such express language in the final Agreement.
¶ 25 Plaintiff alternatively argued that, even if those requirements were conditions precedent,
defendants could not rely on their nonoccurrence because defendants themselves prevented them
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from happening by withholding a countersigned Incentive Agreement for three months while
attempting to “strongarm” him to “agree to pay a significantly increased purchase price for the
Class B units.” Plaintiff further argued that defendants could not rely on the lack of an executed
joinder agreement because they never provided him with it in the first place.
¶ 26 Finally, plaintiff argued that defendants’ conduct demonstrated an intent to be bound,
noting that defendants accepted his revisions, transmitted a finalized agreement for signature,
acknowledged receipt of his signed copy, and retained it while indicating a countersigned version
would follow. Plaintiff asserted that such conduct was sufficient to establish mutual assent despite
the absence of a formal signature. Accordingly, plaintiff maintained that the complaint adequately
alleged a valid and enforceable contract and that defendants’ motion to dismiss count I should be
denied.
¶ 27 As we noted earlier, plaintiff consented to defendant’s motion to dismiss Count II of the
complaint (wage payment) pursuant to section 2-619 of the Code.
¶ 28 D. Defendants’ Reply to Plaintiff’s Response
¶ 29 Defendants filed a reply in support of their motion to dismiss on November 11, 2024,
asserting that plaintiff’s response failed to cure the fundamental defect in count I, namely that the
conditions precedent to contract formation were not satisfied and no enforceable agreement existed
as a matter of law.
¶ 30 E. Circuit Court’s Order
¶ 31 On March 12, 2025, the circuit court issued a written order in which it granted defendants’
motion to dismiss count I pursuant to section 2-615 of the Code. Although, as we point out later,
our review of the circuit court’s judgment in this matter is de novo, we have nonetheless reviewed
the court’s well-reasoned analysis and disposition and find it instructive.
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¶ 32 On April 11, 2025, plaintiff filed his notice of appeal.
¶ 33 II. ANALYSIS
¶ 34 On appeal, plaintiff argues that (1) the circuit court erred in holding that the employment
offer that he accepted and acted upon did not result in a binding agreement; (2) his complaint stated
a legally sufficient claim based on the written Incentive Agreement, performance, and investment;
and (3) the circuit court abused its discretion in dismissing the complaint without oral argument or
leave to amend.
¶ 35 A. Standard of Review
¶ 36 A section 2-615 motion to dismiss challenges the legal sufficiency of the complaint based
on defects apparent on its face. (735 ILCS 5/2-615 (West 2022)). “In ruling on a section 2-615
motion all well-pleaded facts and all reasonable inferences that may be drawn from those facts are
accepted as true.” iMotorsports, Inc. v. Vanderhall Motor Works, Inc., 2022 IL App (2d) 210785,
¶ 13. “The critical inquiry in reviewing a section 2-615 motion is whether the allegations in the
complaint, construed in the light most favorable to the plaintiff, are sufficient to state a cause of
action upon which relief may be granted.” Id. “Thus, only those facts apparent from the face of the
pleadings, documents attached to the complaint (including exhibits, depositions, and affidavits),
matters of which the court can take judicial notice, and judicial admissions in the record may be
considered in ruling on a section 2-615 motion.” Id. If the attached exhibits contradict the
allegations in the complaint, the exhibits prevail, and the allegations are disregarded in evaluating
the sufficiency of the pleading. Id. A circuit court’s order granting a 2-615 motion is reviewed de
novo. Id. Additionally, we may affirm the circuit court’s judgment on any basis supported by the
record, regardless of the reasoning the court relied upon. Id.
¶ 37 B. Incentive Agreement and Condition Precedent
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¶ 38 Before proceeding, we note plaintiff’s frequent citation to Delaware law, which, he
maintains, “governs the Incentive Award Agreement” and is “designated by the parties in the
governing documents.” We note that the offer letter, the legitimacy of which is not disputed and
which we deem to be one of the “governing documents,” expressly provides that its terms and
conditions “shall be governed by the internal laws of the state of Illinois.” In any case, the question
before this court concerns not the substance of the Incentive Agreement, but rather whether such
an agreement even exists, a matter which we may determine simply with resort to basic contract
principles, regardless of which state’s laws apply. For purposes of this analysis, we apply Illinois’
decisional law.
¶ 39 In his opening brief, plaintiff first contends that the circuit court erred in holding that a
formal employment offer, accepted and acted upon, did not result in a binding agreement. He
argues that the circuit court erred in dismissing count I because he sufficiently alleged the existence
of a valid and enforceable contract. Specifically, plaintiff contends that the complaint alleged
mutual assent and consideration where defendants drafted and transmitted the final Incentive
Agreement, plaintiff signed and returned it, defendants acknowledged receipt, and plaintiff
performed by relocating, assuming executive responsibilities, and providing financial
contributions. Plaintiff further argues that defendants cannot avoid the Incentive Agreement based
on their own failure to countersign after accepting the benefits of his performance, and that mutual
assent may be established through the parties’ conduct and communications, not solely through
formal execution.
¶ 40 In response, defendants maintain that execution of the Incentive Agreement was a
condition precedent to contract formation and that plaintiff cannot avoid this requirement by
relying on conduct or performance. Defendants argue that plaintiff improperly conflates his
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acceptance and performance under the signed offer letter with the formation of the separate
Incentive Agreement, which remained subject to negotiation and was never executed. Defendants
further contend that any performance by the parties, including plaintiff’s relocation, employment,
and financial contributions, occurred pursuant to the offer letter, not the Incentive Agreement, and
that the offer letter expressly conditioned plaintiff’s receipt of equity units on “the execution and
delivery of customary equity award agreements,” which never occurred. Defendants also assert
that plaintiff’s reliance on conduct-based assent is misplaced because such conduct must relate to
the specific agreement at issue, and here, plaintiff’s alleged conduct relates only to his employment
under the offer letter. Accordingly, defendants maintain that plaintiff failed to allege facts
demonstrating mutual assent to the Incentive Agreement and that dismissal of count I was proper.
¶ 41 We agree with defendants that plaintiff appears to conflate the offer letter with the Incentive
Agreement and, throughout almost the entirety of his opening brief, treats the offer letter and the
Incentive Agreement as though they were one. They are separate agreements, as is clearly
evidenced by the express language in the incentive equity provision contained in the offer letter
and by the separate writing itself. In fact, the offer letter was signed by both parties. Plaintiff
accepted the offer letter by reporting to work, and defendants compensated him for the same. The
fact that plaintiff “relocated, assumed executive responsibilities, and transferred substantial funds,”
are all matters related to plaintiff’s acceptance of the offer letter. The sole issue before this court,
and the only issue upon which the parties disagree, is whether the Incentive Agreement, standing
alone, is enforceable.
¶ 42 Defendants argue that the circuit court correctly held that Thrive Holdings’ execution of
the Incentive Agreement was a condition precedent to the agreement being a valid and enforceable
contract. In his reply brief, plaintiff, now properly focused on the enforceability of the Incentive
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Agreement, contends that defendants’ condition precedent arguments fails because (1) defendants
waived or satisfied any signature requirement and (2) execution was not essential to formation of
the agreement.
¶ 43 A condition precedent is an act that must be completed or an event that must occur before
a contract takes effect or before a party is obligated to perform under the contract. In re Estate of
Adames, 2020 IL App (1st) 190573, ¶ 48. “Whether an act is necessary to formation of the contract
or to the performance of an obligation under the contract depends upon the facts of the case.”
McAnelly v. Graves, 126 Ill. App. 3d 528, 532 (1982). “A condition goes solely to the obligation
of the parties to perform, existence of such a condition does not prevent the formation of a valid
contract.” Id. Whether the text and format of an agreement establish that a signature is a condition
precedent to the contract generally depends on the parties’ intent, which can be inferred from
several factors. Adames, 2020 IL App (1st) 190573, ¶¶ 53-54.
¶ 44 In evaluating whether mutual signatures are a condition precedent, courts look at whether
the agreement identifies the parties and includes separate signature lines for each party on the last
page. Id. Courts also consider express language indicating that execution is required, such as
provisions stating that a party’s signature signifies agreement to the terms, that the agreement
becomes effective upon signing, that the parties agree to execute the document, or that it becomes
binding only upon the exchange of the required signatures. Id.; see also Calo, Inc. v. AMF
Pinspotters, Inc., 31 Ill. App. 2d 2, 9 (1961) (“If an offer prescribes the place, time or manner of
acceptance[,] its terms in this respect must be complied with in order to create a contract”).
¶ 45 Additionally, in assessing whether an unsigned agreement was intended to be binding,
courts consider the circumstances surrounding its drafting, not just its text. This includes whether
a final version was circulated for approval and signature, whether the parties engaged in follow-
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up regarding execution, and whether they treated a signature as necessary to finalize the agreement.
Lynge v. Kunstmann, 94 Ill. App. 3d 689, 694-95 (1981).
¶ 46 The relevant portions of the Incentive Agreement are as follows:
“This INCENTIVE AWARD AGREEMENT (this “Agreement”) is made as of
February 2, 2024 by and between Thrive Physical Therapy Partners Holdings LLC, a
Delaware limited liability company (the “Company”), and Matthew Frankenfeld (the
“Recipient”).
Section 1. Issuance.
(b) LLC Agreement. As a condition precedent to the issuance of the Incentive Units
to the Recipient, the Company has required that the Recipient be bound by, and the
Recipient has agreed to be bound by, the LLC Agreement and the terms and conditions
hereof. Without limiting the foregoing, the Recipient has agreed to simultaneously execute
a Joinder to the LLC Agreement in a form attached as Exhibit A.
Section 3. Representations and Warranties of the Company. In connection with the
issuance of the Incentive Units, the Company represents and warrants to the Recipient as
follows:
(c) Authorization; No Breach; Consents. The execution, delivery, and performance
by the Company or its officers or managers of this Agreement and the LLC Agreement and
the offer and issuance of the Incentive Units hereunder have been duly authorized by the
Company. Each of this Agreement and the LLC Agreement constitutes a valid and binding
obligation of the Company, enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or
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other laws affecting creditors’ rights generally and limitations on the availability of
equitable remedies.
Section 8. Miscellaneous.
(e) Counterparts. This Agreement may be executed simultaneously in two or more
counterparts, any one of which need not contain the signatures of more than one party, but
all such counterparts taken together will constitute one and the same Agreement. The
parties agree that the delivery of executed counterparts may be made by electronic delivery
(such as PDF).
(k) Entire Agreement. Except as otherwise expressly set forth in this Agreement,
this Agreement and the other agreements referred to in this Agreement embody the
complete agreement and understanding among the parties to this Agreement with respect
to the subject matter of this Agreement, and supersede and preempt any prior
understandings, agreements, or representations by or among the parties or their
predecessors, written or oral, which may have related to the subject matter of this
Agreement in any way.
IN WITNESS WHEREOF, the parties hereto have executed this Incentive Award
Agreement on the date first written above.”
¶ 47 Here, the structure and language of the Incentive Agreement demonstrate that the parties
contemplated a formally executed document as a prerequisite to enforceability. The Incentive
Agreement includes provisions addressing execution, authorization, and delivery, which
presuppose that execution must be complete before any binding obligations arise. Specifically,
Section 1(b) states: “[a]s a condition precedent to the issuance of the Incentive Units to the
Recipient, the Company has required that the Recipient be bound by, and the Recipient has agreed
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to be bound by, the LLC Agreement and the terms and conditions hereof.” In other words, before
plaintiff could receive any equity, he was required to complete an additional step, namely
executing the joinder and agreeing to the LLC Agreement’s terms. Additional provisions within
the Incentive Agreement reinforce this conclusion. Section 3(c) provides that the execution,
delivery, and performance of the Incentive Agreement have been duly authorized and that it
constitutes a binding obligation, which again presupposes that execution has occurred. Similarly,
Section 8(e) contemplates that the Incentive Agreement will be executed in multiple counterparts
and become operative upon the exchange of those executed counterparts. Taken together, these
provisions show that the parties did not intend to be bound upon preliminary assent or negotiation,
but only upon completion of the formal execution process, thereby indicating that mutual
execution was required before any contractual obligations arose.
¶ 48 In his reply brief, plaintiff cites Calo, Inc. v. AMF Pinspotters, Inc., 31 Ill. App. 2d 2
(1961), for the proposition that Illinois courts recognize that contracts may be formed by conduct.
He maintains that defendants’ conduct here, including “acknowledging receipt of the signed
agreement, promising a countersignature, adjusting his salary, and planning co-investment
structures, all point to an existing contractual relationship.” He further asserts that courts do not
require formal execution when the parties’ actions demonstrate mutual agreement. Building on
this, plaintiff contends that the offer letter’s promise of incentive equity units made the Incentive
Agreement a natural extension of his employment relationship, such that defendants’ conduct was
sufficient to establish its enforceability without a formal countersignature.
¶ 49 We note initially that although the offer letter included a provision for incentive equity
units, their availability was contingent on the execution and delivery of additional agreements.
Further, plaintiff’s reliance on Calo is misplaced. In Calo, the buyer made a written offer to
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purchase and rent certain equipment from the seller for use in a bowling alley. Calo, 31 Ill. App.
2d at 5. Although the seller never formally signed the purchase order, it accepted an additional
deposit, submitted plans and specifications, and supervised the remodeling of the premises. Id. at
17. The court held that this conduct constituted sufficient acceptance of the buyer’s offer, forming
an enforceable contract despite the absence of a formal signature. Id. Critically, however, the court
also recognized the converse principle: where parties reduce an agreement to writing and make
signature a condition precedent to its completion, there is no contract until that condition is
satisfied. Id. at 8.
¶ 50 That limiting principle controls here. Unlike in Calo, where no specific mode of acceptance
was prescribed and the seller’s conduct unambiguously demonstrated an intent to be bound, the
Incentive Agreement here expressly contemplated mutual execution as a prerequisite to
enforceability. Further, the conduct plaintiff points to here, namely defendants’ acknowledgment
of receipt of his signed copy and their indication that a countersigned version would follow, is
categorically different from the conduct at issue in Calo, where the seller actively performed under
the agreement’s terms by delivering plans and supervising remodeling. Defendants’
communications here reflect little more than the ordinary course of negotiation surrounding an
agreement that was never finalized. Accordingly, Calo does not support plaintiff’s position and, if
anything, reinforces the conclusion that where the parties expressly contemplated mutual
execution as a condition precedent, no contract is formed until that condition is met.
¶ 51 In his opening brief, plaintiff cites Landmark Properties Inc. v. Architects International-
Chicago, 172 Ill. App. 3d 379 (1988), to argue that “a party may by acts and conduct indicate
assent to the terms of a written contract and become bound by its provisions, even though the party
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has not signed it.” To the extent plaintiff intended that this argument applied, not solely to the offer
letter, but also to the separate Incentive Agreement, we address it.
¶ 52 In Landmark, the central issue was whether the plaintiffs were bound by an arbitration
provision contained in a written agreement they had not signed. Landmark Properties Inc., 172 Ill.
App. 3d at 383. The court held that the plaintiffs were bound by the agreement despite the absence
of their signatures, reasoning that their conduct demonstrated assent because they never rejected
the agreement’s terms and agreed to provide payment if all services were performed in accordance
with the contract. Id. The court further found that the plaintiffs acted in accordance with the
agreement by communicating under its provisions and invoking its dispute resolution procedures,
including initiating mediation and asserting claims under the agreement. Id. at 383-84.
¶ 53 This case is materially distinguishable from Landmark because the issue here is not
whether a provision within an existing contract binds a party, but whether the Incentive Agreement
was ever formed at all. Unlike in Landmark, plaintiff’s conduct relates only to his performance
under the separate offer letter, and the record shows the Incentive Agreement remained subject to
negotiation and was never executed, leaving no underlying contract to which conduct-based assent
can attach.
¶ 54 We find that where the parties expressly contemplated mutual execution as a condition
precedent to formation, conduct falling short of that requirement cannot be substituted for the
execution the parties themselves deemed necessary. Accordingly, plaintiff’s conduct-based
arguments do not overcome the fundamental deficiency that defendants never executed the
Incentive Agreement and the Agreement therefore never became an enforceable contract.
¶ 55 As he did in the circuit court, plaintiff argues on appeal that defendants waived or satisfied
any signature requirement. He maintains that defendants viewed execution as a formality, not as a
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“condition of obligation.” Plaintiff points out that when he sent his last modified version of the
agreement to defendants’ representative, the representative acknowledged receipt and indicated
that he would have the modified agreement signed. Citing Jordan v. Busch, 285 Ill. App. 217
(1936), plaintiff argues that a party cannot hinder a condition precedent and then invoke its non-
occurrence as a barrier to the contract’s formation. By preventing countersignature, plaintiff argues
that defendants waived any condition and satisfied formation requirements.
¶ 56 In Jordan, the plaintiff relinquished his interest in a brewery in exchange for monthly
installment payments funded solely by the defendants’ salaries and dividends derived from their
interest in the same brewery. Jordan, 285 Ill. App. at 220. The defendants subsequently sold their
stock and resigned as officers, thereby eliminating the very source of funds from which payments
were to be made. Id. at 222. The court held that a promisor cannot escape liability by voluntarily
alienating the source of a fund he contractually obligated himself to maintain, and that where a
party’s own conduct renders performance of a condition impossible, the contract becomes
absolute. Id. at 225.
¶ 57 Jordan is inapposite. In Jordan, there was an undisputed, fully executed contract, and the
only question was whether defendants could escape their payment obligations by destroying the
fund they were contractually obligated to maintain. Here, by contrast, the threshold question is
whether a contract was ever formed at all. The principle articulated in Jordan presupposes the
existence of a binding contract and has no application here because the parties never completed
the mutual execution required to bring the contract into existence. Defendants’ refusal to
countersign reflects a failure of contract formation, not a wrongful effort to avoid an existing
obligation, and plaintiff cannot rely on Jordan to transform an unexecuted agreement into an
enforceable contract.
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¶ 58 In sum, plaintiff’s waiver argument fails because there is no basis in the record to conclude
that defendants waived the requirement of mutual execution or otherwise demonstrated an intent
to be bound by the Incentive Agreement. Moreover, as stated above, because mutual execution
was a condition precedent to the formation of the Incentive Agreement, and because defendants
never executed it, no enforceable contract was formed. Plaintiff cannot cure this deficiency by
characterizing defendants’ refusal to countersign as a wrongful act, as that refusal was entirely
consistent with defendants’ position that the parties had not reached a final agreement on the terms.
Accordingly, we reject plaintiff’s waiver argument.
¶ 59 Plaintiff next argues that defendants’ refusal to countersign the Incentive Agreement was
not a rejection of contract formation, but rather a breach of an already-enforceable contract. He
contends that defendants’ repeated assurances that a countersignature was forthcoming
demonstrated an intent to be bound, and that their subsequent refusal was the product of bad faith
delay and leverage-seeking rather than a genuine rejection of the agreement’s terms.
¶ 60 Plaintiff cites Slay v. Allstate Corp., 2018 IL App (1st) 180133, for the proposition that
defendants’ tactic of bundling the Class B and Class C units and repeatedly telling him to “wait”
mirrors the kind of bad faith exercise of contractual discretion condemned in Slay. Plaintiff argues
that defendants used the delay as a negotiating tool to extract concessions rather than as a genuine
denial of the contract’s existence.
¶ 61 In Slay, an insurance agent brought a breach-of-contract claim after her insurer denied the
proposed transfer of her book of business to her husband, allegedly to benefit a competing agent.
Slay, 2018 IL App (1st) 180133, ¶ 3. The court held that the agent sufficiently pleaded a breach of
the implied covenant of good faith and fair dealing, reasoning that the insurer’s broad contractual
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discretion did not permit it to exercise that discretion in an arbitrary, capricious, or bad faith
manner inconsistent with the parties’ reasonable expectations. Id. ¶ 34.
¶ 62 Unlike Slay, however, which involved a party’s bad-faith exercise of discretion under an
existing, fully executed contract, the threshold issue here is not how defendants exercised their
discretion under an enforceable agreement, but whether an enforceable agreement was ever formed
at all. Where no contract exists, there is no implied covenant of good faith and fair dealing to
breach, and plaintiff cannot invoke Slay to circumvent the fundamental deficiency that defendants
never executed the Incentive Agreement.
¶ 63 We find that because defendants never executed the Incentive Agreement, there was no
binding obligation for defendants to honor and no breach upon which plaintiff can base a claim.
Thus, plaintiff’s argument that defendants’ refusal to countersign constituted a breach rather than
a rejection fails, as it rests on the existence of an enforceable contract that never came into
formation.
¶ 64 Lastly, plaintiff has forfeited several arguments on appeal for failing to raise them before
the circuit court. In particular, plaintiff failed to argue (1) equitable theories of promissory estoppel
and unjust enrichment, (2) that the circuit court erred in dismissing his complaint without allowing
him to engage in discovery, amend his complaint, or engage in oral argument, and (3) that
defendants’ issuance of Class C units contradicts their claim that the Incentive Agreement was not
enforceable. Upon review of the record, we conclude that plaintiff has forfeited these arguments
on appeal by failing to raise them before the circuit court or in his response to defendants’ motion
to dismiss. See Bank of New York Mellon v. Rogers, 2016 IL App (2d) 150712, ¶ 32 (issues not
raised in the circuit court are forfeited and may not be raised for the first time on appeal).
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¶ 65 Considering the Incentive Agreement’s language and structure, together with the parties’
negotiations as alleged in the complaint and reflected in the attached exhibits, we conclude that
execution by both parties was a condition precedent to the formation of a contract. The record
establishes that defendants never executed the Incentive Agreement and that plaintiff did not
participate in the equity incentive program. Accordingly, the conditions precedent were not
satisfied, and the Incentive Agreement never became enforceable.
III. CONCLUSION
¶ 66 For the reasons stated, we affirm the judgment of the circuit court.
¶ 67 Affirmed.
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